Toronto, Canada – Canadian retail giant Loblaw Companies Ltd. (L.TO) raised its full-year profit outlook on Wednesday after posting stronger-than-expected third-quarter earnings. The company cited resilient grocery and pharmacy demand as Canadians continue to turn to discount stores and locally made products amid ongoing economic uncertainty and rising cross-border trade tensions.

Resilient Consumer Demand Drives Growth

Loblaw reported that same-store sales in its food retail segment rose 2%, while its drug retail sales increased 4% compared to a year earlier. The performance was driven by robust demand at its discount grocery chains, including Maxi and No Frills, which continue to attract cost-conscious shoppers coping with inflationary pressures.

The company’s value-driven initiatives—such as maintaining lower prices, expanding private-label offerings, and introducing aggressive promotions—have helped it retain a loyal customer base.

“Consumers are making careful choices about where and how they shop, and our discount stores are well-positioned to meet their needs,” a company spokesperson said.

Loblaw Raises Profit Forecast on Positive Outlook

Encouraged by its steady performance, Loblaw now expects annual adjusted net earnings per share (EPS) to grow in the low double-digit percentage range, compared with its previous forecast of high single-digit growth.

The upgraded outlook underscores the company’s confidence in its ability to sustain profitability even as inflation and interest rates continue to squeeze household budgets.

For the quarter ended September 30, Loblaw reported revenue of C$19.40 billion ($13.83 billion)—in line with analysts’ expectations—and adjusted earnings of 69 Canadian cents per share, narrowly topping market estimates of 68 cents.

“Buy Canadian” Trend Boosts Local Retailers

Canadian retailers like Loblaw are also benefiting from the “Buy Canadian” movement, which has gained momentum amid escalating trade tensions with the United States. In recent months, the U.S. administration under President Donald Trump has increased tariffs on Canadian goods, including a 35% tariff on select imports not covered by the United States-Mexico-Canada Agreement (USMCA) and an additional 10% tariff announced in October.

These trade measures have encouraged Canadian consumers to shift toward locally produced goods, reshaping store shelves across the country and fueling domestic demand.

“We’re seeing more customers choosing Canadian brands and locally sourced groceries, which aligns well with Loblaw’s supplier partnerships and sustainability goals,” said a market analyst based in Toronto.

Economic Backdrop: Canadians Stay Cautious but Continue Spending

Despite macroeconomic uncertainty, Canadian retail sales rebounded in August, with shoppers spending more on vehicles, apparel, and supermarket goods, according to Statistics Canada. This suggests consumers are balancing budget concerns with steady spending on essentials and value-driven products.

Loblaw’s strong third-quarter performance reflects this trend, as the company continues to balance rising input costs with competitive pricing strategies to maintain market share.

Looking Ahead: Growth Amid Global Challenges

As Canada’s largest food and pharmacy retailer, Loblaw remains focused on long-term growth through digital transformation, private-label innovation, and expansion of discount formats.

Industry analysts expect the company to maintain steady earnings momentum through the holiday season, supported by resilient grocery demand and increased traffic to discount chains. However, global supply chain volatility and potential tariff escalations could pose challenges in 2026.