Highlights

  • Woolworths (ASX:WOW) reported higher FY26 sales, underlying Earnings and dividends, supported by improved trading performance.
  • Australian Food remained the key earnings contributor, while BIG W returned to profitability during the year.
  • Digital sales growth and productivity initiatives supported the group’s broader transformation strategy.
  • Investors remain focused on margins, competition, regulation and the sustainability of earnings momentum.

Woolworths Group (ASX:WOW) delivered its FY26 full-year results on 26 August 2026, highlighting a recovery in earnings performance after a challenging period marked by cost-of-living pressures, competitive intensity and increased scrutiny across the supermarket sector.

The result showed improvement across key operating areas, with higher sales, stronger underlying earnings, a higher Dividend and a return to profitability for BIG W. However, maintaining this momentum will depend on balancing price investment, Margin discipline and continued operational improvements.

FY26 Results

For the year ended June 2026, Woolworths reported group sales of $71.54 billion, an increase of 3.6% compared with the prior year.

Underlying group EBIT before significant items increased 12.7% to $3.11 billion, while underlying net profit after tax increased 15.4% to $1.60 billion. Basic Earnings Per Share on an underlying basis reached 130.9 cents.

Group EBITDA before significant items increased to $6.09 billion, reflecting improved earnings contribution from major operating divisions.

The statutory result was also higher, although affected by significant items. Reported EBIT increased to $2.41 billion, while reported NPAT increased to $1.14 billion. The result included a provision related to historical underpayment matters affecting salaried store team leaders.

The board declared a final dividend of 52 cents per share, fully franked. This increased the full-year dividend to 97 cents per share, reflecting improved earnings performance and stronger Shareholder distributions.

Business Performance

Australian Food remained the core contributor to Woolworths’ FY26 performance. Sales increased 4.6% to $53.9 billion, while EBIT increased 8.5%.

The division benefited from customer-focused pricing initiatives, range improvements and productivity measures. Woolworths continued expanding its lower-price programs across essential products, aiming to support customer value while improving sales momentum.

New Zealand Food also improved, with sales growth and higher earnings providing a positive contribution compared with previous periods. Australian B2B operations delivered further growth, while Petstock earnings increased during the year.

BIG W was a key highlight, returning to profitability with EBIT of $64 million compared with a loss in the prior year. The improvement reflected stronger customer engagement, improved product offerings and operational changes.

Digital remained an important growth channel across the group. Online sales increased 15.9% to $10.6 billion, supported by growth in Australian Food eCommerce, delivery services and personalised customer engagement.

Growth Strategy

Woolworths continues focusing on improving customer value, strengthening digital capabilities and increasing operational efficiency.

Price Investment remained a major part of the FY26 strategy, with the company lowering prices across a broad range of products to support customer affordability. The challenge moving forward will be ensuring these initiatives translate into sustainable Volume growth without creating excessive pressure on margins.

Technology and data capabilities also remain central to the company’s long-term strategy. Digital platforms, customer insights and automation initiatives are being used to improve shopping experiences, Supply chain efficiency and productivity.

The company is also continuing investment in supply chain infrastructure, including distribution and fulfilment capabilities, to support future growth.

Investor Focus

Several factors will remain important for Woolworths investors.

  • Early FY27 trading performance will indicate whether FY26 momentum continues beyond promotional activity.
  • Margin trends will show whether price investment can coexist with earnings growth.
  • Capital expenditure levels and returns from supply-chain investments will remain under review.
  • Competitive positioning against other supermarket operators will influence future market share.
  • Progress on legacy remediation matters and regulatory developments will continue to be monitored.

Risks

Woolworths continues operating in a highly competitive retail environment where pricing pressure remains intense. Maintaining customer value while protecting margins will remain a key challenge.

Consumer spending conditions also remain uncertain, with household budgets continuing to influence purchasing behaviour.

Regulatory scrutiny across the supermarket sector remains another consideration. The company also faces potential financial and reputational impacts from historical matters, including the provision recognised during FY26.

Higher Capital Investment requirements could also affect near-term cash allocation as Woolworths continues upgrading its supply chain and digital infrastructure.

Outlook

Woolworths enters FY27 with improved operational momentum following a stronger FY26 performance. Higher sales, stronger underlying earnings, increased dividends and BIG W’s recovery demonstrate progress across several areas of the business.

Management remains focused on delivering value for customers, improving productivity and expanding digital capabilities while managing ongoing cost pressures.

The key challenge will be sustaining earnings growth in a competitive supermarket market where pricing decisions, consumer behaviour and regulatory expectations continue to shape the operating environment.

For investors following ASX retail stocks, Woolworths’ FY26 result represents meaningful progress, although maintaining this recovery will depend on continued execution and disciplined margin management.