Sprouts Farmers Market, Inc. Reports Fourth Quarter and Full Year 2025 Results

PHOENIX--( BUSINESS WIRE)--Sprouts Farmers Market, Inc. (Nasdaq: SFM) today reported results for the 13-week fourth quarter and 52-week year ending December 28, 2025.

“Sprouts delivered strong growth in 2025," said Jack Sinclair, chief executive officer of Sprouts Farmers Market. "These results were a testament to the strength of our business and our team's commitment to serving our unique target customer. We are committed to helping our customers live and eat better and remain laser focused on executing our strategy in the coming years."

Fourth Quarter Highlights:

Full Year Highlights:

Leverage and Liquidity in 2025:

First Quarter and Full-Year 2026 Outlook

“While we were pleased with our 2025 results and remain confident in our long-term growth, we expect challenges in 2026, especially in the first half due to strong prior year comparisons and a dynamic macro environment,” said Curtis Valentine, chief financial officer of Sprouts Farmers Market.

The following provides information on our first quarter 2026 outlook.

The Company notes the fiscal year 2026 will be a 53-week year, with the extra week falling in the fourth quarter. We estimate the impact from the 53rd week to be approximately $200 million in sales, $28 million in income before interest and taxes, and $0.21 in diluted earnings per share.

The following provides information on our full-year 2026 outlook (on a 52 week basis):

Fourth Quarter and Full Year 2025 Conference Call

Sprouts will hold a conference call at 5:00 p.m. Eastern Time on Thursday, February 19, 2026, during which Sprouts executives will further discuss fourth quarter and full year 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 February 19, 2026. 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; general economic conditions that impact consumer spending or result in competitive responses; 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; accounting standard changes; the current inflationary environment and future 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

Sprouts Farmers Market is one of the largest and fastest growing specialty retailers of fresh, natural and organic food in the United States. Sprouts helps people live and eat better with fresh produce at the heart of the store and delicious discoveries for every dietary lifestyle. Always foraging for what’s fresh and innovative, Sprouts offers a carefully curated assortment of products that inspire wellness naturally, including organic, gluten-free, plant-based and non-GMO favorites. Headquartered in Phoenix, AZ, Sprouts employs more than 36,000 team members and operates more than 480 stores in 25 states nationwide. To learn more about Sprouts and the role it plays in its communities, visit sprouts.com/about.

SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Thirteen Weeks ended

Fifty-Two Weeks ended

December 28,

2025

December 29,

2024

December 28,

2025

December 29,

2024

Net sales

2,148,691

1,996,228

8,806,159

7,719,290

Cost of sales

1,332,316

1,236,338

5,389,770

4,777,799

Gross profit

816,375

759,890

3,416,389

2,941,491

Selling, general and administrative expenses

653,005

614,880

2,574,687

2,291,350

Depreciation and amortization (exclusive of depreciation included in cost of sales)

39,402

34,619

149,969

132,748

Store closure and other costs, net

896

3,928

5,575

12,896

Income from operations

123,072

106,463

686,158

504,497

Interest income, net

(581

)

(1,819

)

(2,626

)

(2,201

)

Income before income taxes

123,653

108,282

688,784

506,698

Income tax provision

33,828

28,680

165,114

126,097

Net income

89,825

79,602

523,670

380,601

Net income per share:

Basic

0.93

0.80

5.36

3.79

Diluted

0.92

0.79

5.31

3.75

Weighted average shares outstanding:

Basic

96,681

99,820

97,687

100,363

Diluted

97,536

101,020

98,704

101,379

SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

December 28,

2025

December 29,

2024

ASSETS

Current assets:

Cash and cash equivalents

257,282

265,159

Accounts receivable, net

65,221

30,901

Inventories

427,095

343,329

Prepaid expenses and other current assets

60,306

36,131

Total current assets

809,904

675,520

Property and equipment, net of accumulated depreciation

1,085,356

895,189

Operating lease assets, net

1,652,732

1,466,903

Intangible assets

208,215

208,094

Goodwill

381,750

Other assets

20,692

13,243

Total assets

4,158,649

3,640,699

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

291,033

213,414

Accrued liabilities

304,419

216,842

Accrued salaries and benefits

96,017

97,991

Current portion of operating lease liabilities

177,263

150,400

Current portion of finance lease and other finance obligations

2,071

1,321

Total current liabilities

870,803

679,968

Long-term operating lease liabilities

1,682,425

1,520,272

Long-term debt and other finance obligations

81,585

7,248

Other long-term liabilities

40,283

38,259

Deferred income tax liability

80,479

73,059

Total liabilities

2,755,575

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, 95,926,024 shares issued and outstanding, December 28, 2025; 99,255,036 shares issued and outstanding, December 29, 2024

Additional paid-in capital

841,848

808,140

Retained earnings

561,130

513,654

Total stockholders’ equity

1,403,074

1,321,893

Total liabilities and stockholders’ equity

4,158,649

3,640,699

SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

Fifty-Two Weeks ended

December 28,

2025

December 29,

2024

Operating activities

Net income

523,670

380,601

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization expense

157,722

140,164

Operating lease asset amortization

146,599

133,923

Impairment of assets

—

406

Share-based compensation

31,103

28,417

Deferred income taxes

7,420

10,691

Other non-cash items

4,722

5,610

Changes in operating assets and liabilities, net of effects from acquisition:

Accounts receivable

27,216

30,007

Inventories

(83,766

)

(20,131

)

Prepaid expenses and other current assets

36,672

11,903

Other assets

(5,433

)

(45

)

Accounts payable

11,198

27,986

Accrued liabilities

25,246

39,305

Accrued salaries and benefits

(1,975

)

23,240

Operating lease liabilities

(166,206

)

(168,538

)

Other long-term liabilities

1,810

1,675

Cash flows from operating activities

715,998

645,214

Investing activities

Purchases of property and equipment

(248,267

)

(230,375

)

Cash flows used in investing activities

(248,267

)

(230,375

)

Financing activities

Payments on revolving credit facilities

—

(125,000

)

Payments on finance lease liabilities

(1,017

)

(1,148

)

Payments of deferred financing costs

(1,622

)

—

Repurchase of common stock

(471,926

)

(228,472

)

Payments of excise tax on repurchases of common stock

(2,091

)

(1,766

)

Proceeds from exercise of stock options

2,606

4,890

Cash flows used in financing activities

(474,050

)

(351,496

)

(Decrease)/Increase in cash, cash equivalents, and restricted cash

(6,319

)

63,343

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

260,894

267,213

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 fifty-two weeks ended December 28, 2025 and December 29, 2024:

SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES

NON-GAAP MEASURE RECONCILIATION

(UNAUDITED)

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Thirteen Weeks ended

Fifty-Two Weeks ended

December 28,

2025

December 29,

2024

December 28,

2025

December 29,

2024

Net income

89,825

79,602

523,670

380,601

Income tax provision

33,828

28,680

165,114

126,097

Interest income, net

(581

)

(1,819

)

(2,626

)

(2,201

)

Earnings before interest and taxes (EBIT)

123,072

106,463

686,158

504,497

Depreciation, amortization and accretion

41,719

36,283

157,722

140,164

EBITDA

164,791

142,746

843,880

644,661