When Susan Morris became CEO of Albertsons last May, the supermarket chain was still mired in the fallout from its ill-fated effort to merge with Kroger, its growth prospects were in doubt and industry experts warned that the grocer needed to rapidly make drastic changes to remain relevant.
A year later, Albertsons has made meaningful progress in its quest to rejuvenate its business, but as she marks her first anniversary as CEO, Morris faces a steep challenge in blazing a path for the company in a grocery environment where Walmart, Costco and Amazon have only grown stronger, analysts said.
Morris has succeeded in bringing executional discipline and stability to a company that was rocked by uncertainty during the more than two years it devoted to trying to combine with Kroger before the would-be partners called it quits at the end of 2024, said Thom Blischok, chairman and CEO of consulting firm The Dialogic Group, which advises grocers and other retailers. The company’s achievements under Morris include improving store operations, building customer loyalty and expanding e-commerce in a tough economic climate, he said.
“I think this first year could be characterized as a lot of reset, creating a lot of continuity with a high degree of sharper operational intensity, which I think is pretty powerful,” said Blischok. “Year two is going to be first focused on market-winning differentiation … which means she’s got a lot of work to do.”
Another priority for Morris during the months ahead will be to deepen partnerships with CPGs and use their data “to basically have their suppliers become what I would consider to be co-investors in growth,” Blischok said.
The fact that Morris was promoted from within to her role as CEO is among her strongest assets, particularly because her job includes demonstrating to employees demoralized by the failed merger that the company is on track for a turnaround, said Gautham Vadakkepatt, an associate professor of marketing at the University of Central Florida College of Business who studies the retail sector.
Morris spent almost 40 years working for the grocer before she became chief executive. She held the role of executive vice president and chief operations officer at the time she was tapped to replace former CEO Vivek Sankaran, who was at the helm when Albertsons agreed to combine with Kroger in 2022 and led the company throughout the merger-review process.
Certain aspects of Albertsons’ business logged improvements during Morris’ first year on the job. The company’s digital sales rose 21% in fiscal 2025, and digital penetration came in above 10% during the final quarter of the year for the first time. Albertsons also boosted its loyalty program membership by 12% last year, to 51 million members, a trend the company said has led to more transactions and higher customer spending.
In addition, Albertsons revamped its senior ranks with an eye toward efficiency and expanded its retail media arm. The retailer has also invested in modernizing and building stores and put money into artificial intelligence and other technology.
Still, Albertsons recorded weak financial results during its most recent quarter, as pharmacy sales went from being a growth driver to a headwind. The company forecasts that comparable-store sales growth will be essentially flat during fiscal 2026, largely due to pressure on its pharmacy business stemming from the Inflation Reduction Act.
Against that backdrop, the company has spent heavily on activities it put on hold during the merger review, like opening and closing stores and buying equipment — investments that have put pressure on the grocer’s margins and earnings, Arun Sundaram, senior vice president of equity research for CFRA Research, wrote in an email.
While investors anticipated that Albertsons would have a difficult time financially in 2025, their patience may soon wear thin, he added.
“The real test is this year. Investors expect the investments made throughout 2025 to start paying off, especially the price investments aimed at spurring traffic,” Sundaram said. “In that sense, 2026 feels like a make-or-break moment for Morris and her team.”
One pressing issue confronting Albertsons is its stock price, which has sagged about 25% during the time Morris has been CEO and is hovering at a five-year low.
Morris told investors in January that she believed the company was undervalued, adding that the “disconnect only sharpens our resolve to execute faster, scale our transformation and deliver the performance that ultimately commands the value this company deserves.”
Investor discontent could eventually prompt calls for Albertsons to make top-level executive adjustments, raising the stakes for Morris, Sundaram said.
“If Albertsons can start rebuilding margins and return to earnings growth, investors will likely reward the stock. But if we see another year of margin compression and earnings declines, then expect chatter about management change to get louder,” he said.
