Albertsons accelerates layoffs and store reviews amid sales slide

Albertsons is intensifying cost-cutting efforts following its third consecutive quarter of declining sales, with leadership indicating deeper workforce reductions and possible store closures in underperforming markets. The company’s second-quarter financial report revealed a nearly 1% drop in comparable-store sales, while total revenue decreased by 0.1% to $18.9 billion. Although digital sales rose by 11%, the overall trend shows persistent challenges in reversing the downturn.

During the earnings call, CEO Susan Morris described the results as not reflecting the quality of the company’s assets or team capabilities. She acknowledged that previous adjustments, made with “good intentions”, had instead introduced unnecessary complexity and higher costs. Morris emphasized the need for greater speed and discipline to drive better performance, particularly in pricing strategies, promotions, and customer experience. Accountability will be sharpened, and the focus will narrow to core business priorities.

New Executive Chair Meg Whitman, who joined the company last month, reinforced the urgency, stating that Albertsons must become a simpler, more focused company that gets the basics right every day. Whitman highlighted the need to streamline operations, reduce prices, and increase foot traffic to reclaim market share. The retailer’s stock price is off by about a quarter since the start of 2026.

Workforce reductions will play a central role in the restructuring plan. Morris acknowledged that while Albertsons reduced staff last year, further cuts are inevitable. “We did some work last year and saw a substantial reduction in headcount, but quite frankly, there’s more to be had, and you’ll see us taking aggressive action there in the next 12 to 18 months as well,” she said. The company will also assess underperforming regions, though no specific locations have been identified. Whitman framed the overhaul as necessary to unlock Albertsons’ potential, though she acknowledged that dramatic improvement is needed now.

The company’s financial struggles extend beyond sales figures. Comparable-store sales have declined for three consecutive quarters, a trend Morris attributed to operational inefficiencies. “We recognize the need to simplify how we work, sharpen accountability, and move with greater speed and discipline to deliver better results,” she said, adding that resources will now be directed toward high-priority initiatives with clearer performance metrics. Albertsons has not updated its financial outlook, citing ongoing uncertainty about future performance.

Morris and Whitman will detail the full turnaround strategy during the fourth-quarter earnings call. Until then, the immediate focus remains on cost management, operational efficiency, and rebuilding customer confidence. The retailer’s ability to implement these changes will determine whether it can halt its decline, or worsen it.