Asda’s executive chairman has acknowledged that the supermarket still has significant ground to cover in its recovery, after the Leeds-based chain reported a sharp fall in both sales and earnings for 2025.
The UK’s third-largest supermarket chain posted a 3.3% drop in full-year sales, excluding fuel, to £21bn — down from the prior year. Adjusted earnings fell by roughly a third to £764m over the same period, underlining the scale of the challenge facing the business as it attempts to claw back market share lost to rivals including Tesco, Sainsbury’s and Lidl.
A botched £1bn IT upgrade last year set back Asda’s recovery efforts significantly. The company said it experienced “severe disruption” during the technology transition, which resulted in reduced product availability and weaker sales performance. The overhaul involved separating more than 2,500 legacy IT systems and migrating them onto new platforms — a process that became necessary after Asda was sold by Walmart to brothers Zuber and Mohsin Issa and private equity firm TDR Capital in 2021. Walmart retains a 10% stake in the business.
Allan Leighton, who returned to Asda to lead its turnaround, struck a cautiously optimistic tone despite the difficult results. Sales continued to slide in the final quarter of 2025, falling 2.4% as the business continued to feel the drag of the IT disruption. However, Leighton pointed to improving momentum heading into the new year.
“There is plenty to do but there is also plenty of upside,” he said. “We have that momentum and a strong balance sheet to allow us to push forward.”
Product availability — a key metric for supermarkets — has now recovered to an eight-year high of 95%, which Asda credited with driving stronger trading in recent months. Total like-for-like sales fell 1.6% in January and 1% in February, but turned positive in March, with growth of 1.2% recorded so far in the month.
Leighton said the business is entering its second year of turnaround with a clearer path forward. “Our progress in key areas like price, availability and customer satisfaction is edging forwards, reflected in positive like-for-like sales growth in our stores for the last two months,” he added.
The update comes as Asda continues to face intense competition across the UK grocery sector, with discount chains and established rivals alike putting pressure on its market position. While the latest figures confirm how far the recovery still has to run, the improving sales trend offers the first tangible signs that the turnaround may be gaining traction.