The financial results that triggered a stock surge
Sprouts Farmers Market shares climbed over 16% last week, driven by stronger-than-expected financial results. In the fiscal second quarter, which ended on June 28, net sales grew 5% year over year to $2.3 billion. This growth was partly fueled by the opening of 7 new stores, bringing the total count to 490 locations across 25 states.
However, comparable sales — those from stores open for at least 60 weeks — fell 1%. Sprouts' gross margin also declined slightly to 38.7%, as rising fuel costs added pressure. Despite this, the company's earnings rose 1% to $1.37 per share, which exceeded expectations of $1.34 per share.
Cash flow and expansion plans
Sprouts is also generating substantial cash. For the first half of 2026, the company reported $369 million in operating cash flow and $179 million in free cash flow. These figures suggest the chain has room to continue expanding.
The company expects same-store sales to return to positive territory in the third quarter. For the full year, management anticipates net sales growth of 5.5% to 6.5%, with operating income between $675 million and $685 million. It also projects earnings per share of $5.32 to $5.40, supported by 42 new store openings.
A long-term growth strategy
Looking ahead, Sprouts has an ambitious plan to expand its store base to over 1,000 locations nationwide. The company's chief financial officer, Curtis Valentine, stated in a recent call with analysts that it has executed leases for more than 110 locations and has 155 approved new store sites. These figures underline the confidence in Sprouts' long-term growth potential.