Tesco 2024/25 results beat expectations, but the UK’s largest supermarket warns of a challenging market for the coming year.
Preliminary results from supermarket chain Tesco for 2024/25 show a Group adjusted operating profit of £3,128 million, an increase of 10.9% at constant rates on the previous year. Group sales (excluding VAT and excluding fuel) are up 4% at constant rates to £63,636 million, which, according the retailer, included a strong contribution from higher volumes and improved category mix. Revenue has increased by 3.0% at constant rates, including a (6.3%) decline in fuel sales, mainly driven by lower retail prices year-on-year, and Tesco’s market share has increased, up 67bps year-on-year to 28.3%.
Outlook
In a statement, the supermarket said that investments over the last four years have resulted in its most competitive position and highest market share for many years, leading to a “strong financial position and positive trading momentum”, stating that it had delivered well against the multi-year performance framework that it set out in 2021.
However, the business has seen a “further increase in the competitive intensity of the UK market” and expects a lower Group adjusted operating profit for 2025/26 of between £2.7 billion and £3 billion.
“Despite inflationary headwinds, we are committed to ensuring customers get the best possible value by shopping at Tesco.”
Ken Murphy, Tesco chief executive
Tesco chief executive Ken Murphy stated: “Our continued focus on value and quality, coupled with market-leading availability, has contributed to another year of increased customer satisfaction and our highest market share for nearly a decade. We have invested in bringing great prices to our customers throughout the year, and continued to innovate with over 1,600 new or improved products including 400 new Finest lines, where overall sales grew 15%.
“We are also making significant progress on our long-term growth opportunities, further enhancing our digital capabilities with increased personalisation, further improvements to our online experience and an expanded retail media offering.
“Building on our strong financial performance, robust balance sheet and positive momentum, we are setting ourselves up for the year ahead with the flexibility to continue to win in a highly competitive market. Despite inflationary headwinds, we are committed to ensuring customers get the best possible value by shopping at Tesco, and see further opportunities to strengthen our competitiveness.”
