The stock value of Safeway Inc. (NYSE:SWY) plunged by almost 17 percent to $23.52 per share on Thursday around 12:54 in the afternoon in New York after the company posted flat first quarter sales result that missed the consensus estimate of Wall Street analysts.

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During the quarter, Safeway Inc. (NYSE:SWY) generated $9.99 billion net sales. Data from Thomson Reuters showed that analysts expect the company to report $10.16 billion revenue and $0.35 earnings per share.

The food and drug retailer posted $118.8 million net income or $0.49 earnings per share, which included tax benefits of $0.14 per share. During the same period a year ago, the company’s earnings were $0.30 per share.

According to the company, its market share in the United States increased in the supermarket channels and all outlets for the fourth consecutive quarter. Its same store sales went up by 1.5 percent, excluding fuel due to a calendar shift of 0.4 percent, but negatively impacted by a 0.9 percent shift to generic drugs.

In a statement, Steve Burd, chairman and CEO of Safeway Inc. (NYSE:SWY) said, “We are pleased that we continued to see market share gains in the first quarter,Just For U’ usage continues to grow, and our partner fuel reward program is rolling out on schedule and resonating well with consumers.”

“The successful IPO of Blackhawk Network Holdings last week highlights the value we are creating for our stockholders. The proceeds from our sale of Blackhawk stock were used to pay down debt,” added Burd.

Safeway Inc. (NYSE:SWY) said its operating and administrative costs dropped from $2.495 million to $2.48 million due to lower depreciation, utilities and other store occupancy costs. Its interest expense declined from $71.4 million to $65 million.

Safeway Inc. (NYSE:SWY) is one of the largest food and drug retailers with 1,638 stores across the United States and Canada. The company sold its Genuardi’s stores in the first quarter and incurred $14.2 million in impairment and lease exit losses.  The food and drug retailer invested $144.9 million in capital expenditures in the first quarter.

Safeway Inc. (NYSE:SWY) maintained its earnings guidance for fiscal 2013 between $2.25 and $2.45 per share. The company also expects to invest around $1 billion to 1.1 billion in capital expenditures this year. Safeway said its ID sales growth expectations remain at 2 percent to 3 percent, and estimate to generate a free cash flow of $850 million to $950 million.