General Mills profits slide but bets on pets for 2026 win

Betty Crocker and Cookie Crisp maker General Mills has noted a sliding end to a relatively poor year, with fourth quarter operating profits down 35%, adding to a 4% dip in full-year operating profits.

Overall, net sales performed better than most analysts’ expectations at $19.5 billion – down 2% on last year. Operating profits hit $3.3 billion and adjusted operating profit reached $3.4 billion (-7%).

However, the business has invested significantly in operations during the second half of fiscal 2025, with a view to drive value among consumers, accounting for some of the profit erosion.

“Our Q4 financial results reflected these incremental investments and finished in line with our updated expectations,” said General Mills Chairman and CEO Jeff Harmening.

General Mills’ focus going into the next fiscal year is to restore overall organic sales growth, which will require further investment in “consumer value, product news, innovation and brand building,” added Harmening.

A raft of innovation and advertising will help to yield stronger results in the 12 months ahead, with the former ramping up by double digits.

A chunk of the business’s growth strategy is pinned on a launch into fresh pet food, which will occur later in 2025.

General Mills key Q4 financial highlights-3% – net sales were down to $4.6bn $504m – operating profit slumped 35%$294m – net earnings were down 47% Also read → General Mills boycott reflects rising consumer discontentThird Bridge senior analyst John Oh highlighted a strong performance in some territories, such as organic volumes in North America, but warned General Mills needs to dial up its pricing and promotions aggression.

“In categories such as snacking and cereals, our experts mention that while the company has iconic brands with great brand heritage, they also caution that the portfolio is under indexed in high growth areas such as protein and risk falling behind against its competitors,” says Oh.

Analysts also advise General Mills expands its portfolio, specifically in snacking, to stay on top of – though preferably ahead of – consumer trends around health, clean labels and higher protein options.

General Mills key full year financial highlights$19.5bn – net sales slipped 2% $3.3bn – operating profit down 4%$2.3bn – net earnings were down 8%In Q4, General Mills’ North America Retail segment faced pressure from lower pound volume, unfavorable pricing and mix and the divestiture of its Canada yogurt business. Trade expense timing created a notable headwind, while input cost inflation further strained margins.

For the full year, performance was primarily impacted by reduced volume and elevated input costs. The Canada yogurt divestiture continued to weigh on results, and unfavorable pricing dynamics persisted across key operating units, including US snacks, morning foods, and meals & baking solutions

Much of the poor performance could be pinpointed to just two areas in the fourth quarter – North America Retail and North America Foodservice – with volumes down 6 percentage points and 1 percentage point respectively. This led to overall company volume shrinkage of one percentage point.

Pet food expansions expected to fuel General Mills’ growth next year (Image: General Mills)Overall, for the full year, however, North America retail was the only segment to show volume decline, at four percentage points. Retail performed poorly for the quarter and year for profits, which were 29% and 11% down, respectively. International lost profit for the whole year, despite putting on marginal volume growth.

Looking ahead, General Mills will focus on driving organic volume sales, though expects category growth to remain below its long-term projections against a challenging backdrop. This includes the US’s trade tariffs, which the business predicts can be mitigated to a certain extent.

Significant focus will be paid to its “fast-growing,” US fresh pet food sub-category, through the launch of Blue Buffalo later this year, which it announced earlier this month and follows Edgard & Cooper’s US expansion last April.

Fresh pet food will be launched in all states and fully invested in to ensure growth and profitability in as little time as possible, according to the company.