Asda has reported its first quarterly food sales growth in more than two years, attributing the improvement to its investment in competitive pricing. The Leeds-based retailer posted a marginal 0.1% decline in overall group like-for-like sales, excluding fuel, at £5.1 billion for the three months to September.
Same-store food sales returned to positive territory for the first time since 2024, rising by 0.1%. Online grocery sales jumped 6.9%, while its Asda Express convenience format recorded 2.7% growth.
Turnaround from Q2 decline
This marks a significant improvement from the second quarter, when group like-for-like sales fell 2.3% and food sales dropped 1.9%.
Michael Gleeson, chief financial officer at Asda, said: "The work we've done through the period to deliver against our strategy was reflected in our third quarter performance. Like-for-like food sales returned to growth in the third quarter, online sales grew strongly and group sales increased, despite the challenging economic backdrop."
Price strategy and leadership changes
Asda, the UK's third largest supermarket chain, has pursued an aggressive price-cutting strategy to revive its commercial performance. Earlier this month, the retailer appointed former Morrisons boss David Potts as its new chief executive to lead the recovery. Former boss Allan Leighton took on the role of non-executive chairman, two years after returning to lead the business.
While price reductions have supported performance, they have also weighed on profitability. Combined with a problematic IT system upgrade last year that affected stock availability and weakened sales, the group plunged to a £989 million pre-tax loss for 2025, wider than the £599 million deficit recorded the previous year. Adjusted earnings also fell by 33% to £761 million, partly due to its Asda Price and Rollback pricing strategy.
Market share and outlook
Industry data from Worldpanel, released earlier this week, showed Asda's market share dropped to 11.3% in the 12 weeks to November 1, down from 11.6% a year earlier, with sales declining by 0.5% during the period. It was the only major supermarket to record falling sales in the quarter, according to Worldpanel figures.
Upon assuming the chief executive role, Mr Potts said Asda had "made good progress but significant opportunities remain" to reinvigorate sales, with a focus on keeping prices low for shoppers. In August, Mr Leighton said the retailer remained in the "foothills of recovery" and believed it was roughly a third of the way through its turnaround programme.
