FORM 10-Q






                       SECURITIES AND EXCHANGE COMMISSION


                             Washington, D.C. 20549





                         -------------------------------


                                    FORM 10-Q



                   Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


         For 13 Weeks Ended: May 3, 2001 Commission File Number: 1-6187



                                ALBERTSON'S, INC.
              -----------------------------------------------------
             (Exact name of Registrant as specified in its charter)


                               Delaware 82-0184434
   -------------------------------       ------------------------------------
   (State or other jurisdiction of       (I.R.S. Employer Identification No.)
    incorporation or organization)


   250 Parkcenter Blvd., P.O. Box 20, Boise, Idaho                    83726
   -----------------------------------------------                 ----------
                      (Address)                                    (Zip Code)


       Registrant's telephone number, including area code: (208) 395-6200
                                                           --------------


     Indicate  by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.    Yes   X     No
                                                 -----      -----

     Number of Registrant's $1.00 par value
     common shares outstanding at June 4, 2001:         405,344,705


                                       1
<PAGE>



                          PART I. FINANCIAL INFORMATION



                                ALBERTSON'S, INC.
                              CONSOLIDATED EARNINGS
                      (in millions, except per share data)
                                   (unaudited)


<TABLE>
<CAPTION>
                                                                          13 WEEKS ENDED
                                                             ----------------------------------------
                                                                        May 3,               May 4,
                                                                          2001                 2000
                                                             ------------------    ------------------

<S>                                                          <C>                   <C>
Sales                                                                   $9,331               $9,013
Cost of sales                                                            6,673                6,497
                                                             ------------------    ------------------
Gross profit                                                             2,658                2,516

Selling, general and administrative expenses                             2,237                2,138
Merger-related (credits) charges                                           (14)                   2
                                                             ------------------    ------------------
Operating profit                                                           435                  376

Other (expense) income:
  Interest, net                                                           (108)                 (83)
  Other, net                                                               (11)                   1
                                                             ------------------    ------------------
Earnings before income taxes                                               316                  294
Income taxes                                                               130                  115
                                                             ------------------    ------------------

NET EARNINGS                                                            $  186                 $179
                                                             ==================    ==================

EARNINGS PER SHARE:
  Basic                                                                  $0.46                $0.42
  Diluted                                                                $0.46                $0.42

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
  Basic                                                                    405                  424
  Diluted                                                                  408                  424

</TABLE>



















See Notes to Consolidated Financial Statements

                                       2
<PAGE>


                                ALBERTSON'S, INC.
                           CONSOLIDATED BALANCE SHEETS
                                  (in millions)

<TABLE>
<CAPTION>
                                                                        May 3, 2001
                                                                        (unaudited)             February 1, 2001
                                                           -------------------------    -------------------------
                   ASSETS

CURRENT ASSETS:
<S>                                                        <C>                          <C>
  Cash and cash equivalents                                                  $  454                       $   57
  Accounts and notes receivable, net                                            593                          547
  Inventories                                                                 3,394                        3,364
  Prepaid expenses                                                              129                          155
  Property held for sale                                                         70                           71
  Deferred income taxes                                                          80                           70
  Refundable income taxes                                                                                     36
                                                           -------------------------    -------------------------
           TOTAL CURRENT ASSETS                                               4,720                        4,300

LAND, BUILDINGS AND EQUIPMENT (net of
  accumulated depreciation and amortization
  of $5,784 and $5,626, respectively)                                         9,692                        9,622

GOODWILL AND INTANGIBLES, net                                                 1,690                        1,705

OTHER ASSETS                                                                    454                          451
                                                           -------------------------    -------------------------
                                                                            $16,556                      $16,078
                                                           =========================    =========================

     LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                                                          $ 2,257                      $ 2,163
  Salaries and related liabilities                                              455                          561
  Taxes other than income taxes                                                 160                          141
  Income taxes                                                                   92
  Self-insurance                                                                224                          218
  Unearned income                                                                99                          112
  Merger related reserves                                                        11                           13
  Current portion of capitalized lease
    obligations                                                                  19                           20
  Current maturities of long-term debt                                          141                           62
  Other current liabilities                                                     168                          105
                                                           -------------------------    -------------------------
           TOTAL CURRENT LIABILITIES                                          3,626                        3,395

LONG-TERM DEBT                                                                5,849                        5,715

CAPITALIZED LEASE OBLIGATIONS                                                   246                          227

SELF-INSURANCE                                                                  223                          216

DEFERRED INCOME TAXES                                                           120                          116

OTHER LIABILITIES AND DEFERRED CREDITS                                          682                          715

STOCKHOLDERS' EQUITY:
  Preferred stock - $1 par value; authorized
    - 10 shares; issued - none
  Common stock - $1 par value; authorized
    - 1,200 shares; issued - 405 shares
    and 405 shares, respectively                                                405                          405
  Capital in excess of par value                                                 55                           48
  Retained earnings                                                           5,350                        5,241
                                                           -------------------------    -------------------------
                                                                              5,810                        5,694
                                                           -------------------------    -------------------------
                                                                            $16,556                      $16,078
                                                           =========================    =========================
</TABLE>
See Notes to Consolidated Financial Statements

                                       3
<PAGE>


                                ALBERTSON'S, INC.
                             CONSOLIDATED CASH FLOWS
                                  (in millions)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                               13 WEEKS ENDED
                                                                   -------------------------------------
                                                                           May 3,               May 4,
                                                                             2001                 2000
                                                                   ----------------    -----------------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                <C>                 <C>
   Net earnings                                                             $ 186                $ 179
   Adjustments to reconcile net earnings to net
     cash provided by operating activities:
       Depreciation and amortization                                          248                  228
       Goodwill amortization                                                   14                   14
       Noncash merger-related (credits) charges                               (13)                   3
       Net loss on asset sales                                                 14                    5
       Net deferred income taxes and other                                      1                   57
       Decrease (increase) in cash surrender value
         of Company-owned life insurance                                       11                   (1)
       Changes in operating assets and liabilities:
          Receivables and prepaid expenses                                      9                   67
          Inventories                                                         (31)                 119
          Accounts payable                                                     94                   10
          Other current liabilities                                           103                 (135)
          Self-insurance                                                       13                  (24)
          Unearned income                                                     (10)                 (15)
          Other long-term liabilities                                         (36)                 (43)
                                                                   ----------------    -----------------
       Net cash provided by operating activities                              603                  464

CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures, net of proceeds from
     disposals                                                               (327)                (301)
   (Increase) decrease in other assets                                         (2)                  24
                                                                   ----------------    -----------------
       Net cash used in investing activities                                 (329)                (277)

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from long-term borrowings                                         604                    5
   Net commercial paper and bank line activity                               (385)                (176)
   Payments on long-term borrowings                                           (19)                (103)
   Cash dividends paid                                                        (77)                 (76)
   Stock purchases and retirements                                                                 (23)
   Proceeds from stock options exercised                                                             2
                                                                   ----------------    -----------------

       Net cash provided by (used in) financing
         activities                                                           123                 (371)
                                                                   ----------------    -----------------

NET INCREASE (DECREASE)IN CASH AND CASH EQUIVALENTS                           397                 (184)

CASH AND CASH EQUIVALENTS AT BEGINNING
  OF PERIOD                                                                    57                  245
                                                                   ----------------    -----------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                  $ 454                  $61
                                                                   ================    =================
</TABLE>








See Notes to Consolidated Financial Statements

                                       4
<PAGE>


                                ALBERTSON'S, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  (dollars in millions, except per share data)
                                   (unaudited)

Description of Business
   The Company is  incorporated  under the laws of the State of Delaware  and is
the successor to a business  founded by J.A.  Albertson in 1939. Based on sales,
the  Company is one of the  largest  retail  food and drug  chains in the United
States.

   As of  May  3,  2001,  the  Company  operated  2,535  stores  in 36  Western,
Midwestern,  Eastern and Southern states.  Retail  operations  are  supported by
19 major Company distribution operations, strategically located in the Company's
operating markets.

Basis of Presentation
   The accompanying  unaudited  consolidated  financial  statements  include the
results of  operations,  account  balances and cash flows of the Company and its
subsidiaries. All material intercompany balances have been eliminated.

   In  the  opinion  of  management,  the  accompanying  unaudited  consolidated
financial statements include all adjustments necessary to present fairly, in all
material  respects,  the  results of  operations  of the Company for the periods
presented.  Such  adjustments  consisted  only of normal  recurring  items.  The
statements  have  been  prepared  by  the  Company  pursuant  to the  rules  and
regulations of the Securities and Exchange  Commission.  Certain information and
footnote  disclosures  normally  included in  financial  statements  prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted  pursuant to such rules and  regulations.
It is  suggested  that  these  consolidated  financial  statements  be  read  in
conjunction with the consolidated  financial  statements and accompanying  notes
included in the Company's 2000 Annual Report.  The results of operations for the
quarter ended May 3, 2001, are not necessarily  indicative of results for a full
year.

   The  balance  sheet at  February  1, 2001,  has been  taken from the  audited
consolidated financial statements at that date.

   The  preparation  of the  Company's  consolidated  financial  statements,  in
conformity with accounting principles generally accepted in the United States of
America, requires management to make estimates and assumptions.  These estimates
and  assumptions  affect the reported  amounts of assets and liabilities and the
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements,  and the  reported  amounts  of  revenues  and  expenses  during the
reporting period. Actual results could differ from these estimates.

Inventory
   Net  income  reflects  application  of the LIFO  method  of  valuing  certain
inventories, based upon estimated annual inflation ("LIFO Indices"). Albertson's
recorded pretax LIFO expense of $8 and $6 respectively in the quarters ended May
3, 2001 and May 4, 2000.  Actual LIFO indices are  calculated  during the fourth
quarter of the year based upon a statistical sampling of inventories.


                                       5
<PAGE>


Earnings Per Share (EPS)
   Basic EPS is based on the weighted average outstanding common shares. Diluted
EPS is based on the weighted average  outstanding shares reduced by the dilutive
effect  of  stock  options  (2.2  million  and  0.1  million   potential  shares
outstanding  for the quarters ended May 3, 2001 and May 4, 2000,  respectively).
Outstanding  options  which  were  excluded  from the  calculation  as they were
anti-dilutive  amounted to 15.5 million and 16.7 million shares for the quarters
ended May 3, 2001 and May 4, 2000, respectively.

Comprehensive Income
   Comprehensive  income is net income adjusted for certain other items that are
recorded directly to shareholders'  equity.  Comprehensive income consisted only
of reported net  earnings  for the  quarters  ended May 3, 2001 and May 4, 2000.
Comprehensive income equals reported net earnings,  as there were no significant
items of other comprehensive income.

Reclassifications
   Certain reclassifications have been made in prior year's financial statements
to conform to classifications used in the current year.

Reporting Periods
   The  Company's  quarterly  reporting  periods  are  generally  13  weeks  and
periodically  consist of 14 weeks  because the fiscal year ends on the  Thursday
nearest to January 31 each year.

Merger-Related and Exit Costs
   Results of operations for quarter ended May 3, 2001,  include a net of $11 of
merger-related  credits ($6 after tax). The following table presents the pre-tax
(credits) and charges  incurred by category of  expenditure  and  merger-related
accruals included in the Company's Consolidated Balance Sheets:


<TABLE>
<CAPTION>
                                        ------------------- ------------------ ------------------ -------------------
                                                    Exit              Merger           Period
                                                   Costs              Charge            Costs                Total
                                        ------------------- ------------------ ------------------ -------------------
<S>                                     <C>                 <C>                <C>                <C>
Merger related accruals at
   February 1, 2001                                 $  7                  $1              $ 5                 $ 13

Severance costs                                       (1)                                   1
Write-down of assets to net
   realizable value                                  (15)                                   1                  (14)
Integration and other costs                                                                 3                    3
                                        ------------------- ------------------ ------------------ -------------------
       Total (credits) charges                       (16)                                   5                  (11)

Cash expenditures & adjustments                       16                                   (7)                   9
                                        ------------------- ------------------ ------------------ -------------------
Merger-related accruals at
   May 3, 2001                                      $  7                  $1              $ 3                 $ 11
                                        =================== ================== ================== ===================
</TABLE>


                                       6
<PAGE>


   The write-down of assets to net  realizable  value includes the expected loss
on disposal of duplicate  and  abandoned  facilities,  including  administrative
offices,  intangibles and information  technology equipment which were abandoned
by the Company or are being held for sale. This quarter's  activity included $14
of credits  associated  with the  reversal  of  previously  expensed  impairment
charges  related to the sale of the  American  Stores'  Tower in Salt Lake City,
Utah (see subsequent  event  footnote).  The estimated fair value of assets held
for sale has been  determined  using  negotiated  sales  prices  or  independent
appraisals.

   Integration costs consist primarily of incremental transition and integration
costs  associated  with  integrating  the operations of Albertson's and American
Stores  Company  (ASC) and are being  expensed as incurred.  These  include such
costs as labor  associated  with system  conversions and training and relocation
costs.

Indebtedness
   The Company has two revolving credit  agreements which provide for borrowings
up to  $1,650  and a  committed  bank line for $100.  These  agreements  contain
certain  covenants,  the most  restrictive  of which  requires  the  Company  to
maintain  consolidated tangible net worth, as defined, of at least $2,100. As of
May 3, 2001, no amounts were outstanding under these agreements.

   On May 1, 2001,  the Company closed on the issuance of $600 of term notes and
debentures  under a shelf  registration  statement filed with the Securities and
Exchange  Commission in February 2001 (the "2001 Registration  Statement").  The
notes are comprised of $200 of principal  bearing interest at 7.25% due May 2013
and the debentures are comprised of $400 of principal  bearing interest at 8.00%
due May  2031.  Proceeds  were  used to  repay  amounts  outstanding  under  the
Company's  commercial  paper  program  and  other  general  corporate  purposes.
Additional  securities up to $2,400 of principal  remain  available for issuance
under the Company's 2001 Registration Statement.

Supplemental Cash Flow Information
   Selected cash payments and noncash transactions were as follows:

<TABLE>
<CAPTION>
                                                                13 Weeks Ended             13 Weeks Ended
                                                                   May 3, 2001                May 4, 2000
                                                       ------------------------    ------------------------
<S>                                                    <C>                         <C>
   Cash payments for:
     Income taxes                                                          $ 7                       $ 76
     Interest, net of amounts
       capitalized                                                          36                         56
   Noncash transactions:
     Capitalized leases incurred                                            22                         19
     Decrease (increase) in cash
       surrender value of company-owned
       life insurance                                                       11                         (1)
</TABLE>



                                       7
<PAGE>


Capital Stock
   The Board of Directors adopted a program on April 25, 2000, authorizing,  but
not  requiring,  the Company to purchase and retire up to $500 of the  Company's
common stock. This program was increased by an additional $1,000 by the Board of
Directors  on  December  6, 2000,  for a total of $1,500.  The  revised  program
enables the Company to purchase  stock from April 25, 2000, through  December 6,
2001.  During fiscal 2000, the Company purchased and retired 18.7 million shares
at a total cost of $451 or an average  price of $24.15 per share.  No  purchases
were made during the quarter ended May 3, 2001.

Certain Accounting Matters
   On February 2, 2001, the Company  adopted  Statement of Financial  Accounting
Standards No. 133 ("SFAS  133"),  "Accounting  for  Derivative  Instruments  and
Hedging  Activities,"  as amended.  This new standard,  as amended,  establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts,  and for hedging activities.
It  requires  that an entity  recognize  all  derivatives  as  either  assets or
liabilities in the statement of financial position and measure those instruments
at  fair  value.  The  adoption  of this  statement  resulted  in no  transition
adjustment or significant impact on financial  results.  The application of SFAS
133 is  still  evolving  and  further  guidance  from the  Financial  Accounting
Standards Board is expected.  The Company is not aware of any outstanding issues
which are expected to have a significant financial statement impact.

   The Company utilizes derivative  contracts,  such as treasury rate locks, for
hedging interest rate risk associated with issuances of debt. During the quarter
ended  May 3,  2001,  there  were no  significant  transactions.  There  were no
outstanding derivative contracts at May 3, 2001.

   The FASB issued an exposure  draft for Business  Combinations  and Intangible
Assets (including goodwill and identifiable  intangible assets) during February,
2001. The Company's  policy for reviewing  goodwill for  impairment  will not be
significantly  impacted by this exposure draft.  Under the exposure  draft,  the
impairment  approach  will  require the  Company to  disaggregate  and  allocate
goodwill to its reporting units and then record  impairment of goodwill when the
recorded  amount of  goodwill  exceeds  the fair value of the  goodwill  of that
reporting unit.

   Under the Company's  current  accounting  policies,  goodwill is allocated to
certain markets based on prior acquisitions.  As part of normal, on-going review
of performance of markets,  the Company  reviews  long-lived  assets  (including
goodwill) for impairment  whenever  events and  circumstances  indicate that the
carrying amount of the assets may not be recoverable.  For example,  significant
assets  removed  from a market would  trigger a review for  possible  impairment
based on the future expected cash flows of the remaining  assets.  If the sum of
the undiscounted  expected future cash flows is less than the carrying amount of
the assets,  the Company  recognizes an impairment  loss.  Impairments and costs
incurred to close stores or markets,  including  lease  termination  costs,  are
recorded at the time  executive  management  approves  and commits to closing or
relocating such assets.


                                       8
<PAGE>


Legal Proceedings
   On April 5, 2000, a class action  complaint was filed against  Albertson's as
well as American Stores Company, American Drug Stores, Inc., Sav-on Drug Stores,
Inc. and Lucky Stores,  Inc.,  wholly-owned  subsidiaries of the Company, in the
Superior Court for the County of Los Angeles,  California (Mario Gardner, et al.
v. American  Stores  Company,  Albertson's,  Inc.,  American Drug Stores,  Inc.,
Sav-on Drug Stores,  Inc. and Lucky Stores,  Inc.) seeking  recovery of overtime
due to plaintiffs'  allegation  that they were  improperly  classified as exempt
under  California  law. A class  action with  respect to Sav-on  Drug  assistant
managers was recently  certified by the court.  The Company has strong  defenses
against this lawsuit,  and is vigorously  defending it. Although this lawsuit is
subject to the uncertainties  inherent in the litigation  process,  based on the
information  presently available to the Company,  management does not expect the
ultimate  resolution  of this  action to have a material  adverse  effect on the
Company's financial condition.

   On August 23, 2000, a class action  complaint  was filed  against  Jewel Food
Stores, Inc., a wholly-owned  subsidiary of the Company, in the Circuit Court of
Cook County,  Illinois  (Maureen Baker,  et al., v. Jewel Food Stores,  Inc. and
Dominick's Supermarkets,  Inc., Case No. 00L 009664) alleging milk price fixing.
The  Company  has  strong  defenses  against  this  lawsuit,  and is  vigorously
defending it. Although this lawsuit is subject to the uncertainties  inherent in
the litigation  process,  based on the  information  presently  available to the
Company,  management  does not expect the ultimate  resolution of this action to
have a material adverse effect on the Company's financial condition.

   An agreement has been reached,  and court approval  granted,  to settle eight
purported  multi-state  cases  combined in the United States  District  Court in
Boise,  Idaho,  which  raise  various  issues  including  "off the  clock"  work
allegations.  Under the settlement  agreement,  current and former employees who
meet  eligibility  criteria are in the process of  presenting  their claims to a
settlement  administrator.  While the Company cannot specify the exact amount of
their claims,  the $37 pre-tax ($22 after-tax) charge recorded by the Company in
1999  is the  Company's  current  estimate  of  the  total  monetary  liability,
including  attorney fees, for all eight cases.  During the first quarter of 2001
this liability was reduced by an $18 cash payment for legal expenses.

   The Company is also involved in routine litigation  incidental to operations.
The  Company  utilizes  various  methods  of  alternative   dispute  resolution,
including settlement discussions, to manage the costs and uncertainties inherent
in the litigation process. In the opinion of management, the ultimate resolution
of these  legal  proceedings  will not have a  material  adverse  effect  on the
Company's financial condition.

Subsequent Event
   On May 15, 2001, the Company closed on the sale of the American Stores' Tower
in Salt Lake City,  Utah.  This  resulted in a reversal of  previously  recorded
impairment charges.  This reversal was included with merger-related  credits for
the  quarter  ended May 3,  2001.  No  additional  gain or loss is  expected  in
connection with this transaction.



                                       9
<PAGE>


                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  (dollars in millions, except per share data)

Results of Operations
   The following table sets forth certain income statement  components expressed
as a percent to sales and the year-to-year  percentage changes in the amounts of
such components:

<TABLE>
<CAPTION>
                                                Percent to Sales
                                                 13 weeks ended                   Percentage
                                             5-3-01           5-4-00               Increase
                                      ---------------- -----------------     ------------------

<S>                                   <C>              <C>                   <C>
   Sales                                     100.00%          100.00%                    3.5%
   Gross profit                               28.48            27.92                     5.6
   Selling, general and
     administrative expenses                  23.97            23.72                     4.6
   Merger-related (credits)
     charges                                  (0.15)            0.02                    n.m.
   Operating profit                            4.66             4.17                    15.6
   Interest expense, net                       1.16             0.92                    29.9
   Other (expense) income                     (0.12)            0.01                    n.m.
   Earnings before
     income taxes                              3.38             3.26                     7.5
   Net earnings                                2.00             1.98                     4.4

   n.m. - not meaningful
</TABLE>

   Sales for the  quarter  ended May 3,  2001,  increased  by 3.5% over the same
quarter of the prior year. Increases in sales are primarily  attributable to the
continued  development  of new stores and identical and  comparable  store sales
increases.  Identical  store sales  increased 1.0% and  comparable  store sales,
which include replacement stores, increased 1.4%. During the quarter the Company
opened  25  combination  food  and  drug  stores,  1  conventional  supermarket,
17  stand-alone  drugstores  (one of which was  acquired),  and 20 fuel centers,
while closing 13 supermarkets and 7 drugstores.  Twelve of the 20 store closures
were replaced with new stores.  Net retail square footage increased by 3.1% from
the prior  year.  Management  estimates  that  there was  overall  inflation  in
products the Company sells of approximately 1.1% (annualized).  This increase is
being primarily driven by the pharmacy category.

   In addition to store  development,  the  Company has driven  sales  increases
through a number of new initiatives. The Company is starting to see the benefits
of the new  organizational  structure  announced  during fiscal year 2000.  This
alignment  is allowing  the  divisions  to increase  their focus on the customer
through marketing plans that are tailored to fit the individual market.

   The Company  announced a new customer  service  program in March and finished
the last rollout meeting in May. This program,  "Service First, Second to None,"
puts best  practices  from across the Company  into a brand new package and into
tools the stores can use to achieve the highest standards of customer service.

                                       10
<PAGE>

   Albertson's  has also  increased  focus on loyalty  programs  such as the new
Associate  Advantage Loyalty Card Program,  and has entered a national agreement
with Catalina Coupon to extend their program to all Albertson's combination food
and drug stores.

   Gross profit,  as a percent to sales,  increased as a result of the continued
utilization   of  Company   distribution   facilities   and   increased   buying
efficiencies.  The merger has created buying  synergies and margin  improvements
from the implementation of best practices across the Company.  Gross profit also
increased  as a result  of the  elimination  of  incremental  advertising  costs
incurred in the prior year associated with the Lucky banner change.  The pre-tax
LIFO charge  reduced  gross profit by $8 (0.08% to sales) for the 13 weeks ended
May 3, 2001,  as  compared  to $6 (0.07% to sales) for the 13 weeks ended May 4,
2000.

   Selling,  general and administrative expenses as a percent to sales increased
in 2001 as compared to the prior year primarily due to costs associated with the
executive  management change,  increased energy costs, higher benefits expenses,
increased  depreciation  expense associated with the Company's expansion program
and costs associated with the development of the Company's strategic operational
initiatives.  The current year comparison has also been impacted by a $20 charge
taken in the first quarter of the prior year for liabilities  related to certain
previously assigned leases and subleases to tenants who are in bankruptcy.

   The  increase  in net  interest  expense  for the 13 weeks ended May 3, 2001,
resulted  primarily  from higher  average  outstanding  debt during the 13 weeks
ended  May 3,  2001,  as  compared  to the 13  weeks  ended  May 4,  2000.  This
comparison  also  is  impacted  by a $16  interest  expense  reversal  due  to a
favorable income tax settlement reported in the May 4, 2000 quarter.

Merger-Related and Exit Costs
   Results of  operations  for the 13 weeks ended May 3, 2001,  include a net of
$11 of  merger-related  credits ($6 after  tax).  This  included  $14 of credits
associated with the reversal of previously  expensed  impairment charges related
to the sale of the  American  Stores'  Tower in Salt Lake City,  Utah on May 15,
2001.  These  credits  were  offset  by $3  of  integration  charges  consisting
primarily of incremental  labor costs  associated  with system  conversions  and
training and relocation costs.

   The costs of  integrating  the two  companies  have  resulted in  significant
non-recurring  charges  and  incremental  expenses.   These  costs  have  had  a
significant effect on the current quarter and on the prior two years' results of
operations of the Company.  Non-recurring  charges and expenses of  implementing
integration  actions  were  originally  estimated to total $700 after income tax
benefits.  On an after-tax  basis,  and subsequent to the first quarter of 1999,
the Company has incurred  $632 of  merger-related  costs.  With the exception of
some system  conversions,  the  integration  is  substantially  complete and the
Company does not expect to exceed its original estimate of non-recurring charges
and expenses.


                                       11
<PAGE>


Unusual Items
   During the  quarter  ended May 3, 2001,  the  Company  recorded  in  selling,
general and  administrative  expenses $9 of  compensation  related costs for the
executive management changes.

   During the quarter  ended May 4, 2000, a $20 charge was incurred and included
in selling,  general and  administrative  expenses  for  liabilities  related to
certain  previously  assigned  leases  and  subleases  to  tenants  who  are  in
bankruptcy.

   Due to the significance of the merger-related (credits) and charges and other
unusual  items and their effect on operating  results,  the  following  table is
presented to assist in the  comparison of income  statement  components  without
these (credits) and charges:

<TABLE>
<CAPTION>
                     ----------------------------------------------------- -----------------------------------------------------
                                  13 Weeks Ended May 3, 2001                            13 Weeks Ended May 4, 2000
                     ----------------------------------------------------- -----------------------------------------------------
                                                      Without     Percent                                 Without      Percent
                                As       Adjust-      adjust-          To   As Reported      Adjust-      adjust-           To
                          Reported         ments        ments       Sales                      Ments        ments        Sales
                     ------------- ------------- ------------ ------------ ------------ ------------ ------------ --------------
<S>                  <C>           <C>           <C>          <C>          <C>          <C>          <C>          <C>
Sales                       $9,331                     $9,331      100.00%       $9,013                    $9,013       100.00%
Cost of sales                6,673                      6,673       71.52         6,497         $(22)       6,475        71.84
                     ------------- ------------- ------------ ------------ ------------ ------------ ------------ --------------
Gross profit                 2,658                      2,658       28.48         2,516           22        2,538        28.16
Selling, general
 and administrative
 expense                     2,237          $(13)       2,224       23.83         2,138          (53)       2,085        23.13
Merger-related
 (credits) charges             (14)           14                                      2           (2)
                     ------------- ------------- ------------ ------------ ------------ ------------ ------------ --------------
Operating profit               435            (1)         434        4.65           376           77          453         5.03
Interest, net                 (108)                      (108)      (1.16)          (83)                      (83)       (0.92)
Other income, net              (11)                       (11)      (0.12)            1                         1          .01
                     ------------- ------------- ------------ ------------ ------------ ------------ ------------ --------------
Earnings before
 income taxes                  316            (1)         315        3.37           294           77          371         4.12
Income taxes                   130            (1)         129        1.38           115           30          145         1.61
                     ------------- ------------- ------------ ------------ ------------ ------------ ------------ --------------
Net Earnings                $  186          $          $  186        1.99%       $  179         $ 47       $  226         2.50%
                     ============= ============= ============ ============ ============ ============ ============ ==============
</TABLE>


Liquidity and Capital Resources
   Cash  provided  by  operating  activities  during  the first  quarter of 2001
increased  to $603,  compared to $464 in the prior year.  The primary  driver of
this increase relates to the timing of payments for taxes and interest  included
in other current liabilities.  The implementation of the strategic imperative to
maximize  return on  invested  capital  (see  operational  initiatives)  is also
expected to enhance working capital by eliminating unproductive assets, reducing
inventory  and  accounts  receivable  levels  and  increasing  accounts  payable
leverage. These improvements are expected to reduce the cash requirements of the
business.

   The Company's  cash flow from financing  activities  during the quarter ended
May 3, 2001  include  net cash  proceeds  from debt of $200 and the  payment  of
dividends of $77. The increase in cash flow from debt is  attributed to the $600
issuance on May 1, 2001. Due to the timing of this transaction,  the Company was
not able to fully apply these proceeds to pay down commercial  paper balances at
quarter  end.  Debt,  net of cash,  as of May 3,  2001  decreased  by $166  from
February 1, 2001.


                                       12
<PAGE>


   The Board of Directors adopted a program on April 25, 2000, authorizing,  but
not  requiring,  the Company to purchase and retire up to $500 of the  Company's
common stock. This program was increased by an additional $1,000 by the Board of
Directors  on  December  6, 2000,  for a total of $1,500.  The  revised  program
enables the Company to purchase  stock from April 25, 2000, through  December 6,
2001. No purchases were made during the current quarter. As of the quarter ended
May 3, 2001,  the Company has  purchased  and retired 18.7  million  shares at a
total cost of $451 or an average price of $24.15 per share.

   The Company utilizes its commercial paper and bank line programs primarily to
supplement cash requirements for seasonal fluctuations in working capital and to
fund its capital  expenditure  program.  Accordingly,  commercial paper and bank
line borrowings will fluctuate between reporting  periods.  The Company had $768
of commercial  paper  borrowings outstanding  at May 3, 2001, compared to $1,453
outstanding as of May 4, 2000.

   The Company has two revolving credit  agreements which provide for borrowings
up to $1,650 and a committed bank line of $100. These agreements contain certain
covenants,  the most  restrictive  of which  requires  the  Company to  maintain
consolidated  tangible net worth (CTNW), as defined,  of at least $2,100. At the
end of  first quarter 2001,  CTNW,  as defined,  was approximately $4,100. As of
May 3, 2001,  no amounts were  outstanding under  the credit  facilities or bank
line.

   On May 1, 2001,  the Company closed on the issuance of $600 of term notes and
debentures  under a shelf  registration  statement filed with the Securities and
Exchange  Commission in February 2001 (the "2001 Registration  Statement").  The
notes are comprised of $200 of principal  bearing interest at 7.25% due May 2013
and the debentures are comprised of $400 of principal  bearing interest at 8.00%
due May  2031.  Proceeds  were  used to  repay  amounts  outstanding  under  the
Company's  commercial  paper  program  and  other  general  corporate  purposes.
Additional  securities up to $2,400 of principal  remain  available for issuance
under the Company's 2001 Registration Statement.

Certain Accounting Matters
   On February 2, 2001, the Company  adopted  Statement of Financial  Accounting
Standards No. 133 ("SFAS  133"),  "Accounting  for  Derivative  Instruments  and
Hedging  Activities," as amended.  SFAS 133 defines  derivatives,  requires that
derivatives  be carried at fair value on the balance  sheet,  and  provides  for
hedge  accounting when certain  conditions are met. The initial adoption of this
standard resulted in no transition adjustment or significant impact on financial
results.  However, the application of SFAS No. 133 is still evolving and further
guidance  from the  Financial  Accounting  Standards  Board  (FASB) is  expected
through the Derivative Implementation Group (DIG).   As the DIG issues tentative
guidance,  they are subject to a comment period,  after which time the FASB will
either change or approve the guidance for implementation.  The Company continues
to monitor these  developments and is not aware of any outstanding  issues which
are expected to have a significant financial statement impact.

   The Company utilizes derivative  contracts,  such as treasury rate locks, for
hedging interest rate risk associated with issuances of debt. During the quarter
ended  May 3,  2001,  there  were no  significant  transactions.  There  were no
outstanding derivative contracts at May 3, 2001.

                                       13
<PAGE>

   The FASB issued an exposure  draft for Business  Combinations  and Intangible
Assets (including goodwill and identifiable  intangible assets) during February,
2001. This exposure draft addresses the elimination of the  pooling-of-interests
method of accounting,  the requirement to no longer amortize  purchased goodwill
or indefinite  life  intangibles,  and the process for reviewing such assets for
impairment. The Company's identifiable intangible assets are not significant for
purposes of  evaluating  this  exposure  draft.  The  scheduled  release of this
standard  on July 1, 2001,  would  require  adoption by the Company in the first
quarter of 2002.  This  exposure  draft is not final and may  change  before the
standard is adopted.

   Under the current exposure draft,  the Company's  goodwill would no longer be
amortized. Instead, it would be reviewed for impairment and expensed only in the
periods in which the  recorded  value of goodwill is more than its implied  fair
value. Goodwill amortization impacted the basic and diluted per share amount for
the first quarter by $0.04 in both 2001 and 2000, respectively.

Operational Initiatives
   The  Company is  implementing  five  strategic  imperatives  with the goal of
achieving the Company's full potential.

   1) Aggressive  cost and process control is being  implemented  with each main
      category of expense,  including  labor,  to be  rigorously  monitored by a
      member of executive management.

   2) A formal process to review and measure investments, starting with a review
      of  significant  assets in the  Company  and  using a return  on  invested
      capital  approach,  will be implemented.  Once complete,  this analysis is
      expected to allow the Company to address assets that are not adding value.

   3) A  customer-focused  approach to growth is being  implemented by examining
      elements  of the  customer  proposition.  The Company  plans to  re-direct
      non-value  added  dollars  saved  from the  expense  and  process  control
      programs back into the marketplace in order to impact  customers and drive
      growth.

   4) The Company plans to commit a greater share of its capital expenditures to
      information and process  technology over the next three to five years with
      the goal of becoming a leader.

   5) The  Company  will strive to make  Albertson's  an employer of choice with
      less  bureaucracy,  fewer layers of  management,  stronger  communication,
      better training programs and exciting new reward programs.

Environmental
   The  Company  has  identified   environmental   contamination  sites  related
primarily to underground  petroleum storage tanks and ground water contamination
at various store,  warehouse,  office and manufacturing  facilities  (related to
current  operations as well as previously  disposed of businesses).  The Company
conducts  an ongoing  program for the  inspection  and  evaluation  of new sites
proposed  to be  acquired  by the  Company  and  the  remediation/monitoring  of
contamination at existing and previously owned sites. Undiscounted reserves have
been established for each environmental contamination site unless an unfavorable
outcome is remote.  Although the ultimate  outcome and expense of  environmental
remediation is uncertain,  the Company  believes that required  remediation  and

                                       14
<PAGE>

continuing  compliance with  environmental  laws, in excess of current reserves,
will not have a  material  adverse  effect  on the  financial  condition  of the
Company.  Charges  against  earnings  for  environmental  remediation  were  not
material for the 13 weeks ended May 3, 2001, or the 13 weeks ended May 4, 2000.

Cautionary Statement for Purposes of "Safe Harbor Provisions"
of the Private Securities Litigation Reform Act of 1995
   From time to time, information provided by the Company,  including written or
oral  statements  made  by  its  representatives,  may  contain  forward-looking
information as defined in the Private Securities  Litigation Reform Act of 1995.
All  statements,  other than  statements  of  historical  facts,  which  address
activities,  events or developments that the Company expects or anticipates will
or may  occur  in the  future,  including  such  things  as  integration  of the
operations  of  acquired  or  merged  companies,  expansion  and  growth  of the
Company's  business,  future  capital  expenditures  and the Company's  business
strategy, contain forward-looking  information. In reviewing such information it
should be kept in mind that  actual  results  may differ  materially  from those
projected or suggested in such forward-looking information. This forward-looking
information  is  based  on  various  factors  and  was  derived  using  numerous
assumptions. Many of these factors have previously been identified in filings or
statements made by or on behalf of the Company.

   Important  assumptions  and other  important  factors that could cause actual
results  to  differ  materially  from  those  set  forth in the  forward-looking
information  include  changes  in  the  general  economy,  changes  in  consumer
spending, competitive factors and other factors affecting the Company's business
in or beyond the Company's control. These factors include changes in the rate of
inflation,  changes  in state or  federal  legislation  or  regulation,  adverse
determinations   with  respect  to   litigation   or  other  claims   (including
environmental  matters),  labor  negotiations,  the cost and stability of energy
sources, the Company's ability to recruit and develop employees,  its ability to
develop  new stores or complete  remodels as rapidly as planned,  its ability to
implement new technology successfully, stability of product costs, the Company's
ability to integrate  the  operations of acquired or merged  companies,  and the
Company's ability to achieve its five strategic imperatives.

   Other  factors  and  assumptions  not  identified  above could also cause the
actual results to differ materially from those set forth in the  forward-looking
information.   The  Company  does  not   undertake  to  update   forward-looking
information contained herein or elsewhere to reflect actual results,  changes in
assumptions  or  changes  in  other  factors   affecting  such   forward-looking
information.

Quantitative and Qualitative Disclosures About Market Risk
   There have been no  material  changes  regarding  the  Company's  market risk
position  from the  information  provided  under the caption  "Quantitative  and
Qualitative  Disclosures  About Market Risk" on pages 27 and 28 of the Company's
2000 Annual Report to Stockholders.


                                       15
<PAGE>


                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings
   The  information  required  under  this  item is  included  in the  Notes  to
Consolidated  Financial  Statements  under  the  caption "Legal Proceedings"  on
page 9 of  Part I,  Financial  Information  of  this  Report on  Form 10-Q. This
information is incorporated herein by this reference thereto.

Item 2.  Changes in Securities
   In accordance  with the Company's  $1,650  revolving  credit  agreement,  the
Company's  consolidated  tangible net worth, as defined,  shall not be less than
$2,100.

Item 3.  Defaults upon Senior Securities
   Not applicable.

Item 4.  Submission of Matters to a Vote of Security Holders
   Not applicable.

Item 5.  Other Information
   On May 22, 2001, A. Craig Olson, Executive Vice President and Chief Financial
Officer,  announced his resignation.  A search for a new chief financial officer
has been launched.  In the interim,  Richard J. Navarro,  Senior Vice President,
Controller, has been named Acting Chief Financial Officer.

Item 6.  Exhibits and Reports on Form 8-K
   a. Exhibits

                  None

   b. The  following  reports  on  Form 8-K  were filed during the quarter ended
      May 3, 2001:

         Current Report on Form 8-K dated April 26, 2001, reporting the issuance
         of $200,000,000  aggregate  principal  amount of 7.25% senior notes due
         2013  and  $400,000,000  aggregate  principal  amount  of  8.0%  senior
         debentures due 2031.

         Current  Report  on Form 8-K  dated  April  26,  2001,  announcing  the
         appointment of Lawrence R. Johnston as a Class I Director,  Chairman of
         the Board and Chief Executive Officer for Albertson's, Inc.


                                       16
<PAGE>

                                    SIGNATURE


   Pursuant to the  requirements  of the  Securities  Exchange Act of 1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                                ALBERTSON'S, INC.
                                  ---------------------------------------------
                                                  (Registrant)



Date:    June 12, 2001            /S/ Richard J. Navarro
                                  ---------------------------------------------
                                  Richard J. Navarro
                                  Senior Vice President, Controller and
                                    Acting Chief Financial Officer




















                                       17