Kroger plans to cut 3,000 corporate jobs over the next three years as it expands artificial intelligence to streamline operations. The Cincinnati-based supermarket chain says the technology will change how work gets done, while corporate employees face the planned layoffs.
Who Pays for the Shift
CEO Greg Foran announced the plan in a memo to employees on Monday. “Technology is reshaping what's possible,” Foran wrote. “The way work gets done is changing across every industry; we must adapt and take advantage of technology. We need to adopt capabilities, reduce duplicative work and look closely at where work is best fit to be done.”
Kroger says the layoffs will reduce duplicative work and move tasks to places where the company considers them better suited. The company plans to cut 3,000 corporate jobs over three years. The memo doesn't identify which jobs will go or how many cuts will happen each year.
Last month, Kroger outlined an artificial-intelligence strategy it said was intended “to improve the customer experience, make work easier for associates and produce better business outcomes.” Now, the job cuts put that technology push alongside a stated reduction in corporate staffing. The article gives no estimate of the financial savings from the cuts or the cost of the AI strategy.
Kroger has 409,000 employees and more than 2,700 stores. It is the largest standalone U.S. supermarket chain, operating under brands including Ralphs, King Soopers, Smith's and Fred Meyer. The announced layoffs target corporate employees, not a stated number of store workers.
Competition and Consolidation
Kroger competes with Walmart, discount chains Aldi and Lidl, and online companies such as Amazon. Americans increasingly pick up groceries alongside other general goods sold by Walmart, the article reported. It offers no comparative sales or profit figures for the companies.
Kroger proposed a merger with Albertsons in 2022, saying the combination would help it compete with rivals. In 2024, the Federal Trade Commission and Washington and Colorado sued to block the deal. They argued it would raise prices and lower workers' wages by eliminating competition. Judges ultimately ruled the merger shouldn't proceed.
A day after the merger collapsed, Albertsons sued Kroger. Albertsons sought a $600 million termination fee, along with billions of dollars in legal fees and lost shareholder value. Kroger called the claims “baseless” and said Albertsons wasn't entitled to the fee. The article reports the competing claims but doesn't say a court has ruled on Albertsons' suit.
Management's Next Move
Kroger named Foran CEO in February, 11 months after the company's previous CEO resigned abruptly. Before taking the role, Foran led Walmart's U.S. division from 2014 to 2019. At Walmart, he focused on cleaning up stores, keeping items in stock and improving fresh produce selection, while introducing online ordering and pickup and accelerating the company's digital capabilities.
Kroger shares fell 1.6% in morning trading Tuesday, to $61.66. The reported drop came as the company outlined workforce cuts, faced competition from other retailers and continued its dispute with Albertsons over the failed merger. The article reports no union response, worker-organizing campaign or company estimate of how the layoffs would affect operating costs.