New Asda chief executive David Potts inherits a £989m loss and a turnaround only a third done

Asda has a new chief executive, and he arrives with a clear brief: finish a recovery that has barely begun. David Potts, who ran rival Morrisons for eight years until 2023, takes the job with immediate effect, while Allan Leighton steps back to become non-executive chairman two years after returning to the business.

Asda says the handover was planned. Leighton had intended to leave day-to-day management after coming back in 2024, more than two decades after his first stint as chief executive. Even so, the timing puts a veteran grocery operator in charge just as the Christmas trading period gets under way.

Who is David Potts?

Potts is one of the best-known figures in UK grocery. Before Morrisons, he was chief executive of Tesco’s Irish business, its UK arm and its Asian operation. At Morrisons, based in Bradford, he led a turnaround during which the chain was bought by US private equity firm Clayton, Dubilier & Rice. Reports put his tenure at 2015 to 2023.

Leighton called his successor’s record “outstanding” and said Potts’s experience was “exactly what we now require for the next stage of our transformation and beyond.”

The scale of the task facing Asda’s new boss

The numbers explain why a change at the top matters. Asda, the UK’s third-largest supermarket chain, has been cutting prices aggressively to win back shoppers. It has been owned since 2020 by TDR Capital and the billionaire Issa brothers. Its latest accounts showed a pre-tax loss of £989 million for 2025, up from £599 million the year before. Adjusted earnings fell 33% to £761 million, partly because of spending on price cuts under its Asda Price and Rollback schemes.

A botched IT upgrade last year made matters worse, hitting product availability and denting sales. The Independent reported that the chain had also suffered nine consecutive quarters of falling like-for-like sales, alongside a shrinking market share.

There are some early signs of improvement. In August, Asda said sales had returned to growth for the first time in two years. Like-for-like sales, excluding fuel, rose 0.2% in the first seven weeks of the third quarter. That followed a second quarter in which revenue was £5.1 billion but like-for-like sales fell 2.3% and food sales dropped 1.9%. At the time, Leighton estimated the group was roughly a third of the way through its turnaround.

Prices first, then the wider strategy

The new Asda chief executive said the company had “made good progress but significant opportunities remain.” His stated priority is keeping prices low, and he argued that weekly improvements to the shopping trip would be something “customers can experience and feel in their pockets.” He also pointed to the business’s 116,296 staff, whom he called “very hard-working colleagues.”

With Christmas close, Potts said the business has “a clear focus on keeping Asda prices locked low.” Leighton’s “Formula for Growth” strategy, which aims to make Asda “more than a supermarket,” remains in the background, though Potts has not yet said how he will change it.

The appointment is a clear signal that Asda’s owners want an operator with experience of a large-scale grocery turnaround. Whether he can turn a 0.2% uptick into sustained growth, while still cutting prices and returning the business to profit, will be the test of his tenure.

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File photo: David Potts 2024.jpg by Meena, CC0, via Wikimedia Commons.