Sprouts Farmers Market, Inc. Reports Second Quarter 2025 Results

About this update from Sprouts Farmers Market, Inc.

PHOENIX --(BUSINESS WIRE)-- Sprouts Farmers Market, Inc. (Nasdaq: SFM) today reported results for the 13-week second quarter ended June 29, 2025 . "We are pleased with our excellent results for the second quarter," said Jack Sinclair , chief executive officer of Sprouts Farmers Market . "Our dedicated team members have consistently focused on understanding and meeting the needs of our target customers. Our investments in operations, self-distribution, customer personalization, and team member development all set the stage for exciting future growth.” Second Quarter Highlights: Net sales totaled $2.2 billion ; a 17% increase from the same period in 2024 Comparable store sales growth of 10.2% Diluted earnings per share of $1.35 ; compared to diluted earnings per share of $0.94 in the same period in 2024 Opened 12 new stores, resulting in 455 stores in 24 states as of June 29, 2025 Leverage and Liquidity in Second Quarter 2025 Ended the quarter with $261 million in cash and cash equivalents and zero balance on its $700 million revolving credit facility Repurchased 0.5 million shares of common stock for a total investment of $73 million , excluding excise tax Generated cash from operations of $410 million and invested $138 million in capital expenditures, net of landlord reimbursement, year-to-date thru June 29, 2025 Third Quarter and Full-Year 2025 Outlook The following provides information on our third quarter 2025 outlook: Comparable store sales growth: 6.0% to 8.0% Diluted earnings per share: $1.12 to $1.16 The following provides information on our full-year 2025 outlook: Net sales growth: 14.5% to 16.0% Comparable store sales growth: 7.5% to 9.0% EBIT : $675 million to $690 million Diluted earnings per share: $5.20 to $5.32 Unit growth: At least 35 new stores Capital expenditures (net of landlord reimbursements): $230 million to $250 million Second Quarter 2025 Conference Call Sprouts will hold a conference call at 5:00 p.m. Eastern Time on Wednesday, July 30, 2025 , during which Sprouts executives will further discuss second quarter 2025 financial results. A webcast of the conference call will be available through Sprouts’ investor relations webpage, accessible via the following link . Participants should register on the website approximately ten minutes prior to the start of the webcast. A webcast replay will be available at approximately 8:00 p.m. Eastern Time on July 30, 2025 . This can be accessed with the following link . Important Information Regarding Outlook There is no guarantee that Sprouts will achieve its projected financial expectations, which are based on management estimates, currently available information and assumptions that management believes to be reasonable. These expectations are inherently subject to significant economic, competitive and other uncertainties and contingencies, many of which are beyond the control of management. See “Forward-Looking Statements” below. Forward-Looking Statements Certain statements in this press release are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact (including, but not limited to, statements to the effect that Sprouts Farmers Market or its management "anticipates," "plans," "estimates," "expects," or "believes," or the negative of these terms and other similar expressions) should be considered forward-looking statements, including, without limitation, statements regarding the company’s outlook, growth, opportunities and long-term strategy. These statements involve certain risks and uncertainties that may cause actual results to differ materially from expectations as of the date of this release. These risks and uncertainties include, without limitation, the company’s ability to execute on its long-term strategy; the company’s ability to successfully compete in its competitive industry; the company’s ability to successfully open new stores; the company’s ability to manage its growth; the company’s ability to maintain or improve its operating margins; the company’s ability to identify and react to trends in consumer preferences; product supply disruptions; equipment supply disruptions; general economic conditions that impact consumer spending or result in competitive responses; accounting standard changes; potential inflationary and/or deflationary trends; tariffs; and other factors as set forth from time to time in the company’s Securities and Exchange Commission filings, including, without limitation, the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The company intends these forward-looking statements to speak only as of the time of this release and does not undertake to update or revise them as more information becomes available, except as required by law. Corporate Profile True to its farm-stand heritage, Sprouts offers a unique grocery experience featuring an open layout with fresh produce at the heart of the store. Sprouts inspires wellness naturally with a carefully curated assortment of better-for-you products paired with purpose-driven people. The healthy grocer continues to bring the latest in wholesome, innovative products made with lifestyle-friendly ingredients such as organic, plant-based and gluten-free. Headquartered in Phoenix , and one of the largest and fastest growing specialty retailers of fresh, natural and organic food in the United States , Sprouts employs approximately 35,000 team members and operates more than 450 stores in 24 states nationwide. To learn more about Sprouts, and the good it brings communities, visit sprouts.com/about/ . SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Thirteen weeks ended Twenty-six weeks ended June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024 Net sales $ 2,220,602 $ 1,893,519 $ 4,457,038 $ 3,777,327 Cost of sales 1,358,002 1,175,154 2,708,075 2,336,649 Gross profit 862,600 718,365 1,748,963 1,440,678 Selling, general and administrative expenses 645,127 556,367 1,268,353 1,096,138 Depreciation and amortization (exclusive of depreciation included in cost of sales) 36,606 31,489 71,705 63,721 Store closure and other costs, net 1,511 3,192 3,217 5,236 Income from operations 179,356 127,317 405,688 275,583 Interest (income) expense, net (431 ) (139 ) (1,355 ) 679 Income before income taxes 179,787 127,456 407,043 274,904 Income tax provision 46,084 32,167 93,314 65,515 Net income $ 133,703 $ 95,289 $ 313,729 $ 209,389 Net income per share: Basic $ 1.37 $ 0.95 $ 3.19 $ 2.08 Diluted $ 1.35 $ 0.94 $ 3.16 $ 2.06 Weighted average shares outstanding: Basic 97,858 100,460 98,198 100,765 Diluted 98,774 101,196 99,259 101,647 SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) June 29, 2025 December 29, 2024 ASSETS Current assets: Cash and cash equivalents $ 261,404 $ 265,159 Accounts receivable, net 61,550 30,901 Inventories 351,111 343,329 Prepaid expenses and other current assets 35,263 36,131 Total current assets 709,328 675,520 Property and equipment, net of accumulated depreciation 922,966 895,189 Operating lease assets, net 1,543,865 1,466,903 Intangible assets 208,180 208,094 Goodwill 381,750 381,750 Other assets 17,139 13,243 Total assets $ 3,783,228 $ 3,640,699 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 248,980 $ 213,414 Accrued liabilities 223,677 216,842 Accrued salaries and benefits 85,115 97,991 Accrued income tax — — Current portion of operating lease liabilities 161,818 150,400 Current portion of finance lease liabilities 1,397 1,321 Total current liabilities 720,987 679,968 Long-term operating lease liabilities 1,586,088 1,520,272 Long-term debt and finance lease liabilities 6,528 7,248 Other long-term liabilities 37,125 38,259 Deferred income tax liability 76,000 73,059 Total liabilities 2,426,728 2,318,806 Commitments and contingencies Stockholders’ equity: Undesignated preferred stock; $0.001 par value; 10,000,000 shares authorized, no shares issued and outstanding — — Common stock, $0.001 par value; 200,000,000 shares authorized, 97,768,860 shares issued and outstanding, June 29, 2025 ; 99,255,036 shares issued and outstanding, December 29, 2024 98 99 Additional paid-in capital 823,766 808,140 Retained earnings 532,636 513,654 Total stockholders’ equity 1,356,500 1,321,893 Total liabilities and stockholders’ equity $ 3,783,228 $ 3,640,699 SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS) Twenty-six weeks ended June 29, 2025 June 30, 2024 Operating activities Net income $ 313,729 $ 209,389 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization expense 75,264 67,756 Operating lease asset amortization 70,568 65,489 Share-based compensation 14,403 13,266 Deferred income taxes 2,941 (396 ) Other non-cash items 2,712 2,189 Changes in operating assets and liabilities, net of effects from acquisition: Accounts receivable 21,227 18,746 Inventories (7,782 ) (2,380 ) Prepaid expenses and other current assets (719 ) 13,947 Other assets (2,529 ) (125 ) Accounts payable 5,664 (12,914 ) Accrued liabilities 10,108 24,081 Accrued salaries and benefits (12,877 ) (5,095 ) Operating lease liabilities (83,113 ) (83,952 ) Other long-term liabilities 741 1,294 Cash flows from operating activities 410,337 311,295 Investing activities Purchases of property and equipment (120,319 ) (108,925 ) Cash flows used in investing activities (120,319 ) (108,925 ) Financing activities Payments on revolving credit facilities — (125,000 ) Payments on finance lease liabilities (644 ) (542 ) Repurchase of common stock (292,223 ) (104,488 ) Payments of excise tax on repurchases of common stock (2,091 ) — Proceeds from exercise of stock options 1,224 3,265 Cash flows used in financing activities (293,734 ) (226,765 ) Decrease in cash, cash equivalents, and restricted cash (3,716 ) (24,395 ) Cash, cash equivalents, and restricted cash at beginning of the period 267,213 203,870 Cash, cash equivalents, and restricted cash at the end of the period $ 263,497 $ 179,475 Non-GAAP Financial Measures In addition to reporting financial results in accordance with accounting principles generally accepted in the United States (“GAAP”), the company presents EBITDA and EBIT. These measures are not in accordance with, and are not intended as alternatives to, GAAP. The company's management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses these measures for reviewing the financial results of the company, and certain of these measures may be used as components of incentive compensation. The company defines EBITDA as net income before interest expense, provision for income tax, and depreciation, amortization and accretion. The company defines EBIT as net income before interest expense and provision for income tax. Non-GAAP measures are intended to provide additional information only and do not have any standard meanings prescribed by GAAP. Use of these terms may differ from similar measures reported by other companies. Because of their limitations, non-GAAP measures should not be considered as a measure of discretionary cash available to use to reinvest in the growth of the company’s business, or as a measure of cash that will be available to meet the company’s obligations. Each non-GAAP measure has its limitations as an analytical tool, and they should not be considered in isolation or as a substitute for analysis of the company’s results as reported under GAAP. The following table shows a reconciliation of EBIT and EBITDA to net income for the thirteen and twenty-six weeks ended June 29, 2025 and June 30, 2024 : SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES NON-GAAP MEASURE RECONCILIATION (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Thirteen weeks ended Twenty-six weeks ended June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024 Net income $ 133,703 $ 95,289 $ 313,729 $ 209,389 Income tax provision 46,084 32,167 93,314 65,515 Interest (income) expense, net (431 ) (139 ) (1,355 ) 679 Earnings before interest and taxes (EBIT) 179,356 127,317 405,688 275,583 Depreciation, amortization and accretion 38,444 33,234 75,264 67,756 EBITDA $ 217,800 $ 160,551 $ 480,952 $ 343,339 View source version on businesswire.com : https://www.businesswire.com/news/home/20250730655625/en/ Investor Contact: Susannah Livingston (602) 682-1584 [email protected] Media Contact: [email protected] Source: Sprouts Farmers Market

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