NEW YORK (AP) — Shares of Whole Foods Market Inc. dropped in after-hours trading Wednesday after the grocery chain reported fiscal first-quarter profits and revenue fell below analysts' forecasts. The Austin, Texas-based grocery chain, known for its organic and natural food offerings, also lowered its earnings projections for the year and pared down its top end of its full-year revenue guidance.
The latest results show that Whole Foods is facing an increasingly competitive landscape. The chain had been able to boost sales in large part because of its healthy product selection fits with Americans' changing eating habits. But more mainstream players like Kroger Co. are increasingly tapping into that trend as well, and rolling out more products or sections labels as natural or organic.
That has put more pressure on Whole Foods to be more competitive with prices. The chain, which operates 373 stores, has battled a perception among shoppers that its food is pricey.
The chain earned a profit of $158 million, or 42 cents per share, in the quarter that ended on Jan. 19. That compares with a profit of $146 million, or 39 cents per share, in the year-ago period.
Revenue rose 10 percent to $4.24 billion in the quarter.
Analysts expected 44 cents per share on revenue of $4.29 billion, according to FactSet estimates.
Revenue at stores opened at least a year rose 5.4 percent. Analysts were expecting a 5.6 percent gain. The figure was slower than the 5.4 percent increase in the previous quarter and below the 7.2 percent pace seen in the year-ago period.
Whole Foods said it now expects earnings per share for the current fiscal year to be $1.58 to $1.65. It had originally expected $1.65 to $1.69 per year. Analysts expected $1.68 per share, according to FactSet estimates.
The company also now expects full-year revenue to be up 11 percent to 12 percent. That's down from an earlier projection of 11 percent to 13 percent.
The company released its earnings results after the market closed.
Shares dropped nearly 6 percent, or $3.27 per share to $52.19 after hours after slipping 42 cents to $55.46 in regular trading.