General Mills forecasts hit to annual sales, profit as snacking demand slows
By Neil J Kanatt
(Reuters) -General Mills cut its annual sales and profit forecasts on Wednesday, as the Pillsbury owner takes a hit from choppy demand for salty snacks and pet food in North America amid competition from private-label rivals.
Shares of the Cheerios maker was down around 3% in early trading.
Several packaged food companies – including Conagra Brands, Campbell’s and Kraft Heinz – have flagged a tough demand backdrop as price-sensitive shoppers spent mindfully on branded snacks and cut back on frequent restaurant trips.
Analysts view General Mills’ forecast cut as more drastic than expected.
General Mills faces an “uphill battle” with concerns around tariff driving up cost of living, according to Emarketer analyst Blake Droesch.
“Even if tariffs don’t materialize and consumer confidence improves, those who have turned to private label or other lower-cost alternatives are not certain to return to national brands,” he added.
The Minnesota-based company expects full-year organic sales to be down 1.5% to 2%, compared with a prior forecast of flat to up 1%.
It said the annual outlook did not include any impact from recent tariff actions by the Trump administration, as the implementation dates and scope of the levies remained uncertain.
Adjusted profit for the full year is now expected to decline in the range of 7% to 8%, compared with a prior forecast of down between 1% to 3%.
The Betty Crocker parent said it plans new initiatives targeting cost savings of at least $100 million in fiscal 2026.
It reported net sales of $4.84 billion for the quarter ended February 23, missing analysts’ estimate of $4.96 billion, according to data compiled by LSEG.
General Mills said an “unexpected” inventory reduction by retailers in its retail and pet food segment hampered its quarterly sales.
Adjusted profit came in at $1 per share, above estimates of 96 cents per share.
(Reporting by Neil J Kanatt in Bengaluru; Editing by Shailesh Kuber)
