Earnings call transcript: General Mills Q4 2025 sees EPS beat, stock dips

General Mills reported its fiscal fourth-quarter 2025 earnings on June 25, revealing a slight earnings per share (EPS) beat with actual EPS at $0.74, surpassing the forecast of $0.71. Revenue met expectations at $4.6 billion. Despite the positive earnings surprise, the stock saw a pre-market decline of 2.75%, closing at $51.94, reflecting investor concerns over strategic reinvestments and market conditions. According to InvestingPro data, the company maintains a market capitalization of $28.28 billion and trades at an attractive P/E ratio of 11.65, suggesting potential value for long-term investors.

Key Takeaways

• General Mills’ EPS exceeded expectations by 4.23%.
• Revenue matched forecasts at $4.6 billion.
• Stock fell 2.75% pre-market due to strategic reinvestment plans.
• Significant investments in Fresh Pet food line anticipated.
• Organic sales growth guidance set between -1% and +1%.

Company Performance

General Mills highlighted strategic investments and volume growth initiatives during its Q4 2025 earnings call. The company is focusing on returning to volume growth, particularly in North America Retail, despite a price mix decline of 3% in this segment and 1% enterprise-wide. The company plans to reinvest significantly in fiscal 2026, with SG&A expected to grow faster than the top line due to brand reinvestment.

Financial Highlights

• Revenue: $4.6 billion, flat compared to forecasts.
• Earnings per share: $0.74, a 4.23% surprise over the forecasted $0.71.
• Price mix down 3% in North America Retail and 1% enterprise-wide.

Earnings vs. Forecast

General Mills reported an EPS of $0.74, beating the forecast of $0.71 by 4.23%. Revenue was in line with expectations at $4.6 billion. The earnings beat marks a positive note for the company, although the revenue surprise was neutral at 0%.

Market Reaction

Despite the earnings beat, General Mills’ stock fell 2.75% in pre-market trading, closing at $51.94. This decline reflects investor concerns about the company’s strategic reinvestments and the potential impact on short-term profitability. The stock is trading closer to its 52-week low of $51.27, indicating cautious investor sentiment.

Outlook & Guidance

Looking ahead, General Mills expects organic sales growth to be flat, ranging from -1% to +1%. The company plans significant investments in its Fresh Pet food line, which is projected to grow from a $3 billion segment to $10 billion over the next decade. Volume growth is expected to outpace sales growth in the first half of the year.

Executive Commentary

CEO Jeff Harmening expressed enthusiasm about the Fresh Pet launch, stating, "We’re very excited about this launch, this big national launch." He also noted, "Our new product news and our core renovation news is the best that I have seen since I’ve been CEO." Dana McNabb, Group President, highlighted the growth potential in the Fresh segment, projecting it to reach $10 billion in ten years.

Risks and Challenges

• Strategic reinvestments may impact short-term profitability.
• Price mix declines could pressure margins.
• Modest growth in the pet category, below long-term expectations.
• Competitive pressures in international markets.
• Macroeconomic factors affecting consumer spending.

Q&A

During the earnings call, analysts focused on the Fresh Pet launch strategy, pricing approach, and volume growth expectations. Executives clarified their investment strategies and addressed concerns about category growth and competitive positioning.

Full transcript - General Mills (GIS) Q4 2025:

Julianne, Conference Call Operator: Good morning, and welcome to General Mills’ Fourth Quarter Fiscal twenty twenty five Earnings Conference Call. All participants are in a listen only mode. After the speakers’ remarks, we will conduct a question and answer session. As a reminder, this conference call is being recorded. I would now like to turn the call over to Jeff Seaman, Vice President of Investor Relations and Corporate Finance.

Thank you. Please go ahead.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: Thank you, Julianne, and good morning to everyone. Thanks for joining us today for our Q and A session on our fourth quarter fiscal ’twenty five results. I hope everyone had time to review our press release, listen to our prepared remarks and view our presentation materials, which we made available this morning on our Investor Relations website. Please note that in this morning’s Q and A session, we may make forward looking statements that are based on management’s current views and assumptions. Please refer to this morning’s press release for factors that could impact forward looking statements and for reconciliations of non GAAP information, which may be discussed on today’s call.

I’m here today with Jeff Harmening, our Chairman and CEO Kofi Bruce, our CFO and Dana McNabb, Group President of North America Retail and North America Pet. Before we open for questions, I’m gonna hand it over to Jeff Harmening for a few opening remarks.

Jeff Harmening, Chairman and CEO, General Mills: Yeah. Thanks, Jeff. And I thought I’d start this morning. There’s a there’s a lot going on up and down our p and l within our business, and then, you know, certainly a lot going on in the broader world. So thought I’d just take a couple of minutes to summarize what we’re trying to accomplish.

The first and most important thing is really returning to volume growth, specifically in NAR. And we’re really encouraged by what we’ve seen. We started to invest in in value in q three of last year with Pillsbury and Totino’s topped by really good advertising. And we like the results of that so much that we decided that we’d expand the value investments we made in soup and cereal and fruit snacks in the fourth quarter, and we saw the results there that we expected. And so as we go into this year, we’re kind just continuing the formula we had in the fourth quarter, which is we said to expand some of the value investments on targeted businesses that we saw, but also, really importantly, backing that up by significant consumer news.

In fact, I think our new product news and our core renovation news is the best that I have seen since I’ve been as CEO. And we use our remarkable experience framework. We talked a lot about these in our prepared remarks. Certainly, our launch into fresh pet food, all the protein innovation we’ve seen in the NARA portfolio, renovating Haagen Dazs stick bars and so forth, gives us confidence that that we can get our business back to the kind of growth we’re looking for. Importantly, as we’re doing all this work in NARA, we did see share growth in our international businesses this past year as well as foodservice and health share and pet.

And so that gives us a lot of confidence. Backing up all of this investment with record levels of holistic margin management and also productivity initiatives. We’re not sitting still on that front. But we know that it’s an investment year, but we’re very confident that these investments will pay off given what we’ve seen over the last couple of quarters. So with that, let’s open the floor to questions.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: Great. Julian, you can go ahead.

Julianne, Conference Call Operator: Thank you. Our first question comes from Ken Goldman from JPMorgan. Please go ahead. Your line is open.

Ken Goldman, Analyst, JPMorgan: Hi, good morning and thank you. It’s certainly exciting to see Blue go national from a refrigerated standpoint. One of the things you had talked about previously in the past, to paraphrase, is you were always, I think, confident in the revenue opportunity. It was a little more on the margin and cash story that was less tested. So I’m trying to get a better sense, if possible, if something has changed or you’ve learned a little bit more about the margin potential there.

And then as a corollary to that, just trying to get a little bit of sense for your merchandising strategy for that, just given the obviously limited shelf space for that particular category.

Jeff Harmening, Chairman and CEO, General Mills: Yes. So let me let me talk a little bit about this is Jeff. Let me talk a little bit about the past. And, Dana, if you have any follow on comments or follow on a little bit about our marketing plans. But the yeah.

We’re we’re very excited about this launch, this big national launch. We learned we learned a couple of important things in our last test market. You know, one was that the Blue Buffalo brand really resonated. The second, we can make great products. So our repeat rates were really good.

I mean, we had dogs standing in front of refrigerators because they were so excited to eat this stuff. So we know that that works. What we what we didn’t because we launched regionally, we really didn’t have the scale to to market the the way we needed to to generate trial. And so as we go into this national launch, this gives us the opportunity to to launch at, at scale. And you asked about the financials.

We have learned a lot. It’s been it’s been many years since we tried that that test, and we’ve actually been studying the market ever since. And one of the things we’ve grown quite a bit more comfortable with is that over time, I mean, this investment will take a couple of years in in generating trial. That’s the most important job to do. But having done that and achieving scale, we’re confident that we can build a profitable and growing business.

If we weren’t, we wouldn’t get involved in this endeavor. But it’ll take a little bit of investment, but, we believe that we have the right the right activities to do it. Dan, you wanna give any insights into to that?

Dana McNabb, Group President of North America Retail and North America Pet, General Mills: Yeah. Well, as you said, the learning really helped us to build a stronger consumer proposition, and we really think that we have a path to a attractive financial model for a fresh business at scale. What we are coming with is launching Love Made Fresh nationally. It will be in all 50 states. We have a wide variety of formats and flavors to drive appeal, and these formats have been designed for maximum flexibility.

And why that’s important is we know that 80% of pet parents who use fresh, they use it with other food formats. So they’ll top it. They’ll mix it. They’ll sometimes use it on its own. And then 55% of those users, they want to use Kibble and Fresh from the same brand.

So we’re really confident that Blue Buffalo has a right to win here, that we’ve got a unique proposition. As Jeff said, we have improved our go to market approach, and we’re committed to investing in building quality trial and awareness. We have had really strong reception from retailers. And, as we come to market, we’re gonna be the biggest pet brand that’s across, dry, across wet, treats, and fresh. So, we’re still early days, but we’re excited to share more about this launch, as we get closer to the date.

Ken Goldman, Analyst, JPMorgan: Great. Thank you both.

Julianne, Conference Call Operator: Our next question comes from Andrew Lazar from Barclays. Please go ahead. Your line is open.

Andrew Lazar, Analyst, Barclays: Great. Thanks. Good morning, everybody.

Michael Lavery, Analyst, Piper Sandler: Good morning.

Andrew Lazar, Analyst, Barclays: Jeff, think the level of reinvestment plan for fiscal twenty twenty six is certainly deeper, right, than most had anticipated. And I understand the organic top line growth priority and the investment behind Fresh. Question is how do you ensure that the margin profile that comes with this reinvestment is being done in a sort of responsible way rather than giving up too much margin that may be tougher to ultimately rebuild? I guess are there certain aspects of the reinvestment that maybe you see as more one off or temporary in nature that give you confidence that you can rebuild this margin in a reasonable timeframe versus being maybe at a structurally lower level sort of going forward if you will? Thank you.

Kofi Bruce, CFO, General Mills: Sure. Andrew, this is Kofi. Good morning and thanks for the Let me give you just a few thoughts. I think we see a few of the factors. There’s certainly a lot going on underneath the hood and we provided firm on that detail in the prepared remarks.

But underneath the hood, there are a couple of factors that we would see as maybe more temporary in nature. First, as Jeff alluded to, the fresh investment, while a multiyear investment, we would expect that once we build scale, and it will be at a point of profitability and return on that, that investment. Second, as we think about the the nature of tariffs, we expect to be able to mitigate some of the effects of tariff, but not all within the year. So that will put a little bit of drag from a timing perspective. But again, not something that we see as structural necessarily long term.

And then third, just a reminder that on the divestiture of Yoplait, we expect there to be a little bit of stranded cost drag as we are getting at some of the costs and eliminating some of those costs this year, but we’ll have a tail end of fiscal twenty twenty seven. So those are the factors that I think are important to take in even as you measure what is, an important and significant investment behind getting growth restarted.

Andrew Lazar, Analyst, Barclays: Got it. Great. Okay.

Max Gumfort, Analyst, BNP Paribas: Thank you for that. Appreciate it. You bet.

Julianne, Conference Call Operator: Our next question comes from Peter Galbo from Bank of America. Please go ahead. Your line is open.

Peter Galbo, Analyst, Bank of America: Hey, guys. Good morning. Maybe just a quick clarification and then a question. Kofi, I think on Pet specifically in Q4, you talked about the inventory build at retail that you’re expecting to reverse. So is that a full reversal in Q1?

I just want to kind of understand the magnitude there. And then Jeff, like there’s been obviously a lot of lumpiness, I think, in the reported figures on Pet. So maybe you can just give us a broader sense from your prepared remarks on just the state of underlying Pet and how you’re thinking about the different verticals within that, just again given some of the lumpiness that we’ve seen quarter to quarter? Thanks very much.

Jeff Harmening, Chairman and CEO, General Mills: Yes. Thanks for the question. You asked Kofi the first one and me the second one, but I’m going take one for the team here and answer both of those. The as look at inventory levels, first, our inventory levels in Pet are in a good place, kind of broadly speaking. As we look throughout all of last year, there was relatively any very little movement as you look across here in our levels of inventory at retail for our Pet Food business.

Our pet food business, since we bought it, has really had a lot more lumpiness, as you’re terming, in the levels of retail inventory. And that’s really largely due to the fact that it has a high proportion of e commerce sales, which tend to be more volatile than do things going through grocery stores and mass merchants and so forth. And so, I would expect that that the lumpiness quarter to quarter will continue. And and to the extent, you know, will it reverse in next quarter or not, you know, maybe. And, we just wanna let we just wanna be transparent about last quarter and that we saw three points of inventory build last quarter as we head into this quarter.

And whether that will dissipate at the end of this quarter or not, we’ll see. One thing I have decided to do is to not predict what’s gonna happen with pet inventory from quarter to quarter having been pulled a couple of times. So it’s a fair question, but I want you to know there’s our inventory is in a good place both on our retail business, our human food business and our pet food business, and there’s always going to be some level of variability as we go quarter to quarter.

Peter Galbo, Analyst, Bank of America: Great. Thanks, Jeff. And just anything on the underlying Pet kind of performance, how

Jeff Harmening, Chairman and CEO, General Mills: you’re thinking that? Oh, yes. Sorry. I got so excited about that answer. Forgot.

Look, what we I’m really excited I’m really encouraged that we got our Pet business back to stability. And we and we grew it a little bit this past year and our share held. And some of the things we’ve done really worked well, like the advertising on life protection formula has worked well. Our cat business is back to mid single digit growth, and the cat population is growing, so that’s important. We’ve integrated Tiki Cat effectively, and that’s growing well.

Edgar and Cooper is growing well in Europe and bringing back that to The U. S. So we have a lot of things that are working really well, I think, pointed in the right direction. Our marketing is quite good in the pet food business now. There are some things we still have to work on.

Wilderness improved, but it’s not all the way back to to Bright. And, certainly, our treats business would be the same. But I like the direction of travel of our pet food business even without this launch of fresh pet food. And it’s important because, you know, our our our goal this year is is to grow the core of our Blue Buffalo business and add the add this new fresh launch on top of that. And and, we’re encouraged by what we see.

There’s still more work to do, but we’ve gone from a business that had declined the prior year to one that we grew a little bit, and now we’re looking to build on the successes and continue to work on the things that aren’t working exactly the way that we had thought.

Julianne, Conference Call Operator: Our next question comes from Peter Grom from UBS. Please go ahead. Your line is open.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills0: Thanks operator and good morning everyone. I was just hoping to get an understanding on just kind of the organic revenue phasing for the year just in the context of the down 1% to plus one and kind of starting off, I think, in kind of this 3% down 3% range. So just curious how you’re thinking about the phasing of growth as you move through the year. And I guess, do you expect to see a return to growth at some point in time? And then just related in the prepared remarks, you outlined an expectation for category growth to be similar.

And not to get too specific, are you simply assuming what we’re seeing today continues? Or do you expect to see some sequential improvement of where you land for the year ultimately is similar to what we saw in ’25? Thanks.

Peter Galbo, Analyst, Bank of America: Yep. So I think I think

Kofi Bruce, CFO, General Mills: it’s important to note that, you know, as we exit, exit this year, we had about two points of trade expense phasing in our our organic, sales number as we we exit the quarter. So as you think about kind of the setup for next year, we will have trade expense phasing comps as we work our way through the first half of the year. And obviously, as we’ve made investments in the second half of this year, those, those comps will ease. So I would expect that to be reflected in our, the progression of our top line. So I think that’s critical point.

And then the second is, as we think about categories, we are laser focused on what we can control, which is our competitiveness. So we’re not counting on a significant rebound in categories as we work our way through the year.

Julianne, Conference Call Operator: Our next question comes from Chris Carey from Wells Fargo. Please go ahead. Your line is open.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills1: Hey, guys. How are you? I think kind of a holistic question than, more of a quantitative follow-up. From a more holistic side, you’re probably the most intentional when it comes to, pricing reinvestments in the space. And I I think it’s really a couple questions related to that.

First, what are you seeing from a competitive response to some of these early actions? And then secondly, how do you ensure that this isn’t a race to the bottom with branded competitors or private label? And then the more quantitative question is, in the context of really strong 5%, you’ve got the incremental $100,000,000 of savings, but obviously, like substantial pricing investments. Can you just frame kind of like gross margins versus SG and A and how you see those line up stacking up through the year? Thanks so much.

Jeff Harmening, Chairman and CEO, General Mills: Let me take the first part of that question. And then when it comes to margin versus SG and A, I will I’ll pass it on to Kofi, and he can tackle that. On pricing, it’s a really good question, I appreciate it. The things I think there are a couple of things to keep in mind is that the first is that even in the fourth quarter, we looked at our price mix, it was down 3% in North America Retail and down 1% as an enterprise. When we talk about pricing actions and was it gonna be raised to the bottom?

It’s not gonna be a race to the bottom, and the order of magnitude is, is about that much. We’re also investing a lot in in advertising this coming year and new products and all the rest. So it’s not just it’s not just about about pricing. It’s about investment and and making sure that we get trial on on all of our good marketing initiatives. The other is that, you know, in in every category, it’s it’s not as if we are we are leading pricing actions down across the board.

We’re taking targeting actions in specific categories. I’ve talked about this before, but just to really give another example. For example, in in pet food, you know, we were over a price cliff on our wet pet food, and we got under that price cliff, Back in line with competition. And, but we didn’t have any pricing action on life protection formula because that was in a good place. The and, the same with our cat food business.

And so as you and we look across our categories, the actions really are targeted to specific items, specific areas, specific categories. And, really, just to get us back in the zone of of where our marketing is going to be effective. And so our our brands are generally premium brands, and they should be because we’ve got great brands. But the marketing works really well when the when the price is kind of in the zone. And and and kinda getting that in the zone is the first step.

But even more important than that, really, is that once having done that, you know, how good is our marketing? How good are our new products? How good is our core news? And that’s what we’re really excited about because it’s that combination of getting the pricing in, but then also making sure that your marketing is great on top of that, that’s gonna that’s gonna lead to better outcomes. And we saw that with Billsbury.

We saw that with Totino’s. We’re confident we’ll see that with, many of our other businesses as we head into this year. In fact, we already have. I mean, if you look at North America Retail, it’s just we’re just three weeks into the year, but I think about 80% of our North America Retail business, is gaining pound share already, in this quarter.

Kofi Bruce, CFO, General Mills: And then on your question on SG and A, we would expect SG and A to grow a little faster than our top line as a result of reinvestment, a portion of the reinvestment going back into increased media behind our Freshpet launch and certainly behind our brands and innovation in North American retail. In addition, just as a reminder, the incentive reset will be a big drag as you look at the corporate unallocated line in SG and A. So those factors will be the primary drivers of the increase.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: I’ll just add. This is Jeff Siemon. I have one clarification. As Jeff said, our price mix in the quarter, North America Retail and Nielsen was down about three points. And for the quarter at the company level, excluding the trade timing, pricemix was down one.

So I think that was the point. Down three in total, two of that was trade timing. So excluding trade timing, pricemix was down about one in the quarter.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills1: Okay. Thank you, all three of you. Thanks so much.

Julianne, Conference Call Operator: Our next question comes from Robert Moskow from TD Cowen. Please go ahead. Your line is open.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills2: Hi. Thanks for the question. Jeff, I wanted to know if you think pricing can get back into positive territory at some point during the course of the year. It’s hard to get the algorithm to work without having some pricing power to some degree. So maybe you could talk about your philosophy in that regard.

And then secondly, I wanted to ask about the assumptions on how big the fresh business can get in pet. When you started working on this, the category was probably growing at around 25%. But our channel checks indicate that it’s more like 12% to 13% now, including DTC. So does that have any impact on your expectations for how big this business can get longer term? Yes.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: So Rob, a couple of

Jeff Harmening, Chairman and CEO, General Mills: questions a couple of answers to those really, really important questions. Look, I’m about to tell you things that I know that

Max Gumfort, Analyst, BNP Paribas: you already know because you’ve

Jeff Harmening, Chairman and CEO, General Mills: been doing this a long time as I have. But over the long term, to get an algorithm to work in the food space, what you need is about half your growth from volume and half your growth from pricing. I mean, you get pricing and mix and all that. So you need you need both of those things over time. There’s a period of time there’s

Max Gumfort, Analyst, BNP Paribas: a period of

Jeff Harmening, Chairman and CEO, General Mills: time where we saw a record in there’s a dog in the background. The I’m sure things that Blue Buffalo is probably asking for Blue Buffalo. The, but if you look over time, you know, you need a mix of price mix and volume. We saw when we had record inflation for a period about three years, all we had was pricing, and there was no volume. Now we’re in a little bit of a period where there’s a lot more volume than there is than there is price mix given the consumer sentiment kind of of where we are.

But over time, those things tend to level out. So you’re right. Over the course of time, to get the the p and l to really work the way you want it to, you need a mix of pricing and you need a mix price mix and a little bit of volume as well. But this is a period where we’re going to we’re going lean more on volume just as we did more on price mix when we had record inflation a few years ago. And so you’re right, but we’re in a period of time where we know what we need to do.

And in terms of, you know, what comes next and and tariffs and inflation, I mean, your guess is kind of as good as mine. I mean, the the the you know, what’s gonna happen with that? We’re we’re not really sure. I mean, all of our all of our options are still open as to how we deal with the inflation we see in front of us. If inflation, you know, continues to pick up, then, yes, we go to productivity and and all those things, but we have we have a great strategic revenue management tool kit.

And so, you know, we’ll we’ll be glad we’ll be we’ll be very willing to to work with that as well to the extent that that we need to. And so but it’s a pretty unpredictable environment right now, so we’re not really sure how that’s gonna play out. But know that we’re agile enough with enough of the capabilities to to make that to make that work. Your second question about about fresh pet food. You talked about the growth rates and and how they’ve slowed to 12%, I might add, and and how we think about that.

The first, I would say, you know, vis a vis where we started looking at fresh pet food a few years ago, the category is, like, twice the size. So the the pool the pond at which we’ll be fishing in will be about twice the size as it was a few years ago. So that would be the starting point, which gives us reason to believe that our fresh offering has a chance to be a really big offering. And growing 12% is nothing to sneeze at. And the continuation of humanization of pets is an ongoing trend.

It’s a twenty year trend. And it manifests itself in a lot of different ways versus how treating works to to to wanting natural pet food, which Blue Buffalo serves, wanting, you know, fresh offerings, which we’re about to get into. And so we’re confident that this humanization of pet food is going to continue, especially because, it’s particularly relevant among Gen Z and millennial consumers. And so, you know, as as they form households more and more and they buy pets, we’re confident that this trend will will continue.

Dana McNabb, Group President of North America Retail and North America Pet, General Mills: And the only thing I’d add to that is that the Fresh segment is a $3,000,000,000 segment now, and our data indicates it’ll be $10,000,000,000 in ten years. And so there’s still significant growth in this segment to get. We believe Blue Buffalo has a right to win here and it can help spur on that category growth.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills2: Okay. Thanks, Dana. Thanks, Jeff.

Julianne, Conference Call Operator: Our next question comes from David Palmer from Evercore ISI. Please go ahead. Your line is open.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills3: Thanks. First, quick one and a clarification off of a line in Slide number 38. You said category growth below long term expectations and similar to fiscal twenty twenty five reflecting lower price mix. What was your category growth all in for fiscal twenty twenty five? We I asked that because it looks like lately, the category growth on a weighted basis for mills would be over 2% lately just looking at the MULO plus data, which would be in line with your ago.

So it looks like, you know, hearteningly, like, the the categories that you’re in are doing pretty well. So just curious about what sort of category growth assumptions you are seeing.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: Hi, Dave. It’s Jeff Seaman. Yeah. We that that references our global growth exposure, kinda cat take our categories and geographies combined. And, yes, in in The US human food, I’d say our categories are a little bit shy of maybe where we would expect our long term growth to be with volume in line and and price mix not quite maybe to the to the level that we would have expected normally based on our our go forward category mix.

Pet food pet category wise is growing but modestly, less than what what we would expect long term. You know, maybe it’s about 1% today. We’d expect three plus percent long term. And then some of our international categories, China in particular, and even Europe growing a bit less. China down and Europe, maybe a bit less than long term.

So when you take that in aggregate, that was the remark about overall category growth across our enterprise being a bit below where we would expect long term, that 2% to 3% growth rate.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills3: So if if we were to kinda keep it simple and thinking about your business in terms of getting your sales trends in line or better than your categories, 26 versus 25, you know, for all of us look trying to think about whether you know, how you’re thinking about the must get rights for this year, what categories and brands perhaps will get the most improved awards? What are going to be those? It looks like from your slides, you have a lot of snacks, Tatinos, maybe even cereal. You mentioned pets on firmer footing, but what are really going to be the must get rights from a total sales perspective that you’re looking for improvement into ’26? And thanks.

Jeff Harmening, Chairman and CEO, General Mills: Yeah. So let let me let me take that. I’m I’m kinda looking for improvement across the board, to be to be honest with you. The and I think we can get there because our marketing is better. Our new products are better.

Our value is gonna be in the right place. And, I mean, we we win when our our biggest, most important categories get better. And so as you look across our global brands and our low local gems, that’s where we’d expect to see the improvement. I mean, you you you can’t really get the the growth we’re kinda looking at by by growing your small businesses really well. You really need to grow your your biggest, important business as well.

That’s where I would expect to see improvement, but I would also and expected to see it broad based. And I think we have the initiatives to back that up, and we’re we feel good about the starts of the year, and we’ll see how it progresses. But but so far, I would say that, importantly, what we have to do is grow in line with our categories. We think if we do our job right, we can hopefully get our categories to grow a little faster, but but we’re not counting on that. We’re what we’re counting on is just being more competitive within our categories.

But because we’re the leader in so many categories, to the extent that our marketing efforts really stick well, hopefully, can drive a little bit more improvement in category growth as well. But we’re not counting on that.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills3: Okay. Thank you.

Julianne, Conference Call Operator: Our next question comes from Scott Marks from Jefferies. Please go ahead. Your line is open.

Jeff Harmening, Chairman and CEO, General Mills: Hey, good morning, guys. Thanks so much for taking my questions. I have two quick ones. The first, I guess, the innovation front, I guess we saw a lot of products that are putting protein front and center. So just wondering how those are performing thus far and kind of initial launches and markets where you’re getting into.

And then secondly, on the price investment front, we’ve heard some of your competitors speak to investing around key events and key seasons as opposed to more kind of steady state investment. So just wondering how you’re thinking about that and whether you see different consumer responses throughout the year at that at different different points in time. Thanks so much.

Dana McNabb, Group President of North America Retail and North America Pet, General Mills: Yeah. So I think from a from a from a new product standpoint or a new standpoint, you’re absolutely right. Protein is a trend that people are really looking for right now. We see mid single digit growth across the growth grocery store from protein items. And while I’m biased, we make protein taste incredibly good.

What you’re gonna see in the plan coming this year is almost a $100,000,000 worth of ideas. We have really strong protein, across most of our big categories. I’ll use Cheerios protein as an example. That’s only been in the marketplace for six months and has far exceeded our expectation. So we are bringing, new SKUs into the marketplace starting now.

So we really believe that this is a trend that is here to stay and that we are well positioned to win with this trend. So that is how we’re thinking about new products.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: And then price, steady state versus kind of seasonal. Right.

Dana McNabb, Group President of North America Retail and North America Pet, General Mills: I mean, as Jeff has said, the plan for this year is really to make sure that we have, really the right price value and then very strong news innovation and advertising across the entire year. But we also know that when the consumer is struggling, parents won’t sacrifice, spending in the seasons. They want their families to have a good Halloween or a good Valentine’s. And so we will make sure that we are leveraging seasons where appropriate. We have about 50% more seasonal innovation in our plan this year, and I think that will be important to complement the innovation and news that we have throughout the entire fifty two weeks.

Jeff Harmening, Chairman and CEO, General Mills: Got it. Thank you.

Julianne, Conference Call Operator: Our next question comes from Max Gumfort from BNP Paribas. Please go ahead. Your line is open.

Max Gumfort, Analyst, BNP Paribas: Thanks for the question. You’re clearly stepping up your investment posture as you’re prioritizing turning volumes positive, and it’s nice to see that in the platforms that you started investing earlier, like refrigerated dough and T and O’s and dog food, you’re you’re seeing that improved volume performance. The the question is, though, taking refrigerated dough as an example, the the improved volume, it’s not outpacing the price decline. So even though refrigerated dough is a great example of a place where you turn volumes positive, dollar sales really are still struggling, at least in the the Nielsen data we’re looking at. And given the midpoint of your guidance calls for flat organic sales growth, I’m trying to get a sense for what’s giving you the confidence that in these as you roll out these investments more fully, you’ll see a more favorable relationship between volume and price.

Thank you.

Jeff Harmening, Chairman and CEO, General Mills: Yes. So you’re right, Max. The fact that our volumes have increased ahead and our volume shares have increased ahead of our dollar shares is certainly true, and it’s something that we expected and something that we had modeled. In fact, the modeling that we did has turned out to be very, very accurate to what has actually transpired. But the modeling doesn’t always doesn’t just end with how you invest in price.

The what we would expect is that over the course of the first half of this coming year that our volume shares will outpace our dollar shares for the very reasons that you talked about. That’s why, though, it’s so important that as we get into the second half of the year, particularly the fourth quarter, starting in the starting in the second half of the year, that, you know, that we keep our marketing investment up, that we’ve improved our new product profile. Our new products are up 25%. Our that’s that would be our expectation in North America Retail and 30% overall as a company. And and why we have, you know, more core news because once we lap the pricing, our assumption is that our dollar shares would then begin to grow, and that really happens when you get your your your investments in the right zone on value.

But then when you add on top of that really good marketing, which we have. And so the first half of the year, we we would expect that our volume growth will outpace our value growth, our sales growth. And but then that will start to reverse as, as we continue to invest in new product marketing and great advertising and core core business news.

Max Gumfort, Analyst, BNP Paribas: Great. Thank you. And and your guidance, it’s clearly embedding a a pretty big step up in investment spend in at in FY ’26. And it it feels like a a portion of that is around the the national expansion into fresh pet food. Is there any way you could quantify just how much investment is going behind that national expansion into fresh pet food?

And I’ll leave it there.

Jeff Harmening, Chairman and CEO, General Mills: Thank you

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills2: very much.

Jeff Harmening, Chairman and CEO, General Mills: It’s it’s a fair question, but we’re gonna we’re gonna pass on that for now. Just know that, this is not a test market. It’s a national launch, and, we fully intend to, to make, pet parents aware of as long as with our marketing investment, we’re gonna we’re gonna spend the money required to to get the trial because we know we know the repeat is gonna be really good. And so we’re not gonna give a number on that, but just know that it’s it’s important to to get the trial, and And that really comes with good marketing, but significant levels of marketing investment.

Max Gumfort, Analyst, BNP Paribas: Okay. Thanks very much.

Julianne, Conference Call Operator: Our last question today will come from Michael Lavery from Piper Sandler. Please go ahead. Your line is open.

Michael Lavery, Analyst, Piper Sandler: You. Good morning. Two quick Maybe just following up on the launch spending comment. Can you give a sense of how you evaluate and balance organic innovation versus acquiring a Freshpet business? And obviously, the consideration set is extremely limited to go acquire.

But how do you just think about which is the better way to go? Or what drove you to come back after a test a couple of years ago to launch DAO?

Jeff Harmening, Chairman and CEO, General Mills: Yeah. Look, in general, the ways to growth or grow your own brands organically to to buy your way and to grow through m and a, which was also done successfully, or or use equities that other people have to enter categories that we have with ghost and cereal, for example, on the for for protein. And we’ve done all three of those things effectively. And so as we think about what profile it’ll take, we ask ourselves, do we have the right to win to do this organically? And with Buffalo, the answer is absounded yes.

We found that out during the first phase of the trial. The second is do we have the capabilities in order to win? And, you know, we’ve been doing refrigerated refrigerated products since, like, the beginning of time, I think since the fifties. And so, you know, this idea of getting refrigerated, we know how to run a refrigerated network. And so we certainly know how to how to do that.

And then we look at the investment profile, and and do we think we have the investment profile to to be able to enter a category successfully? And and in this case, we think we do. And so we that’s what we evaluate as we look at all of our growth opportunities. We’d like to be able to grow organically. That’s the most important thing for us to do.

But we’re really pleased that that we think we have an offering in this case that will be significant, that will be innovative, that ties really well with the Blue Equity. But, you know, in other areas, you’ve seen us do m and a over time because we we felt like we needed to enter a category like we did with Blue Buffalo originally, and thrilled that we did that.

Michael Lavery, Analyst, Piper Sandler: I know that. That’s helpful. And, can I just come back to one other comment you said about, hoping for improvement across the board? Where does Salty Snacks fit into that? It didn’t really get much mentioned.

I know it’s a smaller piece of the portfolio. But is that just more challenged because of a discretionary component or some reason that, it isn’t maybe getting some of the same investments? Or how does that just fit into your thinking and strategy for the year?

Dana McNabb, Group President of North America Retail and North America Pet, General Mills: Yeah. So so thanks for the question. What I would say for snack broadly overall in a tough economic environment, we see that it’s a bit more of a discretionary spend. And so our categories and our businesses have had a tougher time this year. And the onus is on us is really to do what Jeff talked about, which is to get our value proposition right across all our snacks portfolio and then make sure that we have the best marketing new products and news, to make sure that we’re worth it for the consumers to buy.

From a salty snack standpoint, it didn’t have a great year this year because we just had undersized participation in some of the largest growth trends. So what’s working in salty snacks right now is really bold flavors, having the right value sizes and then, of course, making sure that you use that news to ground merchandising and display. And I think we’re all really excited about the salty plans that are coming this year. We renovated three of our top flavors, significantly increasing flavor intensity We have spicy innovation coming, think spicy dill, a Chex Mix and hot and spicy Chex Mix, and we’ve got a partnership with Tabasco and Bugles. We’ve got value coming in tubs for Chex.

So we just cut really good salty innovation, and I think you’ll see our performance improve significantly in the upcoming fiscal year.

Michael Lavery, Analyst, Piper Sandler: Okay. Thanks so much.

Jeff Seaman, Vice President of Investor Relations and Corporate Finance, General Mills: Okay. I think we’re going go ahead and wrap there. Appreciate the time and attention. And as always, we’ll be available for follow-up calls today. Julianne, I’ll pass it back to you.

Julianne, Conference Call Operator: Thank you. This concludes today’s conference call. You may now disconnect.

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