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Consumer Staples · Earnings · General Mills · Turnaround
General Mills reported a challenging third quarter for fiscal 2026, with net sales declining 8% year-over-year to $4.44 billion and organic net sales down 3%.
Operating profit saw a significant 41% drop to $525 million, while diluted EPS fell 50% to $0.56, and adjusted diluted EPS decreased 37% in constant currency to $0.64. Despite these declines, the company reaffirmed its full-year fiscal 2026 outlook, projecting organic net sales to be down 1.5-2% and adjusted operating profit and EPS to be down 16-20% in constant currency.
Management attributed the near-term headwinds to strategic investments in its "Remarkability" playbook, the divestiture of North American yogurt businesses, and the acquisition of Whitebridge pet food. While North America Retail showed improved pound competitiveness, dollar sales were impacted by price investments.
International segments, however, demonstrated momentum with 1% organic net sales growth and strong operating profit. General Mills anticipates stronger fourth-quarter trends and improved results in fiscal 2027, supported by ongoing cost efficiency initiatives and supply-chain restructuring.
Investors face a period of near-term pressure as the company executes its turnaround strategy.