The Campbell's Company
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This Report contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current expectations regarding our future results of operations, economic performance, financial condition and achievements. These forward-looking statements can be identified by words such as "anticipate," "believe," "estimate," "expect," "intend," "plan," "pursue," "strategy," "target," "will" and similar expressions. One can also identify forward-looking statements by the fact that they do not relate strictly to historical or current facts, and may reflect anticipated cost savings or implementation of our strategic plan. These statements reflect our current plans and expectations and are based on information currently available to us. They rely on several assumptions regarding future events and estimates which could be inaccurate and which are inherently subject to risks and uncertainties. Risks and uncertainties include, but are not limited to, those discussed in "Risk Factors" and in the "Cautionary Factors That May Affect Future Results" in "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in this Report. Our consolidated financial statements and the accompanying notes to the consolidated financial statements are presented in "Financial Statements and Supplementary Data" in this Report.
Item 1. Business
The Company
Unless otherwise stated, the terms "we," "us," "our" and the "company" refer to The Campbell's Company and its consolidated subsidiaries.
We are a manufacturer and marketer of high-quality, branded food and beverage products. We organized as a business corporation under the laws of New Jersey on November 23, 1922; however, through predecessor organizations, we trace our heritage in the food business back to 1869. Our principal executive offices are in Camden, New Jersey 08103-1799.
On March 12, 2024, we completed the acquisition of Sovos Brands, Inc. (Sovos Brands) for total purchase consideration of $2.899 billion. For additional information on this acquisition, see Note 3 to the Consolidated Financial Statements.
On May 30, 2023, we completed the sale of our Emerald nuts business. On August 26, 2024, we completed the sale of our Pop Secret popcorn business. On February 24, 2025, we completed the sale of our noosa yoghurt business. For additional information on the divestitures, see Note 4 to the Consolidated Financial Statements.
Our operations, including reportable segments, are described below. Our locations, including manufacturing facilities, within each reporting segment are described in Item 2. Properties.
Reportable Segments
Our reportable segments are:
•Meals & Beverages, which consists of soup, simple meals and beverages products in retail and foodservice in the U.S. and Canada. The segment includes the following products: Campbell’s condensed and ready-to-serve soups; Swanson broth and stocks; Pacific Foods broth, soups and non-dairy beverages; Prego pasta sauces; Pace Mexican sauces; SpaghettiOs pasta; Campbell’s gravies, beans and dinner sauces; Swanson canned poultry; V8 juices and beverages; Campbell's tomato juice; and as of March 12, 2024, Rao's pasta sauces, dry pasta, frozen entrées, frozen pizza and soups; Michael Angelo’s frozen entrées and pasta sauces; and noosa yogurts. The noosa yoghurt business was sold on February 24, 2025. The segment also includes snacking products in foodservice and Canada; and
•Snacks, which consists of Pepperidge Farm cookies, crackers, fresh bakery and frozen products, including Goldfish crackers, Snyder’s of Hanover pretzels, Lance sandwich crackers, Cape Cod potato chips, Kettle Brand potato chips, Late July snacks, Snack Factory pretzel crisps, and other snacking products in retail in the U.S. The segment also includes the snacking and meals and beverages retail business in Latin America. The segment also included the results of our Pop Secret popcorn business, which was sold on August 26, 2024 and our Emerald nuts business, which was sold on May 30, 2023.
Beginning in 2026, the snacking and meals and beverages retail business in Latin America is managed under our Meals & Beverages segment.
We refer to the following products as our "leadership brands": Campbell's condensed and ready-to-serve soups; Chunky soups; Swanson broth, stocks and canned poultry; Pacific Foods broth, soups and non-dairy beverages; Prego pasta sauces; Pace Mexican sauces; V8 juices and beverages; Rao's pasta sauces, dry pasta, frozen entrées, frozen pizza and soups; Pepperidge Farm cookies, crackers and fresh bakery; Goldfish crackers; Snyder's of Hanover pretzels; Lance sandwich crackers; Cape Cod potato chips; Kettle Brand potato chips; Late July snacks; and Snack Factory pretzel crisps.
See Note 7 to the Consolidated Financial Statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" for additional information regarding our reportable segments.
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Ingredients, Packaging and Finished Products
The ingredients and packaging materials required for the manufacture of our food and beverage products are purchased from various suppliers, substantially all of which are located in North America. We also purchase finished products from domestic and international suppliers. Many of these items are subject to price fluctuations from a number of factors, including but not limited to geopolitical conflicts, shifting global trade policies (including tariffs and retaliatory measures), import and export requirements, product scarcity, demand for raw materials, commodity market speculation, energy costs, currency fluctuations, supplier capacities, government-sponsored agricultural programs and other government policy, climate change, changes in crop size, cattle cycles, herd and flock disease, crop disease, crop pests, drought and excessive rain, temperature extremes and other adverse weather events, water scarcity, scarcity of suitable agricultural land, scarcity of organic ingredients, pandemics or other local or global health issues, environmental and other sustainability regulations and other factors that may be beyond our control. To help reduce some of this price volatility, we use a combination of purchase orders, short- and long-term contracts, inventory management practices, alternative sourcing opportunities, supplier collaboration, various commodity risk management tools for most of our ingredients and packaging and other cost mitigation efforts, as applicable. Ingredient inventories are generally at a peak during the late fall and decline during the winter and spring. Since many ingredients of suitable quality are available in sufficient quantities only during certain seasons, we make commitments for the purchase of such ingredients in their respective seasons.
During 2025, we experienced some volatility in commodity and supply chain costs, including the costs of labor, raw materials, energy, fuel, packaging materials and finished products, with a moderate impact from tariffs in the fourth quarter. We are unable to predict the extent to which tariffs may impact our ability to source ingredients, packaging materials and finished products in the future, and certain supply pressures may continue throughout 2026. In 2026, we expect more significant cost pressures primarily driven by tariff impacts. We plan to reduce some of these costs and impacts over time through cost savings initiatives, inventory management practices, supplier collaboration, alternative sourcing opportunities, continued supply chain productivity initiatives, surgical pricing actions where necessary and other mitigation efforts.
Customers
In most of our markets, sales and merchandising activities are conducted through our own sales force and/or third-party brokers and distribution partners. Our products are generally resold to consumers through retail food chains, mass discounters, mass merchandisers, club stores, convenience stores, dollar stores, e-commerce and other retail, commercial and non-commercial establishments. Our Snacks segment has a direct-store-delivery distribution model that uses independent contractor distributors.
Our five largest customers accounted for approximately 47% of our consolidated net sales in 2025, 2024, and 2023. Our largest customer, Wal-Mart Stores, Inc. and its affiliates, accounted for approximately 21% of our consolidated net sales in 2025 and 22% in 2024 and 2023. Both of our reportable segments sold products to Wal-Mart Stores, Inc. or its affiliates. No other customer accounted for 10% or more of our consolidated net sales.
Trademarks and Technology
As of September 10, 2025, we owned over 3,000 trademark registrations and applications in over 150 countries. We believe our trademarks are of material importance to our business. Although the laws vary by jurisdiction, trademarks generally remain valid and can be renewed indefinitely as long as they are in use and/or their registrations are properly maintained, and they have not become generic. We believe that our principal brands, including Campbell's, Cape Cod, Chunky, Goldfish, Kettle Brand, Lance, Late July, Milano, Pace, Pacific Foods, Pepperidge Farm, Prego, Rao's, Snack Factory, Snyder's of Hanover, SpaghettiOs, Swanson, and V8, are protected by trademark law in the major markets where they are used.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
OVERVIEW
This Management's Discussion and Analysis of Financial Condition and Results of Operations is provided as a supplement to, and should be read in conjunction with, the Consolidated Financial Statements and the Notes to the Consolidated Financial Statements in "Part I - Item 1. Financial Statements," and our Form 10-K for the year ended August 3, 2025, including but not limited to "Part I - Item 1A. Risk Factors" and "Part II - Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations."
Executive Summary
Unless otherwise stated, the terms "we," "us," "our" and the "company" refer to The Campbell's Company and its consolidated subsidiaries.
We are a manufacturer and marketer of high-quality, branded food and beverage products. We operate in a highly competitive industry and experience competition in all of our categories.
On August 26, 2024, we completed the sale of our Pop Secret popcorn business. On February 24, 2025, we completed the sale of our noosa yoghurt business. For additional information on the divestitures, see Note 4 to the Consolidated Financial Statements.
Through the fourth quarter of 2025, the snacking and meals and beverages retail business in Latin America was managed under our Snacks segment. Beginning in 2026, the business is managed under our Meals & Beverages segment. Segment results have been adjusted retrospectively to reflect this change.
Recent Developments
On December 8, 2025, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina di San Marzano di Antonio Romano S.p.A. (La Regina SPA) and La Regina Atlantica, LLC (La Regina Atlantica, and together with La Regina SPA, La Regina). La Regina currently produces all of our Rao’s tomato-based pasta sauces. The aggregate consideration for the transaction is $286 million to be paid in two tranches. Subsequent to the end of the third quarter, we acquired the 49% interests in La Regina on May 4, 2026 for $146 million in cash. The remaining 51% of the outstanding equity interests of La Regina are subject to a call option granted to us and a put option granted to La Regina. For additional information on this transaction, see our Form 8-K filed with the U.S. Securities and Exchange Commission on December 9, 2025, and Note 3 to the Consolidated Financial Statements.
Business Trends
Our industry continues to navigate a dynamic operating and regulatory environment driven by commodity cost volatility, supply chain pressures, tariffs and shifting global trade policies, evolving consumer purchasing and spending patterns and other economic uncertainties. On a year-to-date basis, through the third quarter, we have experienced elevated input cost inflation, impacts from tariffs and other supply chain costs. We expect elevated inflationary pressures to persist through the remainder of 2026 and anticipate the need to benefit from continued supply chain productivity, cost savings initiatives and tariff mitigation efforts to offset some of these costs. We expect consumer trends to continue to evolve and our volumes to improve over time; however, shifting consumer behaviors, economic pressures, and the challenges of persistent inflation may continue to negatively impact our volumes throughout 2026. Although we have no operations in the Middle East, the ongoing geopolitical conflicts in that region, including between Iran and the United States, have caused significant disruption to energy supplies and increases in global energy prices, which has heightened inflationary pressures, disrupted global supply chains and adversely impacted consumer spending patterns. As the situation is rapidly changing, we will continue to evaluate the evolving macroeconomic environment and take actions to mitigate the impact on our business, consolidated results of operations and financial condition.
Summary of Results
This Summary of Results provides significant highlights from the discussion and analysis that follows.
•Net sales decreased 4% in the quarter to $2.366 billion primarily due to unfavorable volume/mix and the impact of the noosa divestiture, partially offset by favorable net price realization.
•Gross profit, as a percent of sales, was 27.5% in 2026 compared to 29.4% in the prior-year quarter. The decrease was primarily due to the gross impact of tariffs and the impact of cost inflation and other supply chain costs, partially offset by benefits from supply chain productivity improvements and favorable net price realization.
•Earnings per share were $.41 in 2026, compared to $.22 in the prior-year quarter. The current quarter included expenses of $.09 per share and the prior-year quarter included expenses of $.51 per share from items impacting comparability as discussed below.
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Net Earnings attributable to The Campbell's Company
The following items impacted the comparability of net earnings and net earnings per share:
•We implemented several cost savings initiatives in recent years. In the third quarter of 2026, we recorded Restructuring charges of $9 million and implementation costs and other related costs of $38 million in Other expenses / (income), $12 million in Cost of products sold, $6 million in Administrative expenses, $1 million in Marketing and selling expenses and $1 million in Research and development expenses related to these initiatives. In the third quarter of 2025, we recorded Restructuring charges of $6 million and implementation costs and other related costs of $7 million in Cost of products sold, $7 million in Administrative expenses, and $1 million in Research and development expenses related to these initiatives. Year-to-date in 2026, we recorded Restructuring charges of $15 million and implementation costs and other related costs of $38 million in Other expenses / (income), $28 million in Cost of products sold, $21 million in Administrative expenses, $3 million in Marketing and selling expenses and $2 million in Research and development expenses related to these initiatives. Year-to-date in 2025, we recorded Restructuring charges of $17 million and implementation costs and other related costs of $26 million in Administrative expenses, $25 million in Cost of products sold, $3 million in Research and development expenses and $2 million in Marketing and selling expenses related to these initiatives.
In the second quarter of 2024, we began implementation of an optimization initiative to improve the effectiveness of our Snacks direct-store-delivery route-to-market network. In the third quarter of 2026, we recognized $2 million in Marketing and selling expenses related to this initiative. In the third quarter of 2025, we recognized $9 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative. Year-to-date in 2026, we recognized $20 million in Marketing and selling expenses related to this initiative. Year-to-date in 2025, we recognized $17 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative.
In the third quarter of 2026, the total aggregate impact related to the cost savings and optimization initiatives was $69 million ($52 million after tax, or $.17 per share). In the third quarter of 2025, the total aggregate impact related to the cost savings and optimization initiatives was $31 million ($24 million after tax, or $.08 per share). Year-to-date in 2026, the total aggregate impact related to the cost savings and optimization initiatives was $127 million ($96 million after tax, or $.32 per share). Year-to-date in 2025, the total aggregate impact related to the cost savings and optimization initiatives was $91 million ($70 million after tax, or $.23 per share). See Note 8 to the Consolidated Financial Statements and "Restructuring Charges, Cost Savings Initiatives and Other Optimization Initiatives" for additional information;
•In the third quarter of 2026, we recognized gains in Cost of products sold of $6 million ($5 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. In the third quarter of 2025, we recognized losses in Cost of products sold of $10 million ($7 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2026, we recognized gains in Cost of products sold of $20 million ($15 million after tax, or $.05 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2025, we recognized gains in Cost of products sold of $8 million ($6 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges;
•In the third quarter of 2026, we recognized actuarial and curtailment gains in Other expenses / (income) of $30 million ($23 million after tax, or $.08 per share). The actuarial and curtailment gains were related to interim remeasurements of certain pension plans due to plan amendments and activity under our cost savings initiatives. Year-to-date in 2025, we recognized an actuarial loss in Other expenses / (income) of $2 million ($1 million after tax) related to an interim remeasurement of our postretirement plan due to a plan amendment;
•In the second quarter of 2026, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina. Subsequent to the end of the third quarter, the acquisition was completed on May 4, 2026. In the third quarter of 2026, we recognized costs associated with the acquisition in Other expenses / (income) of $2 million ($2 million after tax, or $.01 per share). Year-to-date in 2026, we recognized costs associated with the acquisition in Other expenses / (income) of $4 million ($4 million after tax, or $.01 per share);
•Year-to-date in 2026, we recorded litigation expenses in Administrative expenses of $11 million ($8 million after tax, or $.03 per share) related to the Plum baby food and snacks business (Plum), which was divested on May 3, 2021, and certain other litigation matters. In the third quarter of 2025, we recorded litigation expenses in Administrative expenses of $4 million ($4 million after tax, or $.01 per share) related to Plum and certain other litigation matters. Year-to-date in 2025, we recorded litigation expenses in Administrative expenses of $6 million ($6 million after tax, or $.02 per share) related to Plum and certain other litigation matters;
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•Year-to-date in 2026 and 2025, we recognized insurance recoveries in Administrative expenses of $1 million ($1 million after tax) related to a cybersecurity incident that was identified in the fourth quarter of 2023;
•In the third quarter of 2025, the company performed an interim impairment assessment on the Snyder's of Hanover trademark within the Snacks segment and recognized an impairment charge of $150 million ($112 million after tax, or $.37 per share) on the trademark.
In the second quarter of 2025, we performed an interim impairment assessment on certain salty snacks and cookie trademarks within our Snacks segment, including Tom's, Jays, Kruncher's, O-Ke-Doke, Stella D'oro and Archway, collectively referred to as our "Allied brands," and recognized an impairment charge of $15 million on the trademarks.
In the second quarter of 2025, we performed an interim impairment assessment on the Late July trademark within our Snacks segment and recognized an impairment charge of $11 million on the trademark.
Year-to-date in 2025, the total aggregate impact of the impairment charges was $176 million ($131 million after tax, or $.44 per share).
The charges were included in Other expenses / (income);
•In the third quarter of 2025, we completed the sale of our noosa yoghurt business. In the second quarter of 2025, we recorded $15 million ($.05 per share) of tax expense related to the sale. Year-to-date in 2025, we recorded an after-tax loss of $15 million ($.05 per share) on the sale of the business. In the first quarter of 2025, we recorded a loss in Other expenses / (income) of $25 million ($19 million after tax, or $.06 per share) on the sale of our Pop Secret popcorn business. Year-to-date in 2025, the total aggregate impact of charges associated with divestitures was $25 million ($34 million after tax, or $.11 per share); and
•In the third quarter of 2025, we recorded accelerated amortization expense in Other expenses / (income) of $6 million ($5 million after tax, or $.02 per share) related to customer relationship intangible assets due to the loss of certain contract manufacturing customers, which began in the fourth quarter of 2023. Year-to-date in 2025, we recorded accelerated amortization expense in Other expenses / (income) of $20 million ($15 million after tax, or $.05 per share).
The items impacting comparability are summarized below:
| Three Months Ended | |||||||||||||||||||||||
| May 3, 2026 | April 27, 2025 | ||||||||||||||||||||||
| (Millions, except per share amounts) | Earnings Impact | EPS Impact | Earnings Impact | EPS Impact | |||||||||||||||||||
| Net earnings attributable to The Campbell's Company | $ | 124 | $ | .41 | $ | 66 | $ | .22 | |||||||||||||||
| Costs associated with cost savings and optimization initiatives | $ | (52) | $ | (.17) | $ | (24) | $ | (.08) | |||||||||||||||
| Commodity mark-to-market gains (losses) | 5 | .02 | (7) | (.02) | |||||||||||||||||||
| Pension actuarial and curtailment gains | 23 | .08 | — | — | |||||||||||||||||||
| Costs associated with acquisition | (2) | (.01) | — | — | |||||||||||||||||||
| Certain litigation expenses | — | — | (4) | (.01) | |||||||||||||||||||
| Impairment charges | — | — | (112) | (.37) | |||||||||||||||||||
| Accelerated amortization | — | — | (5) | (.02) | |||||||||||||||||||
Impact of items on Net earnings(1) | $ | (26) | $ | (.09) | $ | (152) | $ | (.51) | |||||||||||||||
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(1) Sum of the individual amounts may not add due to rounding.
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| Nine Months Ended | |||||||||||||||||||||||
| May 3, 2026 | April 27, 2025 | ||||||||||||||||||||||
| (Millions, except per share amounts) | Earnings Impact | EPS Impact | Earnings Impact | EPS Impact | |||||||||||||||||||
| Net earnings attributable to The Campbell's Company | $ | 463 | $ | 1.55 | $ | 457 | $ | 1.52 | |||||||||||||||
| Costs associated with cost savings and optimization initiatives | $ | (96) | $ | (.32) | $ | (70) | $ | (.23) | |||||||||||||||
| Commodity mark-to-market gains | 15 | .05 | 6 | .02 | |||||||||||||||||||
| Pension and postretirement actuarial and curtailment gains (losses) | 23 | .08 | (1) | — | |||||||||||||||||||
| Costs associated with acquisition | (4) | (.01) | — | — | |||||||||||||||||||
| Certain litigation expenses | (8) | (.03) | (6) | (.02) | |||||||||||||||||||
| Cybersecurity incident recoveries | 1 | — | 1 | — | |||||||||||||||||||
| Impairment charges | — | — | (131) | (.44) | |||||||||||||||||||
| Charges associated with divestitures | — | — | (34) | (.11) | |||||||||||||||||||
| Accelerated amortization | — | — | (15) | (.05) | |||||||||||||||||||
| Impact of items on Net earnings | $ | (69) | $ | (.23) | $ | (250) | $ | (.83) | |||||||||||||||
Net earnings attributable to The Campbell's Company were $124 million ($.41 per share) in the current quarter, compared to $66 million ($.22 per share) in the year-ago quarter. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit. The estimated net impact of tariffs was approximately $.07 per share in the current quarter.
Net earnings attributable to The Campbell's Company were $463 million ($1.55 per share) in the nine-month period this year, compared to $457 million ($1.52 per share) in the year-ago period. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit, partially offset by lower administrative expenses and lower marketing and selling expenses. The estimated net impact of tariffs was approximately $.17 per share in the current year. The negative impact from divestitures was approximately $.02 per share in the current year.
THIRD-QUARTER DISCUSSION AND ANALYSIS
Sales
An analysis of net sales by reportable segment follows:
| Three Months Ended | ||||||||||||||||||||||||
| (Millions) | May 3, 2026 | April 27, 2025 | % Change | |||||||||||||||||||||
| Meals & Beverages | $ | 1,426 | $ | 1,493 | (4) | |||||||||||||||||||
| Snacks | 940 | 982 | (4) | |||||||||||||||||||||
| $ | 2,366 | $ | 2,475 | (4) | ||||||||||||||||||||
An analysis of percent change of net sales by reportable segment follows:
Meals & Beverages(2) | Snacks | Total(2) | |||||||||||||
| Volume/mix | (5)% | (6)% | (5)% | ||||||||||||
Net price realization(1) | 1 | 2 | 1 | ||||||||||||
| Divestitures | (1) | — | (1) | ||||||||||||
| (4)% | (4)% | (4)% | |||||||||||||
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(1)Includes revenue reductions from trade promotion and consumer coupon redemption programs.
(2)Sum of the individual amounts does not add due to rounding.
In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Rao's and Canada, partially offset by gains in Prego pasta sauces. Sales of Rao's decreased due primarily to the timing of shipments related to the implementation of our existing SAP enterprise-resource planning system for Sovos Brands, Inc. (Sovos Brands) in the prior year. Unfavorable volume/mix was partially offset by favorable net price realization. Sales were impacted by an approximate 1% headwind from the net impact of the Sovos Brands
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SAP implementation in the prior year and the storm-related shipment delays in January this year. Sales of U.S. soup decreased 8% driven primarily by condensed and ready-to-serve soups.
In Snacks, sales decreased 4% due to declines in crackers, pretzels, third-party partner brands and contract manufacturing, chips and fresh bakery. Sales were impacted by volume/mix declines, partially offset by favorable net price realization.
Gross Profit
Gross profit, defined as Net sales less Cost of products sold, decreased by $78 million in 2026 from 2025. As a percent of sales, gross profit declined to 27.5% in 2026 from 29.4% in 2025, due in part to the negative impact of tariffs.
The 190 basis-point decrease in gross profit margin was due to the following factors:
| Margin Impact | |||||
Cost inflation, supply chain costs and other factors(1) | (530) | ||||
Volume/mix(2) | (60) | ||||
| Higher costs associated with cost savings initiatives | (20) | ||||
| Productivity improvements | 310 | ||||
| Net price realization | 110 | ||||
| (190) |
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(1)Includes an estimated negative margin impact of 310 basis points from the gross impact of tariffs, partially offset by a positive margin impact of 70 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges and an estimated positive margin impact of 30 basis points from the benefit of cost savings initiatives.
(2)Includes the impact of operating leverage.
Marketing and Selling Expenses
Marketing and selling expenses as a percent of sales were 9.0% in 2026 compared to 8.7% in 2025. Marketing and selling expenses decreased 1% in 2026 from 2025. The decrease was primarily due to lower costs associated with cost savings and optimization initiatives (approximately 3 points), partially offset by higher advertising and consumer promotion expense (approximately 1 point). The increase in advertising and consumer promotion expense was primarily driven by Meals & Beverages.
Administrative Expenses
Administrative expenses as a percent of sales were 6.6% in 2026 compared to 6.5% in 2025. Administrative expenses decreased 4% in 2026 from 2025. The decrease was primarily due to increased benefits from cost savings initiatives (approximately 4 points); a reduction in certain litigation expenses (approximately 2 points) and lower incentive compensation (approximately 2 points), partially offset by higher general administrative costs (approximately 4 points).
Other Expenses / (Income)
Other expenses were $8 million in 2026 compared to $160 million in 2025. Other expenses in 2026 included costs associated with cost savings initiatives of $38 million, costs associated with an acquisition of $2 million and pension actuarial and curtailment gains of $30 million. Other expenses in 2025 included an impairment charge related to the Snyder's of Hanover trademark of $150 million and accelerated amortization expense of $6 million.
Operating Earnings
Segment operating earnings decreased 22% in 2026 from 2025.
An analysis of operating earnings by segment follows:
| Three Months Ended | ||||||||||||||||||
| (Millions) | May 3, 2026 | April 27, 2025 | % Change | |||||||||||||||
| Meals & Beverages | $ | 213 | $ | 253 | (16) | |||||||||||||
| Snacks | 95 | 140 | (32) | |||||||||||||||
| 308 | 393 | (22) | ||||||||||||||||
| Corporate income (expense) | (60) | (226) | ||||||||||||||||
Restructuring charges(1) | (9) | (6) | ||||||||||||||||
| Earnings before interest and taxes | $ | 239 | $ | 161 | ||||||||||||||
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(1)See Note 8 to the Consolidated Financial Statements for additional information on restructuring charges.
Operating earnings from Meals & Beverages decreased 16%. The decrease was primarily due to lower gross profit. Gross profit margin decreased primarily due to the gross impact of tariffs, cost inflation and other supply chain costs and unfavorable volume/mix, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.
Operating earnings from Snacks decreased 32%. The decrease was primarily due to lower gross profit. Gross profit margin decreased primarily due to cost inflation and other supply chain costs, unfavorable volume/mix and the gross impact of tariffs, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.
Corporate expense in 2026 included the following:
•costs of $60 million related to costs savings and optimization initiatives;
•$2 million of costs associated with an acquisition;
•$30 million of pension actuarial and curtailment gains; and
•$6 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges.
Corporate expense in 2025 included the following:
•$150 million of an impairment charge related to the Snyder's of Hanover trademark;
•costs of $25 million related to cost savings and optimization initiatives;
•$10 million of unrealized mark-to-market losses on outstanding undesignated commodity hedges;
•$6 million of accelerated amortization expense; and
•$4 million of certain litigation expenses, including expenses related to Plum.
Interest Expense
Interest expense of $83 million in 2026 decreased from $85 million in 2025 primarily due to lower levels of debt.
Taxes on Earnings
The effective tax rate was 22.0% in 2026 and 18.5% in 2025. The increase in the effective tax rate was primarily due to timing of recognition of tax expense related to the impairment charge in the prior year.
NINE-MONTH DISCUSSION AND ANALYSIS
Sales
An analysis of net sales by reportable segment follows:
| Nine Months Ended | |||||||||||||||||
| (Millions) | May 3, 2026 | April 27, 2025 | % Change | ||||||||||||||
| Meals & Beverages | $ | 4,741 | $ | 4,943 | (4) | ||||||||||||
| Snacks | 2,866 | 2,989 | (4) | ||||||||||||||
| $ | 7,607 | $ | 7,932 | (4) | |||||||||||||
An analysis of percent change of net sales by reportable segment follows:
| Meals & Beverages | Snacks | Total | |||||||||||||
| Volume/mix | (3)% | (5)% | (4)% | ||||||||||||
Net price realization(1) | 1 | 1 | 1 | ||||||||||||
| Divestitures | (2) | — | (1) | ||||||||||||
| (4)% | (4)% | (4)% | |||||||||||||
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(1)Includes revenue reductions from trade promotion and consumer coupon redemption programs.
In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Canada, V8 beverages and Pace Mexican sauces, partially offset by gains in Rao's. Unfavorable volume/mix was partially offset by favorable net price realization. Sales of U.S. soup decreased 4% primarily due to decreases in ready-to-serve soups and condensed soups, partially offset by increases in broth.
34
In Snacks, sales decreased 4%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased primarily due to declines in chips, crackers, third-party partner brands and contract manufacturing, fresh bakery related to supply constraints and declines in pretzels, partially offset by gains in Pepperidge Farm cookies. Sales were impacted by volume/mix declines, partially offset by favorable net price realization.
Gross Profit
Gross profit, defined as Net sales less Cost of products sold, decreased by $255 million in 2026 from 2025. As a percent of sales, gross profit declined to 28.4% in 2026 from 30.4% in 2025, due in part to the negative impact of tariffs.
The 200 basis-point decrease in gross profit margin was due to the following factors:
| Margin Impact | |||||
Cost inflation, supply chain costs and other factors(1) | (510) | ||||
Volume/mix(2) | (60) | ||||
| Productivity improvements | 280 | ||||
| Net price realization | 90 | ||||
| (200) |
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(1)Includes an estimated negative margin impact of 240 basis points from the gross impact of tariffs, partially offset by an estimated positive margin impact of 30 basis points from the benefit of cost savings initiatives and a positive margin impact of 20 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges.
(2)Includes the impact of operating leverage.
Marketing and Selling Expenses
Marketing and selling expenses as a percent of sales were 9.5% in 2026 compared to 9.1% in 2025. Marketing and selling expenses were comparable in 2026 and 2025. Lower selling expenses (approximately 1 point); increased benefits from cost savings initiatives (approximately 1 point) and lower incentive compensation (approximately 1 point) were offset by higher marketing expenses (approximately 1 point); higher costs associated with costs savings and optimization initiatives (approximately 1 point) and higher benefit-related costs (approximately 1 point).
Administrative Expenses
Administrative expenses as a percent of sales were 6.3% in 2026 and 2025. Administrative expenses decreased 4% in 2026 from 2025. The decrease was primarily due to increased benefits from cost savings initiatives (approximately 4 points); lower incentive compensation (approximately 2 points) and lower costs associated with cost savings initiatives (approximately 1 point), partially offset by higher general administrative costs and inflation (approximately 2 points) and an increase in certain litigation expenses (approximately 1 point).
Other Expenses / (Income)
Other expenses were $24 million in 2026 compared to $244 million in 2025. Other expenses in 2026 included cost associated with cost savings initiatives of $38 million, costs associated with an acquisition of $4 million and pension actuarial and curtailment gains of $30 million. Other expenses in 2025 included impairment charges related to the Snyder's of Hanover, Allied brands and Late July trademarks of $176 million, a loss of $25 million on the sale of the Pop Secret popcorn business, accelerated amortization expense of $20 million and a postretirement actuarial loss of $2 million.
Operating Earnings
Segment operating earnings decreased 18% in 2026 from 2025.
An analysis of operating earnings by segment follows:
| Nine Months Ended | ||||||||||||||||||
| (Millions) | May 3, 2026 | April 27, 2025 | % Change | |||||||||||||||
| Meals & Beverages | $ | 762 | $ | |||||||||||||||
Next expected filings
- ~2026-12-08 10-Q expected by 2026-12-10 (in 78 days)
- ~2027-03-10 10-Q expected by 2027-03-12 (in 170 days)
- ~2027-06-07 10-Q expected by 2027-06-09 (in 259 days)
- ~2027-09-17 10-K expected by 2027-09-24 (in 361 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-09-17 8-K Material Agreement Entered; Financial Statements and Exhibits
- 2026-09-03 8-K Earnings Release; Financial Statements and Exhibits
- 2026-08-13 S-3ASR S-3ASR
- 2026-06-17 8-K Officer/Director Change
- 2026-06-08 8-K Earnings Release; Financial Statements and Exhibits
- 2026-06-08 10-Q Quarterly Report
- 2026-03-11 10-Q Quarterly Report
- 2026-03-11 8-K Earnings Release; Financial Statements and Exhibits
- 2025-12-15 8-K Other Events; Financial Statements and Exhibits
- 2025-12-09 10-Q Quarterly Report
- 2025-12-09 8-K Earnings Release; Financial Statements and Exhibits
- 2025-12-09 8-K Material Agreement Entered; Unregistered Equity Sale; Financial Statements and Exhibits
- 2025-10-07 8-K Officer/Director Change
- 2025-09-18 10-K Annual Report
- 2025-09-05 8-K Officer/Director Change