The Kroger Co. has unveiled a refreshed eCommerce strategy designed to streamline the online shopping experience, attract new customers, and strengthen profitability across its digital operations. The retailer expects these strategic shifts to contribute nearly $400 million in additional eCommerce operating profit by 2026, enabling further investments in lower prices, enhanced store conditions, and improved operational margins.
As part of this restructuring, Kroger anticipates recording approximately $2.6 billion in impairment and related charges in the third quarter of fiscal 2025. These charges stem from selected facility closures and underperformance within its automated fulfillment network. Despite these changes, Kroger projects a neutral impact on identical sales excluding fuel.
Kroger’s enhanced hybrid eCommerce model will leverage its extensive store network, established partnerships with third-party delivery providers, and automated fulfillment centers to accelerate digital growth and fulfillment efficiency.
“eCommerce continues to be essential for customers who expect value, variety, and flexible shopping options,” said Ron Sargent, Kroger’s Chairman and CEO. “With five straight quarters of double-digit online sales growth and rising profitability, we are taking purposeful steps to make shopping faster, simpler, and more rewarding while supporting sustainable, profitable sales expansion.”
As part of its updated digital ecosystem, Kroger has deepened its alliance with Instacart, now serving as its primary delivery partner on Kroger.com and the Kroger mobile app. Kroger will also be among the first retailers to integrate Instacart’s new AI-powered Cart Assistant within its iOS app. Additionally, expanded collaborations with DoorDash and a new experience launching on Uber Eats in early 2026 will help the retailer reach more customers by offering on-demand grocery and food delivery.
The rise in customer engagement across these platforms is also expected to enhance Kroger’s retail media business, unlocking new advertising opportunities for brands seeking targeted visibility.
“Kroger customers want convenient access to fresh, affordable food without sacrificing value,” said Yael Cosset, Executive Vice President and Chief Digital Officer at Kroger. “Our blended model—combining store proximity, automation, and a broad assortment—allows us to serve families quickly and efficiently, in some cases delivering within just 30 minutes.”
After a detailed assessment of its operational footprint, Kroger will close automated fulfillment centers in Pleasant Prairie, Wisconsin; Frederick, Maryland; and Groveland, Florida in January. Performance of the remaining centers will continue to be monitored. In markets with higher customer density, the company will continue investing in automated solutions and will also pilot cost-effective, store-based automation to elevate fulfillment efficiency and improve in-store experiences.
Through this flexible hybrid fulfillment network—integrating stores, third-party partners, and automation—Kroger aims to deliver greater convenience, stronger value, and a more profitable eCommerce model for the long term.
