Albertsons Companies (ACI) Q3 2026 earnings summary

Executive summary

• Identical sales increased 2.4% year-over-year in Q3 2025, with digital sales up 21% and loyalty membership rising 12% to 49.8 million, driven by strong pharmacy and digital performance.

• Net sales and other revenue rose 1.9% to $19.1 billion, while adjusted EBITDA reached $1.039 billion and adjusted net income was $390 million ($0.72 per share).

• Technology modernization, AI-driven transformation, and digital engagement remain strategic priorities, with partnerships involving Google, OpenAI, and Databricks.

• Net income for Q3 2025 was $293 million ($0.55 per share), down from $401 million in Q3 2024, mainly due to the absence of prior year tax benefits.

• Media Collective delivered double-digit growth, and the Own Brands portfolio is targeted to grow penetration from 25% to 30%.

Financial highlights

• Gross margin was 27.4%, down from 27.9% year-over-year, impacted by higher delivery costs and pharmacy sales mix.

• Selling and administrative expense rate improved to 24.9% of revenue, down from 25.1% year-over-year.

• Adjusted EBITDA margin was 5.4%, down from 5.7% year-over-year.

• Interest expense rose to $116 million due to higher borrowings, including for a $750 million accelerated share repurchase program.

• Cash flow from operations was $1.65 billion for the first 40 weeks, down from $1.92 billion year-over-year.

Outlook and guidance

• Fiscal 2025 identical sales growth guidance narrowed to 2.2%-2.5%, with adjusted EBITDA expected between $3.825 billion-$3.875 billion, including $65 million from a 53rd week.

• Adjusted EPS guidance narrowed to $2.08-$2.16 per share.

• Effective income tax rate expected at 23%-24%; capital expenditures guidance unchanged at $1.8-$1.9 billion.

• Pharmacy sales to be impacted by the Inflation Reduction Act's Medicare Drug Price Negotiation, but profit impact is near neutral.

• Management expects continued investment in digital, loyalty, and technology platforms to drive growth.