Migros (MGROS) 2Q26 Financial Results

Migros reported 2Q26 sales revenue of TL 124,399mn, broadly in line with expectations, while EBITDA came in 17% below consensus at TL 5,307mn. On the bottom line, the company posted a net loss of TL 699mn versus consensus expectations of TL 407mn net profit (2Q25: TL 371mn net profit; 1Q26: TL 1,710mn net profit). Sales increased by 3% YoY and 6% QoQ, while intensified promotional activity and higher distribution center personnel costs led to a 20% YoY decline in EBITDA, with the EBITDA margin contracting by 1.2pp to 4.3%. The net loss was mainly driven by gross margin compression and higher net financial expenses. We assess the results as slightly negative due to the weaker-than-expected EBITDA and net loss; however, strong free cash flow generation, the TL 31.8bn net cash position excluding IFRS 16, and unchanged year-end guidance limit the downside. Accordingly, we revise our 12-month target price for MGROS from TL 1,039 to TL 979, while maintaining our “BUY” recommendation and keeping the stock in our model portfolio.