Woolworths Group reported improved growth, with shares jumping over 10% despite missing analysts' expectations in the first half of 2026.
The group, which runs grocery stores across Australia and New Zealand and Big W, said sales increased by 3.4% to A$37.14 billion. This was below investor expectations, who expected sales to rise by 3.6%.
Earnings for the half rose 14.4% to $1.66 billion.
However, sales for the second quarter rose by 4.4%, greatly outperforming expectations.
This marks a turnaround after the company experienced pressure from investors following a major loss in the market to major rival Coles, and to turn around the poorly performing Big W.
“Our focus is to continue to provide value to customers, rebuild trust and maintain sales momentum while making further progress on our strategic priorities to deliver for our customers, team and shareholders,” CEO Amanda Bardwell said.
On the earnings call, Bardwell said that shoppers were increasing focus on value, leading to a higher take-up of promotions and loyalty programs.
She also said Woolworths introduced 300 items in a lower price program that had led to a significant increase in the number of sales.
The company said net profit grew 16.4% to $859 million, but once previously disclosed staff underpayments were rectified, Woolworths reported a statutory net profit of just $374 million in the first half.
Woolworths declared a fully franked interim dividend of 45 cents per share, up from 39 cents a year ago, and higher than expected. It will be paid on 2 April.
While Australian supermarkets continued to deliver sales for the company, Big W increased by just 1.8% in the past six months.
At the time of writing, Woolworths (ASX: WOW) stock rose 10.76% to $34.96. Its market cap is $38.09 billion.
