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Loblaw Q1 2025: sales up 4 %, digital +17 %, 50 new hard-discount stores, PC Optimum boosts retail media, robotic DC cuts costs, margins expand.
Table of Content
Q1 2025 Performance
NetSales
$14.14bn (+4.1 % YoY)
Retail sales $13.84 bn
Pharmacy and Drug Retail
Same-store sales grew 6.4 %
U.S. Net Sales
One76,000 sq ft T&T in Bellevue (WA) opened Dec-24
E-commerce Sales
17.4% e-commerce growth; online now low-to-mid-4 % of retail sales
Store Models
10 new stores (5 hard-discount conversions) opened in Q1
Retail Media Growth
Advance™, powered by Loblaw, now has 500 + in-store digital screens; still posting double-digit profit growth via 16 m PC Optimum data.
Loyalty & Offers
16m+ active PC Optimum members; continued growth from personalized offers, member-only pricing & gamified challenges.
CEO's perspective
"We delivered revenue growth of 4.1 %, reflecting our strategic investments in new stores and banner conversions. That top-line momentum underpins future same-store growth and long-term earnings.” said Per Banque, President & CEO, Q1 2025 call.
Strategic Initiatives
Pricing Strategies
Extended 400 value-item price locks; widened member-only shelf tags across discount banners to protect share as food inflation cools.
Omnichannel Expansion
80%of communities now have same-day PC Express pick-up; DoorDash & Instacart partnerships cover 14 major metros for 1-hour delivery.
Store Remodels & Replacement
On track for 80 new stores in 2025 (≈50 hard-discount) and>300 remodels; hard-discount banners targeted to reach 20–25 % of sales by 2026.
Key Highlights
Supply Chain Automation
Loblaw is switching on anew, fully-robotic 1.2 million-sq-ft warehouse in East Gwillimbury, Ontario. Robots handle almost everything—sorting, shelving and loading—so the company expects to move more goods while cutting labour costs by about half. The centre is coming online in stages this year and should be running at full speed in 2026.
AI and Tech Investments
Loblaw is rolling out Blue Yonder’s machine-learning demand-forecasting software across all of its banners, which means that powerful algorithms now study sales patterns, weather, holidays, local events, and even social-media buzz to predict exactly how much of each product every store will need, day by day. Better forecasts translate into fuller shelves, fewer stock-outs, and less waste, especially for fresh food. At the same time, Shoppers Drug Mart is testing computer-vision “shrink” cameras: small, ceiling-mounted devices that watch high-risk aisles (for example, cosmetics) and automatically flag suspicious product removals in real time. Together, these two technologies let Loblaw put the right product in the right place while reducing the losses that eat into profit.
Long Term Investment
This initiative is one piece of Loblaw’s C$10 billion, five-year investment roadmap (2025-2030). Under the plan, the company is pouring capital into four priority areas: (i) expanding and converting stores to hard-discount formats like No Frills and Maxi, (ii) automating its supply chain with high-tech distribution centers and robotics, (iii) upgrading digital capabilities everything from AI forecasting to retail-media and e-commerce—and (iv) enriching the PC Optimum loyalty ecosystem to keep shoppers engaged and spending more.
Omnichannel Growth
Delivery is the fastest-growing part of Canada’s online-grocery market, yet most shoppers still choose click-and-collect because it’s convenient and avoids delivery fees. Loblaw’s Q1 2025 results reflect that mix: online sales jumped 17 percent, pushed mainly by home delivery, but curb-side pickup still handles most orders. To serve both habits, and to hit management’s goal of growing digital sales in the high-teens each year, Loblaw is budgeting C$2.2 billion in 2025. The money will pay for more stores (especially hard-discount formats), hundreds of in-store medical clinics, and major automation projects such as robotic warehouses and AI-driven inventory tools, ensuring shoppers get a smooth experience whether they collect their groceries or have them brought to their door.
Future Outlook
Loblaw’s 2025 outlook remains upbeat. Management still expects low-single-digit growth in total sales, while digital stays the star performer with a high-teens compound annual growth target for online revenue, fuelled by faster delivery options and an expanding PC Express network. The plan to open about 50 new No Frills and Maxi hard-discount stores this year should lift the hard-discount share of total sales to roughly 20–25 percent and, together with digital scale-up, widen overall margins.
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