General Mills CEO: ‘Fiscal ’27 will be a better year’

MINNEAPOLIS — General Mills Inc. expects to be on a stronger competitive footing in fiscal 2027 after ending fiscal 2026 with a net loss, along with a double-digit sales decline in its core North American Retail business unit.

Despite the weak bottom- and top-line results, Minneapolis-based General Mills topped Wall Street’s high-end earnings-per-share estimates for both the 2026 fourth quarter and full year, with revenue in line with analysts’ forecasts.

“We finished fiscal ’26 on a positive note, delivering fourth-quarter results that met our expectations,” said Jeffrey Harmening, chairman and chief executive officer. “Importantly, we continued to strengthen our foundation to better position General Mills to restore sustainable and profitable growth. This included significant improvement in our base volume, growth in household penetration and a step up in innovation.

“We are confident in our forward trajectory and that fiscal ’27 will be a better year for General Mills. As we look ahead, our plans are designed to drive a step change in remarkability, with a sharper focus on product, packaging and brand communications to strengthen top-line growth.”

For the 53-week 2026 fiscal year ended May 31, General Mills posted a loss of $87.6 million after tallying net income of $2.3 billion, equal to $4.10 per share on the common stock, in the 52-week 2025 fiscal year. The loss reflects the impact of $2.97 billion in restructuring, transformation, impairment and other exit costs, which include a $1.03 billion valuation loss from the planned divestiture of the Brazil business and a $1.5 billion goodwill impairment charge from the North America Pet business unit. On an adjusted basis, 2026 net earnings fell 19% to $1.91 billion, or $3.55 per share, from $2.35 billion, or $4.21 per share, a year earlier. Analysts’ top-end estimate was for adjusted EPS of $3.46.

General Mills closed out the year with a fourth-quarter loss of nearly $2.01 billion, compared with net income of $294 million, or 53¢ per share, in the prior-year period. Excluding $2.81 billion in restructuring, transformation, impairment and other costs recorded in the quarter, adjusted earnings rose 27% to $507.6 million, or 95¢ per share, from $403 million, or 74¢ per share, a year ago. That bested Wall Street’s high-end forecast for adjusted EPS of 86¢.

“Our fiscal ’26 results finished in line with our latest guidance, even as the consumer remained stretched as ongoing macroeconomic pressures continued to weigh on household budgets and category demand,” Harmening said. “On the bottom line, we delivered growth in profit and EPS in Q4, supported by HMM (holistic margin management) cost savings, trade-phasing benefits and the 53rd week.”

To help digest input cost inflation, fund growth investments and spur profit and cash-flow growth, General Mills unveiled a plan to generate $3 billion in cost savings over the four years through fiscal 2030.

“We are laser-focused on driving cost efficiency, cash generation and sustainable capital returns to our shareholders,” Harmening said. “We’ve identified $3 billion in cost saving opportunities through fiscal ’30, with approximately $2 billion expected to come from our industry-leading HMM productivity program and the remaining $1 billion to come from our global transformation initiative and other cost savings actions.”

General Mills said the $2 billion HMM target translates to annual savings of about 4% of cost of goods sold. Cost-efficiency efforts in the transformation savings push include redesigning the supply chain network, streamlining business processes and improving other areas of the cost base. In fiscal 2027, the company expects to realize at least $750 million in total savings toward the $3 billion target.

“We remain committed to balancing investment behind the business with healthy margins, strong cash generation and thoughtful capital allocation,” Harmening said.

General Mills said price investments in 2026 drove a significant improvement in base volume.

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At the top line, fiscal 2026 net sales decreased 5% to $18.42 billion from $19.49 billion in fiscal 2025, including a 6-point headwind from the net impact of divestitures and acquisitions and a 2-point benefit from the 53rd week, General Mills said. Operating income sank 73% year over year to $885.8 million but on an adjusted basis was down 16% to $2.81 billion. In the fourth quarter, net sales edged up 1% to $4.61 billion, but the company sustained an operating loss of $2.09 billion. Adjusted operating profit for the quarter was $705.4 million.

“At the highest level, our top goal remains restoring consistent and profitable organic sales growth, because we know that sustainable, profitable growth is the key to long-term value creation,” Harmening said. “We are confident that driving improved remarkability is the path back to growth because we are already seeing it working. In fiscal ’26, we made clear progress in strengthening our foundation, and now fiscal ’27 is all about building on that strong foundation and converting it into improved top-line performance.”

Organic net sales for fiscal 2026 fell 2% on 1% decreases in both price/mix and volume, while fourth-quarter organic sales were flat on a 2% gain in price/mix and a 2% falloff in volume. Harmening noted that fiscal 2026 “brought tougher conditions than we expected.”

“The consumer backdrop became more challenging, with recent consumer sentiment in the US hitting record lows,” he said. “We saw slower category volume growth, impacting both our human food and pet food businesses. And as consumers remained pressured, we saw them buying more on promotion and less at everyday prices, driving a less profitable mix of volume through our P&L.”

Still, Harmening pointed to key strides made during the year.

“As we look back on fiscal ’26, we made progress in strengthening our competitiveness, even as the environment proved challenging,” he said. “For example, in categories where we invested to get our base prices below key cliffs or narrow the gap to competition, we drove a significant improvement in our base volume, which reflects everyday consumer purchases, from a 10% decline in fiscal ’25 to 1% growth in the fourth quarter of fiscal ’26.”

North America Retail (NAR) totaled fiscal 2026 net sales of $10.57 billion, down by 11% on a reported basis and by 3% organically, reflecting decreases of 2% in price/mix and 1% in volume. General Mills said the unit’s net sales reflect a 9-point headwind from divestitures and a 1-point benefit from the 53rd week, with the segment holding or gaining pound share in 65% of its top 10 US categories. Operating profit dropped 20% to $2.19 billion, reflecting lower volume, including the impact of the yogurt business divestitures.

In the fourth quarter, NAR tallied net sales of $2.47 billion, down 4% on a reported basis but flat organically. Operating income rose 7% to $506.4 million. Among NAR divisions, fourth-quarter net sales were up 5% apiece for US Snacks and US Meals & Baking Solutions. Net sales fell 19% for the Big G Cereal & Canada division, formed by combining the US Morning Foods and Canada units after the company completed the US yogurt divestiture.

Harmening said General Mills expects its remarkability framework to re-energize the top line. The strategy focuses on strengthening brands through products, packaging, communication, omnichannel execution and value to boost consumer affinity and fuel long-term growth.

“In fiscal ’26, we strengthened that foundation by addressing our everyday shelf prices, which helped improve base volume and restore household penetration growth,” he said. “In fiscal ’27, we’ll build from that stronger base by putting more emphasis on other elements of remarkability, including product innovation and renovation, packaging and brand communications.”

For the 52-week fiscal 2027, General Mills projects adjusted EPS of $3 to $3.20, organic net sales of down 1.5% to up 0.5%, and an adjusted operating profit decline of 8% to 13%.

“As we move to fiscal ‘27, we are planning for the consumer environment to stay relatively consistent with fiscal ’26,” Harmening said. “Rather than hope for the consumer to improve, we are moving with even greater urgency to meet consumers where they are and capture more of the growth that’s currently available.”