Digital coupon engagement hit an all-time high with 750 million digital offers downloaded, Kroger CEO Rodney McMullen said.

Grocery chain operator The Kroger Co. reported its digital sales for the second quarter grew 8% compared to the comparable quarter a year earlier. That includes a 34% rise in sales ordered online for at-home delivery.

During a conference call with analysts, Kroger CEO Rodney McMullen said the retailer continues to invest in digital growth initiatives, including the expansion of its web-only Kroger Delivery network in new and existing areas of operation. He also touted Kroger’s success at engaging customers online.

“During the quarter, digital coupon engagement hit an all-time high with 750 million digital offers downloaded, totaling almost $1 billion in savings,” McMullen said, according to a Seeking Alpha transcript.

Kroger (No. 8 in the 2022 Digital Commerce 360 Top 1000) and U.K. online grocer Ocado Group Plc are creating a set of automated warehouses to handle online orders for delivery. In April 2021, Kroger opened its first Ocado-powered center in Monroe, Ohio. It now has 18 operating fulfillment centers using Ocado technology.

In Q2, which ended Aug. 13, Kroger opened a new customer fulfillment center in Romulus, Michigan, supporting customers in several geographies, including Michigan, Northern Ohio, and Indiana. It also commenced operations at seven new “spoke” fulfillment centers, which handle last-mile delivery.

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Those facilities are in:

  • Louisville, Kentucky
  • Nashville, Tennessee
  • Chicago, Illinois
  • Austin, Texas
  • Birmingham, Alabama
  • Oklahoma City, Oklahoma
  • San Antonio, Texas

Kroger also recently announced plans for a new 300,000 square-foot distribution center in the Denver area.

Performance highlights

Total company sales were $34.64 billion in the second quarter. That’s up about 9% compared to $31.68 billion for the same period last year. Excluding fuel, sales increased 5.2% compared to the same period last year, Kroger reported. Operating profit was $954 million, which is up 13.7% from $839 million a year earlier. Net earnings were $731 million, up 56.5% from $467 million a year earlier.

For the six months ended Aug. 13, Kroger total sales were $79.24 billion, up 8.6% from $72.98 billion a year earlier. Operating profit was $2.46 billion, up from $1.64 billion in the year-ago period. Net earnings were $1.40 billion, up 131% from $607 million a year earlier.

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Kroger raised its earnings forecast for the full year, citing strong demand for food prepared at home and a shift toward private-label goods.

Adjusted earnings in the current fiscal year will range as high as $4.05 a share, up from the previous forecast of no more than $3.95, Kroger said in a statement Friday. The profit measure rose to 90 cents per share in the fiscal second quarter, compared with the 82-cent average of analyst estimates Bloomberg News compiled.

For the second quarter ended Aug. 13, 2022, Kroger reported:

  • Total company sales were $34.64 billion, up about 9% compared to $31.68 billion for the same period last year.
  • Excluding fuel, sales increased 5.2% compared to the same period last year.
  • Operating profit was $954 million, up 13.7% from $839 million a year earlier.
  • Net earnings were $731 million, up 56.5% from $467 million a year earlier.
  • Gross margin of 20.9% of sales.

For the six months ended Aug. 13,  2022, Kroger reported:

  • Total sales were $79.24 billion. That’s up 8.6% from $72.98 billion a year earlier.
  • Operating profit was $2.46 billion, up from $1.64 billion in the year-ago period.
  • Net earnings were $1.40 billion, up 131% from $607 million a year earlier.

Percentage changes may not align exactly with dollar figures due to rounding.

Bloomberg News contributed to this report.

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