Coles Q1 Sales Up 3.9% with 27.9% eCommerce Growth in Supermarkets
Coles Group reported a solid 3.9% rise in first quarter sales for FY26, driven by strong supermarket growth and digital expansion, while liquor sales faced ongoing market challenges.
- Supermarket sales revenue up 4.8%, with 27.9% eCommerce growth
- Liquor sales decline 1.1%, despite progress in ‘Simply Liquorland’ conversions
- eCommerce penetration reaches 13.3% in supermarkets
- Tobacco sales drop sharply due to new legislation and illicit market growth
- Continued investment in store renewals and digital customer experience
Strong Supermarket Growth Drives Overall Sales
Coles Group Limited has kicked off FY26 with a 3.9% increase in total group sales revenue for the first quarter ending 28 September 2025. This growth was primarily fuelled by a robust 4.8% rise in supermarket sales, which reached nearly $10 billion. Comparable sales growth in supermarkets hit 4.6%, reflecting the company’s ongoing focus on delivering value, quality, and an enhanced customer experience.
The supermarket segment also saw a remarkable 27.9% surge in eCommerce sales, pushing online penetration to 13.3%. This digital momentum was supported by expanded delivery catchments, same-day delivery launches in Melbourne, and new website and app features designed to simplify shopping and improve personalization.
Liquor Segment Faces Market Headwinds
In contrast, Coles’ liquor division experienced a 1.1% decline in sales revenue, continuing a trend of softness in the sector. Comparable sales fell by 1.4%, despite the rollout of the ‘Simply Liquorland’ banner simplification program, which has converted 112 stores to date. This initiative aims to broaden customer appeal through tailored ranges and value offers such as the ‘Price Match Promise’ and ‘Buy More, Save More’ promotions.
While liquor eCommerce sales grew by 6.8%, penetration remains modest at 7.6%. The company also completed 61 liquor store renewals during the quarter, signaling a commitment to refreshing its retail footprint amid challenging market conditions.
Operational Highlights and Strategic Initiatives
Coles continued to innovate with hundreds of new supermarket products, including popular launches like the Grill’d retail range and Coles Pistachio spread. The company also expanded its every day low price (EDLP) range and completed over 70 category reviews to tailor local store assortments more closely to customer preferences.
On the digital front, Coles partnered with OpenAI to introduce ChatGPT Enterprise tools for store support teams, enhancing operational efficiency. The construction of the Truganina Automated Distribution Centre (ADC) progressed, with key warehouse areas completed, positioning Coles for future supply chain improvements.
Outlook and Market Positioning
Looking ahead to the second quarter, Coles expects supermarket sales growth to remain steady, with a strong focus on festive season offerings. The company has launched over 340 new Own Brand products and specialty drinks to capture holiday demand. In liquor, the emphasis will be on completing the majority of ‘Simply Liquorland’ conversions and refining the range and value proposition to meet consumer needs during the busy season.
CEO Leah Weckert highlighted the company’s commitment to value and seamless omnichannel shopping experiences, aiming to support customers through competitive pricing and convenience both in-store and online.
Bottom Line?
Coles’ supermarket strength and digital gains set a positive tone, but liquor’s recovery remains a watchpoint.
Questions in the middle?
- Will liquor sales stabilize or continue to decline amid market softness?
- How will inflation trends affect Coles’ pricing strategy and margins going forward?
- What impact will the Truganina ADC have on supply chain efficiency and cost savings?
