Asda has reported a 3.8% decline in total sales, amounting to £5.1 billion for the three-month period concluding in September, compared to the same timeframe last year. This drop is a significant reversal from the previous quarter’s growth of 0.2%, with comparable store sales decreasing by 2.8%. The supermarket attributed part of this decline to internal issues, particularly difficulties in separating its IT systems from those of its former parent company, Walmart.
Allan Leighton, chair of Asda, noted that these challenges have hindered his plans to turn around the business, citing that the drop in sales and market share was “totally self-inflicted.” He expressed concern over the government’s influence on consumer sentiment, asserting that a lack of growth and investment opportunities is affecting confidence among shoppers. Leighton stated that these conditions are detrimental to the retail sector’s ability to increase sales.
Recent official statistics also indicated an unexpected decline in UK retail sales. This downturn coincided with consumer hesitation ahead of anticipated Black Friday deals, compounded by uncertainty regarding the government’s budget decisions. Asda’s struggles follow a substantial takeover in early 2021, which reportedly led to a significant drop in sales and profits, raising concerns that rival Aldi could soon surpass it as the UK’s third-largest supermarket.
Leighton acknowledged ongoing issues with new IT systems impacting product availability, particularly in clothing and home goods. However, he emphasized improvements and expressed optimism about future strategies, including maintaining price cuts to bolster competitiveness. According to Leighton, Asda is now positioned to be 4% to 7% cheaper than key competitors, such as Tesco and Morrisons, aiming to attract more customers.
Source: https://www.theguardian.com/business/2025/nov/28/asda-sales-fall-it-problems-consumer-confidence