Carrefour, a major French supermarket retailer, saw its stock decline sharply after issuing a revised earnings outlook in response to escalating civil unrest affecting its home market. The company’s third-quarter earnings report, published late Tuesday, attributed the downward revision to what management characterized as an unprecedented situation in France, where recent days have brought widespread protests and associated disruptions.
The retail environment has been disrupted by mass demonstrations calling for increased public service funding and protesting elevated living costs. While the majority of protest activity remained peaceful, some incidents over the weekend involved looting and vandalism of commercial establishments, arson attacks on municipal buildings, and confrontations with law enforcement. These developments prompted Carrefour to reassess its financial projections.
Under the revised guidance, the company now anticipates operating margin growth between 0 and 15 basis points, down substantially from a prior forecast of 25 basis points. Adjusted earnings per share are projected to remain flat to slightly higher, compared with earlier expectations for high-single-digit growth. Free cash flow is expected to decline modestly, reversing a previous forecast for modest expansion. Management cited disrupted store operations and weakened consumer spending, already pressured by elevated energy expenses, as the primary drivers of the downward revision.
Carrefour’s third-quarter performance showed like-for-like sales growth of 2.3% at constant exchange rates, meeting analyst expectations. The French market, which generated 11.9 billion euros in revenue during the quarter and represents just over half of total company sales, expanded 1.2% year-over-year. Despite the sharp single-day decline, Carrefour shares remained up approximately 2.5% on a year-to-date basis, still outperforming the CAC 40 index, which was down nearly 4% over the same period.
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