Sainsbury's tops Q1 forecasts with 2.1% like-for-like sales growth

Key Facts

Against a backdrop of persistent cost-of-living pressures weighing on British consumers, Sainsbury's first-quarter results provided a positive indicator for the retail sector. The supermarket chain reported retail like-for-like sales growth of 2.1% excluding fuel for the first quarter of fiscal 2026, surpassing the consensus estimate of 1.9%. Reports also indicated that its Argos unit performed better than anticipated, prompting UBS and Deutsche Bank to reiterate their buy ratings.

This performance came amid intense competition and margin pressure in the UK retail sector, with consumer confidence weakening per the CBI Distributive Trades index which printed at -54 in June (per market data). Despite this, analysts maintained a positive stance on the stock, viewing the sales beat as a sign of operational resilience in a challenging environment.

Investors will watch upcoming UK retail sales data and the company's next quarterly update, with the market focused on Sainsbury's ability to sustain growth amid economic headwinds.