Woolworths has emerged as the early winner in Australia’s latest supermarket battle, with its shares jumping after annual net profit reached $1.138 billion and the Disney Ooshies promotion persuaded more families to move their grocery spending to the retailer.
The market welcomed stronger supermarket earnings, rapid online growth and a 7.6% rise in Australian Food sales during the first eight weeks of the new financial year. However, the result is likely to attract scrutiny while household budgets remain under pressure.
The numbers moving WOW shares
- Group sales: $71.5 billion, up 3.6%
- Net profit: $1.138 billion
- Underlying EBIT: $3.1 billion, up 12.7%
- Australian Food sales: $53.85 billion, up 4.6%
- Group online sales: Up 15.9%
- Big W EBIT: $64 million, reversing a $33 million loss
- Early FY27 Australian Food sales: Up 7.6%
Woolworths growth by key measure
Percentage growth reported for FY26, except early FY27 Australian Food sales
Group sales — 3.6%
Australian Food sales — 4.6%
Early FY27 Australian Food sales — 7.6%
Underlying EBIT — 12.7%
Group online sales — 15.9%
Bars compare percentage growth and are scaled against the highest figure of 15.9%. They do not represent the monetary size of each segment.
The comparison shows that online sales recorded the fastest growth, while the 12.7% increase in underlying EBIT substantially exceeded the 3.6% rise in group sales. Woolworths generated earnings faster than revenue through higher customer volumes, margin improvement and cost savings.
Ooshies delivered more than publicity
Customers received a blind bag containing a Disney character for every $30 spent during the promotion, which ran from mid-July to mid-August. Woolworths said it attracted families, collectors and people who would not ordinarily shop at its stores.
The company estimated that Ooshies added between 1.5 and 2 percentage points to the 7.6% increase in early FY27 Australian Food sales. An outside calculation based on average monthly sales suggests that could represent more than $120 million in additional spending, although Woolworths did not report a separate Ooshies revenue figure.
A YouGov survey of 1,102 Australian adults found that 39% said the campaign changed their shopping habits. The proportion reportedly reached 64% among parents with children under 18.
Coles lost momentum during the promotion
Coles acknowledged that its supermarket sales slowed while Ooshies were available. Sales improved after the promotion ended, but chief executive Leah Weckert said it was too early to determine whether trading had fully recovered.
Woolworths’ result also outpaced Coles’ headline performance. Coles reported a 1% increase in net profit to $1.09 billion, while Woolworths delivered a larger profit lift. Both companies continue to search for savings, with Coles pursuing corporate job cuts and expanded outsourcing.
Why the Woolworths share price jumped
Woolworths shares gained as much as 5% after the market opened on August 26. At approximately 2:04pm AEST, WOW was trading at $40.26, up $1.41 or 3.62%, according to the supplied delayed market snapshot.
The shares moved between $39.97 and $41.19 during the session. The rally reportedly added around $2 billion to Woolworths’ market value, briefly pushing it above $50 billion for the first time since 2021.
Investors can review the company’s announcement, annual report and presentation through the official Woolworths Group results page.
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Online sales and Big W tell different stories
Group online sales increased 15.9% as customers used home delivery, on-demand ordering, in-store collection and Direct to Boot. This provides Woolworths with a way to retain customers after the temporary collectibles campaign ends.
Big W returned to profit with EBIT of $64 million after a $33 million loss. However, its sales weakened during the opening eight weeks of FY27 as budget-conscious households reduced spending on discretionary products.
Why the profit matters to shoppers
Chief executive Amanda Bardwell said higher earnings did not come simply from increasing shelf prices. She attributed the improvement to customers visiting more frequently, adding more items to their baskets and responding to investments in stores, online services and lower prices.
Woolworths, which operates around 1,700 stores, has frozen prices on 105 products. Bardwell expects the challenging economic environment to continue and described value-seeking as an entrenched change in customer behaviour.
Pricing and margins will remain closely watched under the Australian supermarket price-gouging rules affecting Woolworths and Coles.
Risks behind the stronger result
Woolworths continues to manage payroll remediation linked to historical employee underpayments. Woolworths and Coles were found to have underpaid nearly 30,000 employees because of errors involving workplace award arrangements, leaving uncertainty around final remediation costs.
Stock losses, including theft, declined during the year, although staff safety remains a concern. Woolworths recorded about 7,000 incidents of violence and is conducting a staff-consented technical test of facial-recognition technology at its New Zealand support office.
The next test is whether Woolworths can retain shoppers attracted by Ooshies. Stronger online services and higher shopping frequency provide momentum, but sustainable growth will depend on competitive prices after the collectibles boost disappears.
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