BOISE, Idaho – Albertsons Cos. on Thursday reported first-quarter fiscal 2026 results that reflected continued strength in its digital and pharmacy businesses but ongoing challenges in core grocery operations, prompting the company to lower its full-year outlook and accelerate a broad operational restructuring effort.
For the 16 weeks ended June 20, 2026, identical sales declined 0.8%, while digital sales climbed 13%. Net sales and other revenue increased 0.2% to $24.9 billion, driven largely by higher fuel sales.
Net income fell to $84.7 million, or 17 cents per share, from $236.4 million, or 41 cents per share, a year earlier. Adjusted net income totaled $210.3 million, or 42 cents per share, compared with $318.9 million, or 55 cents per share, in the prior-year period. Adjusted EBITDA declined to $1.01 billion from $1.11 billion.
“Our digital and pharmacy businesses continued to deliver strong growth, while core grocery faced increasing pressure from softer industry unit trends and a more cautious consumer,” said CEO Susan Morris. “While these results did not meet our expectations, they underscored the need to move faster.”
To improve competitiveness and execution, Albertsons unveiled ACI Edge, a new operating model that consolidates its 11 divisions into four regions and centralizes center-store merchandising under a single enterprise team. The company said the changes are designed to streamline decision-making, improve accountability and better leverage enterprise scale, technology and local market expertise.
“We call it the ACI Edge. It combines the scale and capabilities of a national retailer with the accountability and local focus that have long distinguished our banners,” said Morris. “By consolidating 11 divisions into four regions and centralizing center store merchandising, we can make faster decisions, improve in-stocks and move accountability closer to our stores, where fresh, service and local execution matter most to customers.”
The new operating model will move the company from 11 divisions to four regions. Each region will include local markets focused on strengthening customer connections, supporting stores and driving results in their communities.
The company is also advancing Merch United by centralizing center store merchandising, bringing customer insights, supplier relationships, strategy, product, placement, promotion and price under a single enterprise team while continuing to combine national scale with local expertise. Merch United combines the buying power, data and analytics of a national retailer with the customer focus and local insights of Albertsons Cos.' market teams.
“Center store centralization is an important next step in Merch United and in how we build a stronger, more connected merchandising organization,” said Michelle Larson, executive vice president and chief merchandising officer of Albertsons Cos. “By bringing center store work together at the enterprise level, we can better leverage our scale, strengthen supplier partnerships and create more capacity for our regional and market teams to focus on fresh, local and the customer needs that make each community unique.”
Fresh merchandising decisions will remain in the markets and continue to be guided by the Merch United strategy, local customer preferences and market needs. Regional and market teams will continue to play an essential role in serving customers, supporting stores and delivering locally relevant experiences.
There are no plans to realign stores or districts as part of this transition. The company’s banners will continue serving customers with the local identity, history and community connections that have made them trusted shopping destinations.
Ultimately, these changes are intended to improve how Albertsons Cos. serves customers. A simpler operating structure, combined with the company's growing data and AI capabilities, will help teams respond more quickly to customer needs, improve in-stock performance and deliver a more consistent experience across stores and digital channels.
The reported that gross margin declined to 26.6% from 27.1% a year ago, reflecting higher delivery, handling and fuel costs associated with continued digital growth. Selling and administrative expenses rose to 25.6% of sales, impacted by higher rent and occupancy expenses, merger-related litigation costs, business transformation initiatives, and depreciation and amortization.
Interest expense increased to $166.7 million from $141.8 million, primarily because of higher average borrowings.
During the quarter, Albertsons invested $522.1 million in capital expenditures, including 15 store remodels, four new store openings, and ongoing investments in digital and technology platforms.
The retailer also continued returning capital to shareholders. In April, the board increased the quarterly dividend by 13% to 17 cents per share and expanded its share repurchase authorization to $2 billion. During the quarter, the company repurchased 13.4 million shares for $226.5 million.
Looking ahead, Morris said Albertsons is accelerating investments in pricing, customer value and the in-store experience, even before realizing expected productivity gains.
“Given continued softness in industry unit trends and a more cautious consumer, we are accelerating investments and operational changes designed to strengthen our customer value proposition and improve our competitive position,” Morris said. “We believe these actions will improve our growth trajectory, strengthen our competitive position and create long-term shareholder value.”
