Ocado shares tumble as boss warns of job cuts
The boss of online retailer Ocado has warned of “significant” job cuts after US retail giant Kroger pulled out of its automated warehouse partnerships, prompting shares to tumble.
The group confirmed it has closed several warehouses in North America and warned that further job losses are to come as Ocado continues to “simplify” its model.
The warning of redundancies spooked the markets on Thursday morning as shares in Ocado Group tumbled ten per cent on the market open, leaving the stock down two per cent in the year to date.
Total revenue before adjustment at Ocado Group grew in the year to November 2025, up 12 per cent to £1.4bn.
The retailer, which is listed on the FTSE-250, spent over £90m on technology as it enters a “very significant phase of investment in our robotics and automation capabilities,” CEO Tim Steiner said.
Operating costs at the online retailer grew three per cent to £1.6bn, and the group’s adjusted loss before tax eased slightly, shrinking seven per cent to £353m.
Ocado Group said it is looking to cut costs by £150m and staff cuts could be as high as 1,000.
North American partners shut warehouses
Ocado Group’s chief executive said more staff losses are imminent as the retailer winds down a set of automated warehouse partnerships with US retail giant Kroger and Canadian retailer Sobeys.
Ocado accelerated its tech pivot last year as it announced plans to sell its AI-driven warehouse tech globally, which allows retailers to pick and fulfill online grocery orders using AI.
Ocado had struck an exclusivity deal with retail giant Kroger for the use of this tech in the US, but the American firm scrapped three warehouses and shelved plans for a fourth.
Sobeys walked away from a warehouse which used Ocado tech last month, prompting the retailer’s shares to plunge almost ten per cent.
Most of the retailer’s exclusivity deals with global partners have now expired, which Ocado’s boss says offers an opportunity for expansion.
Steiner said: “With exclusivity arrangements concluded in most markets, we have greater flexibility to pursue new partnerships and growth opportunities.
“We are well set to re-enter multiple markets with an evolved technology platform, designed to be more flexible, offering a wider range of solutions to help retailers to run more efficiently.”
Announcing today’s results, Steiner said its investment in new tech is “largely completed,” with the retailer “simplifying” its operating model to fund its push into tech overseas.
He said: “These changes will also reflect the lower structural cost base that we have signalled over recent years. Regrettably, this means a significant number of roles will no longer be required.”