EMERYVILLE, Calif. — Grocery Outlet said it will shutter 36 underperforming stores — about 6% of its total footprint — following a disappointing fourth quarter marked by a nearly $235 million operating loss and more than $218 million in net losses.
President and CEO Jason Potter pointed out on Wednesday’s earnings call that two dozen of the closures are on the East Coast, representing 30% of that region’s locations. He emphasized that the company’s remaining 51 East Coast stores are profitable.
“We are not fully exiting any state, and we continue to see significant long‑term growth potential in the East. However, it’s now clear that we expanded too quickly,” Potter said.
He noted that the company had opened 7 new stores and closed zero stores, ending the quarter with 570 stores in 16 states.
“Consumer pressure intensified, federally funded benefits were delayed, and competition grew more promotional in the fourth quarter. In response, we have begun to sharpen our focus on what matters most: delivering clearer value and a better in-store experience. We’re intensely focused on restoring the opportunistic mix to rebuild value perception with the customer and advancing our store refresh program, and we’re already seeing early, measurable improvements. At the same time, we’re closing underperforming stores, reshaping our new store growth strategy and reallocating resources to strengthen operating results and returns on capital. We are confident that we have identified the core challenges, and now have the right plans in place and the right team to execute them,” he added.
