General Mills cut its sales outlook to mark the fifth birthday of its 'growth' strategy

By Tomi Kilgore

Weak consumer sentiment and heightened uncertainty have prompted an earnings and sales-growth guidance cut

General Mills's stock falls after the full-year profit and sales outlook were lowered, as the consumer recovery has been slower and has cost more than expected.

Shares of General Mills dropped Tuesday after the consumer-foods company lowered its full-year outlook for both profit and sales growth, as the company's growth strategy appeared unable to counter weak consumer sentiment.

The lowered outlook came just as the company, which brands include Cheerios, Pillsbury, Häagen-Dazs and Progresso, outlined at an industry conference the progress it has made on its "Accelerate" growth strategy, which enters its sixth year.

Since the strategy was first announced at the Consumer Analyst Group of New York conference on Feb. 16, 2021, General Mills said it has reshaped about a third of its portfolio and returned more than $14 billion to its shareholders.

But the stock has tumbled 15.4% since the strategy was announced, through Friday, while the State Street Consumer Staples Select Sector SPDR ETF XLP has rallied 36.3% and the S&P 500 index SPX has run up 73.7%.

On Tuesday, the stock fell 3.6% in premarket trading.

The company said it expects fiscal 2026 organic net sales, which excludes sales gains through acquisitions, to be down 1.5% to 2% from a year ago, compared with previous guidance of down 1% to up 1%. That puts it on track for a third-straight year of sales declines. Fiscal 2026 ends in May 2026.

General Mills said fiscal 2026 adjusted earnings per share, which excludes nonrecurring items, are expected to be down 16% to 20%, when excluding currency effects, which is worse than the previous outlook for a decline of 10% to 15%.

Speaking at this year's CAGNY conference, CEO Jeff Harmening, who has been in charge of General Mills since June 1, 2017, said "a still volatile" consumer environment was driving a slower volume recovery at a higher cost than expected.

"While the recovery may take longer than we previously anticipated, we remain confident that enhancing the remarkability of our brands is the best path to restoring consistent and profitable organic sales growth," Harmening said, according to a FactSet transcript.

General Mills isn't the only branded-foods company that has been hurt by pickier consumers. PepsiCo (PEP) said earlier this month it had cut prices on some household snacks to better compete, and Kraft Heinz (KHC) said last week that it was putting its plan to separate its grocery business on hold so it can focus on boosting sales and profitability.

-Tomi Kilgore

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02-17-26 0838ET