United Natural Foods stock slides over 15% after earnings report as margins weaken
United Natural Foods (NYSE:UNFI) stock slid 15.5% on Wednesday as the food wholesaler's gross margin weakened in Q1, while its earnings were largely in line with expectations.
More than 1.2M shares changed hands as of 2.24 pm ET vs. average trading volume of 445.4K.
United Natural (UNFI) reported Q1 gross margin of 14.55% vs. 14.89% in Q1 2022 and 14.49% in Q4 2022.
Adj. EPS was $1.13 vs. $1.10 in Q1 2022, reflecting adj. EBITDA growth and lower interest expense.
Revenue grew 7.1% Y/Y to $7.5B, helped by higher inflation, net new customers wins, and deeper sales penetration with existing customers. Sales were partially offset by expected decline in unit volume consistent with the overall industry.
The company also reaffirmed its guidance.
"Looking ahead, our customer pipeline is robust, with new customer acquisition and expansion from existing customers expected in H2 of the year," said CEO Sandy Douglas.
Shares of United Natural (UNFI), which posted two straight monthly gains in October and November, fell 9.4% in the last six months.