Albertsons Companies Inc - Class A
Q1 2025 Earnings
Did ACI Beat Earnings? Q1 2025 Results
Albertsons delivered a modest beat across the board in its fiscal first quarter, posting adjusted EPS of $0.55 against a consensus of $0.54 while revenue of $24.88 billion edged ahead of the $24.69 billion estimate, though both metrics reflected a business navigating genuine margin pressure rather than a breakout performance. Net sales grew 2.5% year over year, propelled by a 2.8% identical sales gain and a 25% surge in digital sales, with pharmacy the primary engine behind the comp improvement. Gross margin compressed to 27.1% from 27.8% a year ago, reflecting deliberate price investments and a shift toward lower-margin pharmacy volume, a dynamic that has intensified as value-seeking consumers push grocers to defend their pricing. Adjusted EBITDA fell to $1.11 billion from $1.18 billion, underscoring that top-line momentum has yet to fully offset the cost of growth. Looking ahead, management raised the low end of its identical sales outlook to a range of 2.0% to 2.75% while maintaining adjusted EPS guidance of $2.03 to $2.16 for the full fiscal year.
- Identical sales increased 2.8%, primarily driven by strong pharmacy sales growth
- Digital sales increased 25%
- Loyalty members grew 14% to 47.3 million
- Productivity initiatives including reductions in shrink expense partially offset gross margin pressures
- Selling and administrative expenses decreased as a percentage of revenue due to lower merger-related costs and leveraging of employee and technology costs
“In the first quarter, we delivered solid operating and financial performance, while investing in our core operations and improving our customer value proposition. Ongoing investments in our strategic priorities drove increased engagement across our digital platforms, evidenced by strong growth in our digital sales, pharmacy operations, and membership in our loyalty program. To fuel these investments, we leveraged our productivity engine to drive efficiencies throughout our operations.”
Albertsons CEO, on the earnings call
Forward Guidance & Outlook
Albertsons raised the low end of its identical sales growth outlook to 2.0%–2.75% (previously 1.5%–2.5%). The company maintained its adjusted EBITDA guidance of $3.8 billion to $3.9 billion (including approximately $65 million from a 53rd week), adjusted EPS of $2.03 to $2.16 per share, effective tax rate of 23.5%–24.5%, and capital expenditures of $1.7 billion to $1.9 billion for fiscal 2025.
ACI YoY Financials
Figures from SEC filings and company reports. Not investment advice.