Tesco, the largest food retailer of Great Britain, recorded a better withdrawal than expected in the growth of sales below in its first quarter and won the market share by competitors, stating that value improvements, product quality and service were challenging consumers.The group, whose share of the British shopping market grew to 28%this year, a level not seen since 2016, left its guide for the entire year unchanged on Thursday, with the CEO Ken Murphy who says that the market “remains intensely competitive”.
Tesco’s shares increased by 2% after declaring that sales similar to the United Kingdom increased by 5.1% in the 13 weeks to May 24, increasing 4.3% in the previous quarter.
Group sales were 16.4 billion pounds ($ 22.2 billion), an increase of 4.6% on a similar basis.Murphy said that the result of the United Kingdom reflected “our powerful value proposal, the strong availability and concentration on the quality and innovation of the product”.
The Tesco update threw the wider data data published Tuesday showing that British expenditure for consumers for non -food articles lost the momentum in May while the trust of families in their personal finances has decreased.
Stay on tiptoe
Tesco said that he still expected to report a rectified operational profit between 2.7 billion and 3.0 billion pounds for the year concluding February 2026, falling compared to the 3.13 billion pounds reached in 2024/25.
The group had declared in April that he expected that the profit decreased in his years of 2025/26, while he set aside the liquidity to face a step forward in the “competitive intensity” of the British shopping market – a reference to a commitment of price cuts supported by ASDA, the number three, which lost market shares.
“We are definitely witnessing a competing intensification, I think that although it was a rational intensification, in the sense that everyone is a little peak on foot with each other,” Murphy said to journalists.
“So you are not necessarily seeing enormous movements in their competitiveness, but everyone has increased their game.”
He said that the inflation in Tesco was below the rate of the sector, which went up to 4.1% in May, according to the market researcher Kantar.
Most analysts think that Tesco’s strategy to combine the prices of the dislocation from hundreds of key articles, together with the strong promotion of its closet of the Clubcard, which provides lower prices for members, works well.
Tesco is also becoming more and more digital, intensifying personalized involvement with customers and developing growth roads such as his online market platform and retail sales media.
“(Tesco) seems to be in a better position than many of his peers,” said John Moore, head of the wealth of RBC Brewin Dolphin.
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