CAMPBELLS Co
For the period ended Apr 27, 2025. Filed Jun 2, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 27, 2025 · Filed Jun 2, 2025
CPB$23.13-1.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-01-26; filed 2025-03-05.
0000016732-25-000026
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-04-27; filed 2025-06-02.
0000016732-25-000064
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 215 previous paragraphs and 232 current paragraphs.
122 unchanged; 71 reworded; 31 added; 16 removed; 6 previous and 8 current paragraphs rearranged.
Tables are not compared: 18 previous and 19 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
In addition, in light of recent actions by the United States Department of Health and Human Services, Food and Drug Administration (FDA) and states, we anticipate continued legislative and regulatory developments with respect to food ingredients, labeling and packaging at the state and federal levels, along with related changes in consumer expectations and behavior. In April 2025, the FDA announced a series of actions aimed at phasing out all “petroleum-based synthetic dyes” from the nation’s food supply, and in May 2025, the Make America Healthy Again (MAHA) Commission published a report discussing factors contributing to chronic childhood disease including diet, environmental exposure, lack of physical activity and healthcare. While the effects of all of these proposals remain uncertain at this time, we are continuing to monitor changes to laws and regulations that affect the food industry and evaluate their impact on our business and financial condition.
Current report
•Net sales increased 4% in the quarter to $2.475 billion primarily due to the benefit from the acquisition of Sovos Brands and favorable volume/mix, partially offset by the impact of divestitures and lower net price realization. The increase in volume/mix was partially related to the favorable timing of shipments this quarter.
Current report
•In the third quarter of 2025, the company performed an interim impairment assessment on the Snyder's of Hanover trademark within the Snacks segment and recognized an impairment charge of $150 million ($112 million after tax, or $.37 per share) on the trademark.
Current report
THIRD-QUARTER DISCUSSION AND ANALYSIS
Current report
(2)Prior year included a negative margin impact of 70 basis points from a Sovos Brands acquisition date fair value adjustment for inventory.
Current report
Operating earnings from Snacks decreased 13%. The decrease was primarily due to lower gross profit, partially offset by lower administrative expenses.
Current report
•$150 million of an impairment charge related to the Snyder's of Hanover trademark;
Current report
•$6 million of accelerated amortization expense; and
Current report
•$77 million of costs associated with the acquisition of Sovos Brands;
Current report
•costs of $23 million related to cost savings and optimization initiatives;
Current report
•$6 million of accelerated amortization expense; and
Current report
•$13 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges.
Current report
NINE-MONTH DISCUSSION AND ANALYSIS
Current report
(2)Prior year included a negative margin impact of 20 basis points from a Sovos Brands acquisition date fair value adjustment for inventory.
Current report
•$20 million of accelerated amortization expense;
Current report
•$96 million of costs associated with the acquisition of Sovos Brands;
Current report
•costs of $68 million related to cost savings and optimization initiatives;
Current report
•$20 million of accelerated amortization expense;
Current report
•$5 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges.
Current report
On March 12, 2024, we completed the acquisition of Sovos Brands. Cash consideration was $2.857 billion. The acquisition was funded through the 2024 DDTL Credit Agreement of $2 billion and cash on hand.
Current report
On October 10, 2023, we entered into the 2024 DDTL Credit Agreement totaling up to $2 billion scheduled to mature on October 8, 2024. Loans under the 2024 DDTL Credit Agreement bear interest at the rates specified in the 2024 DDTL Credit Agreement, which vary based on the type of loan and certain other conditions. The 2024 DDTL Credit Agreement contains customary representations and warranties, affirmative and negative covenants, including a financial covenant with respect to a minimum consolidated interest coverage ratio of consolidated adjusted EBITDA to consolidated interest expense (as each is defined in the 2024 DDTL Credit Agreement) of not less than 3.25:1.00, and events of default for credit facilities of this type. The proceeds of the loans under the 2024 DDTL Credit Agreement could only be used in connection with the acquisition of Sovos Brands and the payment of fees and expenses incurred in connection therewith. On March 12, 2024, we borrowed $2 billion under the 2024 DDTL Credit Agreement and used the proceeds in order to fund the acquisition of Sovos Brands, along with the fees and expenses incurred in connection therewith.
Current report
•$400 million aggregate principal amount of notes bearing interest at a fixed rate of 5.30% per annum, due March 20, 2026, with interest payable semi-annually on each of March 20 and September 20 commencing September 20, 2024;
Current report
•$500 million aggregate principal amount of notes bearing interest at a fixed rate of 5.20% per annum, due March 19, 2027, with interest payable semi-annually on each of March 19 and September 19 commencing September 19, 2024;
Current report
•$600 million aggregate principal amount of notes bearing interest at a fixed rate of 5.20% per annum, due March 21, 2029, with interest payable semi-annually on each of March 21 and September 21 commencing September 21, 2024; and
Current report
•$1 billion aggregate principal amount of notes bearing interest at a fixed rate of 5.40% per annum, due March 21, 2034, with interest payable semi-annually on each of March 21 and September 21 commencing September 21, 2024.
Current report
Second Quarter Assessment
Current report
Third Quarter Assessment
Current report
During the third quarter of 2025, we performed an interim impairment assessment on the Snyder's of Hanover trademark within our Snacks segment. In 2025, sales and operating performance were below expectations. In the third quarter of 2025, based on recent performance, we lowered our long-term outlook and recognized an impairment charge of $150 million on the trademark, reducing the carrying value to $470 million.
Current report
The $1.47 billion carrying value of the Rao'strademark associated with the Sovos Brands acquisition approximates fair value. Holding all other assumptions used in the acquisition valuation measurement constant, changes in the assumptions below would reduce the fair value of this trademark and result in impairment charges of approximately:
Current report
(1)Based on 2025 interim impairment testing.
Current report
While the 1% changes in assumptions would not result in impairment charges on our other trademarks, some changes would reduce the excess coverage of fair value over carrying value to less than 10% for the Cape Cod trademark.
Removed paragraphs (16)
Previous report
Company Name Change
Previous report
On November 19, 2024, at the 2024 Annual Meeting of Shareholders of the company, our shareholders approved an amendment to the company’s Restated Certificate of Incorporation to change the company’s name from “Campbell Soup Company” to “The Campbell’s Company.” The company’s name change became effective on November 19, 2024.
Previous report
•Net sales increased 9% in the quarter to $2.685 billion primarily due to a 13-point benefit from the acquisition of Sovos Brands.
Previous report
SECOND-QUARTER DISCUSSION AND ANALYSIS
Previous report
•$7 million of accelerated amortization expense;
Previous report
•$14 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges.
Previous report
•costs of $34 million related to cost savings initiatives;
Previous report
•$7 million of accelerated amortization expense;
Previous report
•$7 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges.
Previous report
Excluding these amounts, the remaining decrease was primarily due to lower administrative costs.
Previous report
SIX-MONTH DISCUSSION AND ANALYSIS
Previous report
•costs of $49 million related to costs savings initiatives;
Previous report
•$14 million of accelerated amortization expense;
Previous report
•costs of $45 million related to cost savings initiatives;
Previous report
•$19 million of costs associated with the acquisition of Sovos Brands;
Previous report
•$14 million of accelerated amortization expense;
Reworded paragraphs (71)
Previous wording
On August 26, 2024, we completed the sale of our Pop Secret popcorn business. For additional information on the divestiture, see Note 4 to the Consolidated Financial Statements.
Current wording
On August 26, 2024, we completed the sale of our Pop Secret popcorn business. On February 24, 2025, we completed the sale of our noosa yoghurt business. For additional information on the divestitures, see Note 4 to the Consolidated Financial Statements.
Previous wording
Our industry continues to navigate an ongoing recovery in light of global macroeconomic challenges, including changes in consumer purchasing and spending patterns; supply chain pressures; commodity cost volatility; labor market issues; and economic uncertainties amplified by increased regulatory activity, potential or actual imposition of tariffs and shifting global trade policies. Twenty-five percent tariffs on product imports from Mexico and Canada, and additional 10% tariffs on product imports from China (for an aggregate of 20%) went into effect on March 4, 2025. These actions are expected to result in retaliatory measures on U.S. goods. We are continuing to monitor the rapidly evolving tariff and global trade policies and are working with our suppliers to mitigate potential impacts on our business. The extent and duration of the tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as negotiations between the U.S. and affected countries, the responses of other countries or regions, exemptions that may be granted, availability and cost of alternative sources of supply and demand for our products in affected markets.
Current wording
Our industry continues to navigate global macroeconomic challenges, including tariffs and shifting global trade policies; changes in consumer purchasing and spending patterns; supply chain pressures; commodity cost volatility; labor market issues; and economic uncertainties amplified by increased regulatory activity. Tariffs on China, Canada, Mexico, the European Union and other countries have and are expected to result in retaliatory measures on U.S. goods, such as the 25% tariffs imposed by Canada on imports of certain U.S. goods, and increase costs. We are continuing to monitor the rapidly evolving tariff and global trade policies and are working with our suppliers to mitigate potential impacts on our business. The extent and duration of the tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as recent legal challenges to the U.S.'s imposition of tariffs, negotiations between the U.S. and affected countries, the responses of other countries or regions, exemptions that may be granted, availability and cost of alternative sources of supply and demand for our products in affected markets.
Previous wording
Through the second quarter, we continued to experience some moderation in input cost inflation, as we continue to see cost improvement across certain ingredients and packaging materials. We anticipate continued supply chain productivity and benefits from cost savings initiatives to mitigate inflationary pressures and expect such benefits to offset incremental costs in 2025, excluding potential impacts of tariffs. We expect consumer trends to continue to evolve and our volumes to improve over time; however, economic pressures, including the challenges of persistent inflation and impacts of tariffs, may continue to negatively impact our volumes throughout 2025. We will continue to evaluate the evolving macroeconomic environment to take action to mitigate the impact on our business, consolidated results of operations and financial condition.
Current wording
Through the third quarter, we experienced a moderate level of input cost inflation and other supply chain costs. We anticipate continued supply chain productivity and benefits from cost savings initiatives to mitigate inflationary pressures and expect such benefits to offset incremental costs in 2025, excluding potential impacts of tariffs. We expect consumer trends to continue to evolve and our volumes to improve over time; however, economic pressures, including the challenges of persistent inflation and impacts of tariffs, may continue to negatively impact our volumes throughout 2025. We will continue to evaluate the evolving macroeconomic environment to take action to mitigate the impact on our business, consolidated results of operations and financial condition.
Previous wording
•Gross profit, as a percent of sales, was 30.5% in 2025 compared to 31.6% in the prior-year quarter. The decrease was primarily due to unfavorable net price realization, the impact of cost inflation and other supply chain costs and the impact of the acquisition, partially offset by benefits from supply chain productivity improvements.
Current wording
•Gross profit, as a percent of sales, was 29.4% in 2025 compared to 30.9% in the prior-year quarter. The decrease was primarily due to the impact of cost inflation and other supply chain costs, mark-to-market adjustments on outstanding undesignated commodity hedges and unfavorable net price realization, partially offset by benefits from supply chain productivity improvements, the prior-year impact from a Sovos Brands acquisition date fair value adjustment for inventory and favorable volume/mix.
Previous wording
•Earnings per share were $.58 in 2025, compared to $.68 in the prior-year quarter. The current quarter included expenses of $.16 per share and the prior-year quarter included expenses of $.12 per share from items impacting comparability as discussed below.
Current wording
•Earnings per share were $.22 in 2025, compared to $.44 in the prior-year quarter. The current quarter included expenses of $.51 per share and the prior-year quarter included expenses of $.30 per share from items impacting comparability as discussed below.
Previous wording
•We implemented several cost savings initiatives in recent years. In the second quarter of 2025, we recorded Restructuring charges of $5 million and implementation costs and other related costs of $10 million in Cost of products sold, $8 million in Administrative expenses, $1 million in Marketing and selling expenses and $1 million in Research and development expenses related to these initiatives. In the second quarter of 2024, we recorded Restructuring charges of $2 million and implementation costs and other related costs of $29 million in Administrative expenses, $3 million in Cost of products sold, $1 million in Marketing and selling expenses and $1 million in Research and development expenses (aggregate impact of $27 million after tax, or $.09 per share) related to these initiatives. Year-to-date in 2025, we recorded Restructuring charges of $11 million and implementation costs and other related costs of $19 million in Administrative expenses, $18 million in Cost of products sold, $2 million in Marketing and selling expenses and $2 million in Research and development expenses related to these initiatives. Year-to-date in 2024, we recorded Restructuring charges of $4 million and implementation costs and other related costs of $34 million in Administrative expenses, $6 million in Cost of products sold, $3 million in Marketing and selling expenses and $2 million in Research and development expenses (aggregate impact of $37 million after tax, or $.12 per share) related to these initiatives.
Current wording
•We implemented several cost savings initiatives in recent years. In the third quarter of 2025, we recorded Restructuring charges of $6 million and implementation costs and other related costs of $7 million in Cost of products sold, $7 million in Administrative expenses and $1 million in Research and development expenses related to these initiatives. In the third quarter of 2024, we recorded implementation costs and other related costs of $13 million in Administrative expenses, $3 million in Cost of products sold, $1 million in Marketing and selling expenses, $1 million in Research and development expenses and a reduction to Restructuring charges of $3 million related to these initiatives. Year-to-date in 2025, we recorded Restructuring charges of $17 million and implementation costs and other related costs of $26 million in Administrative expenses, $25 million in Cost of products sold, $3 million in Research and development expenses and $2 million in Marketing and selling expenses related to these initiatives. Year-to-date in 2024, we recorded Restructuring charges of $1 million and implementation costs and other related costs of $47 million in Administrative expenses, $9 million in Cost of products sold, $4 million in Marketing and selling expenses and $3 million in Research and development expenses related to these initiatives.
Previous wording
In the second quarter of 2024, we began implementation of an optimization initiative to improve the effectiveness of our Snacks direct-store-delivery route-to-market network. Year-to-date in 2025, we recognized $8 million in Marketing and selling expenses related to this initiative.
Current wording
In the second quarter of 2024, we began implementation of an optimization initiative to improve the effectiveness of our Snacks direct-store-delivery route-to-market network. In the third quarter of 2025, we recognized $9 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative. In the third quarter of 2024, we recognized $5 million in Marketing and selling expenses related to this initiative. Year-to-date in 2025, we recognized $17 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative.
Previous wording
In the second quarter of 2025, the total aggregate impact related to the cost savings and optimization initiatives was $25 million ($19 million after tax, or $.06 per share). Year-to-date in 2025, the total aggregate impact related to the cost savings and optimization initiatives was $60 million ($46 million after tax, or $.15 per share). See Note 8 to the Consolidated Financial Statements and "Restructuring Charges, Cost Savings Initiatives and Other Optimization Initiatives" for additional information;
Current wording
In the third quarter of 2025, the total aggregate impact related to the cost savings and optimization initiatives was $31 million ($24 million after tax, or $.08 per share). In the third quarter of 2024, the total aggregate impact related to the cost savings and optimization initiatives was $20 million ($15 million after tax, or $.05 per share). Year-to-date in 2025, the total aggregate impact related to the cost savings and optimization initiatives was $91 million ($70 million after tax, or $.23 per share). Year-to-date in 2024, the total aggregate impact related to the cost savings and optimization initiatives was $69 million ($52 million after tax, or $.17 per share). See Note 8 to the Consolidated Financial Statements and "Restructuring Charges, Cost Savings Initiatives and Other Optimization Initiatives" for additional information;
Previous wording
•In the second quarter of 2025, we recognized gains in Cost of products sold of $14 million ($10 million after tax, or $.03 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. In the second quarter of 2024, we recognized gains in Cost of products sold of $7 million ($5 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2025, we recognized gains in Cost of products sold of $18 million ($13 million after tax, or $.04 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2024, we recognized losses in Cost of products sold of $8 million ($6 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges;
Current wording
•In the third quarter of 2025, we recognized losses in Cost of products sold of $10 million ($7 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. In the third quarter of 2024, we recognized gains in Cost of products sold of $13 million ($10 million after tax, or $.03 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2025, we recognized gains in Cost of products sold of $8 million ($6 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. Year-to-date in 2024, we recognized gains in Cost of products sold of $5 million ($4 million after tax, or $.01 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges;
Previous wording
•In the second quarter of 2025 and 2024, we recorded accelerated amortization expense in Other expenses / (income) of $7 million ($5 million after tax, or $.02 per share) related to customer relationship intangible assets due to the loss of certain contract manufacturing customers, which began in the fourth quarter of 2023. Year-to-date in 2025 and 2024, we recorded accelerated amortization expense in Other expenses / (income) of $14 million ($10 million after tax, or $.03 per share);
Current wording
•In the third quarter of 2025 and 2024, we recorded accelerated amortization expense in Other expenses / (income) of $6 million ($5 million after tax, or $.02 per share) related to customer relationship intangible assets due to the loss of certain contract manufacturing customers, which began in the fourth quarter of 2023. Year-to-date in 2025 and 2024, we recorded accelerated amortization expense in Other expenses / (income) of $20 million ($15 million after tax, or $.05 per share);
Previous wording
In the second quarter of 2025, the total aggregate impact of the impairment charges was $26 million ($19 million after tax, or $.06 per share).
Current wording
In the second quarter of 2025, the total aggregate impact of the impairment charges was $26 million ($19 million after tax, or $.06 per share). Year-to-date in 2025, the total aggregate impact of the impairment charges was $176 million ($131 million after tax, or $.44 per share).
Previous wording
•In the second quarter of 2025, we recorded $15 million ($.05 per share) of deferred tax expense related to the sale of the noosa yoghurt business, which was completed on February 24, 2025. In the first quarter of 2025, we recorded a loss in Other expenses / (income) of $25 million ($19 million after tax, or $.06 per share) on the sale of our Pop Secret popcorn business. Year-to-date in 2025, the total aggregate impact of charges associated with divestitures was $25 million ($34 million after tax, or $.11 per share);
Current wording
•In the third quarter of 2025, we completed the sale of our noosa yoghurt business. In the second quarter of 2025, we recorded $15 million ($.05 per share) of tax expense related to the sale. Year-to-date in 2025, we recorded an after-tax loss of $15 million ($.05 per share) on the sale of the business, which is subject to the finalization of certain purchase price adjustments. In the first quarter of 2025, we recorded a loss in Other expenses / (income) of $25 million ($19 million after tax, or $.06 per share) on the sale of our Pop Secret popcorn business. Year-to-date in 2025, the total aggregate impact of charges associated with divestitures was $25 million ($34 million after tax, or $.11 per share);
Previous wording
•In the second quarter of 2025, we recorded litigation expenses in Administrative expenses of $1 million ($1 million after tax) related to the Plum baby food and snacks business (Plum), which was divested on May 3, 2021, and certain other litigation matters. In the second quarter of 2024, we recorded litigation expenses in Administrative expenses of $1 million ($1 million after tax) related to Plum. Year-to-date in 2025, we recorded litigation expenses in Administrative expenses of $2 million ($2 million after tax, or $.01 per share) related to Plum and certain other litigation matters. Year-to-date in 2024, we recorded litigation expenses in Administrative expenses of $3 million ($3 million after tax, or $.01 per share) related to Plum;
Current wording
•In the third quarter of 2025, we recorded litigation expenses in Administrative expenses of $4 million ($4 million after tax, or $.01 per share) related to the Plum baby food and snacks business (Plum), which was divested on May 3, 2021, and certain other litigation matters. Year-to-date in 2025, we recorded litigation expenses in Administrative expenses of $6 million ($6 million after tax, or $.02 per share) related to Plum and certain other litigation matters. Year-to-date in 2024, we recorded litigation expenses in Administrative expenses of $3 million ($3 million after tax, or $.01 per share) related to Plum;
Previous wording
•In the first quarter of 2024, we announced our intent to acquire Sovos Brands and on March 12, 2024, the acquisition closed. In the second quarter of 2024, we incurred costs associated with the acquisition in Other expenses / (income) of $10 million ($9 million after tax, or $.03 per share). Year-to-date in 2024, we incurred costs associated with the acquisition in Other expenses / (income) of $19 million ($17 million after tax, or $.06 per share).
Current wording
•In the first quarter of 2024, we announced our intent to acquire Sovos Brands and on March 12, 2024, the acquisition closed. In the third quarter of 2024, we incurred $93 million of costs associated with the acquisition, of which $16 million was recorded in Restructuring charges, $39 million in Administrative expenses, $16 million in Other expenses / (income), $2 million in Marketing and selling expenses, $2 million in Research and development expenses and $18 million in Cost of products sold, of which $17 million was associated with the acquisition date fair value adjustment for inventory. We also recorded costs of $2 million in Interest expense related to costs associated with the Delayed Draw Term Loan Credit Agreement (the 2024 DDTL Credit Agreement) used to fund the acquisition. The aggregate impact was $95 million, $81 million after tax, or $.27 per share. Year-to-date in 2024, we incurred $114 million of costs associated with the acquisition, of which $16 million was recorded to Restructuring charges, $39 million in Administrative expenses, $35 million in Other expenses / (income), $2 million in Marketing and selling expenses, $2 million in Research and development expenses, $18 million in Cost of products sold and $2 million in Interest expense. The aggregate after-tax impact was $98 million, or $.33 per share.
Previous wording
Net earnings attributable to The Campbell's Company were $173 million ($.58 per share) in the current quarter, compared to $203 million ($.68 per share) in the year-ago quarter. After adjusting for items impacting comparability, earnings decreased primarily due to higher marketing and selling expenses and higher interest expense, partially offset by an increase in gross profit.
Current wording
Net earnings attributable to The Campbell's Company were $66 million ($.22 per share) in the current quarter, compared to $133 million ($.44 per share) in the year-ago quarter. After adjusting for items impacting comparability, earnings decreased primarily due to higher interest expense and higher marketing and selling expenses, partially offset by lower administrative expenses.
Previous wording
Net earnings attributable to The Campbell's Company were $391 million ($1.30 per share) in the six-month period this year, compared to $437 million ($1.46 per share) in the year-ago period. After adjusting for items impacting comparability, earnings decreased primarily due to higher interest expense, higher marketing and selling expenses and higher administrative expenses, partially offset by an increase in gross profit.
Current wording
Net earnings attributable to The Campbell's Company were $457 million ($1.52 per share) in the nine-month period this year, compared to $570 million ($1.91 per share) in the year-ago period. After adjusting for items impacting comparability, earnings decreased primarily due to higher interest expense and higher marketing and selling expenses, partially offset by an increase in gross profit and a lower effective tax rate.
Previous wording
In Meals & Beverages, sales increased 21%, primarily due to a 23-point benefit from the acquisition of Sovos Brands. Excluding the benefit from the acquisition of Sovos Brands, sales decreased primarily due to declines in SpaghettiOs and U.S. soup, partially offset by gains in foodservice. Lower net price realization was partially offset by favorable volume/mix. Sales of U.S. soup decreased 1% primarily due to declines in ready-to-serve soups and condensed soups, partially offset by increases in broth.
Current wording
In Meals & Beverages, sales increased 15%, primarily due to a 12-point benefit from the acquisition of Sovos Brands. Excluding the benefit from the acquisition of Sovos Brands and the impact from the divestiture of the noosa yoghurt business, sales increased primarily due to gains in U.S. soup, Rao's pasta sauces and Canada, partially related to the favorable timing of shipments. Sales of Rao'spasta sauces increased due primarily to the timing of shipments related to the implementation of our existing SAP enterprise-resource planning system for Sovos Brands. Favorable volume/mix was partially offset by lower net price realization. Sales of U.S. soup increased 7% primarily due to increases in condensed soups, broth and ready-to-serve soups.
Previous wording
In Snacks, sales decreased 6%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased due to declines in third-party partner brands and contract manufacturing, Goldfish crackers and Snyder's of Hanover pretzels. Sales were impacted by volume/mix declines and lower net price realization.
Current wording
In Snacks, sales decreased 8%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased due to declines in Goldfish crackers, third-party partner brands and contract manufacturing, Snyder's of Hanover pretzels, Late July snacks and Lance sandwich crackers. Sales were impacted by volume/mix declines and neutral net price realization.
Previous wording
Gross profit, defined as Net sales less Cost of products sold, increased by $122 million in 2025 from 2024. As a percent of sales, gross profit was 30.9% in 2025 and 31.4% in 2024.
Current wording
Gross profit, defined as Net sales less Cost of products sold, decreased by $4 million in 2025 from 2024. As a percent of sales, gross profit was 29.4% in 2025 and 30.9% in 2024.
Previous wording
The 110 basis-point decrease in gross profit margin was due to the following factors:
Current wording
The 150 basis-point decrease in gross profit margin was due to the following factors:
Previous wording
(1)Includes a 50 basis-point positive impact from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges and an estimated positive margin impact of 50 basis points from the benefit of cost savings initiatives, which were more than offset by cost inflation and other factors.
Current wording
(1)Includes an estimated positive margin impact of 60 basis points from the benefit of cost savings initiatives, which was more than offset by cost inflation and other factors, including a 90 basis-point negative impact from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges.
Previous wording
(2)Includes the impact of operating leverage.
Current wording
(3)Includes the impact of operating leverage.
Previous wording
Marketing and selling expenses as a percent of sales were 9.5% in 2025 compared to 8.8% in 2024. Marketing and selling expenses increased 18% in 2025 from 2024. The increase was primarily due to the impact of the acquisition (approximately 11 points) and higher advertising and consumer promotion expense (approximately 7 points) driven by Meals & Beverages and Snacks.
Current wording
Marketing and selling expenses as a percent of sales were 8.7% in 2025 and 2024. Marketing and selling expenses increased 5% in 2025 from 2024. The increase was primarily due to the impact of the acquisition (approximately 5 points).
Previous wording
Administrative expenses as a percent of sales were 6.1% in 2025 compared to 7.7% in 2024. Administrative expenses decreased 13% in 2025 from 2024. The decrease was primarily due to lower costs associated with cost savings initiatives (approximately 11 points) and increased benefits from cost savings initiatives (approximately 6 points), partially offset by the impact of the acquisition (approximately 5 points).
Current wording
Administrative expenses as a percent of sales were 6.5% in 2025 compared to 8.8% in 2024. Administrative expenses decreased 22% in 2025 from 2024. The decrease was primarily due to costs associated with the acquisition in the prior year (approximately 19 points); increased benefits from cost savings initiatives (approximately 9 points) and lower costs associated with cost savings initiatives (approximately 2 points), partially offset by higher general administrative costs and inflation (approximately 5 points) and the impact of the acquisition (approximately 2 points).
Previous wording
Other expenses were $41 million in 2025 compared to$26 million in 2024. Other expenses in 2025 included impairment charges related to the Allied brands and Late July trademarks of $26 million and accelerated amortization expense of $7 million. Other expenses in 2024 included costs associated with the acquisition of $10 million and accelerated amortization expense of $7 million.
Current wording
Other expenses were $160 million in 2025 compared to$30 million in 2024. Other expenses in 2025 included an impairment charge related to the Snyder's of Hanover trademark of $150 million and accelerated amortization expense of $6 million. Other expenses in 2024 included costs associated with the acquisition of $16 million and accelerated amortization expense of $6 million.
Previous wording
Operating earnings from Meals & Beverages increased 18%. The increase was primarily due to the benefit of the acquisition of Sovos Brands, partially offset by higher marketing and selling expenses.
Current wording
Operating earnings from Meals & Beverages increased 8%. The increase was primarily due to the benefit of the acquisition of Sovos Brands, partially offset by a decline in the base business.
Previous wording
•costs of $20 million related to costs savings and optimization initiatives;
Current wording
•costs of $25 million related to costs savings and optimization initiatives;
Previous wording
•$8 million of unrealized mark-to-market losses on outstanding undesignated commodity hedges;
Current wording
•$10 million of unrealized mark-to-market losses on outstanding undesignated commodity hedges;
Previous wording
•$2 million of certain litigation expenses, including expenses related to Plum;
Current wording
•$4 million of certain litigation expenses, including expenses related to Plum.
Previous wording
Interest expense of $88 million in 2025 increased from $46 million in 2024 primarily due to higher levels of debt.
Current wording
Interest expense of $85 million in 2025 increased from $70 million in 2024 primarily due to higher levels of debt and higher average interest rates on the debt portfolio.
Previous wording
The effective tax rate was 30.0% in 2025 and 25.1% in 2024. Theincrease in the effective tax rate was primarily due to $15 million ofdeferred tax expense recognized related to the sale of the noosa yoghurt business in the current quarter, partially offset bynondeductible costs associated with the acquisition of Sovos Brands in the year-ago quarter.
Current wording
The effective tax rate was 18.5% in 2025 and 26.9% in 2024. The decrease in the effective tax rate was primarily due to the items impacting comparability, including nondeductible costs associated with the acquisition of Sovos Brands in the year-ago quarter and the timing of recognition of tax expense related to the impairment charge.
Previous wording
In Meals & Beverages, sales increased 22%, primarily due to a 22-point benefit from the acquisition of Sovos Brands. Excluding the benefit from the Sovos Brands acquisition, sales decreased primarily due to declines in U.S. soup and SpaghettiOs, partially offset by gains in foodservice and Prego pasta sauces. Lower net price realization was partially offset by favorable volume/mix. Sales of U.S. soup decreased 3% primarily due to decreases in ready-to-serve soups and condensed soups, partially offset by an increase in broth.
Current wording
In Meals & Beverages, sales increased 19%, primarily due to a 19-point benefit from the acquisition of Sovos Brands. Excluding the benefit from the Sovos Brands acquisition and the impact from the divestiture of the noosa yoghurt business, sales increased primarily due to gains in Rao's pasta sauces, foodservice and Canada, partially offset by declines in SpaghettiOs. Sales of Rao'spasta sauces increased due primarily to the timing of shipments related to the implementation of our existing SAP enterprise-resource planning system for Sovos Brands. Favorable volume/mix was partially offset by lower net price realization. Sales of U.S. soup were comparable with prior year as decreases in ready-to-serve soups and condensed soups were offset by increases in broth.
Previous wording
In Snacks, sales decreased 5%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased due to declines in third-party partner brands and contract manufacturing, Goldfish crackers, Pepperidge Farm cookies and Snyder's of Hanover pretzels. Sales were impacted by volume/mix declines and lower net price realization.
Current wording
In Snacks, sales decreased 6%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased due to declines in third-party partner brands and contract manufacturing, Goldfish crackers, Snyder's of Hanover pretzels, Pepperidge Farm cookies, Kettle Brand potato chips, Late July snacks and Lance sandwich crackers. Sales were impacted by volume/mix declines and lower net price realization.
Previous wording
Gross profit, defined as Net sales less Cost of products sold, increased by $43 million in 2025 from 2024. As a percent of sales, gross profit was 30.5% in 2025 and 31.6% in 2024.
Current wording
Gross profit, defined as Net sales less Cost of products sold, increased by $118 million in 2025 from 2024. As a percent of sales, gross profit was 30.4% in 2025 and 31.3% in 2024.
Previous wording
The 50 basis-point decrease in gross profit margin was due to the following factors:
Current wording
The 90 basis-point decrease in gross profit margin was due to the following factors:
Previous wording
(1)Includes an estimated positive margin impact of 50 basis points from the benefit of cost savings initiatives and a 30 basis-point positive impact from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges, which were more than offset by the impact of cost inflation and other factors.
Current wording
(1)Includes an estimated positive margin impact of 50 basis points from the benefit of cost savings initiatives, which was more than offset by cost inflation and other factors.
Previous wording
(2)Includes the impact of operating leverage.
Current wording
(3)Includes the impact of operating leverage.
Previous wording
Marketing and selling expenses as a percent of sales were 9.3% in 2025 and 8.8% in 2024. Marketing and selling expenses increased 15% in 2025 from 2024. The increase was primarily due to the impact of the acquisition (approximately 11 points), higher advertising and consumer promotion expense (approximately 3 points) and higher costs related to cost savings and optimization initiatives (approximately 2 points), partially offset by lower other marketing expenses (approximately 1 point). The increase in advertising and consumer promotion expense was driven by Snacks and Meals & Beverages.
Current wording
Marketing and selling expenses as a percent of sales were 9.1% in 2025 compared to 8.8% in 2024. Marketing and selling expenses increased 12% in 2025 from 2024. The increase was primarily due to the impact of the acquisition (approximately 9 points); higher advertising and consumer promotion expense (approximately 2 points) and higher costs related to cost savings and optimization initiatives (approximately 2 points). The increase in advertising and consumer promotion expense was driven by Meals & Beverages and Snacks.
Previous wording
Administrative expenses as a percent of sales were 6.2% in 2025 compared to 7.0% in 2024. Administrative expenses decreased 2% in 2025 from 2024. The decrease was primarily due to increased benefits from cost savings initiatives (approximately 5 points); lower costs related to cost savings initiatives (approximately 4 points); lower incentive compensation (approximately 1 point) and lower benefit-related costs (approximately 1 point), partially offset by the impact of the acquisition (approximately 5 points) and higher general administrative costs (approximately 4 points).
Current wording
Administrative expenses as a percent of sales were 6.3% in 2025 compared to 7.6% in 2024. Administrative expenses decreased 10% in 2025 from 2024. The decrease was primarily due to costs associated with the acquisition in the prior year (approximately 7 points); increased benefits from cost savings initiatives (approximately 7 points); lower costs related to cost savings initiatives (approximately 4 points); lower benefit-related costs (approximately 1 point) and lower incentive compensation (approximately 1 point), partially offset by higher general administrative costs and inflation (approximately 6 points) and the impact of the acquisition (approximately 4 points).
Previous wording
Other expenses were $84 million in 2025 compared to $50 million in 2024. Other expenses in 2025 included impairment charges related to the Allied brands and Late July trademarks of $26 million, a loss of $25 million on the sale of the Pop Secret popcorn business, accelerated amortization expense of $14 million and a postretirement actuarial loss of $2 million. Other expenses in 2024 included costs associated with the acquisition of $19 million and accelerated amortization expense of $14 million.
Current wording
Other expenses were $244 million in 2025 compared to $80 million in 2024. Other expenses in 2025 included impairment charges related to the Snyder's of Hanover, Allied brands and Late July trademarks of $176 million, a loss of $25 million on the sale of the Pop Secret popcorn business, accelerated amortization expense of $20 million and a postretirement actuarial loss of $2 million. Other expenses in 2024 included costs associated with the acquisition of $35 million and accelerated amortization expense of $20 million.
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Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
•costs of $74 million related to costs savings and optimization initiatives;
Current report — wording carried from elsewhere
•$8 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges; and
Current report — wording carried from elsewhere
On October 2, 2024, pursuant to the registration statement, we completed the issuance of senior unsecured notes of $1.15 billion, consisting of:
Current report — wording carried from elsewhere
On March 19, 2024, pursuant to the registration statement, we issued senior unsecured notes of $2.5 billion, consisting of:
Current report — wording carried from elsewhere
The notes contain customary covenants and events of default. If a change of control triggering event occurs, we will be required to offer to purchase the notes at a purchase price equal to 101% of the principal amount plus accrued and unpaid interest, if any, to the purchase date. We used the net proceeds from the sale of the notes to repay the $2 billion of outstanding borrowings under the 2024 DDTL Credit Agreement used to fund the Sovos Brands acquisition, including fees and expenses in connection therewith, and the remainder of the net proceeds to repay commercial paper.
Current report — wording carried from elsewhere
On April 5, 2024, we repaid $100 million of the $500 million outstanding under the 2022 DDTL Credit Agreement due November 15, 2025.
Current report — wording carried from elsewhere
Pacific Foods, Late Julyand Allied brands trademarks.
Current report — wording carried from elsewhere
(2)Based on 2024 annual impairment testing.
Rearranged previous paragraphs (6)
Previous report — wording carried elsewhere
Operating earnings from Snacks decreased 29%. The decrease was primarily due to lower gross profit and higher marketing and selling expenses. Gross profit decreased primarily due to the impact of cost inflation and other supply chain costs, unfavorable volume/mix and unfavorable net price realization, partially offset by supply chain productivity improvements and the benefits from cost savings initiatives.
Previous report — wording carried elsewhere
•$10 million of costs associated with the acquisition of Sovos Brands;
Previous report — wording carried elsewhere
•$1 million of Plum litigation expenses; and
Previous report — wording carried elsewhere
•$26 million of impairment charges related to the Allied brands and Late July trademarks;
Previous report — wording carried elsewhere
•$18 million of unrealized mark-to-market gains on outstanding undesignated commodity hedges; and
Previous report — wording carried elsewhere
On August 26, 2024, we sold our Pop Secret popcorn business for $70 million.