Key facts
- Kraft Heinz lowered its annual sales and profit forecasts, citing persistent weakness in consumer demand.
- The company now expects 2025 organic net sales to decline between 3% and 3.5%.
- Annual adjusted earnings per share are forecast to be between $2.50 and $2.57.
- Third-quarter net sales declined 2.3% to $6.24 billion, missing estimates.
- CEO Carlos Abrams-Rivera stated that operating conditions remain challenging and consumer recovery will take longer than anticipated.
Kraft Heinz has lowered its annual sales and profit forecasts, signaling persistent weakness in demand for its pricier snacks and pantry condiments from budget-conscious consumers amid macroeconomic uncertainty. The company now expects 2025 organic net sales to fall between 3% and 3.5%, a downward revision from its prior target of a 1.5% to 3.5% decline. This outlook is weighed down by weakness in markets including Indonesia and tepid demand from retailers in the U.S.
CEO Carlos Abrams-Rivera stated in a release that the operating environment remains challenging and that these pressures are expected to persist beyond the fourth quarter, leading to a longer path to consumer recovery. Cost-conscious consumers have increasingly switched to cheaper store brands due to high inflation and economic uncertainty. The company forecast annual adjusted earnings per share of between $2.50 and $2.57, compared with its prior expectation of $2.51 to $2.67.
Kraft Heinz reported a net sales decline of 2.3% to $6.24 billion in the third quarter ended Sept. 27, missing analysts’ estimates of $6.26 billion. Net sales in its North America segment fell 3.8%, while overall prices for the company increased by one percentage point. Excluding items, it reported quarterly earnings per share of 61 cents, compared with estimates of 58 cents. Packaged foods peer Hormel Foods also posted preliminary quarterly results below expectations on Wednesday.