Campbell's posted another weak stretch, as fiscal Q4 net sales slipped 8% to $2.13 billion, matching expectations and marking a fourth straight drop. Gross profit came in at $583 million, a drop of 17%, as higher supply chain and tariff costs squeezed margins.
Investors did not love it. In New York trading, shares sank up to 10%, adding to a 15% year-to-date slide through Wednesday's close.
"Our performance is not where it needs to be, and we are taking decisive action to improve it," Chief Executive Officer Mick Beekhuizen said. The plan: a cost initiative seeking $500 million of savings by fiscal 2030, designed to bolster margins that have been pressured by higher supply chain and tariff expenses. The company has already shuttered a handful of snack plants and reduced its salaried ranks by 13%, Chief Financial Officer Todd Cunfer said.
Campbell's also lowered its quarterly dividend by 36% to 25 cents per share, the smallest payout since 2009, to help bring down debt. Management plans to roll out some commodity-driven price increases that should start showing up in results next quarter.
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The Camden, New Jersey company is watching demand ease for Goldfish, with softer interest also hitting chips from Kettle Brand and cookies from Pepperidge Farm, as shoppers pivot to healthier, higher-protein choices - a shift further reinforced by rising use of GLP-1 weight loss drugs. Sales of salty snacks, including pretzels and chips, dropped 7.8% versus a year earlier, a pullback executives linked to stiffer competition.
Cunfer called the next stretch for snacks "very challenging" and projected a high single digit decline in that segment's sales this quarter. To meet demand shifts, Campbell's wants to replicate past Goldfish momentum with more varieties, including high-protein and gluten-free options.
Campbell's expects inflation to keep pressuring margins in the new fiscal year, which started Aug. 3, and now forecasts earnings per share to fall 17% to 24% for the year. Looking further out, the company anticipates fiscal 2027 sales will be 2% to 4% lower. For everyday investors, the real watch items are whether price hikes stick, the savings plan hits its marks, and snack innovation actually brings shoppers back.
