Morrisons third-quarter results provide further evidence that its recovery is strengthening.
Group like-for-like sales increased by 3.2% in the 13 weeks to 26 July 2026, its fifteenth consecutive quarter of growth and strongest performance since the second quarter of 2025. More importantly, Morrisons reported that sales and volumes grew ahead of the market, contributing to a year-on-year increase in market share.
The results suggest Morrisons investment in price is beginning to influence shopper behaviour. Its new Unbeatable Prices commitment will need to build on this momentum if the retailer is to deliver sustained volume growth ahead of a potentially more challenging period for household budgets.
Growth broadens across the business
Morrisons third-quarter performance was supported by growth across supermarkets, online, convenience, pharmacy and its Myton manufacturing operations.
Online sales increased at a double-digit rate, helped by the expansion of Morrisons Now and its wider quick commerce offer. The retailer also opened 71 Morrisons Daily franchise stores during the year, while confirming that hundreds more are planned.
Total sales reached £4.1 billion during the quarter, representing year-on-year growth of 2.5%. While favourable summer weather and the World Cup supported demand, Morrisons above-market volume growth is significant because it indicates that its performance was not entirely reliant on inflation or temporary market conditions.
Unbeatable Prices strengthens Morrisons value credentials
Morrisons Unbeatable Prices scheme guarantees that prices on more than 500 everyday essentials will be the same as, or lower than, those offered by Aldi, Lidl, Tesco, Sainsbury’s and Asda.
Although Morrisons has not explicitly positioned it as a replacement, the scheme represents a significant extension of its previous Aldi and Lidl Price Match. The commitment covers products across fresh food, household essentials and Market Street, and applies in supermarkets, online and through click and collect.
The ambition will be to build greater trust in Morrisons prices for everyday essentials, while combining this reassurance with the retailer’s established fresh-food credentials and Market Street counters.
This is important because competitive prices on frequently purchased products can influence perceptions of value across the wider shop. Greater confidence in Morrisons prices could encourage shoppers to consolidate more of their grocery spending with the retailer, supporting higher purchase frequency and larger baskets.
Early evidence is encouraging, with Morrisons stating that the scheme has already had a positive impact. However, building a lasting value reputation will require consistency in both price and execution.
Cost savings provide capacity to invest
Maintaining this price position will require disciplined execution.
Morrisons delivered a further £53 million of cost savings during its third quarter, taking cumulative savings since the programme began in 2023 to £995 million. These efficiencies have helped offset external cost pressures while funding investment in colleagues and the shopper offer.
This establishes a direct relationship between productivity and volume growth. Cost savings give Morrisons greater capacity to invest in lower prices, while stronger volumes can improve operational leverage across its stores and manufacturing network.
However, the model depends on price investment generating sufficient additional demand rather than simply reducing the margin earned on existing sales. Morrisons must therefore demonstrate that Unbeatable Prices can change shopper behaviour, not just improve its headline price position.
Although Morrisons has reduced its debt by 46% since 2022, the retailer will also need to balance its growth ambitions with further debt reduction and margin protection.
Inflation increases the importance of volume
IGD’s latest economic Viewpoint expects food inflation in 2026 to be weaker than first predicted, although this will prove to be a delay rather than a turning point. Weather disruption, energy markets, farm inputs and policy measures are expected to place greater pressure on food prices during 2027 and the first half of 2028.
This increases the strategic importance of Morrisons building volume now. A stronger value reputation could help it retain shoppers when affordability comes under renewed pressure, but higher input costs will also make funding its price commitment more difficult.
The challenge is therefore not simply to maintain its current rate of growth. Morrisons must convert Unbeatable Prices into higher purchase frequency, larger baskets and sustained market-share gains, while protecting the fresh-food quality and service that differentiate its offer.
If Morrisons can maintain its volume momentum while continuing to remove costs, its latest results may mark an important step from stabilisation towards meaningful renewal.
