Shares of Grocery Outlet Holding (NASDAQ:GO) fell sharply in after-hours trading on Tuesday, plunging 11.69% following the release of the company's fourth quarter 2024 financial results and fiscal 2025 guidance that fell short of Wall Street expectations.

For the fourth quarter, Grocery Outlet reported adjusted earnings per share of $0.15, missing analysts' consensus estimate of $0.17. Revenue grew 10.9% year-over-year to $1.10 billion, driven by new store openings and a 2.9% increase in comparable store sales. However, gross margin declined 70 basis points to 29.5%, primarily due to higher inventory shrinkage related to system conversion issues.

Looking ahead, the company provided a disappointing outlook for fiscal 2025. Grocery Outlet expects adjusted earnings per share of $0.70 to $0.75, below analysts' expectations. The company also projected comparable store sales growth of 2% to 3%, lower than the 2.7% increase reported in fiscal 2024. Additionally, Grocery Outlet announced a restructuring plan aimed at improving profitability and cash flow generation, but said it would incur costs of $52 million to $61 million related to the plan.