July 23 (Reuters) - Albertsons cut its annual identical-sales and profit forecasts on Thursday and said it would accelerate investments in prices and its online business to better compete for cash-strapped shoppers, sending its shares down 15% before the bell. Higher gas and food prices have caused households to become more selective in their spending and shop more at mass retailers such as Walmart and private label and discount grocers such as Aldi, hurting sales at companies such as Albertsons.
"Core grocery faced increasing pressure from softer industry unit trends and a more cautious consumer," Albertsons CEO Susan Morris said in a statement.
Rival Kroger's shares dropped about 3% in trading before the bell.
Meanwhile, Albertsons said its chief financial officer, Sharon McCollam, will retire later this year.
"Given continued softness in industry unit trends and a more cautious consumer, we are accelerating investments and operational changes designed to strengthen our customer value proposition and improve our competitive position," Morris said.
As its core middle- and lower-income consumers continue to trade down, Albertsons has already cut prices on hundreds of items, invested in improving its online and e-commerce channel to compete on convenience, and doubled down on its private label and store brands.
The company expects annual identical sales to decline in the range of 0.5% to 1.5%, compared with its prior target of flat to up 1%.
Its first-quarter identical sales declined 0.8%, compared with estimates of a 0.46% fall, according to data compiled by LSEG.
Albertsons estimated fiscal 2026 adjusted earnings per share in the range of $1.75 to $1.85, compared with its earlier target of $2.22 to $2.32.
(Reporting by Juveria Tabassum in Bengaluru; Editing by Sriraj Kalluvila)
