Tesco Projects Profit Decline as Price War Intensifies

The UK’s largest supermarket announces £500m in cost cuts and warns of mounting competition and regulatory pressures impacting profitability.

Tesco forecasts adjusted operating profits of £2.7bn to £3.0bn for the next financial year, down from £3.1bn this year, citing competitive pressures and rising costs.
The company plans an additional £500m in cost reductions to counter higher operating costs, including a £235m increase in National Insurance contributions.
CEO Ken Murphy highlighted an intensifying price war, driven by rivals like Asda, which has pledged significant price cuts, pressuring Tesco to maintain competitive pricing.
Despite challenges, Tesco achieved a decade-high UK market share of 28.3%, supported by value-focused strategies and its Clubcard loyalty program.
Further job cuts remain a possibility, though Tesco emphasizes its track record of managing cost-saving measures while growing its workforce.