Grocery Outlet, the Emeryville-based discount grocer with a large Northern California footprint, said it plans to close 36 financially underperforming stores as it tries to improve profitability after reporting a steep quarterly loss.
The closures are part of a business “Optimization Plan” adopted by the company’s board on Monday and expected to be “substantially completed during fiscal 2026,” Grocery Outlet said in a news release Wednesday announcing fourth-quarter and full-year financial results.
“We made progress on our strategic priorities in 2025; however, our fourth-quarter results made clear that we have more work to do, and we’re moving quickly,” Jason Potter, the company’s president and chief executive, said in a statement. “At the same time, we’re closing underperforming stores, reshaping our new store growth strategy and reallocating resources to strengthen operating results and returns on capital. “
Grocery Outlet did not disclose which locations will be shuttered. The company, which has stores nationwide, also did not specify how many of the 36 stores are in California or the Bay Area.
Grocery Dive, an industry publication, reported that 24 of the stores slated to close are on the East Coast, citing Potter’s remarks to investors.
At the same time, the company is continuing to invest in its home market and plans to open two new Bay Area stores, even as it trims weaker locations elsewhere.
The store-closing plan comes as Grocery Outlet reported a fourth quarter net loss of $218.2 million, compared with net income of $2.3 million a year earlier, according to the company’s release.
The company attributed some of the pressure to the timing of government assistance. Comparable sales were hurt by delayed disbursements from “federally-funded assistance programs that many of our customers depend on, including the Supplemental Nutrition Assistance Program,” the company said.
MarketWatch reported the company’s stock fell about 24% in after-hours trading following the announcement.
This article originally published at Grocery Outlet to close dozens of ‘underperforming’ stores.
