General Mills Q3 sales fall on brand investments, yogurt divestitures, reaffirms 2026 outlook

Overview

• U.S. packaged foods maker's fiscal Q3 sales declined 8% but slightly beat analyst expectations

• Adjusted EPS for fiscal Q3 fell 37% yr/yr in constant currency and missed analyst estimates

• Company attributed declines to brand investments, yogurt divestitures, and unfavorable trade expense timing

Outlook

• Company reaffirms full-year fiscal 2026 outlook

• General Mills sees FY26 organic net sales down 1.5% to 2%

• Company expects FY26 adj operating profit and adj diluted EPS down 16% to 20% in constant currency

• General Mills expects sequential improvement in Q4 sales and earnings, driven by 53rd week and favorable timing

Result Drivers

• BRAND INVESTMENTS - Co said increased investments to improve brand remarkability weighed on Q3 sales and earnings

• YOGURT DIVESTITURES - Divestiture of North American yogurt business reduced sales and operating profit, especially in North America Retail and Foodservice segments

• HIGHER INPUT COSTS - Gross margin declined due to higher input costs, partially offset by price/mix benefits

Company press release: ID:nBw18F50Ga

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 13 "hold" and 4 "sell" or "strong sell"

• The average consensus recommendation for the food processing peer group is "buy."

• Wall Street's median 12-month price target for General Mills Inc is $47.00, about 21.3% above its March 17 closing price of $38.74

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 13 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.