USA | The Kroger Co. announced updates to its eCommerce plan, resulting in a differentiated and simplified customer experience, new households shopping at Kroger, and immediate profitability improvements.
Kroger expects these updates to positively affect its eCommerce operating profit, which is expected to be approximately USD 400 million in 2026. This will improve the customer experience by lowering prices and improving store conditions, while also boosting operating margins.
The company expects to incur impairment and related charges in the third fiscal quarter of 2025 of approximately USD 2.6 billion, resulting from these closures and the automated fulfilment network not meeting financial expectations. The company expects these closures to have a neutral effect on its identical sales without fuel.
Kroger's hybrid eCommerce offerings will deliver accelerated online growth by leveraging its strong, growing store footprint, well-established third-party delivery partners, and automated fulfilment facilities, where applicable.
"eCommerce remains a core part of serving customers who want better value, wide selection and flexible ways to shop," said Ron Sargent, Kroger's chairman and CEO.
"We are building on a strong foundation with five consecutive quarters of double-digit eCommerce sales growth and increased profitability improvements. We are taking decisive action to make shopping easier, offer faster delivery times, provide more options to our customers, and we expect to deliver profitable sales growth as a result."
Kroger expanded its Instacart relationship as its primary delivery fulfilment provider across Kroger.com and the Kroger app. The companies recently announced that Kroger will be one of the first retailers to offer customers access to Instacart's AI assistant, Cart Assistant, on Kroger's iOS mobile app.
To reach more customers and fulfil more shopping trips, Kroger also broadened its relationship with DoorDash, giving tens of millions of customers access to food and grocery essentials on demand through the DoorDash Marketplace.
In addition, Kroger announced the upcoming launch of a new customer experience on Uber Eats Marketplace in early 2026 to fulfil more customers' shopping needs by providing access to groceries when customers order meals from their favourite local restaurants, as well as offering standard grocery delivery.
Increased customer traffic and trips through these third-party providers will also fuel Kroger's retail media business growth through first-of-its-kind capabilities, creating new opportunities for CPGs to reach and engage customers with relevant advertising.
"Every customer is different, and they expect more options to access fresh, affordable food, without compromising on the value or convenience," said Yael Cosset, executive vice president and chief digital officer for Kroger.
"Our differentiated approach, combining the proximity of our stores with high-capacity automation, the wide assortment of the fresh food they love, allows us to fulfil more trips for the families we serve. Being able to deliver food and groceries to tens of millions of families who shop with us every year, in as little as 30 minutes, is a winning model for Kroger and our customers."
In geographies where Kroger sees higher demand density, the company will continue to leverage automated customer fulfilment to increase customer engagement, capacity, and productivity and profitability.
As part of its comprehensive hybrid fulfilment network, Kroger will also pilot capital-light, store-based automation in high-volume geographies to improve fulfilment capabilities and elevate the in-store customer experience. The adjustments to the network, combined with increased store-based fulfilment, will improve ROIC.
This flexible, hybrid network balances an expanded store footprint, third-party delivery, and automation, providing customers with the products they love, the value they want, through the options they need, while building a sustainable and profitable business.
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