Grocery Outlet’s traffic picks up, but it trims its EBITDA outlook (NASDAQ: GO)

Posted by Trevor Kearing on Nov 11th, 2026

What happened

Grocery Outlet Holding Corp. (NASDAQ: GO) reported third-quarter comparable store sales growth of 0.5%, driven by a 2.4% rise in transactions.

Average transaction size fell 1.9%, so shoppers came more often but bought less each time. Net sales rose 0.9% to $1.18 billion in the quarter ended Oct. 3. New stores helped. Store closures under the Optimization Plan held sales back.

Net income was $13.3 million, or $0.13 per diluted share, versus $11.6 million, or $0.12, a year earlier. That included $3.6 million in net restructuring credits.

Key numbers

Metric	Latest	Change	Source
Q3 net sales	$1.18 billion	from $1.17 billion, +0.9%	Grocery Outlet Q3 fiscal 2026 earnings release (SEC 8-K Exhibit 99.1)
Q3 comparable store sales	+0.5%		Grocery Outlet Q3 fiscal 2026 earnings release (SEC 8-K Exhibit 99.1)
Q3 diluted EPS (GAAP)	$0.13	from $0.12, +8.3%	Grocery Outlet Q3 fiscal 2026 earnings release (SEC 8-K Exhibit 99.1)
Q3 diluted adjusted EPS	$0.16	from $0.21, -23.8%	Calculated from SEC 8-K
Q3 adjusted EBITDA	$59.4 million	from $66.7 million, -10.9%	Calculated from SEC 8-K
Q3 gross margin	30.0%	from 30.4%, -0.4 percentage points	Grocery Outlet Q3 fiscal 2026 earnings release (SEC 8-K Exhibit 99.1)

Why it matters

The traffic gain is real, but profit is mixed. Adjusted net income, which excludes special items, fell to $15.6 million, or $0.16 per diluted share, from $20.7 million, or $0.21, a year earlier.

Gross margin slipped to 30.0% from 30.4%. The company cited product promotions to drive sales, higher transportation costs and weaker produce demand after a Cyclospora outbreak. Adjusted EBITDA was $59.4 million, or 5.0% of net sales.

OptimistFi has argued that Grocery Outlet works if bargain traffic holds while integration stops dragging results into GAAP losses. Rising transactions support the first half. The 39-week net loss of $161.4 million, which includes a $158.0 million non-cash goodwill impairment, shows GAAP results are still negative.

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What's next

For fiscal 2026, the company narrowed adjusted EBITDA guidance to $225 million to $229 million from $225 million to $235 million. It set comparable store sales growth at 0.2% to 0.4%, from -0.5% to 0.0%. It set diluted adjusted earnings per share at $0.52 to $0.55, from $0.51 to $0.55.

The company also raised its estimate of total net restructuring charges under the Optimization Plan to between $22 million and $29 million, citing lease termination and idle property costs. It expects the plan to be substantially complete by the fourth quarter of fiscal 2027.

Management discusses the results on a call at 4:30 p.m. Eastern on Nov. 10. A fourth-quarter report with positive comparable sales and adjusted EBITDA inside the new range would strengthen the case. A miss would weaken it.