Whole Foods on Wednesday reported quarterly sales that missed analysts expectations, as it worked to cut prices and boost traffic.
The grocery-store chain reported fiscal-third-quarter sales totaling a record $3.7 billion, and adjusted earnings per share of $0.37. Analysts had estimated that Whole Foods had revenue of $3.72 billion, according to Bloomberg.
Whole Foods shares fell by as much as 4% in pre-market trading on Thursday.
Comparable-store sales – at locations open for at least one year – fell 2.6%, greater than an expected decline by 2.4%.
The company has been focusing on cutting costs, with a $300 million-target. This could lead to cheaper groceries for its customers who have lower-priced options that are also organic; Whole Foods is currently one of the most expensive places to buy food.
It launched a new chain of stores, called 365 by Whole Foods Market, to effectively compete with the likes of Trader Joe’s and Kroger. To offer cheaper items, the company is scaling back on the design and furnishing of the new stores.
“Through lower capital and operating costs, we are able to offer great values to our customers, and the response [to 365] has been overwhelmingly positive,” said John Mackey, co-CEO of Whole Foods Market, in the earnings statement.
Whole Foods said it expects to open two new stores during its fiscal fourth quarter. It estimated that its adjusted EPS in its fiscal fourth quarter would be between $0.23 and $0.24, short of analysts’ forecast for $0.25.