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65 jili By ADRIANA GOMEZ LICON FORT LAUDERDALE, Fla. (AP) — President-elect Donald Trump promised on Tuesday to “vigorously pursue” capital punishment after President Joe Biden commuted the sentences of most people on federal death row partly to stop Trump from pushing forward their executions. Related Articles National Politics | Elon Musk’s preschool is the next step in his anti-woke education dreams National Politics | Trump’s picks for top health jobs not just team of rivals but ‘team of opponents’ National Politics | Biden will decide on US Steel acquisition after influential panel fails to reach consensus National Politics | Biden vetoes once-bipartisan effort to add 66 federal judgeships, citing ‘hurried’ House action National Politics | A history of the Panama Canal — and why Trump can’t take it back on his own Trump criticized Biden’s decision on Monday to change the sentences of 37 of the 40 condemned people to life in prison without parole, arguing that it was senseless and insulted the families of their victims. Biden said converting their punishments to life imprisonment was consistent with the moratorium imposed on federal executions in cases other than terrorism and hate-motivated mass murder. “Joe Biden just commuted the Death Sentence on 37 of the worst killers in our Country,” he wrote on his social media site. “When you hear the acts of each, you won’t believe that he did this. Makes no sense. Relatives and friends are further devastated. They can’t believe this is happening!” Presidents historically have no involvement in dictating or recommending the punishments that federal prosecutors seek for defendants in criminal cases, though Trump has long sought more direct control over the Justice Department’s operations. The president-elect wrote that he would direct the department to pursue the death penalty “as soon as I am inaugurated,” but was vague on what specific actions he may take and said they would be in cases of “violent rapists, murderers, and monsters.” He highlighted the cases of two men who were on federal death row for slaying a woman and a girl, had admitted to killing more and had their sentences commuted by Biden. On the campaign trail, Trump often called for expanding the federal death penalty — including for those who kill police officers, those convicted of drug and human trafficking, and migrants who kill U.S. citizens. “Trump has been fairly consistent in wanting to sort of say that he thinks the death penalty is an important tool and he wants to use it,” said Douglas Berman, an expert on sentencing at Ohio State University’s law school. “But whether practically any of that can happen, either under existing law or other laws, is a heavy lift.” Berman said Trump’s statement at this point seems to be just a response to Biden’s commutation. “I’m inclined to think it’s still in sort of more the rhetoric phase. Just, ‘don’t worry. The new sheriff is coming. I like the death penalty,’” he said. Most Americans have historically supported the death penalty for people convicted of murder, according to decades of annual polling by Gallup, but support has declined over the past few decades. About half of Americans were in favor in an October poll, while roughly 7 in 10 Americans backed capital punishment for murderers in 2007. Before Biden’s commutation, there were 40 federal death row inmates compared with more than 2,000 who have been sentenced to death by states. “The reality is all of these crimes are typically handled by the states,” Berman said. A question is whether the Trump administration would try to take over some state murder cases, such as those related to drug trafficking or smuggling. He could also attempt to take cases from states that have abolished the death penalty. Berman said Trump’s statement, along with some recent actions by states, may present an effort to get the Supreme Court to reconsider a precedent that considers the death penalty disproportionate punishment for rape. “That would literally take decades to unfold. It’s not something that is going to happen overnight,” Berman said. Before one of Trump’s rallies on Aug. 20, his prepared remarks released to the media said he would announce he would ask for the death penalty for child rapists and child traffickers. But Trump never delivered the line. One of the men Trump highlighted on Tuesday was ex-Marine Jorge Avila Torrez, who was sentenced to death for killing a sailor in Virginia and later pleaded guilty to the fatal stabbing of an 8-year-old and a 9-year-old girl in a suburban Chicago park several years before. The other man, Thomas Steven Sanders, was sentenced to death for the kidnapping and slaying of a 12-year-old girl in Louisiana, days after shooting the girl’s mother in a wildlife park in Arizona. Court records show he admitted to both killings. Some families of victims expressed anger with Biden’s decision, but the president had faced pressure from advocacy groups urging him to make it more difficult for Trump to increase the use of capital punishment for federal inmates. The ACLU and the U.S. Conference of Catholic Bishops were some of the groups that applauded the decision. Biden left three federal inmates to face execution. They are Dylann Roof, who carried out the 2015 racist slayings of nine Black members of Mother Emanuel AME Church in Charleston, South Carolina; 2013 Boston Marathon bomber Dzhokhar Tsarnaev ; and Robert Bowers, who fatally shot 11 congregants at Pittsburgh’s Tree of Life Synagogue in 2018 , the deadliest antisemitic attack in U.S history. Associated Press writers Jill Colvin, Michelle L. Price and Eric Tucker contributed to this report.Jason Sudeikis believes in some father-son fun. The Ted Lasso star enjoyed a special public outing with his 10-year-old son Otis —whom he shares with ex Olivia Wilde —when the pair sat courtside as the Los Angeles Lakers faced the Orlando Magic at L.A.’s Crypto.com Arena Nov. 21. In between plays, the 49-year-old, who wore a black hoodie adorned with the artwork from Billie Eilish ’s album Hit Me Hard and Soft along with a black ball cap, posed for a photo with his son, who was also dressed casually in a yellow hooded sweatshirt and blue pants. The youngster also let his long blonde hair hang naturally as he munched on popcorn during the basketball game. Otis and Jason—who also shares daughter Daisy , 8, with the Don’t Worry Darling director—appear to be big NBA fans, as they previously attended a Lakers game together during the 2022-2023 season, where they were they snapped a selfie on the Emmy winner’s smartphone as the players warmed up. Despite the duo’s apparent love of basketball, the Saturday Night Live alum revealed his kids seem to be more interested in making music. “They love making up songs,” he said during a 2023 appearance on Late Night with Seth Meyers . “I come home, and as I’m coming up the stairs, I can usually hear a keyboard.” The comedian didn’t take credit for his kids’ musical pursuits, citing Billie’s documentary The World's a Little Blurry as the source of their creative spark. However, he compared their a-ha moment to the one that ignited his own career. “When you see Billie and her older brother Finneas making music together and making each other laugh,” he explained, “it was kind of similar to when I would go visit my uncle George [ Wendt ] on the Cheers set and be like, ‘This is a job? You guys all joking around?’” Jason concluded, “I think they took that and were like, ‘OK, we’re gonna do this.’” Keep scrolling for some sweet photos Jason and Olivia have shared of their kids growing up. Olivia and Daisy celebrating National Daughters Day with an adorable hug. "It's good to be Otis," Olivia said, adding that they adore Quest Love . The director joked in April 2020, "I have never seen anyone cheat so badly." Daisy clearly inherited the performing gene from her parents. For National Sibling Day in 2020, the Don't Worry Darling director captioned this pic, "It's important to have an accomplice." Olivia brought her children as part of the writers' strike in 2023, writing, "Core memories include learning about corporate greed even when you wanna love Netflix." "Little big foot," she captioned this shot in October 2020. Some mischief was had in March 2019. The skater boy and girl played together in a video she shared in April 2019: "Happy #nationalsiblingsday to these cool kids who let me kick it with them all the time as long as I bring snacks." The actress teased, "She looks like she just realized she crawled in bed with the wrong woman." For National Daughter Day in 2020, Olivia called Daisy "my super hero times infinity plus a million." "It's been a Frozen summer," Olivia simply wrote in July 2019. The pair were all smiles for a sweet day out. The Booksmart director shared, "My favorite nap lap." Posting a photo from the London museum, Olivia wrote, "My people. (Quick Q: how many times can you wash an Elsa dress before her powers are released, triggering a new ice age, and/or the dress rips?)." "No one is talking about how the stuffed animals are doing with all this," Olivia quipped in September 2020. Olivia shared a photo of dress-up in a garden.

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Kroger ( KR 1.33% ) Q3 2024 Earnings Call Dec 05, 2024 , 10:00 a.m. ET Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks: Operator Good morning and welcome to The Kroger Co. third quarter 2024 earnings conference call. [Operator instructions] Please note, this event is being recorded. I'd now like to turn the conference over to Rob Quast, senior director, investor relations. Please go ahead. Robinson C. Quast -- Senior Director, Investor Relations Good morning. Thank you for joining us for Kroger's third quarter 2024 earnings call. I am joined today by Kroger's chairman and chief executive officer, Rodney McMullen; and interim chief financial officer, Todd Foley. Before we begin, I want to remind you that today's discussions will include forward-looking statements. We want to caution you that such statements are predictions, and actual events or results can differ materially. A detailed discussion of the many factors that we believe may have a material effect on our business on an ongoing basis is contained in our SEC filings. The Kroger Company assumes no obligation to update that information. After our prepared remarks, we look forward to taking your questions. In order to cover a broad range of topics from as many of you as we can, we ask that you please limit yourself to one question and one follow-up question, if necessary. I will now turn the call over to Rodney. W. Rodney McMullen -- Chair and Chief Executive Officer Thank you, Rob. Good morning, everyone, and thank you for joining us today. Before we begin, I'd like to provide an outline of our discussion topics this morning. I will start by sharing a recap of our third quarter performance and highlight how we continue to advance our go-to-market strategy, which powers our value creation model and drives long-term sustainable growth for our shareholders. Then Todd will cover our financial results for the third quarter and walk through updates to our full year guidance. And finally, I will close with some comments on our pending merger with Albertsons. Turning first to our performance. We delivered strong third quarter sales results, led by our pharmacy and digital performance, which reflects the versatility of our model. Customer engagement remains strong. Our convenient seamless shopping experience, along with incredible customer value through low prices, personalized offers, and great quality Our Brands products, drove growth in both total and loyal households. As we entered the last quarter of 2024, we are focused on providing the quality, fresh, and affordable products that make holiday celebrations special. Customer spending habits continue adjusting to current macroeconomic factors. As inflation normalizes, our premium and mainstream households are feeling more confident and are returning to their pre-pandemic shopping patterns more quickly. Mainstream households are the primary driver of our positive customer engagement trends. While overall consumer settlement remains low, expectations are improving, which positions us well for the holidays and into next year. As we said, near term, some customers are managing macroeconomic uncertainty. Spending from budget-conscious households remained under pressure as the effects of multiyear inflation and higher interest rates have had a larger impact on these households. Therefore, we expect it will take longer for these households to feel the benefits of economic improvement. Kroger is delivering on its long-standing commitment to provide customers with the value they are seeking. We are helping customers save in multiple ways, including competitive shelf prices and loyalty discounts, personalized offers, fuel rewards, and an expanded multitiered Our Brands portfolio. Digital offers are an important way we deliver savings to customers, and engagement continues to grow with 5% more digital offer clips so far this year, and that has led to 14% more savings for Kroger customers. We are always creating additional ways for our customers to save. This quarter, we celebrated and thanked our customers with a customer appreciation week, offering new great deals. And to help our customers enjoy a memorable Thanksgiving, we lowered the price of Thanksgiving meals for the third consecutive year by creating a meal bundle that served a group of 10 people for less than $5 per person. We are focused on executing our go-to-market strategy to deliver a differentiated customer experience through our focus areas of fresh, Our Brands, personalization, and seamless. We appreciate our associates' continued efforts to elevate the customer experience and bringing this strategy to life by improving on our key priorities of full, fresh, and friendly again this quarter. I would now like to cover how we are enhancing our go-to-market strategy. We are seeing long runways for growth in many areas of our strategy, starting with fresh. Customers connect strongly to our Fresh for Everyone brand promise, which is a key differentiator for Kroger. Improvements across the supply chain as part of our end-to-end fresh initiative are increasing days of freshness. For example, bagged salads now offer customers more than seven days of freshness. Customers are noticing, and it has led to identical sales in produce of more than 3% this quarter. In addition, we constantly evaluate new ways to apply data and technology to provide an even better fresh experience and deliver more days of freshness for our customers. One of the ways we are doing this is through recent implementation of RFID-embedded labels on bakery items. These labels provide us with greater insights into our fresh inventory, resulting in consistently fresher items and higher in-stock levels. We have seen encouraging results, including higher sales in locations and categories where we have piloted the RFID labels, and we look forward to scaling this to more stores. Turning to Our Brands, I would like to step back and talk about the significant investments we've made in Our Brands and how those investments are delivering value to both customers and shareholders. For years, the grocery industry offered private label products, with the primary goal of creating products at lower price points. Several years ago, we recognized an untapped opportunity for growth in these products and envisioned a future where our private label products would match or exceed the innovation, quality, and recognition of national brands, which is why we coined the phrase Our Brands. Guided by that vision, our teams built distinct and recognizable brands that our customers want and love, providing more value and meeting unique product needs that national brands cannot fill. Recently, we focused in on refining Our Brand architecture to optimize the portfolio and ensure each brand plays a unique role on the shelf. The successful addition of Smart Way, our new opening price point brand, played an important role in rounding out our multitiered portfolio and offering an attractive alternative to national brands at every price point. The next phase of the work involved refreshing designs and packaging, enhancing brand equity, and reinforcing quality and improving the shopability. For example, to reinforce our long-standing guarantee of quality and freshness, we are placing guarantees on labels across our Kroger-branded products. Innovation remains a driving force for Our Brands' growth. We utilize our data and insights to understand customer trends and meet increasing demands by consistently introducing new items to our portfolio, with a focus on growth areas, including free-from, organic, and multicultural. This innovation enables us to differentiate ourselves from both national brands and other private label brands, creating destination items that help build customer loyalty. Our manufacturing capabilities will continue to be an important advantage for Our Brands. With oversight over the quality and the supply, we can develop unique and differentiated products while keeping costs low, allowing us to pass the savings to customers while preserving our ability to grow margins. A true win-win for customers in Kroger. This quarter, Our Brands continued to deliver strong financial results, which Todd will cover in more detail. Next, to personalization. Our Kroger Plus program provides our loyal customers access to savings and rewards that, in turn, drive traffic to our seamless experience. As customers become more engaged, we gain deeper insights into customer trends while creating the data that enables us to grow Kroger Precision Marketing and deliver more effective promotions and relevant product recommendations. We are working to grow Boost, the next level of our loyalty program, through new benefits. And this quarter, we announced the addition of Disney+, Hulu, or ESPN+ streaming benefits with Boost annual memberships. Turning to seamless. Digital sales grew 11%, driven by an increase in both households and traffic. Within digital, delivery sales grew at 18% and continues to outpace other channels. Boost is one of the important ways we are increasing e-commerce penetration, providing customers an affordable membership model for free delivery. Increasing e-commerce penetration is important to our model as households who shop with us digitally and are in our stores are our most loyal customers and increase retail media monetization opportunities as well. As our digital business grows, particularly in our delivery network, it continues to have a larger impact on our financial results. Improving profitability is a key priority and becoming even more important to our financial model. Over nearly a decade, we made significant investments in our digital capabilities: building out our own properties, creating distribution channels in both pickup and delivery, investing in automation, enhancing personalization, and introducing an industry-leading retail media network. While each of these capabilities required significant investments, we now have a unique digital experience that our customers enjoy. Moving forward, we are committed to growing volumes, utilizing automation, and introducing new technology that will create efficiency gains while helping us narrow the profitability gap between online and in store. Narrowing that gap will generate meaningful operating margin benefits and help drive shareholder value over the next several years. By executing our go-to-market strategy, we are building loyalty, increasing customer engagement, and creating more growth opportunities. First, with alternative profit businesses, which had another solid quarter, Kroger Precision Marketing continued to deliver the most significant growth from our alternative profit businesses. Next, in health and wellness, as the pharmacy industry continues to transform, Kroger has a unique opportunity to play a bigger role in helping patients live healthier lives while growing our share of the industry. We are excited about this area of the business, and its performance this quarter demonstrates we can grow this business profitably in a way that supports our customers to live healthier lives. Sales and profitability this quarter were well ahead of last year, led by growth in both GLP-1s and vaccines. Our strong growth in vaccines reflect patient trust in Kroger to vaccinate them and their families during the start of the cold and flu season, the peak quarter of the year for vaccinations. Our health and wellness teams did an excellent job this quarter in building awareness around our vaccine capabilities, growing share, and administrating significantly more vaccines this year versus a year ago. These helped offset the product mix pressures from GLP-1s. Our vaccine efforts are leading to new patient scripts, which is important as these customers are more likely to become loyal households and spend more across the store. We appreciate our associates for their continued efforts to elevate the customer experience by delivering on our key priorities of full, fresh, and friendly. Team consistency leads to a better customer experience, and we are excited about another quarter of improvement in retention. Our focus on retention reflects a holistic strategy, including investments in wages and benefits, as well as enhancing the associate experience through training, technology, and career development opportunities. With that, I will hand it over to Todd to take you through our third quarter financial results. Todd. Todd Foley -- Interim Chief Financial Officer Thanks, Rodney, and good morning, everyone. Kroger's third quarter results reflect the durability of our model, with strong pharmacy results that helped offset lower fuel profitability as we cycled strong fuel results from a year ago. As we head into the final quarter of the year, we are narrowing the ranges on our identical sales without fuel, adjusted FIFO operating profit, and adjusted EPS guidance. The strength of our model gives us confidence in our ability to deliver on this full year guidance. Before I walk through our third quarter financial results, I would like to start off by covering a couple of items from the quarter that affected our financial results. First, during the third quarter, we finalized the sale of our Kroger Specialty Pharmacy business for $464 million. The sale reduced total company sales in the third quarter by approximately $340 million compared to the same period last year, and annualized sales will be approximately $3 billion lower going forward. KSP was a low-margin business. As a result, the sale of the business increased both Kroger's gross margin and operating general and administrative costs as a rate of sales. It had no material effect on operating profit. Second, on a year-over-year basis, the combined hurricane season and port strike had approximately a 20-basis-point favorable impact on sales as customers stocked up in anticipation of these events. These events had an unfavorable impact on OG&A. Together, this did not have a material impact on total operating profit. I'll now take you through our third quarter financial results. We achieved identical sales without fuel growth of 2.3%. As Rodney mentioned earlier, identical sales without fuel were led by strong pharmacy and digital sales. We're also encouraged by the continuation of positive customer metric trends, including increases in total and loyal households. Our Brands had a strong quarter with sales outpacing national brands again this quarter, led by mid-single-digit growth in our most premium brand, Private Selection. Customers continue to demand premium products but, at the same time, are looking for value. Our Private Selection brand is a perfect solution by offering our customers premium quality at an attractive price. These results demonstrate the breadth of Our Brands portfolio and the ability to meet customers' needs for quality and value. Digital sales delivered another quarter of double-digit growth, led by 18% growth in delivery solutions, driven by our customer fulfillment centers. The CFCs are offering customers a superior digital experience with excellent in-stocks, fresh items, and a white-glove on-time delivery. CFC growth was driven by a significant increase in households and trips, as well as an increase in basket size. Our third quarter identical sales without fuel results were affected by the Boar's Head recalls that began in the second quarter. We acted quickly with the safety of our customers in mind as soon as we became aware of the situation. Boar's Head is a strategic supplier, with brand-loyal customers that are an important driver of our deli sales. As a result, some customers have temporarily migrated away from the category. It will take some time for those customers to resume their prior purchasing behavior, and we expect this to remain a headwind to sales in the near term. The unfavorable sales effect from Boar's Head this quarter was largely offset by the favorable sales impact from the hurricane and port strike. Turning to margins. Gross margin was 22.9% of sales, and our FIFO gross margin rate, excluding fuel, increased 51 basis points compared to last year and was ahead of expectations. The increase in rate was primarily attributable to the sale of Kroger Specialty Pharmacy, Our Brands performance, and lower shrink, partially offset by lower pharmacy margins. The result reflected Kroger's ability to improve margin while being competitive on price and helping customers manage their budgets. The OG&A rate, excluding fuel and adjustment items, increased 22 basis points, driven by the sale of Kroger Specialty Pharmacy and increased incentive plan costs, partially offset by the continued execution of cost savings initiatives. Excluding the sale of Kroger Specialty Pharmacy, fuel, and adjustment items, our OG&A rate to sales would have been nearly flat year over year, demonstrating that our model can leverage expenses when we achieve our long-term id sales without fuel goal of 2% to 4%. This is made possible by our relentless focus on productivity and cost savings initiatives, which remain an essential part of our model. These initiatives are focused on simplification and utilizing technology to enhance the associated experience without impacting the customer experience. This quarter, we launched a new, internally developed, generative AI-powered sell-through tool, which helps us better manage inventory in both fresh and center store departments through real-time insights tracking sales and shipments. This enables our teams to increase freshness on shelves and prioritize sell-through, optimizing both sales and margins. Looking ahead, we plan to further enhance the AI capabilities on this platform by extending into improved forecasting and end-to-end inventory management. During the third quarter, we recorded a LIFO charge of $4 million, compared to a charge of $29 million for the same period last year, due to lower expected year-over-year inflation. Adjusted FIFO operating profit was 1.02 billion, and adjusted EPS was $0.98 per diluted share, an increase of 3% compared to last year. Fuel is an important part of our strategy. Fuel rewards through our Kroger Plus program help build customer loyalty. Fuel sales were significantly lower this quarter compared to last year, attributable to a lower average retail price per gallon. Fuel profitability was also meaningfully behind a year ago as a result of fewer gallons sold and lower cents per gallon margin. I wanted to provide a brief update on inflation as it remains a topic of interest for many investors. Inflation was down slightly in the third quarter compared to the second quarter but remains around 1%. We expect inflation to remain consistent in the fourth quarter. I would now like to provide a brief update on associates and labor relations. During the third quarter, we ratified new labor agreements for Dillons Columbia and Missouri clerks; Central Division, Ottawa, and Streator clerks; Northern Illinois meat clerks; Fred Meyer Portland retail stores; and the Foods Co. contract in Northern California, all covering nearly 13,000 associates. We respect associates' right to collectively bargain. We're also communicating to local unions. And coming to the table with proposals that do not balance investing in associates with keeping groceries affordable for our customers and supporting a growing and profitable business model are untenable. These proposals stand in the way of operating our business in a way that ensures job security and advancement opportunities for associates. Turning to cash flow. Kroger continues to generate strong adjusted free cash flow or consistent operating results. Free cash flow generation is an important part of our model and is enabling us to invest in our business for growth. At the end of the third quarter, Kroger's net total debt to adjusted EBITDA ratio was 1.21, compared to our target range of 2.3 to 2.5. Our strengthened balance sheet provides us flexibility to pursue growth and enhance shareholder value. We continue to take a disciplined approach to deploying capital, prioritizing the highest growth opportunities that strengthen our business and deliver solid returns for our shareholders. We're committed to maintaining our investment-grade debt rating, increasing our dividend over time, subject to board approval, and returning excess capital to shareholders when we are able to do so. I would now like to provide some additional color on our outlook for the rest of the year. After delivering solid third quarter results, we're narrowing the ranges of identical sales without fuel, adjusted FIFO operating profit, and adjusted EPS guidance. Additionally, we have updated our guidance for adjusted effective tax rate and expect it to be 22.5%. We now expect identical sales without fuel for the year to be in the range of 1.2% to 1.5%, with quarter-to-date trends signaling we will be near the midpoint of this range. Identical sales without fuel results year to date have largely been in line with our expectations, with Q3 being slightly ahead of expectations due the favorable effects from the hurricanes, the port strike, and strong vaccine growth during the peak season for immunizations. Our expectations for fourth quarter identical sales without fuel are consistent with our forecast at the beginning of the year. We expect Q4 identical sales to remain strong but sequentially lower than third quarter, partially due to the cycling of weather benefits from the fourth quarter of 2023 that are not built into our current forecast for Q4 2024. We now expect adjusted FIFO operating profit to be in the range of $4.6 billion to $4.7 billion, and adjusted net earnings per diluted share is expected to be in the range of $4.35 to $4.45. Looking to next year, we are in the process of finalizing our 2025 business plan. While we still have many unknowns, we do expect Kroger to deliver FIFO operating profit growth on a stand-alone basis. During our fourth quarter earnings call, we plan to share our full year 2025 outlook in more detail. In closing, we are happy to deliver another quarter of strong results, which reflect the resilience of our value creation model. While macroeconomic conditions remain uncertain, our model has multiple levers, which enable us to navigate any environment, including grocery, health and wellness, fuel, and alternative profit businesses. This gives us flexibility in the ways we create shareholder value and confidence in our ability to generate attractive and sustainable returns for shareholders. I will now turn the call back to Rodney. W. Rodney McMullen -- Chair and Chief Executive Officer Thanks, Todd. Before I open it up to Q&A, I'd like to speak briefly about our pending merger with Albertsons. First, I would like to express my appreciation for our associates and their incredible commitment. It has been a long journey, and our associates have done an excellent job serving customers and running the day-to-day operations of our business while also preparing for the merger. I would like to extend a special thanks to those who supported the litigation in federal and state courts, both the associates who testified and the teams who prepared a compelling case about the meaningful and measurable benefits of the merger. Our teams are ready to ensure a seamless transition for our customers and associates from day one. It is exciting to see the complementary strengths of both Kroger and Albertsons organizations. And we look forward to combining these strengths to provide customers with an even better experience. As we await the court rulings in the regulatory challenges to the merger, we remain confident in the facts and the strengths of our position. The retail industry continues to be more competitive. And we know how our customers shop. Every day, they are making decisions on where to eat and where to buy their groceries. They shop at a wide range of competitors, from Costco to Amazon to dollar stores, and they eat at restaurants. They shop digitally and brick and mortar. And as I've said before, we remain committed to closing the merger because it will provide meaningful and measurable benefits for customers, for associates, and for communities across the country. And we look forward to bringing these commitments to life. Regardless of the outcome of the trials, Kroger is operating from a position of strength. And we are optimistic about our future. Our business is more diverse than ever, and our value creation model provides us with multiple ways to drive sustainable growth. Our strong free cash flow and strengthened balance sheet provides us with the ability to invest in our business and enhance shareholder value. With that, Todd and I look forward to taking your questions. Because we are still in litigation, we will not be taking questions on the merger this morning. Questions & Answers: Operator Thank you. [Operator instructions] Our first question for today comes from Simeon Gutman of Morgan Stanley. Your line is now open. Please go ahead. Simeon Gutman -- Analyst Good morning, Rodney, Todd. My question is on the P&L for 2024. If you take out the extra week lap and then you pull out some of the merger-related costs, the big ones, it looks like the core business is growing pretty nicely on EBIT and really nicely, potentially mid-single, even high single-digit percentage. And that's despite lower fuel profitability, and the environment has been pretty tough. So, first, is that a fair characterization? And is it mixing the way you would have thought between the core business and the alternative? Thanks. Todd Foley -- Interim Chief Financial Officer Great question, Simeon. Thanks for that. And I think that's a fair read on how you've described it. You know, we were obviously very happy with the results that we've seen coming from not only the core business but inclusive of pharmacy. We're particularly pleased with the results we saw in the pharmacy. You heard Rodney talk about it today. So, despite that lever in fuel giving us a headwind this quarter, we were pleased with the core growth coming from the core business and see that continuing. The mix relative to alternative and core business, I think the growth expectations that we have around the alternative profit business are relatively consistent to what we expected to see. And so, I think that those are -- continue to be as balanced as we expected going into the quarter. W. Rodney McMullen -- Chair and Chief Executive Officer And, you know, longer term, as everyone knows, the alternative business -- profit businesses, we continue to see a great opportunity, and the margins on that business is meaningfully higher than the supermarket business. And the whole flywheel between our brick-and-mortar business and our seamless business, pickup and delivery, is the engine behind driving that continuation there, which we're very excited about. Todd Foley -- Interim Chief Financial Officer That's a great call, Rodney. We saw the digital growth, again, at low double-digit growth, which is an important part of the growth that you talked about, Simeon. And that -- again, when you talk about mix in our business and our omnichannel, that low double-digit growth is right on what we expected and helps drive both the core business and the alternative profit, as Rodney described. Simeon Gutman -- Analyst And the one follow-up, this is more toward a comment Rodney made. All year, we talked about the mainstream, the premium, and the lower end. It felt like there may have been an inflection whereas the mainstream has been resilient and the premium has been healthy. I thought your comments today on mainstream inflected a little more positively. I'm not sure if that's reading too much in. Lower income sounds about the same. Curious if that's fair. W. Rodney McMullen -- Chair and Chief Executive Officer Yeah, the mainstream customers certainly performed -- connected with us better in the third quarter than the second quarter. How much of that is driven because of things we did and how much they're just feeling better, we don't know. Now, they're telling us they feel better. And certainly, customers that are on a budget continue to be under a lot of strain. And the cumulation of inflation and other aspects and higher interest rates have affected -- continue to affect them more. And I think the other thing that's always important to remember is that customer, in many cases, are starting out in careers and things and they don't have as many physical assets on -- you know, a house or a little bit of savings and those things, and those inflation obviously affects that person a little harder than others. Thanks, Simeon. Operator Our next question comes from Rupesh Parikh of Oppenheimer. Rupesh, your line is now open. Please go ahead. Rupesh Parikh -- Analyst Good morning and thank you for taking my question. So, just going back to your guidance, so you did narrow the operating profit range to the lower end of the range for the full year. So, just curious what's driving that. W. Rodney McMullen -- Chair and Chief Executive Officer Todd, I'll let you start. Todd Foley -- Interim Chief Financial Officer Yeah. Well, you know, with one quarter left, Rupesh, we wanted to try to narrow the range because there should be less variability in our expectations. When you look at the sales part of the guidance, down at 1.2 to 1.5, I think that's pretty consistent with what we've been thinking for the year. The midpoint on that range is a tick higher than I think what we have been thinking before. And frankly, when you look at where we expect to be in Q4, I think that's right on how we've been thinking about it all year, relative to all of that. Q3 actually is the one that was really strong. And we talked about -- Rodney talked about the pharmacy and the digital growth there, particularly in the vaccine space. We were really pleased. We've been working hard to grow our vaccine business, and we saw that throughout the quarters early in this year. But with Q3 being that key vaccine -- you know, Super Bowl season for vaccines, we were really pleased to see that that growth continue and that it paid off in that point in time. So, that's where we saw Q3 being really strong and that Q4 guidance being really what we expected. When you look at it on the EPS side of our guidance, Rupesh, again, we narrowed the range there. We took a nickel off the top side and the bottom side. And really, that midpoint of the range is pretty consistent with where we've been thinking about it for the year. As we think about that range and some of the key factors for that range in the fourth quarter, a couple of key things that we're keeping an eye on. One is weather. We alluded to it in our prepared comments. There were several meaningful weather events a year ago that, you know, drove some benefits. And we just don't forecast weather, you know, on a forward-looking basis. So, if we see the number and magnitude of weather events in the fourth quarter this year, I think that would be something that could push us toward the higher end of that range. And then the other one is fuel. Certainly, we -- you know, fuel tends to be pretty volatile, and we've seen that this year. And really, we have fuel expectations to be pretty in line with where they were last year. And frankly, from a gallon trend and from a cents per gallon trend, in the fourth quarter, we're pretty consistent sequentially from where we've been performing over the last few periods. So, if we have variance in the fuel profitability, either positive or negative, I think that could lean us toward the top or the bottom end of that range, respectively. W. Rodney McMullen -- Chair and Chief Executive Officer Todd said this, but I think it's important to just highlight it. You know, if you look at the range for the year, fuel in the third quarter was a tougher quarter than what we expected it to be, and that really -- relative to the top side. And the other thing that Todd mentioned, we don't budget weather because we just don't know. Obviously, there's been some major storms, but those storms haven't been in places where we operate stores. So, it really hasn't affected us so far. And generally, that's a positive when we have weather because people eat at home as opposed to going to restaurants. Rupesh Parikh -- Analyst And then my very quick follow-up question, just on the Boost membership, you added the Disney perk as well, just, you know, overall, are you guys happy with the signups that you're seeing and the retention with that program? W. Rodney McMullen -- Chair and Chief Executive Officer I would say we're very happy, but the thing that I guess I get more excited about is the potential because it's an incredible value for customers and customers love it and they -- and we have a high renewal rate and a high NPS score. So, our job is to continue to educate more customers on it. So, I'm really more excited about, you know, the opportunity going forward and the overall deeper connection with customers. So, great question. Thanks, Rupesh. Operator Thank you. Our next question comes from Leah Jordan of Goldman Sachs. Your line is now open. Please go ahead. Leah Jordan -- Analyst Good morning. Thank you for taking my question and thanks for the commentary on inflation this morning and how you're thinking about it in the fourth quarter. But as you plan with your vendors, seeing if you can add more color on how you're thinking about inflation into next year. You know, what are you seeing across categories in hearing from those partners? Todd Foley -- Interim Chief Financial Officer Yeah. No, a great question. Maybe still a little early to think about next year. But, you know, if you think about where we were this year, obviously, coming into the year, we were coming out of that crazy disinflation that we had a year ago. And inflation has played out more or less the way we expected. It's maybe a little bit less than what we expected, but it's been relatively stable at just under 1%, maybe even saw, I think, a slight step back in Q3 relative to Q2, which, as we said, we expect to see for next year. As we look to next year at this point, looking at, you know, both some of the macro and governmental studies, as well as conversations with vendors, again, it's still early to tell and we might see a slight expansion to inflation next year but really don't expect to see anything meaningfully different or inconsistent with what we're kind of seeing right now with inflation. W. Rodney McMullen -- Chair and Chief Executive Officer We are continuing to see CPGs be a little more aggressive on trade dollars. And, you know, over time, you know, that obviously affects inflation a little bit as well. Leah Jordan -- Analyst Great. Thank you. And I just wanted to follow up on some of your fresh initiatives. I know you've been working on improving days of freshness in produce for a while, so great to see some improvement there. But it seemed like the RFID tags within bakery is new to me. You know, just wanted more color there. You know, what degree of lift are you seeing when you add that to the category? How many of your stores have it today and how should we think about the rollout over time? W. Rodney McMullen -- Chair and Chief Executive Officer Well, we are -- you know, as I mentioned, we're testing it. We're happy with the initial result. The benefits are as much helping our associates be able to do their job a little bit easier. And, you know, it's too early -- it's early enough to be excited about the potential. It's too early to say, you know, this much we can budget in terms of what we would do. But, you know, the thing that we're excited about for our customers, it's helping us make sure we have fresher product for the customer and stay in stock better. And, you know, it's super exciting. You know, we will look at other areas of the store to see what kind of opportunity it is. The cost per tag is still higher than we would like. So, we still need to continue to work on focusing on the getting the cost per tag down. But positive early results really early in the process and excited about the potential. Thanks, Leah. Operator Thank you. Our next question comes from Ken Goldman of J.P. Morgan. Your line is now open. Please go ahead. Ken Goldman -- Analyst Hi. Thank you. I wanted to follow up on the topic of next year, I appreciate it's too early to -- for specifics, and I'm not asking for any numbers. But to Simeon's question, you agreed that it's a fair read that the core underlying business is doing very well -- I think those were the words -- despite when you ex out the merger cost and the digital mix and fuel and so forth. And you talked a little bit about inflation being sort of steady and predictable and consistent in that low single-digit range. Are there any other unusual tailwinds or headwinds that we should consider, just directionally, as we think about next year? Just trying to get a sense for what would kind of throw you off from having another, you know, reasonably good year. You did say that operating profit would be up, but you didn't kind of tell us how much, and your longer term amount goes 3% to 5%, of course. W. Rodney McMullen -- Chair and Chief Executive Officer Yeah, and it's -- it would be way too early to tell you specifics. And obviously, we're awaiting for the ruling on the merger, which will affect guidance as well. The other thing that -- I guess, from a positive standpoint that I'm excited about, in the third quarter, we opened or expanded the most number of stores that we've done I think it's actually in a quarter in seven years. And as you know, last year, we talked about it that we will open more stores this year than we have in several years, and we would expect to continue to open more stores. And so far, the stores that we've opened, we're happy with the way they're connecting with customers and we're happy in terms of the volumes they're creating and the early read on, you know, the profitability of the stores as well. So, over time, we would hope that that would continue to be a tailwind. And obviously, on seamless, we continue to see that as really critical to our five- or 10-year future to be awesome there. And we still have a lot of work to do to make -- where we're indifferent, whether somebody shops with us online or in store, and we'll continue to put a lot of effort there. In terms of headwind, Todd, I'll let you -- anything that you can think of that's -- Todd Foley -- Interim Chief Financial Officer I can't think of anything unusual headwinds or tailwinds as we sit here today, frankly, Ken. But, you know, going into next year, part of what has us optimistic and feeling good about the strength of our value creation model is a lot of the momentum we have in the things that are in our high-growth areas today. We've talked about a lot of them already. It's pharmacy. It's our digital business. It's our alternative profit. And we have good momentum in those spaces and are executing on those. And from a headwind standpoint, we're going to continue to invest in the business, we're going to invest in price. You've heard Rodney say it before, we assume every year is going to be more competitive than the last, and that view hasn't changed. And so, we'll continue to engage in customers, make sure we're delivering value to them by investing in price and investing in their shopping experience. And we're committed to continue to invest in wages. So, some of those are headwinds. They're just the parts of our model that is we deliver the value in our model through all their different value propositions, we're able to use that to invest in the business to keep the flywheel moving. Ken Goldman -- Analyst OK. Thank you for that. And then speaking about price investments, you know, Rodney, you mentioned that CPGs continue to be a little bit more aggressive on trade dollars. Your largest competitor or -- you know, in food retail -- we'll see if the judges agree that it's a competitor or not. But your largest competitor in food retail had more kind of commentary last week or this week about, you know, how they would like to see more of those price investments from key vendors. Rodney, your tone, you know, since I've known you has always been more sort of agnostic about that. You know, if investor -- if your vendors don't invest with that, you'll be happy to sell customers more private label. I'm just curious where you stand in terms of are you content with the level of price investment or are you more just sort of agnostic and saying, look, whatever our vendors want, it'll play out either way beneficially for you. W. Rodney McMullen -- Chair and Chief Executive Officer Yeah. I guess a little bit of both. The -- if you look at tonnage growth in CPGs, there's a lot of CPGs that cannot be satisfied with their tonnage growth. And I believe that trade dollars and being more aggressive on partnering with us to make sure the right customer gets access to those benefits is good long term for the customer, long-term benefit for both of us on tonnage. If they're not willing to do that, it really gets back to the comment that we talked about. Our Brands, and, you know, Todd and I both mentioned it, had a strong quarter. The profitability of Our Brands is, you know, several 100 basis points higher than national brand. And if the CPGs are willing to continue to give up share to Our Brands, we're OK with that because what we find is once a customer tries Our Brands, the repeat rate of customers coming back is incredibly high because what they find is they have -- there's no compromise on quality and they have a great value for the money. So, you know, at the end of the day, the customer wins when they buy Our Brands. But it really is -- we try to run a business where the customer decides what they want to buy as opposed to forcing them to buy something. Thanks, Ken. Operator Thank you. Our next question comes from Ed Kelly of Wells Fargo. Your line is now open. Please go ahead. Edward Kelly -- Analyst Hi. Good morning, everyone. W. Rodney McMullen -- Chair and Chief Executive Officer Good morning. Edward Kelly -- Analyst Curious about the gross margin. You've had a couple of good quarters, you know, on the gross margin front. I think you admit this quarter was better than expected. How are you thinking about gross margin in Q4, and then, you know, even like into -- I don't know, you're not going to get next year, but sort of like the outlook for the gross margin? And I'm talking like ex-Spec Pharma divestiture and maybe, you know, just talk about the puts and takes around that. Todd Foley -- Interim Chief Financial Officer Yeah. No, great question, Ed, and I think you hit on a key part of thinking about it, excluding KSP. You know, we talked about, you know, it was a strong quarter in gross margin, and about half of that year-over-year benefit was a result of the divestiture. But the other piece of it really came -- we highlighted both of them. Rodney -- layers in well with what Rodney was just talking about -- was our growth in Our Brands. We continue to have Our Brands sales growth outpacing national brands, and that is always going drive, you know, solid margin expansion. And so, that's certainly what we saw again in the third quarter, very similar to what we saw in the second. And then shrink had another nice quarter. So, we've got, you know, cautiously optimistic on the progress we're making there, but we are making progress in the shrink space that really helped us in the third. As we look to the fourth, I think, you know -- excluding KSP, I think, overall, we'll probably be slightly favorable in the fourth. Reflecting KSP, when you pull that out, I think we'll probably be relatively flat on that, relative to some of the puts and takes, again, if we over-indexed in things like Our Brands and whatnot, but we may be a little bit favorable. But overall, I think we'll be relatively consistent, relatively flat year over year on the margins in Q4. W. Rodney McMullen -- Chair and Chief Executive Officer I totally agree with everything Todd said, and Todd said the big pieces. I would also add a couple of smaller pieces that's helping on gross margin that should continue is, if you look at our warehouse and transportation costs, we continue to make some progress there. And the customer continue to buy more value-added product, and fresh continues to grow as well. So, those are things that help on mix, in addition to things that Todd talked about. Edward Kelly -- Analyst And just to -- Rodney, a quick follow-up. This one is for you, and you kind of hinted at it or talked about it. But, you know, Albertsons would be a transformational deal. How do you feel about Kroger's position, you know, if the deal is rejected? And do you need to hunt for something else more transformational or is it just simply more prudent to double down on what you have and reward shareholders for their patience with return of capital? W. Rodney McMullen -- Chair and Chief Executive Officer Yeah, it's a great question. You know, if you look at the balance sheet capacity that we have, there's probably no -- nothing else that would be transformational that would use the balance sheet capacity that we would have. So, I don't know that we would be out there trying to find what's the next Albertsons. As you know, and you just said it, we try -- we've always made sure that we don't need to do mergers to make our business successful. And that was one of the reasons that we've always been proud of what Kroger has done. We're super excited about Albertsons and the potential, and we believe we will be able to add a ton of value for giving customers better value. The people there, we'll be able to provide security, and grow our business and create additional career opportunities and support communities. But if it doesn't happen, we'll continue to go on. As you know, we always will continue to look at how -- ways to grow the business. Mergers is always one of those ways of growing the business. But we try to make sure that we only do a merger when it makes sense. And we're not chasing something, and we won't get in a position where we are having to chase something. So, great question, and thanks, Ed. Operator Thank you. Our next question comes from Michael Lasser of UBS. Your line is now open. Please go ahead. Michael Lasser -- Analyst Good morning. Thank you so much for taking my question. As of the second quarter, Kroger had made a point in its presentation that it was on track to deliver more than 20% media growth this year, and that line was removed this quarter. So, is it right to interpret that the media growth, which is an important driver of the alternative revenue stream, is starting to slow perhaps as there are more platforms for advertisers to choose and direct its advertising dollars? And if that's the case, how does Kroger accelerate that element of its algorithm in order to support the long-term outlook for the business? Todd Foley -- Interim Chief Financial Officer Yeah, let me start there, Michael. Thanks for the question. It's a good call. We do still expect to see our retail media growth be in that 20% range for the year. It's still a fast-growing part of our business, and the outcomes that we're seeing continue to demonstrate that we're well-positioned for that growth. You know, as we look at those CPGs that are advertising with us, we see the outsized return on ads spend that they're generating. And so, that's why I say we're able to demonstrate and we're seeing those results. And not coincidentally, the sales for those CPGs at Kroger are strong. And so, I think the proof points continue to be there, but as you say, there's a proliferation of options as everybody's kind of got their own flavor of what this is. So, I think we just need to continue to demonstrate that to CPGs because I think the proof will be in the results. W. Rodney McMullen -- Chair and Chief Executive Officer Todd's last point, to me, and if CPGs are listening, and that's the only reason why I'm adding on top, the CPGs that increased spending the most had the highest tonnage growth with us on -- which, to me, is it shows you the power of our platform. And, you know, Todd said it. I just wanted to double down on it. Michael Lasser -- Analyst OK. And my follow-up question is what do you need to drive -- what do you need to happen in order to drive the -- back -- Kroger to achieve the sales piece of its long-term algorithm in 2025? This year, there's been a contribution from the GLP-1 drug, some storm-related spending. Perhaps don't -- won't -- those won't be as meaningful contributors next year. So, is it that you would be banking on, A, market share stabilizing and is that realistic; and B, some acceleration in inflation to offset what have been driving the -- some of the comp this year? W. Rodney McMullen -- Chair and Chief Executive Officer Yeah, we wouldn't -- we would not be dependent on inflation. And it's really -- we continue to double down on the customer experience. And when we find that we improve the customer experience, our business follows that or the customer rewards us for that. And it's -- you know, it really gets back to -- you've heard us say it a million times -- full, fresh, and friendly. The other thing that we're increasingly supporting is allocating capital to growth areas, and that would be, you know, storing; obviously, continuation of seamless. Our online business continues to have outside growth. And then specific projects that support cost reductions and sales opportunities. Todd Foley -- Interim Chief Financial Officer Yeah, I agree with everything you said, Rodney, especially the storing, which you hit on earlier as well. You mentioned GLP-1, and that certainly has been part of this year. But as we sit here today, I think we continue to expect to see growth in that area as more manufacturers get in the mix and the supply continues to become more available and more and more patients continue to utilize that drug. So, I think we'll still see -- expect to see growth in the GLP-1 space as well for the -- at least near future -- foreseeable future. W. Rodney McMullen -- Chair and Chief Executive Officer Thanks, Michael. Operator Thank you. Our next question comes from John Heinbockel of Guggenheim Partners. Your line is now open. Please go ahead. John Heinbockel -- Analyst Hey, Rodney, can you talk about the -- you referenced in your release the initiatives -- productivity initiatives on in-store order selection. How broadly is that rolled out? And when I think about how much you can take the cost per order down, can you take that down double digit from where we are today? W. Rodney McMullen -- Chair and Chief Executive Officer Over time, we would certainly expect to take it down double digit from where we are today. And when I talk about over time, I'm talking about over the next two or three years. And it's -- we still have a reasonable amount to roll it out. Now, as you -- you followed Kroger long enough to know that we will start -- whenever we roll something out, we start with the biggest opportunity places first. So, it's the highest volume locations and those kind of things. The thing that I think is fascinating and exciting is if you look at the fundamental things behind the software, we're learning that we can actually use that same technology in other areas of the business. And I would hope that we'll continue to find those kind of opportunities. So, I feel, you know, confident and comfortable that, certainly, well, you know, double-digit-type stuff of improvement. But, you know, our team is not going be satisfied until they get to where it's indifferent, how somebody shops with us. Operator Thank you. Our next question comes from Michael Montani of Evercore ISI. Your line is now open. Please go ahead. Michael Montani -- Analyst Yes. Good morning. Thanks for taking the question. I just wanted to ask first, did I miss the fuel CPG contribution for this quarter? Wondering if you could give some added color there. And then just had a follow-up. Todd Foley -- Interim Chief Financial Officer Yeah. Thanks, Michael. We don't typically -- we stopped a few quarters ago given -- giving details around CPG. You did catch on to the point that -- I think that Rodney brought out that both gallons and CPG were down in the third quarter, again, with some of the volatility in fuel. But as we looked at the fourth quarter relative to our expectations versus a year ago, we think fuel will be a little bit -- our expectation is that fuel will be a little bit more stable year over year in Q4, and that's supported by some of the trends that we've seen over the last few periods in both gallons and margins. Operator Thank you. Our next question comes from Rob Dickerson of Jefferies. Your line is now open. Please go ahead. Robert Dickerson -- Analyst Great. Thanks so much. Rodney, you know, I know you said upfront and it seems like consumer settlement is still low, but maybe, you know, there are some green shoots. Maybe it's improving a little bit. So, I'm just wondering kind of as you got through the Thanksgiving holiday and then as we're kind of, you know, in a real time in the current holiday season, like have you seen any, you know, incremental, almost like sequential traffic improvement in the actual retail stores? W. Rodney McMullen -- Chair and Chief Executive Officer We feel good about where we are. The thing I guess I would say that we still don't quite under -- it'll take time as there's five less shopping days between Thanksgiving and Christmas. So, we feel good about where we are. We're tracking a little bit better than where we thought we would be. But we still are cautious because of the five less shopping days and how does that play out. And as you mentioned, we are seeing the customer -- most of the customers are starting to feel a little bit more relaxed and comfortable in terms of where they stand and what's coming, what -- how things look going forward. Operator Thank you. Our next question comes from Jacob Aiken-Phillips of Melius Research. Your line is now open. Please go ahead. Jacob Aiken-Phillips -- Melius Research -- Analyst Good morning, everyone. Thanks for the question. I just wanted to go back to inflation a little bit. So, you showed that you were able to kind of leverage SG&A given, like, flat comps, excluding KSP. How do we think about that relationship going forward in terms of wage inflation and wage investment? And then also, with tariffs, aware of the view that it could be a self-fulfilling prophecy in terms of, like, people buying stuff and causing inflation, even if there aren't actually tariffs happening. I just wanted your thoughts on that. Todd Foley -- Interim Chief Financial Officer Yeah, I'll start with the wage investments. It's a great question. You -- we've talked a lot about how important it is for us to invest in our associates because they're so critical in delivering our customer experience. But, you know, we will continue to balance those wage investments with the other profitability enhancement items that we say. So, in any inflationary environment and in any sales leverage environment, you know, we've demonstrated that our model enables us to pull the levers to be able to balance those wage increases accordingly over time. So, given the comments that we've said with fairly balanced inflation, we think we'll be able to leverage our SG&A, including wage investments. Rodney, I don't know if you want to comment on tariffs. W. Rodney McMullen -- Chair and Chief Executive Officer Tariffs, for us, you know, first of all, you know, the effect on us is probably a little less than most companies. And we buy products internationally, but it's pretty modest. If you look in the fresh departments, it's, you know, less than 20% of the stuff. If you look in the center store, it's a fraction of that. So, we would see the tariffs affecting others generally more than us, and we feel like we'll be able to manage whatever is done because our competitors will have to deal with the same thing. Thanks, Jacob. Operator Thank you. Our next question comes from Chuck Cerankosky of Northcoast Research. Your line is now open. Please go ahead. Chuck Cerankosky -- Analyst Good morning, everyone. Rodney, you mentioned that the mainstream and premium customers were pretty close to spending how they had been before COVID. But they are also, from what I can observe, the groups that are more likely to be going to restaurants, which seem to be doing fairly well right now. How do you sort of offset that with Kroger's prepared food offerings and maybe what changes are you making in those categories? W. Rodney McMullen -- Chair and Chief Executive Officer Well, first of all, we believe that that's a huge opportunity. You know, our market share -- you know, half of meals bought at a restaurant is consumed in a car or at home. Actually, I think it's a little over half. So, we see that as a huge opportunity. I would say we're trying a lot of different things. We've -- we're working with a couple of outside companies trying to help us there. But, you know, to me, it's more of a -- we -- in the future, we have a bigger opportunity than we've been able to unlock so far, and we believe it's a huge opportunity because what we've found is that a customer can buy a meal from us and it's usually the cost is one-third to one-fourth versus going out to a restaurant. So, it's -- for us, it's a great opportunity, but we're just scratching the surface. Operator Thank you. At this time, we'll take no further questions, so I'll hand it back to Rodney for any further remarks. W. Rodney McMullen -- Chair and Chief Executive Officer Thank you for all the questions. And as always, we have a lot of our associates listening in. First, I would like to send our thoughts and prayers to those impacted by the recent hurricanes. I would also like to take a moment to express my gratitude and appreciation for our dedicated team of associates, especially during this time. They just did amazing things on supporting communities. And as you know, our stores are vital to each community we serve. And during these types of times, our customers rely on us to provide them with food and other essential items. And I am so proud of our associates who have stepped up to be there for our customers, communities, and each other. Thank you for everything that you do for Kroger and our customers and thank you for everyone joining us today. We wish you a very happy holiday season, Merry Christmas, and Happy New Year. Operator [Operator signoff] Duration: 0 minutes Call participants: Robinson C. Quast -- Senior Director, Investor Relations W. Rodney McMullen -- Chair and Chief Executive Officer Todd Foley -- Interim Chief Financial Officer Rodney McMullen -- Chair and Chief Executive Officer Simeon Gutman -- Analyst Rupesh Parikh -- Analyst Leah Jordan -- Analyst Ken Goldman -- Analyst Edward Kelly -- Analyst Ed Kelly -- Analyst Michael Lasser -- Analyst John Heinbockel -- Analyst Michael Montani -- Analyst Robert Dickerson -- Analyst Jacob Aiken-Phillips -- Melius Research -- Analyst Chuck Cerankosky -- Analyst More KR analysis All earnings call transcriptsBy SAMY MAGDY CAIRO — Famine is spreading in Sudan due to a war between the military and a notorious paramilitary group that has devastated the country and created the world’s largest displacement crisis, a global hunger monitoring group said Tuesday. The Integrated Food Security Phase Classification, or IPC, said it detected famine in five areas, including in Sudan’s largest displacement camp, Zamzam , in North Darfur province, where famine was found for the first time in August. The report said the war has triggered unprecedented mass displacement and a collapsing economy. It said hostilities can result in farmers abandoning their crops, looting and stock destruction. FILE – People gather to collect water in Khartoum, Sudan, May 28, 2023. (AP Photo/Marwan Ali, File) FILE – Sudanese Khadiga Omer adam sits by her sick child in an MSF-run clinic in the Aboutengue displacement site near Acre, Chad, Friday, Oct 4. 2024. (AP Photo/Sam Mednick, File) FILE – Sudanese refugees arrive in Acre, Chad, Sunday, Oct 6. 2024. (AP Photo/Sam Mednick, File) File – A man walks by a house hit in recent fighting in Khartoum, Sudan, an area torn by fighting between the military and the notorious paramilitary Rapid Support Forces, April 25, 2023. (AP Photo/Marwan Ali, File) FILE – Residents displaced from a surge of violent attacks squat on blankets and in hastily made tents in the village of Masteri in west Darfur, Sudan, on July 30, 2020. (Mustafa Younes via AP, File) FILE – A World Food Programme (WFP) truck backs up to load food items from a recently landed UN helicopter, in Yida camp, South Sudan, Sept. 14, 2012. (AP Photo/Mackenzie Knowles-Coursin) FILE – Sudanese refugee girls carry water supplies near a polling station in the refugee camp of Zamzam, on the outskirts of El Fasher, Darfur, Sudan, on April 13, 2010. (AP Photo/Nasser Nasser, File) FILE -People line up in front of a bakery during a cease-fire in Khartoum, Sudan, May 27, 2023. (AP Photo/Marwan Ali, File) This grab from video shows smoke rising over Khartoum, Sudan on Thursday Sept. 26, 2024, after Sudan’s military started an operation to take areas of the capital from its rival, the paramilitary Rapid Support Forces. (AP Photo/Rashed Ahmed) File – A man walks by a house hit in recent fighting in Khartoum, Sudan, an area torn by fighting between the military and the notorious paramilitary Rapid Support Forces, April 25, 2023. (AP Photo/Marwan Ali, File) FILE – People gather to collect water in Khartoum, Sudan, May 28, 2023. (AP Photo/Marwan Ali, File) FILE – Sudanese refugees displaced by the conflict in Sudan gather to receive food staples from aid agencies at the Metche Camp in eastern Chad Tuesday, March 5, 2024. (AP Photo/Jsarh Ngarndey Ulrish, File) Women who fled war in Sudan rest in a refugee camp in Adre, Chad, Saturday, Oct. 5, 2024. (AP Photo/Sam Mednick) A woman who fled war in Sudan and requested anonymity because she feared retribution after reporting sexual exploitation, holds her baby in a refugee camp in Adre, Chad, Saturday, Oct. 5, 2024. (AP Photo/Sam Mednick) People cross into Chad from Sudan in Adre, Chad, Sunday, Oct. 6, 2024. (AP Photo/Sam Mednick) A woman who fled war in Sudan digs in a refugee camp in Adre, Chad, Thursday, Oct. 3, 2024. (AP Photo/Sam Mednick) Patients are treated in an MSF-run clinic in the Aboutengue displacement site near Acre, Chad, Friday, Oct 4. 2024. (AP Photo/Sam Mednick) Halima Habdullha holds her 7-month-old severely malnourished daughter Kaltum Abakar in an MSF-run clinic in the Aboutengue displacement site near Acre, Chad, Friday, Oct 4. 2024. (AP Photo/Sam Mednick) Ousmane Taher and his family cross from Sudan into Chad near Acre Sunday, Oct 6. 2024. (AP Photo/Sam Mednick) Sudanese refugees arrive in Acre, Chad, Sunday, Oct 6. 2024. (AP Photo/Sam Mednick) FILE – People gather to collect water in Khartoum, Sudan, May 28, 2023. (AP Photo/Marwan Ali, File) Along with the Zamzam camp, which has more than 400,000 people, famine was also detected in two other camps for displaced people, Abu Shouk and al-Salam in North Darfur, and the Western Nuba Mountains, the IPC report said. Five other areas in North Darfur are projected “with reasonable evidence” to experience famine in the next six months, including el-Fasher, the provincial capital of North Darfur, it said. Seventeen areas in the Nuba Mountains and the northern and southern areas of Darfur are at risk of famine, it added. The report also said some areas in the capital, Khartoum, and the east-central province of Gezira “may be experiencing” famine-like conditions. It said experts were unable to confirm whether famine threshold has been surpassed due to lack of data. “It is not merely a lack of food but a profound breakdown of health, livelihoods and social structures, leaving entire communities in a state of desperation,” it said. There is widespread hunger, with food in markets scarce and prices high. Aid groups say they struggle to reach the most vulnerable as warring parties limit access, especially in North Darfur province. Ahead of the IPC’s report, Sudan’s government said it had suspended its participation in the global monitoring system, according to a senior United Nations official with knowledge of the move. In a letter dated Dec. 23, Agriculture Minister Abu Baker al-Beshri accused the IPC of “issuing unreliable reports that undermine Sudan’s sovereignty and dignity,” said the U.N. official, who spoke in condition of anonymity to discuss the letter. Sudan’s 20-month war has killed more than than 24,000 people and driven over 14 million people — about 30% of the population — from their homes, according to the United Nations. An estimated 3.2 million Sudanese have crossed into neighboring countries including Chad, Egypt and South Sudan. The war began in April 2023 when tensions between its military and paramilitary Rapid Support Forces exploded into fighting in Khartoum before spreading to other areas. The conflict has been marked by atrocities including ethnically motivated killing and rape, according to the U.N. and rights groups. The International Criminal Court is investigating alleged war crimes and crimes against humanity. Dervla Cleary, a senior emergency and rehabilitation officer at the U.N.’s Food and Agriculture Organization, said 638,000 people are experiencing famine. “The situation in Sudan is just awful. It is unacceptable in a world like today,” she said. The IPC report called for a ceasefire, calling it the only way to reduce the risk of famine spreading further.” Sudan is the third country where famine was declared in the past 15 years, along with South Sudan and Somalia. The IPC comprises more than a dozen U.N. agencies, aid groups and governments that use its monitoring as a global reference for analysis of food and nutrition crises. The organization has also warned that large parts of Gaza’s Palestinian population face the threat of famine.

ENGLEWOOD, Colo. (AP) — The Denver Broncos' usually stout defense has been rocked ever since losing second-year cornerback Riley Moss to an MCL injury against Las Vegas in Week 12. Without Moss there to capitalize on opponents shying away from star cornerback Patrick Surtain II, the Broncos (9-6) have had to largely abandon their preferred man coverage in favor of zone strategies and the results haven't been pretty. They allowed 32 points to the Cleveland Browns when former teammate Jerry Jeudy caught nine passes for a career-best 235 yards, including a 70-yard touchdown. Only Jonathan Taylor's fumble at the goal line as he was about to score a 41-yard touchdown and give Indianapolis a 20-3 lead saved the Broncos in Week 15 and allowed Denver to seize momentum and get the victory. They couldn't stop Justin Herbert , who led the Los Angeles Chargers back from a double-digit third-quarter deficit for a 34-27 win last week that prevented the Broncos from ending their eight-year playoff drought. It also put more pressure on the Broncos to win Saturday at Cincinnati, where the Bengals (7-8) cling to hopes of catching the Broncos and denying Denver a wild-card berth. Moss returned to practice last week and the Broncos will determine this week whether he’s ready to return to the field or if it’s better to keep him out until their season finale against Kansas City. But all signs point to Moss being on the field to help thwart Cincy's offense led by Joe Burrow, Ja'Marr Chase and Tee Higgins. “It's great to have him back,” Surtain said after practice Tuesday. “I mean, you talk about a guy who was playing lights-out before the injury, but to see him back out there with confidence, out there practicing, getting his mojo back, it brings a lot of confidence to the team, as well. So, it's good to see him back out there in action, for sure.” Moss has enjoyed a breakout season in Denver with 71 tackles, eight pass breakups and an interception in 12 starts. He played in 14 games as a rotation player his rookie season after recovering from core muscle surgery that relegated him to special teams and spot duty in 2023. “We were and have been super excited" about the third-round pick out of Iowa, coach Sean Payton said. "Obviously, the guy that plays opposite of Patrick is going to get a lot of business. All throughout training camp, he really rose to the occasion, battled, competed and throughout really a good portion of the season. “He’s a big reason why we were playing so well defensively,” Payton added. "The sooner the better when we can get him back in the lineup. Hopefully it can happen this weekend.” In Moss' dozen starts, the Broncos allowed 16.8 points per game. Without him, they've been allowing 26.3 points a game. Burrow and Chase pose a bigger challenge to the Broncos than Jeudy and Jameis Wiston did for Cleveland or Herbert and Ladd McConkey did for the Chargers. The medial collateral ligament is on the inside of the knee that connects the thigh bone to the shin bone. It’s one of four major ligaments that stabilize the knee and allow it to rotate. It typically takes a month to recover from an MCL sprain and the Broncos had their bye week earlier this month, meaning Moss might only have to miss three games. If the Broncos reach the playoffs for the first time since winning Super Bowl 50 in Hall of Famer Peyton Manning's last start, they'll likely need to have a healthy Moss opposite Surtain to have any realistic hopes of avoiding a one-and-done appearance. The Broncos got a scare when Surtain injured an ankle against Indianapolis two weeks ago and limped off the field in the closing minutes. However, he was a full-go at practice last week and had no issues against the Chargers. NOTES: The Broncos waived veteran CB Levi Wallace, who had been inactive the past two weeks after giving up several big plays to Jeudy on Dec. 2. Denver also designated RB Tyler Badie to return from a back injury he sustained against the Jets in Week 4. Payton said he hopes to sign Wallace to the practice squad if he clears waivers. AP NFL: https://apnews.com/hub/nflFrom wealth and success to murder suspect, the life of Luigi Mangione took a hard turnUnion blasts comments by Quebec minister mulling law to intervene to end strikes

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House rejects Democratic efforts to force release of Matt Gaetz ethics report

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NEW YORK (AP) — U.S. stock indexes are drifting lower Tuesday in the runup to the highlight of the week for the market, the latest update on inflation that’s coming on Wednesday. The S&P 500 dipped by 0.2% in late trading, a day after pulling back from its latest all-time high . The index is on track for its first back-to-back losses in more than three weeks, as momentum slows following a big rally that has it on track for one of its best years of the millennium . The Dow Jones Industrial Average was down by 7 points, or less than 0.1%, with roughly an hour remaining in trading, and the Nasdaq composite fell 0.3%. Tech titan Oracle dragged on the market and sank 7.8% after reporting growth for the latest quarter that fell just short of analysts’ expectations. It was one of the heaviest weights on the S&P 500, even though CEO Safra Catz said the company saw record demand related to artificial-intelligence technology for its cloud infrastructure business, which trains generative AI models. AI has been a big source of growth that’s helped many companies’ stock prices skyrocket. Oracle’s stock had already leaped nearly 81% for the year coming into Tuesday, which raised the bar of expectations for its profit report. C3.ai fell 2.1% despite reporting a smaller loss for the latest quarter than analysts expected. The AI software company increased its forecast for how big a loss it expects to take this fiscal year from its operations. In the bond market, Treasury yields ticked higher ahead of Wednesday’s report on the inflation that U.S. consumers are feeling. Economists expect it to show roughly similar increases as the month before. That and a report on Thursday about inflation at the wholesale level will be the final big pieces of data the Federal Reserve will get before its meeting next week, where many investors expect the year’s third cut to interest rates . The Fed has been easing its main interest rate from a two-decade high since September to lift the slowing jobs market, after bringing inflation nearly down to its 2% target. Lower rates would help give support to the economy, but they could also provide more fuel for inflation. The yield on the 10-year Treasury rose to 4.22% from 4.20% late Monday. Even though the Fed has been cutting its main interest rate, mortgage rates have been more stubborn and have been volatile since the autumn. That has hampered the housing industry, and homebuilder Toll Brothers’ stock fell 5.2% even though it beat analysts’ expectations for profit and revenue in the latest quarter. CEO Douglas Yearley Jr. said the luxury builder has been seeing strong demand since the start of its fiscal year six weeks ago, an encouraging signal as it approaches the beginning of the spring selling season in mid-January Elsewhere on Wall Street, Alaska Air Group soared 13.6% after raising its forecast for profit in the current quarter. The airline said demand for flying around the holidays has been stronger than expected. It also approved a plan to buy back up to $1 billion of its stock, along with new service from Seattle to Tokyo and Seoul . Boeing climbed 5.2% after saying it's resuming production of its bestselling plane , the 737 Max, for the first time since 33,000 workers began a seven-week strike that ended in early November. Vail Resorts rose 2.7% after the ski resort operator reported a narrower first-quarter loss than expected in what is traditionally its worst quarter. In stock markets abroad, indexes were mixed in China after the world’s second-largest economy said its exports rose by less than expected in November. Stocks rose 0.6% in Shanghai but fell 0.5% in Hong Kong. AP Business Writers Matt Ott and Elaine Kurtenbach contributed.None

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