Woolworths Group Ltd (ASX: WOW) shares are getting smashed today.
Shares in the S&P/ASX 200 Index (ASX: XJO) supermarket giant closed yesterday trading for $33.42. In morning trade on Wednesday, shares crashed to $29.40 each, down 12.0%. At the time of writing, shares are changing hands for $29.97 apiece, down 10.3%.
For some context, the ASX 200 is up 0.2% at this same time.
The sharp sell-down follows the release of Woolworths' full-year financial results for the 12 months to 29 June (FY 2025).
Here's what's catching investor interest.
(*To better compare FY 2025 to FY 2024, Woolworths' normalised results below were adjusted to remove the impact of the 53rd week in FY 2024.)
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Woolworths shares tumble on earnings retreat
Investors are bidding down Woolworths shares today despite the company reporting a 3.6% year-on-year increase in sales (normalised) to $69.1 billion.
Woolies eCom sales were a standout performer, surging 17.1% from FY 2024 to $9.1 billion over the financial year just past.
Margins came under pressure over the year, however, with the gross margin slipping 0.07% to 27.2%.
And costs were up, with the company reporting a 0.66% increase in its CODB to 23.3%.
Likely throwing up headwinds for Woolworths shares today, earnings before interest and tax (EBIT) in FY 2025 declined by 12.6% to $2.75 billion.
And on the bottom line, net profit after tax (NPAT) of $1.39 billion was down 17.1% from FY 2024.
With profits tumbling, management declared a final fully franked dividend of 45 cents per share. That's down 21.1% from last year's final payout.
If you're looking to bank that passive income, you'll need to own shares at market close on 1 September. Woolworths stock trades ex-dividend on 2 September.
What did management say?
Commenting on the past year's results pressuring Woolworths shares today, CEO Amanda Bardwell said: "After a highly disrupted first half, we have taken action to reposition the group for long-term sustainable growth."
Bardwell added:
While there is more to do and current trading remains below our ambition, we have seen some early positive signs with improving customer scores…
Most important was getting it right for our customers. We have invested in lowering shelf prices, increasing specials and absorbing cost price increases on everyday items and made our pricing clearer and easier to understand.
What's ahead for Woolworths shares?
Looking at what could impact Woolworths shares in the year ahead, the company said it expects to return to profit growth in FY 2026.
"We expect an improved financial performance driven by Australian Food, a continued recovery in New Zealand Food and a return to profitability in BIG W," Bardwell said.
She said that over the medium term, the company aims to deliver sustainable mid- to high-single-digit EBIT growth "through consistent growth from Woolworths Retail, improved profits from New Zealand Food and BIG W and incremental growth from our complementary businesses and services".
With today's big fall factored in, Woolworths shares are down 15.5% over 12 months, not including dividends.
