Albertsons Inc. digital sales grew at 10 times the rate of its net sales in its fiscal Q1 2025, which ended June 14.
In its fiscal Q1, Albertsons net sales and other revenue increased year over year to $24.88 billion. That’s 2.5% year-over-year growth compared to $24.27 billion in Q1 of its fiscal 2024.
CEO Susan Morris told investors on the retailer’s earnings call that Albertsons’ results “demonstrate gradual and incremental progress” toward its five strategic priorities:
- Driving customer growth and engagement through digital connection
- Growing Albertsons Media Collective
- Enhancing the customer value proposition
- Modernizing capabilities through technology
- Driving transformational productivity
The media collective refers to Albertsons’ retail media network.
“While our ecommerce penetration is still below industry peers, it is one of our biggest growth customer acquisition and customer retention opportunities for 2025 and beyond,” Morris told investors. “From a profitability perspective, our ecommerce business is near breakeven and improving.”
Albertsons is No. 18 in the Top 2000 Database. The database ranks North America’s top online retailers by their annual ecommerce sales. It owns and operates its namesake store, Albertsons, as well as brands including Carrs, Haggen, Jewel Osco, Lucky, Safeway and more.
Albertsons digital sales in Q1
In its fiscal Q1, Albertsons digital sales increased 25% year over year. Meanwhile, its identical sales — which refers to digital sales and those from the same stores that were open the year before — increased 2.8%.
Ecommerce accounted for 9% of Albertsons’ total grocery revenue in Q1. First-party sales, or those through Albertsons’ websites and apps, led the growth, according to Morris.
“We’re continuing to enhance our digital shopping experience, including the introduction of AI and interactive features that deliver both ease and convenience,” Morris told investors.
That includes launching a feature Albertsons called shop assist. It “enables the connected shopping experience that allows customers to communicate back and forth with our in-store associates throughout their orders fulfillment process,” she said.
Additionally, Albertsons has created more flexibility in its basket building. Customers can add items to their delivery orders until an in-store associate has started the picking process. Morris said Albertsons recognizes that shoppers often think of at least one more item they need just after placing an order.
In addition to selling food through its app, Albertsons also seeks to simplify meal planning and make shopping easier, both in-store and online, Morris said.
“Our app has become the epicenter of the omnichannel experience with digital customers engaging nearly 3x a week on average,” she said. “What began as a tool for enabling ecommerce and delivering great deals is now a Swiss army knife of tools that makes customers’ lives easier regardless of whether they’re shopping in our stores or online.”
Those tools include:
- Building grocery lists
- Personalized meal-planning capabilities
- Search and product-locating capabilities
- In-store mode that connects meal planning and other store-specific capabilities
How other pharmacy closings benefit Albertsons
Albertsons’ digital pharmacy and health sales grew 20% year over year, which Morris attributed to growth in prescriptions and immunization.
That ties into digital grocery sales because cross shoppers tend to visit stores four times more than their counterparts and “buy significantly more groceries with us, resulting in outsized customer lifetime value across the entire store.”
Widespread pharmacy closures in the U.S. create market share opportunity for Albertsons, Morris said. To capitalize on that opportunity, Albertsons is investing in its pharmacy and health digital platform, she added.
“Through this platform, we’re also launching customized omnichannel benefits that are not only attracting new customers but also converting existing pharmacy- and grocery-only customers to become cross-shoppers,” Morris said. “It is also helping customers to find new and personalized ways to improve their health and well-being.”
Albertsons loyalty members
In Q1, Albertsons grew its loyalty platform 14% to 47 million members.
Morris said Albertsons simplified its program to further enhance the value it offers. By making it easier for members to understand how to use the program and redeem discounts and rewards, Albertsons has led customers to spend more.
“A case in point, 30% of our engaged households are now electing the cash off option, reinforcing the customers’ desire for immediate value,” she said.
The loyalty program is key to enabling digital customer engagement, she added. It provides “a rich source of data” for the Albertsons media collective. Throughout the rest of the year, she said, Albertsons will “introduce compelling benefits” to attract new members and “further enable marketing and monetization opportunities for the media collective.”
How Albertsons is using AI agents
Morris said Albertsons has begun using artificial intelligence (AI) agents to enhance business functions.
AI agents are layers of software built on top of large language models (LLMs), designed not only to interact with humans through text-based, chatbot-style interfaces, but also to make decisions and execute actions autonomously.
Albertsons is using them for pricing and promotions, personalization, customer service and more, Morris said.
Check back for more earnings reports. Here’s last quarter’s article on Albertsons digital sales.
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