Kroger is closing nearly 1,000 corporate positions for cost cutting

Investing.com — The Kroger Company (NYSE:KR) is laying off nearly 1,000 corporate employees as part of a restructuring to reduce costs and focus on core operations. A source close to the matter quoted this information to Investing.com. These layoffs will not affect store, production or distribution center employees.

The layoffs follow Bloomberg's report Tuesday that cited a memorandum sent to staff by interim CEO Ron Sargent. The message outlined internal changes aimed at simplifying operations and reallocating resources to where they are most effective.

Sargent wrote in the memorandum: “These decisions are never easy, but we know that thoughtful but difficult choices are necessary to prepare our organization for continued success.” As part of the restructuring, Kroger will end projects that no longer align with its business priorities.

The company plans to reinvest the savings from these cuts into lowering prices, opening new stores and adding more front-line staff. No financial figures have been released, and it is unclear how much the company expects to save from the reorganization.

As of February, Kroger employed more than 409,000 people, the vast majority of whom worked in stores. The company did not disclose in detail how many employees are in its corporate tiers.

Ron Sargent took over as interim CEO earlier this year following the departure of former CEO Rodney McMullen. Kroger has not yet announced a timeline for appointing a permanent executive.

The company's shares lost 1.6% on the day after the initial news and are currently flat in after-hours trading.

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