General Mills opens FY2026 with expected revenue loss

General Mills reported $4.5 billion (€3.8B) in net sales for the first quarter of fiscal year (FY) 2026, a 7% year-over-year (YoY) decline. It is also a further deceleration for the same quarter last year (1.2%). According to the company, this includes a “4-point headwind from the net impact of divestitures and acquisitions,” as it sold its yogurt business at the end of June. 

Organic net sales went down 3%, driven by “unfavorable organic net price realization and mix reflecting price investments and unfavorable trade expense timing” in retail, the company says.

While operating profit more than doubled (+108%) in the quarter to $1.7 billion (€1.4B), adjusted operating profit, on the other hand, fell 18%, to $711 million (€601M). Adjusted diluted earnings per share were down 20% to $0.86 (€0.72). 

According to analysts from the intelligence platform Alphastreet, the performance reflects uncertainties in the market and weak consumer demand, noting, “Demand has remained sluggish recently as customers spend less on discretionary items and are increasingly favoring private labels, especially in categories like cereal and pet food.”

In June, the Minneapolis manufacturer concluded its FY2025 with a mixed performance, meeting its revised guidance but experiencing modest declines across key financial metrics. For the full year ending 25 May 2025, it achieved net sales of $19.5 billion (€16.7B), a 2% decrease compared to FY2024.

Pet food

The company’s pet food business, anchored by the Blue Buffalo brand, experienced revenue growth but saw a decline in organic net sales.

North America Pet segment net sales rose 6% YoY, to $610 million (€515.5M), but organic net sales dipped 5%. The segment lagged retail sales by roughly 4 points, “primarily reflecting shipment timing differences,” according to the company.

While cat food and pet treats’ net sales were up double digits, dog food was down. 

The pet segment’s operating profit fell 5% to $113 million (€96M), pressured by higher input costs and expenses related to selling, general and administrative (SG&A) activities in preparation for the launch of fresh pet food.

Chairman and Chief Executive Officer Jeff Harmening reaffirms the company’s primary goal to restore organic sales growth this year and put fresh pet food at the center of this strategy. 

“We will continue to drive further improvement this year behind disciplined execution of our price investments, new advertising campaigns, stronger in-store events and exciting innovation like Blue Buffalo’s launch into fresh pet food that is just now starting to ship to customers,” Harmening says. 

Looking ahead

General Mills reaffirms its annual guidance for FY2026. It projects organic net sales to range from a decrease of 1% to an increase of 1%, reflecting modest expectations amid ongoing inflation in input costs and competitive pricing pressures.

Adjusted operating profit and adjusted EPS are both forecasted to decline between 10% and 15%, although the company expects a strong free cash flow conversion rate of 95% or higher.

Harmening says the “team remains focused on executing on 3 priorities for fiscal 2026: returning North America Retail to volume growth, accelerating momentum in North America Pet, and driving efficiencies to reinvest behind growth.”

The packaged food company owns multiple brands, such as Cheerios, Nature Valley, Blue Buffalo, Häagen-Dazs, Old El Paso, Pillsbury, Betty Crocker, Totino’s, Annie’s, Wanchai Ferry and Yoki.