Albertsons second-quarter net income falls to $51.5 million, will not give fiscal 2026 outlook

Albertsons Companies, Inc. (ACI) said Tuesday that net income for its second quarter fell to $51.5 million, or $0.11 per share, from $168.5 million, or $0.30 per share, a year earlier.

The results cover the 12 weeks ended Sept. 12, 2026, the company said in a regulatory filing that attached its press release.

Net sales and other revenue were $18,894.7 million, down 0.1% from $18,915.8 million a year earlier.

Identical sales fell 0.8%. The company said that decline drove the drop in revenue, partly offset by higher fuel sales.

Here's how the company did:

• Net income per diluted share: $0.11 vs. $0.30 a year earlier
• Adjusted net income per diluted share: $0.36 vs. $0.44 a year earlier
• Net sales and other revenue: $18,894.7 million vs. $18,915.8 million a year earlier
• Adjusted EBITDA: $784.0 million vs. $848.4 million a year earlier

Digital sales rose 11% in the quarter. Pharmacy sales kept growing despite ongoing Inflation Reduction Act (IRA) headwinds, and the release calls pharmacy and digital areas of strength.

The gross margin rate was 26.8%, compared with 27.0% a year earlier.

Excluding fuel and LIFO expense, the gross margin rate fell 17 basis points, the company said.

The company attributed that decline mainly to higher delivery and handling costs tied to digital sales growth, and to higher shrink.

Improvements in pharmacy margins, linked to the IRA, partly offset those costs.

Selling and administrative expenses were $4,840.2 million, compared with $4,806.9 million a year earlier. As a share of revenue, they rose to 25.6% from 25.4%.

The net loss on property dispositions and impairment losses was $42.4 million, compared with $4.4 million a year earlier. The company tied it primarily to retail store impairment losses and equipment disposals.

Interest expense, net was $125.0 million, up from $105.3 million, primarily on higher average outstanding borrowings. Other income, net was $13.2 million, compared with $29.7 million.

Income tax expense was $11.2 million, a 17.9% effective tax rate, compared with $51.2 million and 23.3% a year earlier.

Merger-related costs, which the company adds back in its adjusted results, were $35.3 million, up from $19.0 million. The company said they were primarily litigation costs related to the terminated merger.

Adjusted EBITDA was $784.0 million, or 4.1% of revenue, compared with $848.4 million, or 4.5%, a year earlier.

Over the first 28 weeks, net income was $136.2 million, or $0.28 per share, compared with $404.9 million, or $0.71, a year earlier.

"Our results do not reflect the potential of the Company," said CEO Susan Morris. "We are launching a comprehensive business review to speed up improvements in Albertsons' performance and tackle even harder a cost structure we can no longer afford."

Turnaround and business review

On July 23, 2026, the company announced ACI Edge, an operating structure realignment designed to accelerate execution and increase accountability.

Under ACI Edge, the company consolidated its 11 divisions into four regions and fully centralized center-store merchandising under a single enterprise team.

The company called ACI Edge the first step in a broader turnaround.

It is now reviewing its customer strategy, cost structure, operating model, portfolio of banners, markets, assets and businesses, and capital allocation priorities.

Outlook

The company is no longer providing a fiscal 2026 outlook.

It will not provide an updated outlook until the comprehensive business review is completed during its fourth quarter.

The company said it believes it is prudent to complete the review, establish clear priorities and fully evaluate the associated financial model first.

It expects to provide a refreshed financial framework, both short and long-term, alongside its comprehensive turnaround plan by its fourth-quarter earnings call.

The company also plans to host an investor day in Spring 2027.

The conference call is set for 8:30 a.m. Eastern Time on Tuesday, hosted by Morris and Interim CFO Cody Perdue.

Capital allocation and debt

Capital expenditures were $899.6 million over the first 28 weeks. The spending included 38 remodels, seven new store openings and continued investment in digital and technology platforms.

The company paid a quarterly dividend of $0.17 per share on Aug. 7, 2026, to holders of record as of July 24, 2026.

It announced its next quarterly dividend of $0.17 per share, payable Nov. 6, 2026, to holders of record at the close of business on Oct. 23, 2026.

Over the first 28 weeks, the company repurchased 26.0 million shares for $387.6 million under its existing multi-year authorization. A year earlier it repurchased 25.7 million shares for $550.1 million.

Total debt, including finance leases, was $9,328.2 million at quarter end, up from $8,126.5 million a year earlier.

The net debt ratio on a rolling four-quarter basis was 2.42, compared with 2.02.

About Albertsons

The company operated 2,240 stores at the end of the quarter, compared with 2,257 a year earlier.

Albertsons is a food and drug retailer operating across 35 states and the District of Columbia under 22 banners, including Albertsons, Safeway and Vons.