Ocado shares fell around 19% to a 13-year low after investors looked beyond a £354m one-off accounting boost from the closure of Kroger and Sobeys fulfilment centres, with analysts describing it as a complicated set of half-year results.

Including the Kroger and Sobeys payments, reported group revenue increased 54% to £1.04bn and adjusted earnings jumped to £432m from £92m. However, excluding the closure-related payments, group revenue rose just 1% to £684m in the 26 weeks to 31 May, while adjusted earnings fell 12% to £81m.

Technology Solutions revenue declined 8% to £256m, although Ocado Retail, its joint venture with Marks & Spencer (M&S), delivered a stronger performance, with revenue rising 15% to £1.76bn, adjusted earnings increasing to £73m from £33m, and adjusted pre-tax profit improving to £12m from a £17m loss a year earlier.

Ocado generated a net cash inflow of £25m, ended the period with liquidity of £1.1bn and remained on track to become cash flow positive in the second half of 2026 and for the full year in 2027.

The Hertfordshire-based company, best known for developing warehouse automation and fulfilment technology for supermarkets globally, also reaffirmed plans to cut costs by £150m and said six customer fulfilment centres are due to go live over the next two to three years, including sites in Busan and Tokyo later this year.

Despite the guidance, investors were disappointed by the lack of new major retail partnerships, particularly in the US, ongoing uncertainty following Kroger and Sobeys scaling back their commitments, and concerns that retailers are increasingly favouring store-based fulfilment over Ocado's automated warehouse model.

All of this contributed to stock was trading around £1.44-£1.46, down 18%-19% on the day, making it one of the biggest fallers in the FTSE 250.

Under-pressure Ocado CEO, Tim Steiner, said,: “Alongside a more focused R&D investment strategy, we have made significant organisational changes to strengthen cost and capital discipline while improving the effectiveness of our commercial operations. As we continue to focus on delivering growth and efficiency, we will achieve positive cash flow in the second half of the year and be full-year cash flow positive in FY27."

Steiner, who is expected to stay in the role for at least the next 18 months while succession planning continues, added: “I remain fully focused on executing our strategy and creating value. I am pleased that, in recent weeks, we have established a clear process for long-term succession planning at Ocado."

Analysts called the results "messy" and "noisy".

Dan Coatsworth, head of markets at AJ Bell, said: “To call the results messy is an understatement. This reflects a business that continues to take one step forward and one step backward."

He added: "The numbers are confused by a one-off boost to revenues resulting from the partial withdrawal of two of Ocado’s partners. Once you remove one-off fees linked to the closure of customer centres, it’s clear that Ocado is running in quicksand. Following boardroom drama about long-term succession plans, Ocado needs to regain its mojo and find a new way to drive sales and earnings. The market hates the latest results, sending the share price to a 13-year low.”

Richard Hunter, head of markets at interactive investor, echoed these sentiments: “These are relatively noisy numbers which reveal that, while there is much activity under the bonnet, actual progress is pedestrian at best. From an investment perspective, there remains a mountain to climb."

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