Grocery Outlet Holding Corp. (GO) stock surged 6.46% in pre-market trading on Monday, following the company's third-quarter earnings report that showed robust sales growth and inline earnings performance amid ongoing execution challenges.

The discount grocery chain reported a 10.4% increase in net sales to $1.11 billion for the quarter, driven by new store openings and a 1.2% rise in comparable store sales. Gross profit increased 9.2% to $344.9 million, with a gross margin rate of 31.1%.

However, Grocery Outlet acknowledged facing significant disruptions from its transition to a new SAP system, which impacted inventory visibility, operational efficiency, and the ability to execute its dynamic business model effectively. As a result, comparable store sales growth of 1.2% was weaker than expected.