Albertsons’ second-quarter profit collapse has pushed the supermarket operator into a company-wide strategic review. Net income fell roughly 70% year over year, fiscal-2026 guidance was withdrawn, and executives say costs, prices, store operations, banners and assets could all be reconsidered. No specific Albertsons or Safeway stores have been announced for closure or sale.
Albertsons’ second-quarter results triggered the review
For the 12 weeks ended September 12, 2026, Albertsons Companies earned only about $51.5 million to just under $52 million. That compares with approximately $168.5 million to $169 million in the same period a year earlier, a decline of about 70%.
| Measure | Second quarter 2026 | Second quarter 2025 | Change |
|---|---|---|---|
| Net income | About $51.5 million to just under $52 million | About $168.5 million to $169 million | Down roughly 70% |
| Net sales and other revenue | $18.89 billion | About $18.91 billion, based on the reported 0.1% decline | Down 0.1% |
The near-flat revenue figure shows why the profit drop is particularly serious: Albertsons generated almost the same sales but retained far less earnings. Management withdrew its fiscal-2026 outlook rather than maintain targets it no longer considers reliable.
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Why did Albertsons profits plunge?
Executives said sales and earnings growth were below expectations and that market-share trends were lagging. The operating environment has also become more difficult:
- Cautious shoppers: Consumers are limiting or delaying purchases as household budgets remain pressured.
- Inflation and fuel costs: Persistent inflation raises the cost of products and operations, while elevated fuel prices affect distribution and customers’ travel to stores.
- Intense price competition: Walmart, discount chains and other grocery formats continue to compete aggressively on everyday prices.
- Private-label pressure: Customers seeking cheaper alternatives can shift spending toward store brands and away from higher-margin national products.
That creates a difficult trade-off. Albertsons needs to spend on lower prices, better availability and stronger store execution to win traffic, but those moves can further compress margins unless the company removes costs elsewhere.
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What “major changes” could include
Executive Chair Meg Whitman and Chief Executive Officer Susan Morris have started a comprehensive business review. Whitman said the process will examine Albertsons’ operating model, cost structure and capital allocation, as well as its portfolio of banners, markets, assets and businesses. She described the scope plainly: “Everything should be on the table as we figure out how Albertsons should be structured to better compete in the years ahead.”
That language allows for several outcomes, including reorganizing headquarters functions, changing investment priorities, selling assets or exiting markets that do not meet performance goals. It does not mean a breakup has been decided. No public announcement identifies a particular store, banner or brand for sale or closure.
Is Albertsons going to sell stores?
Possibly, but there is no confirmed list. The review’s mandate covers stores and other assets broadly, yet the company has not named locations or banners that will be divested. Reports that a specific Albertsons, Safeway, Vons or Jewel-Osco site is closing should be treated as unconfirmed unless Albertsons later identifies it in a filing or announcement.
What is Meg Whitman changing?
Whitman is overseeing a strategic examination rather than announcing one immediate operational switch. The stated focus is how the company is organized, where it spends capital, how its divisions and merchandising teams work, and which parts of the portfolio justify continued investment. Morris said, “We’re not satisfied with the results and the current trajectory of our business.”
ACI Edge is already changing the organization
Alongside the new review, Albertsons has an existing restructuring effort called ACI Edge. It is consolidating 11 divisions into four regions and centralizing center-store merchandising, the part of grocery operations covering many packaged and shelf-stable products.
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The company also increased its planned cost-savings goal from $1.5 billion to $2 billion over three years. That is a target for savings execution, not money already realized. The results will depend on whether centralization and purchasing efficiencies reduce expenses without damaging local assortment, in-store service or sales.
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How the failed Kroger merger still matters
Albertsons’ strategic choices are still shaped by the proposed $24.6 billion merger with Kroger. A federal court blocked the transaction on antitrust grounds in December 2024, after which Albertsons terminated the deal. Reuters has reported that Albertsons is pursuing damages from Kroger, while the company now has to improve its standalone business rather than rely on merger synergies.
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The merger’s failure also limits the range of easy scale solutions. Albertsons must find savings, improve competitiveness and decide where to allocate capital within its existing portfolio while operating under continuing antitrust scrutiny.
Will Albertsons prices come down?
Lowering prices is one of the purposes management gave for the review, but no timetable, product list or average reduction has been announced. Shoppers may see targeted promotions or price investments as the company tries to regain traffic, yet an immediate chain-wide price cut is not guaranteed. Albertsons must fund any reductions through the cost savings and operating improvements it is pursuing.
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What happens next?
- Review period: Management will assess operations, costs, capital allocation, banners, markets and assets while ACI Edge continues.
- Execution of savings: The company will work toward the $2 billion, three-year cost-savings target and evaluate whether the regional structure improves performance.
- Turnaround plan: Reuters reports that Albertsons expects a broader plan in the fiscal fourth quarter ending February 2027.
- Potential portfolio decisions: Any store, banner or asset sale would require a separate announcement; none has been specified so far.
Until that plan is published, the reliable conclusion is that Albertsons is in a reset, not a completed breakup. The next evidence to watch is whether sales and market share stabilize, whether savings arrive without weaker store execution, and whether management names concrete portfolio actions.
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The bottom line
Albertsons’ profits fell from roughly $169 million to about $52 million while sales barely moved. That combination prompted the withdrawal of fiscal-2026 guidance and an unusually broad review led by Whitman and Morris. ACI Edge and the larger savings target provide an initial framework, but the company has not announced specific closures or sales. The decisive test will be whether Albertsons can lower prices and improve shopping conditions quickly enough to recover customers without eroding profitability further.
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- This card is non-reloadable. No cash or ATM access. Funds do not expire. If available funds remain on your card after the valid thru date has passed, please call customer service for a replacement card. A one-time purchase fee applies at the time of checkout. No fees after purchase.
- To access your card information safely, type the complete website address shown on your Gift Card (MyGift.GiftCardMall.com) directly into your browser's address bar. Don't use search engines or shortened versions of the website address, as these may lead you to fake or fraudulent sites. Do not provide any Gift Card details (example: Card Number) to someone you do not know or trust. If you believe you've reached an illegitimate website, contact cardholder service at 1-888-524-1283. Be cautious of phishing sites, there are a variety of scams in which fraudsters try to trick others into paying with gift cards.
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- Use your Visa Gift Card in the U.S. everywhere Visa debit cards are accepted, including online.
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