Albertsons shares tumbled more than 20% Thursday after the grocery chain sharply cut its fiscal 2026 profit outlook, citing weakening demand and increasingly cautious consumer spending habits.
The company now expects full-year net income of $1.75 to $1.85 per share, down dramatically from its previous guidance range of $2.22 to $2.32 per share. Albertsons also lowered its adjusted EBITDA forecast to $3.55 billion to $3.625 billion, compared with prior expectations of $3.85 billion to $3.925 billion.
CEO Susan Morris acknowledged the challenges facing the business, noting that while digital and pharmacy operations continued posting strong growth during the first quarter, core grocery operations faced mounting pressure from softer industry trends and consumer belt-tightening.
Comparable Sales Under Pressure
The revised outlook reflects deteriorating sales trends across Albertsons’ store base. The company now projects identical sales — a key metric similar to comparable sales — to decline between 0.5% and 1.5% for the full year. That marks a significant shift from previous expectations of flat to 1% growth.
First-quarter results illustrated the challenge, with identical sales falling 0.8%. Net income for the period came in at $84.7 million, or 17 cents per share, down sharply from $236.4 million, or 41 cents per share, in the same quarter a year earlier.
Broader Grocery Weakness
The guidance cut comes amid emerging signs that U.S. grocery shoppers are pulling back on store visits. Food inflation, elevated gas prices, and tighter household budgets appear to be converging to dampen spending across the sector.
In response, Albertsons said it is “moving decisively” to invest in customer experience improvements, betting that enhanced service and store conditions will help reverse current trends and restore growth over time.
Despite the near-term headwinds weighing on earnings, Morris told analysts the company remains focused on longer-term objectives. “While the pressure on consumers is weighing on near-term earnings, the company aims to improve traffic, units, loyalty and the overall trajectory of the business over time,” she said during a call with analysts.
The steep stock decline Thursday underscores investor concern about both Albertsons’ specific challenges and the broader health of grocery spending as economic pressures mount on American consumers.
Source: www.cnbc.com — https://www.cnbc.com/2026/07/23/albertsons-stock-plunges-on-lowered-outlook-softened-grocery-trends.html
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