Ocado Share Price Collapses 90% as Founder Tim Steiner Charts Path to Profitability

Ocado share price has fallen more than 90% over the past five years, making it one of the London Stock Exchange's most dramatic collapses. The company is now pursuing aggressive cost cuts and new retail partnerships in a bid to reach positive cash flow. CEO Tim Steiner, who recently secured his position through 2028, is leading the turnaround effort amid ongoing investor scepticism.

The Three-Part Decline

Ocado's trajectory reveals three distinct phases of deterioration. The company invested heavily in robotic grocery fulfilment centres globally, but the capital requirements proved unsustainable as losses accumulated year after year. Major partners including Kroger and Sobeys subsequently retreated from expansion plans, citing the high energy costs of running Ocado's technology infrastructure. Most recently, leadership turbulence emerged as shareholders questioned founder and CEO Tim Steiner's continued role, a dispute resolved earlier this month when the board confirmed he will remain in position until early 2028 before transitioning to an advisory capacity.

The financial pressures have been relentless. The company posted a net cash outflow of £147 million in the first half of its current financial year—more than a third higher than the same period the previous year. Underlying EBITDA declined from £92 million to £81 million, despite headline revenue surging 54 percent to £1 billion, largely due to £354 million in termination payments from Kroger and Sobeys' contract cancellations.

Recovery Signals Emerging

Management is now executing a £150 million cost reduction programme, with the majority of initiatives implemented in the second quarter. Steiner has stated the company expects to achieve positive free cash flow in the second half of the current financial year, with full-year cash positivity targeted for the 2027 fiscal year ending in November.

Recent full-year results showed adjusted EBITDA surging 59 percent to £178 million, and group revenue rose 12.1 percent to £1.4 billion, both exceeding analyst expectations. International warehouse volumes grew 27 percent. However, the Technology Solutions division—the company's core business—experienced declining revenue and profit, with the number of live modules falling and several key projects delayed. Kroger's Phoenix site was pushed back a year, as was the Lotte Shopping installation in Seoul.

Steiner emphasised "strong commercial momentum" and "rigorous cost discipline" in introducing the half-year results, while acknowledging the company has re-engaged with retailers across major grocery markets, with particular focus on the United States supported by a "significantly evolved" technology portfolio. The newly signed deal with Asda represents another opportunity to demonstrate the viability of its model.