Shares in the supermarket giant fell 2.6% on Thursday following the announcement. While the 1.8% growth figure for the 13 weeks ending May 30 marks a decline from the 3.1% recorded in the previous quarter, CEO Ken Murphy urged caution against interpreting the data as a structural slowdown. He pointed to the exceptionally high baseline set during the same period last year, which was bolstered by favorable weather and operational struggles at rivals like Marks & Spencer and the Co-op.
Despite the softer sales figures, Tesco maintained its full-year guidance, projecting an adjusted operating profit between £3.0 billion and £3.3 billion. The company reported that food inflation remains contained, currently tracking below the 2.2% official rate cited by the Office for National Statistics. Garry White, an investment commentator at Charles Stanley, noted that the steady outlook provides a measure of stability for investors navigating a subdued trading environment.
Operational bright spots persist, particularly within the Whoosh rapid delivery service, which posted sales growth exceeding 30%. Murphy highlighted that demand for the service saw an immediate spike during England’s World Cup opener on Wednesday, suggesting that while broader sentiment is cautious, specific convenience channels remain resilient.
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