The news: New Kroger CEO Greg Foran said the grocer must win customers with “great value, great products, and a great experience,” adding that “price is an important part of that equation.” Kroger says it made progress on that front by improving customers’ price perceptions, which likely contributed to solid results.

Same-store sales excluding fuel nearly doubled from 1.5% to 2.9% last year, and adjusted EPS rose 9% YoY. Even so, the company faces mounting pressure as Aldi and Whole Foods expand, Amazon accelerates online grocery growth by adding perishables to same-day delivery, and Walmart continues to gain share in online grocery, according to our forecast.

Looking ahead: Foran sees further opportunities to cut costs and reinvest the savings into lower prices. Kroger is renegotiating private-label supplier agreements and going direct where it previously relied on intermediaries. Its revamped ecommerce strategy has also lowered expenses by shifting more fulfillment to its store network while increasingly leaning on third-party delivery partners such as Instacart, DoorDash, and Uber to handle last-mile logistics more efficiently.

At the same time, Kroger is doubling down on value to drive share gains. The company is building on its $39 billion private-label business, expanding promotions, lowering select prices, and continuing to offer paper coupons.

Ecommerce, which we expect to expand 13.4% this year, remains a priority. The division generated $16 billion in sales last year and grew 20% in Q4, and Kroger is working to improve profitability. That growth also strengthens its retail media business: As more shoppers transact online, Kroger can serve more ads, capture richer data, and deliver greater value to brand partners.

Implications for Kroger, other retailers, and brands: Kroger, like many other retailers, offered cautious full-year guidance, projecting comparable sales excluding fuel to rise between 1% and 2%. That may reflect an under-promise, over-deliver strategy, but it also suggests further work is needed to reinforce its value proposition.

While Foran’s playbook appears disciplined, the cost-of-living pressures weighing on consumers are unlikely to ease soon—especially if gas prices remain elevated. In that environment, shoppers may increasingly trade down unless Kroger can clearly demonstrate that it delivers strong value for the money.