Safeway is closing more stores in 2026, continuing a downsizing wave under parent company Albertsons that claimed dozens of locations last year. Safeway operates just over 900 locations nationwide, primarily concentrated in the western U.S., with a small presence in Maryland and Virginia, and the latest closures reflect the grocer’s effort to streamline its footprint following the collapse of its proposed merger with Kroger.
Most of the Safeway closures stem from expiring leases rather than a broader market retreat. In Washington, D.C., Safeway permanently closed its Hechinger Mall location after nearly 40 years on May 16, 2026. “We are coming to the end of our lease at this location, and have made the decision to reinvest our resources into other existing stores,” the company said in a statement.
The store closures follow Albertsons’ failed $24.6 billion merger with Kroger, which federal judges blocked in December 2024 on antitrust grounds. After the deal collapsed, Albertsons shifted away from expansion and began streamlining its existing footprint. In 2025, Albertsons closed at least 30 stores across its various banners, including locations under the Carrs, Albertsons, and United Supermarkets names, and that pace has continued into 2026.
Albertsons reported broader operational challenges in its first quarter of fiscal 2026. Identical sales—a key retail metric that strips out newly opened and closed stores—fell 0.8% in the 16 weeks ended June 20, according to the company’s July 23 earnings report. Net income dropped to $84.7 million, or 17 cents per share, compared with $236.4 million, or 41 cents per share, in the same period a year ago.
Restructuring to Address Slowing Sales
In response to the sales decline and mounting competitive pressure, CEO Susan Morris announced a sweeping restructuring initiative called ACI Edge on July 23. The plan consolidates Albertsons’ 11 divisions into four regions and centralizes center-store merchandising under a single enterprise team. “These actions are designed to deliver sharper value, greater differentiation in fresh, and an elevated customer experience across our stores and markets,” Morris said.
The restructuring also prompted Albertsons to cut its full-year financial outlook. The company now expects identical sales to range from negative 1.5% to negative 0.5%, compared with its previous guidance of flat to up 1%. Adjusted EBITDA guidance was cut to $3.55 billion to $3.625 billion from a prior range of $3.85 billion to $3.925 billion.
Morris cited pressure from value-conscious consumers as a key challenge. “The biggest challenge for Albertsons is its lower-income shoppers, those shoppers are buying fewer items, more generic brands,” she noted in a July 23 earnings discussion. The company also faces intensifying competition from Costco, Walmart, and regional chains like H-E-B, which have eroded Albertsons’ market share in recent years.
Albertsons owns more than 20 different grocery banners across 35 states, including Safeway, Vons, Jewel-Osco, Shaw’s, and ACME. The company said it is “opening new stores in areas with strong demand and long-term opportunity, while also making the difficult decision to close some locations,” and that it works “to place as many associates as possible in other stores.” However, the full scope of which chains and specific stores will be most affected remains unclear as the footprint review continues.
Sources
- Inc. — Safeway store closures continuing through 2026 under Albertsons downsizing, with Hechinger Mall D.C. location closing after 40 years
- Idaho Business Review — Albertsons Q1 2026 identical sales decline, ACI Edge restructuring plan consolidating 11 divisions into 4 regions, lowered full-year guidance
- NPR — Albertsons and Kroger merger blocked by federal judges in December 2024, Albertsons filed lawsuit against Kroger
