Kroger plans to eliminate roughly 3K corporate roles over the next three years, CEO Greg Foran told staff in a memo dated Oct. 12.
The cuts hit about 37% of the grocer's 8.2K corporate employees, the largest such reduction in the company's 143-year history. A Kroger representative confirmed the plan.
Decisions on which corporate roles go will be shared in the coming months. Foran, who took over as chief executive in February, framed the restructuring around speed and cost. He wrote that Kroger has more layers, handoffs, and overhead than it needs.
"Our business is becoming leaner, more focused and more competitive."
Greg Foran, Kroger
AI is doing some of the cutting
Kroger is folding artificial intelligence into its workflow, and the memo ties the job reductions to reducing duplicative work through technology.
The company laid out its AI strategy last month, including models that manage workflows and use customer data to power an AI shopping assistant.
Savings are earmarked for lower prices and investment in in-store employees, Foran said.
The backdrop is a tougher grocery market. Kroger recently lowered its annual identical sales target and is cutting prices to compete with Walmart ($WMT) and Aldi as shoppers tighten up.
Foran's earlier push this year centered on lowering prices and negotiating better supplier deals to match the scale of Costco, Walmart, and Amazon, per the memo shared with Grocery Dive.
The courtroom bill is waiting
Albertsons is demanding more than $9.3B from Kroger over the collapse of their $24.6B merger, which a federal court blocked in December 2024.
Lawyers presented the demand in Delaware Chancery Court this week, ahead of a two-week trial scheduled for later this month.
The figure covers the premium shareholders would have received, a $600M termination fee, $75M in interest, and additional costs.
Albertsons wants Judge Lori Will to rule that Kroger willfully breached the deal by failing to use best efforts to win regulatory approval, including refusing to change its asset divestiture plan.
The merger agreement required Kroger to clear any antitrust obstacle, capped only at divesting no more than 650 stores, according to the court filing.
Kroger rejects the accusations and says it pursued every avenue for approval. Two timelines now run side by side. A three-year cost-cutting plan built on technology, and a trial that could land a bill larger than most of the savings it produces.
