Campbell Soup Company

The call did not include full quarter financial statements in the transcript, but management provided FY27 directional guidance: organic net sales midpoint is down about 3%, MMB is expected to be down slightly, Snacks is expected to improve modestly through the year, gross margin is expected to be down 50 to 100 basis points for the full year, and EPS is expected to be sharply down in Q1 but positive by the fourth quarter. Todd Cunfer also said inflation is expected to run about 5% to 6% and logistics cost inflation around double digits, with pricing realization starting in Q2 and cost savings becoming more second-half weighted. Interest expense is projected to be about $25 million higher year over year, partly due to La Regina and the planned refinancing of a $500 million bond maturing in March.

Mick Beekhuizen emphasized that the company is focused on three priorities: returning to core fundamentals, funding the brands, and improving everyday execution. He said the team has been strengthened in Snacks over the past 6 to 9 months and that Campbell’s is moving faster at translating consumer insights into relevant innovation, citing Goldfish, Pepperidge Farm, Campbell’s Nourish/protein soups, and Rao’s as examples. His tone was confident but candid, acknowledging that parts of the portfolio, especially Snacks and mainstream RTS/eating soups, still require more work.

Todd Cunfer framed FY27 as a year of phasing, with pressure in Q1 from negative price realization, inflation, logistics, and promotional/slotting investments, followed by improving margins as pricing and savings flow through. He said the company is taking a modest price increase on about 60% of the portfolio, averaging 4% to 5%, and expects total-year gross margin to be down 50 to 100 basis points. He also detailed the $500 million cost savings program, noting $150 million rolls over from the prior $375 million plan and $350 million is incremental, and said interest expense should rise about $25 million year over year due to La Regina and refinancing-related items.

Analysts pressed management on the timing of sales and EPS recovery, the logic behind price increases, the details of the $500 million savings program, and whether the dividend cut or refinancing plans signaled a broader capital-structure shift. Management said Q1 will be the weakest quarter, Snacks will be very challenging early, and improvement should come later in the year as pricing, innovation, and savings build. On the capital side, management said the dividend reduction was necessary, the board remains focused on long-term value creation, and a hybrid financing option is still under consideration for the $500 million bond maturity.