Kroger's latest quarter gave investors little reason for cheer, and its stock was paying the price on Friday.

The grocery giant now expects same-store sales excluding fuel to rise between 0.2% and 0.8% for the fiscal year, down from a prior range of 1% to 2% growth. The new guidance includes a roughly 140-basis-point hit tied to the Inflation Reduction Act, which ?lowered ?prescription drug prices for ?Medicare beneficiaries and impacted pharmacy revenue. Management separately reaffirmed its earnings guidance of $5.10 to $5.30 a share for the fiscal year.

The grocery giant on Friday posted fiscal second-quarter earnings of $1.05 a share, narrowly missing Wall Street's call for $1.07. Sales of $34.6 billion were in line with analysts' projections.

Shares tumbled 4% to $54.65 in premarket trading. Futures tracking the benchmark S&P 500 index were up 0.5%.

The latest figures were released as persistent inflation forces middle- and lower-income households to prioritize essentials over discretionary spending. U.S. consumer sentiment weakened in August following an unexpected decline in U.S. retail sales in July, which marked the first drop in nine months.

Kroger noted that it had raised its dividend by 11% earlier in the quarter, marking the 20th consecutive dividend hike. The grocery chain bought back $1 billion worth of shares during the period and has repurchased $1.2 billion in shares this year under a $2 billion board authorization announced late last year. Kroger expects to complete the remaining buybacks by Jan. 30, 2027, the end of the fiscal year.