Shares of the retailer, which had consistently raised its outlook over the past two years, fell 4.5% to $45.07 after the dull forecast. Last month, rival Walmart raised its annual forecasts as more Americans shopped for its lower-priced groceries and other essentials. However, Kroger's gross margins rose 21 basis points, compared to a fall a year earlier, benefiting from lower supply chain costs as well as its efforts to source some products closer to its distribution centers. It also profited from shoppers - including higher-income consumers looking for more economical options amid persistent inflation - preferring its store-label brands to pricier national brands. Reporting by Granth Vanaik in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.

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Persons: Joseph Feldman, Kroger, Rodney McMullen, Kroger's McMullen, Arun Sundaram, Granth, Shinjini Organizations: Kroger, Investors, Walmart, Albertsons, CFRA, Thomson Locations: Bengaluru