Ocado investors will be looking for positive signals on the company's long-term outlook when it releases its half-year results on Thursday, amid reports of a leadership clash between its top executives. The retail technology group has seen its share price fall by about a quarter over the past year, pressured by the closure of some robotic warehouses and challenging consumer conditions.
Leadership Unrest and CEO Succession
The results come against a backdrop of reported boardroom unrest. Ocado chair Adam Warby and board member Jorn Rausing, a Tetra Pak billionaire and shareholder, reportedly attempted to oust founder and chief executive Tim Steiner over concerns about the share price. However, long-term investors pushed back, with some threatening to seek Warby's removal if Steiner was ousted.
On Monday, Ocado confirmed that Steiner will remain as CEO until December 2027, ending months of speculation. The group will finalise succession plans at the start of its 2027-28 financial year, which begins on December 1, 2027. After his successor is appointed, Steiner will stay on as an adviser in a “founder role,” providing strategic advice to the board and management through 2029. Shares fell further after the announcement.
Financial Performance and Growth Plans
Investors will be keen for Steiner and other leaders to outline long-term plans. Ocado operates a grocery retail joint venture with Marks & Spencer and a technology arm that runs robotic warehouses for supermarkets. In February, the company announced around 1,000 job cuts—about 5% of its global workforce—mainly at its Hertfordshire headquarters, as part of restructuring.
The technology arm recently proposed closing warehouses with grocery partners in North America, including Kroger in the US and Sobeys in Canada. However, Ocado has also secured new partnerships, such as a deal with Asda. Analysts at JP Morgan expect the half-year update to show revenue growth of 2.4% year-on-year for the six months to May, driven by stronger orders from the Ocado Retail joint venture boosting logistics revenues.
Cash Flow Target and Investor Sentiment
The group is also expected to update on its target of reporting positive cash flow in the second half of this financial year. AJ Bell head of financial analysis Danni Hewson said: “The forthcoming results will give a snapshot of Ocado in the present day, but what matters more is how Ocado plans to become a stronger commercial entity longer term. Its growth plans have disappointed, so it needs bolder ideas.”
