Albertsons Drops Fiscal 2026 Outlook After Second Straight Identical-Sales Decline
Net sales and other revenue were $18,894.7 million in the 12 weeks ended September 12, 2026, and the company said it will not update its outlook until a comprehensive business review is finished in the fourth quarter.
Albertsons Companies (ACI), the U.S. food and drug retailer, said it is no longer providing a fiscal 2026 outlook and will not issue an updated one until a comprehensive business review is completed in the fourth quarter, after a second consecutive quarter in which identical sales fell 0.8%.
That identical-sales decline matched the 0.8% drop in the first quarter of fiscal 2026 and followed a 0.7% increase in the fourth quarter of fiscal 2025. Net sales and other revenue decreased 0.1% to $18,894.7 million for the 12 weeks ended September 12, 2026, from $18,915.8 million a year earlier. The decline was driven by identical sales and was partially offset by higher fuel sales.
Chief Executive Officer Susan Morris said second-quarter performance was in line with the company’s revised outlook but “did not reflect the potential of the Company.” Albertsons is launching a comprehensive business review to speed improvements and tackle a cost structure it can no longer afford, with work aimed at simplifying the organization, improving decision-making, reinvesting savings in customer value and boosting long-term shareholder returns.
Digital sales increased 11% in the second quarter, slowing from a 13% increase in the first quarter and a 16% increase in the fourth quarter of fiscal 2025. Pharmacy sales continued to grow despite Inflation Reduction Act headwinds.
Gross margin rate was 26.8%. Excluding fuel and LIFO expense, the rate decreased 17 basis points, a smaller compression than the 23-basis-point ex-fuel/LIFO decline in the first quarter. Albertsons attributed the decrease primarily to higher delivery and handling costs tied to digital growth and higher shrink, partially offset by pharmacy-margin improvements related to the IRA and incremental investments in customer value funded by productivity initiatives.
Selling and administrative expenses were 25.6% of net sales and other revenue. Excluding fuel, the rate increased 38 basis points, a smaller ex-fuel rise than the 42-basis-point increase in the first quarter. The increase was primarily attributable to sales deleveraging from lower identical sales, while selling and administrative expenses were relatively flat year over year as productivity and cost-management benefits offset inflation and higher merger-related litigation costs.
Net income was $51.5 million, or $0.11 a share, compared with $168.5 million, or $0.30 a share, a year earlier. Adjusted net income was $179.0 million, or $0.36 a share, versus $248.4 million, or $0.44 a share. Adjusted EBITDA was $784.0 million, or 4.1% of net sales and other revenue, compared with $848.4 million, or 4.5%, a year earlier.
Net loss on property dispositions and impairment losses was $42.4 million, primarily from retail store impairment losses and equipment disposals, versus $4.4 million a year earlier. Interest expense, net was $125.0 million, primarily from higher average outstanding borrowings.
On July 23, 2026, Albertsons announced ACI Edge, consolidating 11 divisions into four regions and centralizing center-store merchandising under a single enterprise team. It described ACI Edge as the first step in a broader turnaround. Building on those actions, the company is reviewing customer strategy, cost structure, operating model, banners, markets, assets, businesses and capital allocation priorities.
The company believes it is prudent to complete the review, establish priorities and evaluate the associated financial model before providing an updated outlook. It expects to provide a refreshed short- and long-term financial framework alongside a comprehensive turnaround plan by its fourth-quarter earnings call and plans an investor day in spring 2027.
During the first 28 weeks of fiscal 2026, capital expenditures were $899.6 million, including 38 remodels, seven new stores and digital and technology investment. The company paid a $0.17-a-share quarterly dividend on August 7, 2026, and announced the next $0.17 payment for November 6, 2026. In the first 28 weeks, it repurchased 26.0 million shares for $387.6 million. As of September 12, 2026, it operated 2,240 retail stores with 1,709 in-store pharmacies.