# Grocery Outlet Holding Corp. (GO)

Informational only - not investment advice.

CIK: 0001771515
SIC: 5411 Retail-Grocery Stores
SIC breadcrumb: [Retail Trade](/division/G/) > [SIC Major Group 54](/major-group/54/) > [SIC 5411 Retail-Grocery Stores](/industry/5411/)
Latest 10-K filed: 2026-03-04
SEC page: https://www.sec.gov/edgar/browse/?CIK=1771515
Filing source: https://www.sec.gov/Archives/edgar/data/1771515/000177151526000015/go-20260103.htm

## At a glance

FY2025 · period end 2026-01-03 · filed 2026-03-04 · accession 0001771515-26-000015 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001771515.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 4,688,759,000 USD | 2025 | verified |
| Net income | -224,912,000 USD | 2025 | verified |
| Assets | 3,091,099,000 USD | 2025 | verified |
| Free cash flow | 23,800,000 USD | 2025 | computed |
| Net margin | -4.80% | 2025 | computed |
| Operating margin | -4.73% | 2025 | computed |
| Revenue YoY | +7.26% | 2025 | computed |
| ROE | -22.86% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | GO | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | -4.8% | 1.7% | 0 | 8 |
| Operating margin | -4.7% | 2.2% | 0 | 8 |
| Revenue growth | 7.3% | 3.6% | 86 | 8 |
| FCF margin | 0.5% | 1.1% | 14 | 8 |
| ROE | -22.9% | 11.6% | 0 | 8 |
| ROA | -7.3% | 3.9% | 0 | 8 |
| Liabilities / equity | 2.14 | 2.05 | 57 | 8 |
| Current ratio | 1.37 | 1.10 | 71 | 8 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 5411 Retail-Grocery Stores, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 4688759000 | USD | 2025 | 2026-03-04 |
| Net income | -224912000 | USD | 2025 | 2026-03-04 |
| Assets | 3091099000 | USD | 2025 | 2026-03-04 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-04. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001771515.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  | 2,075,465,000 | 2,287,660,000 | 2,559,617,000 | 3,134,640,000 | 3,079,582,000 | 3,578,101,000 | 3,969,453,000 | 4,371,501,000 | 4,688,759,000 |
| Net income |  | 20,601,000 | 15,868,000 | 15,419,000 | 106,713,000 | 62,310,000 | 65,052,000 | 79,437,000 | 39,465,000 | -224,912,000 |
| Operating income |  | 76,936,000 | 82,467,000 | 68,343,000 | 107,375,000 | 89,095,000 | 94,990,000 | 125,782,000 | 78,327,000 | -221,705,000 |
| Gross profit |  | 631,883,000 | 695,397,000 | 787,102,000 | 973,347,000 | 948,786,000 | 1,092,099,000 | 1,241,679,000 | 1,321,937,000 | 1,419,293,000 |
| Diluted EPS |  | 0.30 | 0.23 | 0.19 | 1.08 | 0.63 | 0.65 | 0.79 | 0.40 | -2.30 |
| Operating cash flow |  | 84,703,000 | 105,811,000 | 132,835,000 | 181,237,000 | 165,587,000 | 185,511,000 | 303,447,000 | 111,963,000 | 222,133,000 |
| Capital expenditures |  | 71,066,000 | 64,762,000 | 97,194,000 | 124,920,000 | 123,384,000 | 130,482,000 | 168,990,000 | 186,611,000 | 198,333,000 |
| Dividends paid |  | 1,307,000 | 153,587,000 | 3,645,000 | 434,000 | 186,000 | 105,000 | 15,000 | 0.00 | 0.00 |
| Share buybacks |  |  |  |  | 0.00 | 0.00 | 3,451,000 | 5,893,000 | 81,355,000 | 0.00 |
| Assets |  |  | 1,376,862,000 | 2,185,529,000 | 2,485,624,000 | 2,669,808,000 | 2,772,404,000 | 2,969,586,000 | 3,173,821,000 | 3,091,099,000 |
| Liabilities |  |  | 1,076,911,000 | 1,440,145,000 | 1,563,317,000 | 1,660,536,000 | 1,662,190,000 | 1,750,247,000 | 1,976,437,000 | 2,107,436,000 |
| Stockholders' equity | 406,352,000 | 427,133,000 | 299,951,000 | 745,384,000 | 922,307,000 | 1,009,272,000 | 1,110,214,000 | 1,219,339,000 | 1,197,384,000 | 983,663,000 |
| Cash and cash equivalents |  |  | 21,063,000 | 28,101,000 | 105,326,000 | 140,085,000 | 102,728,000 | 114,987,000 | 62,828,000 | 69,602,000 |
| Free cash flow |  | 13,637,000 | 41,049,000 | 35,641,000 | 56,317,000 | 42,203,000 | 55,029,000 | 134,457,000 | -74,648,000 | 23,800,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  | 0.99% | 0.69% | 0.60% | 3.40% | 2.02% | 1.82% | 2.00% | 0.90% | -4.80% |
| Operating margin |  | 3.71% | 3.60% | 2.67% | 3.43% | 2.89% | 2.65% | 3.17% | 1.79% | -4.73% |
| Return on equity |  | 4.82% | 5.29% | 2.07% | 11.57% | 6.17% | 5.86% | 6.51% | 3.30% | -22.86% |
| Return on assets |  |  | 1.15% | 0.71% | 4.29% | 2.33% | 2.35% | 2.68% | 1.24% | -7.28% |
| Liabilities / equity |  |  | 3.59 | 1.93 | 1.70 | 1.65 | 1.50 | 1.44 | 1.65 | 2.14 |
| Current ratio |  |  | 1.59 | 1.30 | 1.64 | 1.86 | 1.67 | 1.35 | 1.44 | 1.37 |

## As-reported value updates

No tracked differences above grepcent's stated thresholds and capped precision rule were found between the earliest XBRL-filed value and the value currently on file for the standardized annual metrics grepcent tracks.


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-12. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001771515.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-10-01 |  |  | 0.17 | reported discrete quarter |
| 2023-Q1 | 2023-04-01 |  |  | 0.14 | reported discrete quarter |
| 2023-Q2 | 2023-07-01 |  |  | 0.24 | reported discrete quarter |
| 2023-Q3 | 2023-07-01 |  | 24,471,000 |  | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 1,003,913,000 |  | 0.27 | reported discrete quarter |
| 2023-Q4 | 2023-12-30 | 989,818,000 | 14,106,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-30 | 1,036,944,000 | -1,025,000 | -0.01 | reported discrete quarter |
| 2024-Q2 | 2024-03-30 |  | -1,025,000 |  | reported discrete quarter |
| 2024-Q2 | 2024-06-29 | 1,128,520,000 |  | 0.14 | reported discrete quarter |
| 2024-Q3 | 2024-06-29 |  | 14,001,000 |  | reported discrete quarter |
| 2024-Q3 | 2024-09-28 | 1,108,183,000 |  | 0.24 | reported discrete quarter |
| 2024-Q4 | 2024-12-28 | 1,097,854,000 | 2,311,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-29 | 1,125,567,000 | -23,317,000 | -0.24 | reported discrete quarter |
| 2025-Q2 | 2025-03-29 |  | -23,317,000 |  | reported discrete quarter |
| 2025-Q2 | 2025-06-28 | 1,179,772,000 |  | 0.05 | reported discrete quarter |
| 2025-Q3 | 2025-06-28 |  | 4,961,000 |  | reported discrete quarter |
| 2025-Q3 | 2025-09-27 | 1,168,153,000 |  | 0.12 | reported discrete quarter |
| 2025-Q4 | 2026-01-03 | 1,215,267,000 | -218,161,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-04-04 | 1,166,352,000 | -180,322,000 | -1.83 | reported discrete quarter |
| 2026-Q2 | 2026-04-04 |  | -180,322,000 |  | reported discrete quarter |
| 2026-Q2 | 2026-07-04 | 1,192,764,000 |  | 0.06 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from GO's latest 10-K: [/company/GO/business/](/company/GO/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from GO's latest 10-K: [/company/GO/risk-factors/](/company/GO/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1771515/000177151526000066/go-20260704.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-08-12
Report date: 2026-07-04

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion of our financial condition and results of operations in conjunction with the unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this Form 10-Q, and the audited consolidated financial statements and related notes thereto and management's discussion and analysis of financial condition and results of operations included in our 2025 Form 10-K. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in other sections of this report. See "Special Note Regarding Forward-Looking Statements" in this report.

We operate on a fiscal year that ends on the Saturday closest to December 31st each year. The fiscal years ending January 2, 2027 (“fiscal 2026”) and ended January 3, 2026 ("fiscal 2025") consist of 52 weeks and 53 weeks, respectively. References to the second quarter of fiscal 2026 and the second quarter of fiscal 2025 refer to the 13 weeks ended July 4, 2026 and June 28, 2025, respectively.

As used in this report, references to "Grocery Outlet," "the Company," "the registrant," "we," "us" and "our," refer to Grocery Outlet Holding Corp. and its consolidated subsidiaries unless otherwise indicated or the context requires otherwise.

Overview

We are a growth-oriented extreme value retailer of quality, name-brand consumables and fresh products sold primarily through a network of independently operated stores. Our flexible buying model allows us to offer quality, name-brand opportunistic products at prices generally 40% to 70% below those of conventional retailers. Our Grocery Outlet stores are primarily run by entrepreneurial independent operators ("IOs") who create a neighborhood feel through personalized customer service and a localized product offering. As of July 4, 2026, we had 547 stores in California, Washington, Oregon, Pennsylvania, Tennessee, Nevada, Idaho, Maryland, North Carolina, Ohio, Virginia, Georgia, New Jersey, Alabama, Delaware and Kentucky.

Recent Trends and Developments

The extent of the continuing impact of the factors set forth below on our operational and financial performance will depend on many factors, including certain factors outside of our control.

Macroeconomic Conditions. Over the past several years, our business has been and continues to be impacted by macroeconomic conditions including supply chain and labor challenges, varying rates of inflation, tariffs, fuel price increases and changes in consumer behavior, and our IOs have been impacted by staffing challenges and increased labor costs and utility costs within their businesses. In recent periods, comparable store sales have been negatively impacted by decreased average transaction size. We are actively pursuing initiatives to increase average transaction size through our deployment of enhanced in-store merchandising and execution to further improve the shopping experience.

Tariffs, such as those recently implemented or proposed by the U.S. government on goods imported from other countries, may result in cost increases on some of the products we sell, such as fresh meat and general merchandise that we import from impacted countries, as well as the materials and supplies we use for store construction. Tariffs may also negatively affect consumer sentiment. The tariff environment remains highly dynamic and specific tariffs applicable to our business continue to evolve. While we are regularly re-evaluating the potential impact of implemented and proposed tariffs, the short-term impact of price increases due to tariffs is largely dependent on our ability to negotiate with suppliers, opportunities to change sources of supply, our assortment decisions and whether or not we pass the effects through to our customers, which will largely depend upon competitive market conditions. It is reasonably possible that new or additional tariffs will be periodically implemented or proposed given the current global trade environment. Sustained uncertainty about, or worsening of, current global economic conditions and further tariffs and escalations of tensions between the U.S. and its trading partners has and could continue to adversely impact the stability of global financial markets and result in a global economic slowdown and long-term changes to global trade, which could in turn have a material adverse impact on our business and financial condition.

In February 2026, the Supreme Court of the U.S. issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act ("IEEPA"). In the second quarter of fiscal 2026, we applied for tariff refunds, and refunds received have not been material. The ultimate availability, timing, and amount of any potential additional tariff refunds remains uncertain and is subject to further legal, regulatory, and administrative developments. Subsequent to the ruling, in February 2026, the U.S. presidential administration invoked additional tariffs under other laws resulting in a rapidly changing tariff environment. In July 2026, these additional tariffs expired, and the U.S. presidential administration announced new tariffs, which we are assessing the impact. At this time we cannot reasonably estimate the total financial impact of recent tariff developments and however these and any additional tariffs may materially affect our future results of operations and cash flows.

25

Table of Contents

Pricing Competition. During the last few years we have observed an increase in promotional and pricing activities from key competitors, putting further pressure on our relative value proposition, which in turn, has resulted in our increased efforts to actively negotiate costs and adjust prices to sharpen our value proposition. We have invested and plan to continue to invest in additional promotional activity in the near term, which adversely impacted gross margin in the first half of fiscal 2026 and which we expect will continue to adversely impact gross margin through the third quarter of fiscal 2026.

Opportunistic Product. We continue working to increase opportunistic product levels to what we believe is necessary to improve the perception of our value leadership and drive sales. As of the second quarter of fiscal 2026, comparable sales from opportunistic product has improved relative to the first quarter of fiscal 2026.

Optimization Plan. We initiated a business optimization plan during the first quarter of fiscal 2026, intended to strengthen long-term profitability and cash flow generation, improve operational execution, optimize our existing store footprint and align with our disciplined new store growth strategy (the "Optimization Plan"). The Optimization Plan provides for the closure of 36 financially underperforming stores ("Closure Stores"), including the termination, sublease or assignment of the applicable store leases; the termination, sublease or assignment of a lease for a distribution center facility that we are no longer utilizing (together with the store leases, the "Lease Exits"); and the termination of operator agreements with IOs for the Closure Stores as well as certain other store locations (the "Operator Agreement Terminations").

We estimate that we will incur between $15 million and $24 million in net total restructuring charges in fiscal 2026 and fiscal 2027 related to the Optimization Plan, and we expect these actions to be substantially completed by the first quarter of fiscal 2027. We incurred bad debt expense of approximately $15 million and cash costs of approximately $3 million in connection with the Operator Agreement Terminations. We have negotiated, or intend to negotiate, a lease termination, sublease or assignment with the landlords of the Lease Exits. We expect to incur net restructuring charges for the Lease Exits totaling between $(3) million and $6 million, which primarily include cash costs of between $50 million and $60 million for lease termination fees, costs to prepare the premises for surrender to the landlords, sublessee or assignee, and idle property costs, partially offset by the net non-cash write-off of the right-of-use assets and lease liabilities associated with these leases of between $(53) million and $(54) million.

During the first half of fiscal 2026, we closed all 36 Closure Stores, and we substantially completed the Operator Agreement Terminations. In addition, we negotiated lease terminations with the landlords for certain of the Lease Exits and wrote-off the right-of-use assets and lease liabilities associated with these leases. We also entered into a sublease for the distribution facility we are no longer using. For the leases associated with the Lease Exits, we incurred costs to prepare the premises for surrender to the landlords and idle property costs, net of proceeds received from sales of assets.

See Note 12 to the condensed consolidated financial statements for additional information regarding the Optimization Plan, including the costs incurred and restructuring liability activity.

New Store Growth. Our new store growth efforts are focused on organic growth combined with complementary real estate opportunities that align with our long-term geographic expansion and store growth strategies. Complementary growth opportunities may include expanding strategic relationships with large property owners, evaluating acquisitions of opportunistic real estate that become available through consolidation in the retail sector, and exploring strategic regional acquisitions of operating businesses.

Excluding the Closure Stores related to the Optimization Plan, we opened 13 net new stores in the first half of fiscal 2026, and we plan to open 30 to 33 net new stores for the full year fiscal 2026. We have begun to expand with a more clustered location model in new markets to improve supply chain efficiency and marketing leverage that reflects our more disciplined approach. We also have started to make adjustments to how we go to market, including piloting new approaches to store openings and underwriting to stricter standards. For example, we are operating certain of these new stores as Company-operated stores initially, which differs from our historical practice, before eventually transitioning the operations to an IO.

26

Table of Contents

Key Factors and Measures We Use to Evaluate Our Business

We consider a variety of financial and operating measures in assessing the performance of our business. The key financial measures we use in accordance with accounting principles generally accepted in the United States of America ("GAAP") are net sales, gross profit and gross margin, selling, general and administrative expenses ("SG&A"), operating income (loss), net income (loss) and comprehensive income (loss) and earnings (net loss) per share. The key operational metrics and non-GAAP financial measures we use are number of new stores, comparable store sales, EBITDA, adjusted EBITDA, adjusted net income and adjusted earnings per share.

Second Quarter of Fiscal 2026 Overview

Key financial and operating performance results for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025 were as follows:

•Net sales increased 1.1% to $1.19 billion.

•Comparable store sales declined by 0.3%, driven by a 2.1% decrease in average transaction size, partially offset by a 1.8% increase in the number of transactions.

•Gross margin was 30.2%, compared to 30.6% in the second quarter of fiscal 2025, a decline of 40 basis points.

•We opened 10 new stores and closed 12 stores, including 9 stores as a result of the Optimization Plan (see Note 12 to the condensed consolid

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1771515/000177151526000015/go-20260103.htm
Complete FY 2026 MD&A: /company/GO/mda/fy2026/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-03-04
Report date: 2026-01-03

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion of our financial condition and results of operations in conjunction with the consolidated financial statements and related notes thereto included in "Item 8. Financial Statements and Supplementary Data." This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those described in "Item 1A. Risk Factors" or set forth in other sections of this report. See "Special Note Regarding Forward-Looking Statements" in this report.

For discussion related to the results of operations and changes in financial condition for fiscal 2024 compared to fiscal 2023 refer to "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II of the Annual Report on Form 10-K for the fiscal year ended December 28, 2024 ("2024 Form 10-K").

We operate on a fiscal year that ends on the Saturday closest to December 31st each year. References to fiscal 2026, fiscal 2025, fiscal 2024, and fiscal 2023 refer to the fiscal years ended January 2, 2027, January 3, 2026, December 28, 2024, and December 30, 2023, respectively. Our 2025 fiscal year consisted of 53 weeks while our 2024 and 2023 fiscal years consisted of 52 weeks.

As used in this report, references to "Grocery Outlet," "the Company," "the registrant," "we," "us" and "our," refer to Grocery Outlet Holding Corp. and its consolidated subsidiaries unless otherwise indicated or the context requires otherwise.

Overview

We are a growth-oriented extreme value retailer of quality, name-brand consumables and fresh products sold primarily through a network of independently operated stores. Our flexible buying model allows us to offer quality, name-brand opportunistic products at prices generally 40% to 70% below those of conventional retailers. Our Grocery Outlet stores are primarily run by entrepreneurial IOs who create a neighborhood feel through personalized customer service and a localized product offering. As of January 3, 2026, we had 570 stores in California, Washington, Oregon, Pennsylvania, Tennessee, Idaho, Nevada, Maryland, Ohio, New Jersey, North Carolina, Georgia, Alabama, Delaware, Kentucky and Virginia.

Recent Trends and Developments

The extent of the continuing impact of the factors set forth below on our operational and financial performance will depend on many factors, including certain factors outside of our control.

Macroeconomic Conditions. Over the past several years, our business has been and continues to be impacted by macroeconomic conditions including supply chain and labor challenges, varying rates of inflation, tariffs, and changes in consumer behavior, and our IOs have been impacted by staffing challenges and increased labor costs and utility costs within their businesses. In recent periods, comparable store sales have been negatively impacted by decreased average transaction size. We are actively pursuing initiatives to increase average transaction size through our deployment of enhanced in-store merchandising and execution to further improve the shopping experience.

Tariffs, such as those recently implemented or proposed by the U.S. government on goods imported from other countries, may result in cost increases on some of the products we sell, such as fresh meat and general merchandise that we import from impacted countries, as well as the materials and supplies we use for store construction. Tariffs may also negatively affect consumer sentiment. The tariff environment remains highly dynamic and specific tariffs applicable to our business continue to evolve. While we are regularly re-evaluating the potential impact of implemented and proposed tariffs, the short-term impact of price increases due to tariffs is largely dependent on our ability to negotiate with suppliers, opportunities to change sources of supply, our assortment decisions and whether or not we pass the effects through to our customers, which will largely depend upon competitive market conditions. It is reasonably possible that new or additional tariffs will be periodically implemented or proposed given the current global trade environment. Sustained uncertainty about, or worsening of, current global economic conditions and further tariffs and escalations of tensions between the U.S. and its trading partners has and could continue to adversely impact the stability of global financial markets and result in a global economic slowdown and long-term changes to global trade, which could in turn have a material adverse impact on our business and financial condition.

43

Table of Contents

In February 2026, the Supreme Court of the U.S. issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act ("IEEPA"). The ultimate availability, timing, and amount of any potential refunds of such tariffs remain highly uncertain and are subject to further legal, regulatory, and administrative developments. The U.S. presidential administration subsequently invoked additional tariffs under other laws resulting in a rapidly changing tariff environment. At this time we cannot reasonably estimate the total financial impact of this ruling, however it, and any additional tariffs, may materially affect our future results of operations and cash flows.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law. The OBBBA includes several changes to U.S. federal tax law, including reinstatement of 100% bonus depreciation on qualified property and immediate expensing of domestic research and development expenses. Certain provisions of the OBBBA will impact the timing of cash tax payments in future periods.

The U.S. Government shutdown during the fourth quarter of fiscal 2025 adversely impacted the disbursement of benefits from federally-funded assistance programs that many of our customers depend on, including SNAP. Approximately 9% of our net sales in fiscal 2025 were in the form of EBT payments and a substantial portion of these payments may be related to benefits associated with SNAP. The U.S. Government shutdown during the fourth quarter of fiscal 2025 adversely impacted the disbursement of benefits from federally-funded assistance programs that many of our customers depend on, including SNAP, and our sales from EBT payments were negatively impacted during the period. Any future government shutdowns or other disruptions to these benefits could affect the spending habits of our customers and adversely impact our business performance and results of operations.

Pricing Competition. During the last few years we have observed an increase in promotional and pricing activities from key competitors, putting further pressure on our relative value proposition, which in turn, has resulted in our increased efforts to actively negotiate costs and adjust prices to sharpen our value proposition.

Optimization Plan and Restructuring Plan. To strengthen long-term profitability and cash flow generation, improve operational execution, optimize our existing store footprint and align with our disciplined new store growth strategy, in the first quarter of fiscal 2026 we conducted a strategic, financial and operational analysis of our store fleet. Following that review, on March 2, 2026, our Board adopted a business optimization plan (the "Optimization Plan") that provides for the closure of 36 financially underperforming stores ("Closure Stores"), including the termination or sublease of the applicable store leases; the termination or sublease of a lease for a distribution center facility that we are no longer utilizing (together with the store lease terminations and subleases, the "Lease Exits"); and the termination of operator agreements with IOs for the Closure Stores as well as certain other store locations (the "Operator Agreement Terminations"). These actions under the Optimization Plan are expected to be substantially completed during fiscal 2026.

In addition, preceding the adoption of the Optimization Plan, during the reporting process for the audited consolidated financial statements for fiscal 2025, we determined that the long-lived assets of the Closure Stores were impaired, and recognized $110 million of non-cash charges in Impairment of long-lived assets on the consolidated statements of operations and comprehensive income (loss).

We estimate that we will incur between $14 million and $25 million in net total restructuring charges in fiscal 2026 related to the Optimization Plan approved in the first quarter of fiscal 2026. Estimated restructuring charges expected to be incurred in connection with the Operator Agreement Terminations include bad debt expense of between $11 million and $14 million and cash expenses of between $2 million and $3 million. The Company intends to negotiate lease terminations with the landlords of the Closure Stores and one distribution center facility during fiscal 2026. If we are successful in negotiating these lease terminations, the Company expects to incur net restructuring charges for the Lease Exits of between $1 million and $8 million, which primarily includes cash costs of between $49 million and $60 million for lease termination fees, costs to prepare the premises for surrender to the landlords and idle property costs, partially offset by the net non-cash write-off of the right-of-use assets and lease liabilities associated with these leases of between $(48) million and $(52) million.

In addition to the above costs, we estimate that our fiscal 2026 gross profit may be negatively impacted by between $4 million and $6 million as a result of sales discounts or product markdowns to liquidate on-hand inventory during the wind-down of operations of the Closure Stores.

44

Table of Contents

Previously, we initiated a restructuring plan during the fourth quarter of fiscal 2024, which was substantially completed in the second quarter of fiscal 2025, to improve long-term profitability, cash flow generation and return on invested capital, optimize the footprint of new store growth and lower our cost base (the "Restructuring Plan"). The Restructuring Plan included (i) the termination of a total of 28 leases for unopened stores in suboptimal locations and the discontinued development of certain future store sites where we had incurred initial costs, but leases had not yet been signed, (ii) the cancellation of certain capital intensive warehouse projects and (iii) a reduction in headcount in building a more scalable cost structure. As of January 3, 2026, we incurred total costs under the Restructuring Plan of $61.8 million, of which $38.2 million were cash expenditures.

All costs incurred from the Optimization Plan and the Restructuring Plan during fiscal 2025 and fiscal 2024 are included in Restructuring charges on the consolidated statements of operations and comprehensive income (loss). See Note 16 to the consolidated financial statements for additional information regarding the Optimization Plan and the Restructuring Plan, including the costs incurred and restructuring liability activity.

New Store Growth. Our new store growth efforts are focused on organic growth combined with complementary real estate opportunities that align with our long-term geographic expansion and store growth strategies. Complementary growth opportunities may include expanding strategic relationships with large property owners, evaluating acquisitions of opportunistic real estate that become available through consolidation in the retail sector, and exploring strategic regional acquisitions of operating businesses. On April 1, 2024, we acquired United Grocery Outlet, which included 40 stores in six adjacent states we did not

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2026 MD&A: /company/GO/mda/fy2026/
All MD&A years: /company/GO/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/GO/mda/fy2024/): filed 2025-02-26; accession 0001771515-25-000017 (https://www.sec.gov/Archives/edgar/data/1771515/000177151525000017/go-20241228.htm)
- [FY 2023 MD&A](/company/GO/mda/fy2023/): filed 2024-02-28; accession 0001771515-24-000016 (https://www.sec.gov/Archives/edgar/data/1771515/000177151524000016/go-20231230.htm)
- [FY 2022 MD&A](/company/GO/mda/fy2022/): filed 2023-03-01; accession 0001771515-23-000009 (https://www.sec.gov/Archives/edgar/data/1771515/000177151523000009/go-20221231.htm)
- [FY 2022 MD&A](/company/GO/mda/a-0001771515-22-000011/): filed 2022-03-02; accession 0001771515-22-000011 (https://www.sec.gov/Archives/edgar/data/1771515/000177151522000011/go-20220101.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 5411 Retail-Grocery Stores) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm

Macro-to-micro threads including this sector: [Inflation (CPI / PCE / PPI)](/thread/inflation-cpi-pce-ppi/), [US labor market](/thread/us-labor-market/), [Growth & output](/thread/growth-output/), [Sector employment](/thread/sector-employment/), [Industrial orders & inventories](/thread/industrial-orders/), [Trade & external](/thread/trade-external/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/GO.md · JSON record: /company/GO.json · verified financials: /company/GO/financials.json / /company/GO/financials.csv · machine TOC for the whole site: /llms.txt