Tesco has reported continued sales growth in the first quarter of its 2026/27 financial year, driven by stronger customer satisfaction, higher fresh food sales, growing online demand, and ongoing investment in value, convenience, and digital services. The UK-based supermarket group announced its Q1 trading update on 18 June 2026, covering the 13 weeks ended 30 May 2026, with Group like-for-like sales increasing by 1.0% and UK like-for-like sales rising 1.8%.
The retailer said fresh food, online grocery, Tesco Finest products, and personalised customer offers contributed to performance during the quarter. Tesco also maintained its full-year profit guidance despite continued economic uncertainty affecting household spending.
What is Tesco’s Q1 Trading Statement?
A trading statement is a scheduled business update that provides investors and stakeholders with information on a company’s sales performance, operational progress, and financial outlook between full earnings reports.
Tesco’s Q1 Trading Statement covers sales performance for the first 13 weeks of the 2026/27 financial year and highlights developments across its UK, Ireland, Booker, and Central European operations.
At a Glance
- Group like-for-like sales increased 1.0%
- UK like-for-like sales rose 1.8%
- Fresh food sales grew 3.6%
- Tesco Finest sales increased 9%
- UK online sales rose 8.9%
- More than 520 new and improved products were launched
- Tesco maintained full-year profit guidance of £3.0bn to £3.3bn
How Did Tesco Perform in the UK?
Tesco reported UK like-for-like sales growth of 1.8% during the quarter. The retailer said customer satisfaction improved significantly year-on-year, supported by investments in value, product range, and service.
Food sales increased 2.6%, while fresh food sales grew 3.6%. Tesco Finest continued to perform strongly, with sales rising 9% during the period. On a two-year basis, UK like-for-like sales were up 6.9%.
What Drove Growth in Fresh Food and Private Label?
Fresh food remained one of Tesco’s strongest-performing categories during the quarter. Growth was supported by customer demand across core grocery categories and continued investment in quality and product innovation.
Tesco expanded its premium Tesco Finest range with more than 220 new and improved products. Overall, the retailer launched more than 520 new and upgraded products across its stores, including additions to its High Protein range and food-to-go offerings.
How Is Tesco Expanding Its Online Grocery Business?
Online sales in the UK increased 8.9% during the quarter, while online sales in Ireland rose 10.9%. Tesco continued expanding its same-day delivery capabilities through the rollout of additional Whoosh locations.
The retailer also introduced “Book for Later” Whoosh delivery slots, providing customers with more flexible same-day delivery options. Additional large stores were added to the service network during the reporting period.
What Retail Technology Initiatives Did Tesco Launch?
Tesco continued investing in digital retail and customer personalisation tools during the quarter. The company began testing dynamic product recommendations at online checkout to help shoppers discover additional products.
The retailer also launched a new Adobe-powered customer communications platform and expanded personalised Clubcard offers. Tesco reported that nearly 100 million tailored customer offers had been delivered since the programme launched in March 2026.
How Did Tesco Perform Outside the UK?
In the Republic of Ireland, like-for-like sales increased 3.3%, supported by growth across food, online, and store operations. Food sales rose 3.7%, with volume growth reported across fresh and packaged categories.
Central Europe recorded like-for-like sales growth of 0.8%, supported by food volume gains and stronger online performance. Online sales in the region increased 17.4% following improvements in delivery coverage and customer experience.
What Happened at Booker?
Booker reported a 3.2% decline in like-for-like sales during the quarter. Tesco attributed the performance partly to the previous exit of a lower-margin national contract and challenging comparisons with the prior year.
Despite the decline, Booker added 146 net new retailer partners and reported improvements in customer satisfaction, including measures related to pricing, speed, and product availability.
Why Does This Matter for the Supermarket Industry?
Tesco’s update highlights several trends shaping the supermarket sector in 2026. Retailers continue to focus on value-driven pricing, fresh food quality, premium private-label development, online grocery growth, and personalised digital engagement.
The results also demonstrate how major supermarket groups are increasingly combining traditional retail operations with retail media, loyalty data, artificial intelligence-powered recommendations, and delivery technology to strengthen customer relationships.
As competition remains intense across the UK grocery market, retailers are continuing to invest in both price competitiveness and digital innovation to maintain market share.
What Happens Next?
Tesco expects adjusted operating profit for the 2026/27 financial year to remain between £3.0 billion and £3.3 billion, while free cash flow is expected to remain within its medium-term target range of £1.5 billion to £2.0 billion.
The retailer plans to continue expanding personalised customer experiences, online grocery services, and product innovation initiatives throughout the year. Tesco is scheduled to publish its Interim Results on 8 October 2026, providing a further update on trading performance and strategic progress.
Editor’s Note: This article is based on Tesco’s Q1 Trading Statement for the 13 weeks ended 30 May 2026, published on 18 June 2026. All sales figures, operational updates, and financial guidance are sourced from the company’s official trading update.
