Grocery giant Albertsons is planning an extensive overhaul as inflation continues to hinder consumer spending.

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The company released quarterly earnings Tuesday (Oct. 13) showing a sales dip of 0.8%, and said it was pausing its financial guidance as it undertakes a sweeping business review.

“Sales and earnings growth have not met our expectations,” Meg Whitman, Albertsons’ recently appointed executive chair, said on an earnings call.

“Market share trends have lagged, and despite many individual successes across the business, we’re not delivering results consistent with the quality of our assets. We must turn things around. The first step is to take a hard look at the business, challenge assumptions, and decide what actions create the greatest value for customers and shareholders.”

At the center of the strategic pivot is a rapidly shifting consumer landscape, with persistent high inflation and steep fuel costs squeezing household budgets.

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“I would say that as you’re hearing across the industry, we are seeing the customer remain under pressure,” CEO Susan Morris said. “Particularly our lower-income customers, they’re still trading down, looking for value, buying more private label. And we expect to see that continue for the short term.”

Recent research by PYMNTS Intelligence shows that paycheck-to-paycheck consumers have little room to reduce expenses as it is.

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