CAMPBELL'S Co

Previous wording

On December 8, 2025, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina di San Marzano di Antonio Romano S.p.A. (La Regina SPA) and La Regina Atlantica, LLC (La Regina Atlantica, and together with La Regina SPA, La Regina). La Regina currently produces all of our Rao’s tomato-based pasta sauces. The aggregate consideration for the transaction is $286 million to be paid in two tranches. The remaining 51% of the outstanding equity interests of La Regina are subject to a call option granted to us and a put option granted to La Regina. The transaction is subject to certain customary closing conditions. For additional information on this pending transaction, see our Form 8-K filed with the U.S. Securities and Exchange Commission on December 9, 2025, and Note 3 to the Consolidated Financial Statements.

Current wording

On December 8, 2025, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina di San Marzano di Antonio Romano S.p.A. (La Regina SPA) and La Regina Atlantica, LLC (La Regina Atlantica, and together with La Regina SPA, La Regina). La Regina currently produces all of our Rao’s tomato-based pasta sauces. The aggregate consideration for the transaction is $286 million to be paid in two tranches. Subsequent to the end of the third quarter, we acquired the 49% interests in La Regina on May 4, 2026 for $146 million in cash. The remaining 51% of the outstanding equity interests of La Regina are subject to a call option granted to us and a put option granted to La Regina. For additional information on this transaction, see our Form 8-K filed with the U.S. Securities and Exchange Commission on December 9, 2025, and Note 3 to the Consolidated Financial Statements.

Previous wording

Our industry continues to navigate a dynamic operating and regulatory environment driven by commodity cost volatility, supply chain pressures, tariffs and shifting global trade policies, evolving consumer purchasing and spending patterns and other economic uncertainties. Through the second quarter, we experienced elevated input cost inflation, impacts from tariffs and other supply chain costs. We anticipate continued supply chain productivity, benefits from cost savings initiatives and tariff mitigation efforts to offset some of these costs, and we expect inflationary pressures to moderate throughout 2026. We expect consumer trends to continue to evolve and our volumes to improve over time; however, shifting consumer behaviors may continue to negatively impact our volumes throughout 2026. On February 28, 2026, a military conflict commenced in the Middle East involving the United States, Israel and Iran. Although we have no operations in the Middle East, the ongoing geopolitical conflicts in the region could lead to significant disruption of energy supplies and increases in global energy prices, which could heighten inflationary pressures, disrupt global supply chains and adversely impact consumer spending patterns. We will continue to evaluate the evolving macroeconomic environment and take actions to mitigate the impact on our business, consolidated results of operations and financial condition.

Current wording

Our industry continues to navigate a dynamic operating and regulatory environment driven by commodity cost volatility, supply chain pressures, tariffs and shifting global trade policies, evolving consumer purchasing and spending patterns and other economic uncertainties. On a year-to-date basis, through the third quarter, we have experienced elevated input cost inflation, impacts from tariffs and other supply chain costs. We expect elevated inflationary pressures to persist through the remainder of 2026 and anticipate the need to benefit from continued supply chain productivity, cost savings initiatives and tariff mitigation efforts to offset some of these costs. We expect consumer trends to continue to evolve and our volumes to improve over time; however, shifting consumer behaviors, economic pressures, and the challenges of persistent inflation may continue to negatively impact our volumes throughout 2026. Although we have no operations in the Middle East, the ongoing geopolitical conflicts in that region, including between Iran and the United States, have caused significant disruption to energy supplies and increases in global energy prices, which has heightened inflationary pressures, disrupted global supply chains and adversely impacted consumer spending patterns. As the situation is rapidly changing, we will continue to evaluate the evolving macroeconomic environment and take actions to mitigate the impact on our business, consolidated results of operations and financial condition.

Previous wording

•Net sales decreased 5% in the quarter to $2.564 billion primarily due to unfavorable volume/mix and the impact of divestiture with neutral net price realization. Net sales were impacted by an approximate 1% headwind as a result of storm-related shipment delays in January.

Current wording

•Net sales decreased 4% in the quarter to $2.366 billion primarily due to unfavorable volume/mix and the impact of the noosa divestiture, partially offset by favorable net price realization.

Previous wording

•Gross profit, as a percent of sales, was 28.0% in 2026 compared to 30.5% in the prior-year quarter. The decrease was primarily due to the impact of cost inflation and other supply chain costs, the gross impact of tariffs and unfavorable volume/mix, partially offset by benefits from supply chain productivity improvements and favorable net price realization.

Current wording

•Gross profit, as a percent of sales, was 27.5% in 2026 compared to 29.4% in the prior-year quarter. The decrease was primarily due to the gross impact of tariffs and the impact of cost inflation and other supply chain costs, partially offset by benefits from supply chain productivity improvements and favorable net price realization.

Previous wording

•Earnings per share were $.48 in 2026, compared to $.58 in the prior-year quarter. The current quarter included expenses of $.02 per share and the prior-year quarter included expenses of $.16 per share from items impacting comparability as discussed below.

Current wording

•Earnings per share were $.41 in 2026, compared to $.22 in the prior-year quarter. The current quarter included expenses of $.09 per share and the prior-year quarter included expenses of $.51 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 2026, we recorded Restructuring charges of $3 million and implementation costs and other related costs of $9 million in Cost of products sold, $7 million in Administrative expenses, $2 million in Marketing and selling expenses and $1 million in Research and development expenses related to these initiatives. 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. Year-to-date in 2026, we recorded Restructuring charges of $6 million and implementation costs and other related costs of $16 million in Cost of products sold, $15 million in Administrative expenses, $2 million in Marketing and selling expenses and $1 million in Research and development expenses 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.

Current wording

•We implemented several cost savings initiatives in recent years. In the third quarter of 2026, we recorded Restructuring charges of $9 million and implementation costs and other related costs of $38 million in Other expenses / (income), $12 million in Cost of products sold, $6 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 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. Year-to-date in 2026, we recorded Restructuring charges of $15 million and implementation costs and other related costs of $38 million in Other expenses / (income), $28 million in Cost of products sold, $21 million in Administrative expenses, $3 million in Marketing and selling expenses and $2 million in Research and development expenses 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.

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. In the second quarter of 2026, we recognized $2 million in Marketing and selling expenses related to this initiative. Year-to-date in 2026, we recognized $18 million in Marketing and selling expenses related to this initiative. 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 2026, we recognized $2 million in Marketing and selling expenses related to this initiative. 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. Year-to-date in 2026, we recognized $20 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 2026, the total aggregate impact related to the cost savings and optimization initiatives was $24 million ($18 million after tax, or $.06 per share). 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 2026, the total aggregate impact related to the cost savings and optimization initiatives was $58 million ($44 million after tax, or $.15 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 2026, the total aggregate impact related to the cost savings and optimization initiatives was $69 million ($52 million after tax, or $.17 per share). 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). Year-to-date in 2026, the total aggregate impact related to the cost savings and optimization initiatives was $127 million ($96 million after tax, or $.32 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). 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 2026, we recognized gains in Cost of products sold of $16 million ($12 million after tax, or $.04 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. 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. Year-to-date in 2026, 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. 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;

Current wording

•In the third quarter of 2026, we recognized gains in Cost of products sold of $6 million ($5 million after tax, or $.02 per share) associated with unrealized mark-to-market adjustments on outstanding undesignated commodity hedges. 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. Year-to-date in 2026, we recognized gains in Cost of products sold of $20 million ($15 million after tax, or $.05 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;

Previous wording

•Year-to-date in 2025, we recognized an actuarial loss in Other expenses / (income) of $2 million ($1 million after tax) related to an interim remeasurement of our postretirement plan due to a plan amendment.

Current wording

•In the third quarter of 2026, we recognized actuarial and curtailment gains in Other expenses / (income) of $30 million ($23 million after tax, or $.08 per share). The actuarial and curtailment gains were related to interim remeasurements of certain pension plans due to plan amendments and activity under our cost savings initiatives. Year-to-date in 2025, we recognized an actuarial loss in Other expenses / (income) of $2 million ($1 million after tax) related to an interim remeasurement of our postretirement plan due to a plan amendment;

Previous wording

•In the second quarter of 2026, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina. The acquisition is subject to certain customary conditions. Year-to-date in 2026, we recognized costs associated with the pending acquisition in Other expenses / (income) of $2 million ($2 million after tax, or $.01 per share);

Current wording

•In the second quarter of 2026, we entered into purchase agreements to acquire 49% of the issued and outstanding equity interests of La Regina. Subsequent to the end of the third quarter, the acquisition was completed on May 4, 2026. In the third quarter of 2026, we recognized costs associated with the acquisition in Other expenses / (income) of $2 million ($2 million after tax, or $.01 per share). Year-to-date in 2026, we recognized costs associated with the acquisition in Other expenses / (income) of $4 million ($4 million after tax, or $.01 per share);

Previous wording

•In the second quarter of 2026, 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 2025, we recorded litigation expenses in Administrative expenses of $1 million ($1 million after tax) related to Plum and certain other litigation matters. Year-to-date in 2026, we recorded litigation expenses in Administrative expenses of $11 million ($8 million after tax, or $.03 per share) related to Plum and certain other litigation matters. 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;

Current wording

•Year-to-date in 2026, we recorded litigation expenses in Administrative expenses of $11 million ($8 million after tax, or $.03 per share) related to the Plum baby food and snacks business (Plum), which was divested on May 3, 2021, and certain other litigation matters. 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 Plum 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;

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

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. 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); and

Previous wording

•In the second quarter of 2025, 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, we recorded accelerated amortization expense in Other expenses / (income) of $14 million ($10 million after tax, or $.03 per share); and

Current wording

•In the third quarter of 2025, 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, we recorded accelerated amortization expense in Other expenses / (income) of $20 million ($15 million after tax, or $.05 per share).

Previous wording

(1)Sum of the individual amounts may not add due to rounding.

Current wording

(1) Sum of the individual amounts may not add due to rounding.

Previous wording

Net earnings attributable to The Campbell's Company were $145 million ($.48 per share) in the current quarter, compared to $173 million ($.58 per share) in the year-ago quarter. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit, partially offset by lower marketing and selling expenses and lower administrative expenses. The estimated net impact of tariffs was approximately $.06 per share in the current quarter. The estimated net impact of January storm-related shipment delays and incremental supply chain costs was approximately $.04 per share in the current quarter. The negative impact from the divestiture was approximately $.01 per share in the current quarter.

Current wording

Net earnings attributable to The Campbell's Company were $124 million ($.41 per share) in the current quarter, compared to $66 million ($.22 per share) in the year-ago quarter. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit. The estimated net impact of tariffs was approximately $.07 per share in the current quarter.

Previous wording

Net earnings attributable to The Campbell's Company were $339 million ($1.13 per share) in the six-month period this year, compared to $391 million ($1.30 per share) in the year-ago period. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit, partially offset by lower administrative expenses and lower marketing and selling expenses. The estimated net impact of tariffs was approximately $.10 per share in the current period. The estimated net impact of January storm-related shipment delays and incremental supply chain costs was approximately $.04 per share in the current period. The negative impact from divestitures was approximately $.02 per share in the current period.

Current wording

Net earnings attributable to The Campbell's Company were $463 million ($1.55 per share) in the nine-month period this year, compared to $457 million ($1.52 per share) in the year-ago period. After adjusting for items impacting comparability, earnings decreased primarily due to lower gross profit, partially offset by lower administrative expenses and lower marketing and selling expenses. The estimated net impact of tariffs was approximately $.17 per share in the current year. The negative impact from divestitures was approximately $.02 per share in the current year.

Previous wording

In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Prego pasta sauces, foodservice and V8 beverages, partially offset by gains in Rao's. Unfavorable volume/mix was partially offset by favorable net price realization. Sales were impacted by an approximate 1% headwind as a result of storm-related shipment delays in January. Sales of U.S. soup decreased 4% with decreases in condensed soups, ready-to-serve soups and broth.

Current wording

In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Rao'sand Canada, partially offset by gains in Prego pasta sauces. Sales of Rao'sdecreased due primarily to the timing of shipments related to the implementation of our existing SAP enterprise-resource planning system for Sovos Brands, Inc. (Sovos Brands) in the prior year. Unfavorable volume/mix was partially offset by favorable net price realization. Sales were impacted by an approximate 1% headwind from the net impact of the Sovos Brands

Previous wording

In Snacks, sales decreased 6% primarily due to declines in chips and pretzels, fresh bakery related to supply constraints, and third-party partner brands and contract manufacturing. Sales were impacted by volume/mix declines, with neutral net price realization.

Current wording

In Snacks, sales decreased 4% due to declines in crackers, pretzels, third-party partner brands and contract manufacturing, chips and fresh bakery. Sales were impacted by volume/mix declines, partially offset by favorable net price realization.

Previous wording

Gross profit, defined as Net sales less Cost of products sold, decreased by $102 million in 2026 from 2025. As a percent of sales, gross profit declined to 28.0% in 2026 from 30.5% in 2025, due in part to the negative impact of tariffs.

Current wording

Gross profit, defined as Net sales less Cost of products sold, decreased by $78 million in 2026 from 2025. As a percent of sales, gross profit declined to 27.5% in 2026 from 29.4% in 2025, due in part to the negative impact of tariffs.

Previous wording

The 250 basis-point decrease in gross profit margin was due to the following factors:

Current wording

The 190 basis-point decrease in gross profit margin was due to the following factors:

Previous wording

(1)Includes an estimated negative margin impact of 230 basis points from the gross impact of tariffs, partially offset by an estimated positive margin impact of 30 basis points from the benefit of cost savings initiatives and a positive margin impact of 10 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges.

Current wording

(1)Includes an estimated negative margin impact of 310 basis points from the gross impact of tariffs, partially offset by a positive margin impact of 70 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges and an estimated positive margin impact of 30 basis points from the benefit of cost savings initiatives.

Previous wording

Marketing and selling expenses as a percent of sales were 9.8% in 2026 compared to 9.5% in 2025. Marketing and selling expenses decreased 2% in 2026 from 2025. The decrease was primarily due to lower selling expenses (approximately 2 points) and increased benefits from cost savings initiatives (approximately 1 point), partially offset by higher costs associated with costs savings and optimization initiatives (approximately 1 point).

Current wording

Marketing and selling expenses as a percent of sales were 9.0% in 2026 compared to 8.7% in 2025. Marketing and selling expenses decreased 1% in 2026 from 2025. The decrease was primarily due to lower costs associated with cost savings and optimization initiatives (approximately 3 points), partially offset by higher advertising and consumer promotion expense (approximately 1 point). The increase in advertising and consumer promotion expense was primarily driven by Meals & Beverages.

Previous wording

Administrative expenses as a percent of sales were 6.2% in 2026 compared to 6.1% in 2025. Administrative expenses decreased 3% in 2026 from 2025. The decrease was primarily due to increased benefits from cost savings initiatives (approximately 5 points) and lower costs associated with cost savings initiatives (approximately 1 point), partially offset by higher benefit-related costs (approximately 2 points) and inflation (approximately 1 point).

Current wording

Administrative expenses as a percent of sales were 6.6% in 2026 compared to 6.5% in 2025. Administrative expenses decreased 4% in 2026 from 2025. The decrease was primarily due to increased benefits from cost savings initiatives (approximately 4 points); a reduction in certain litigation expenses (approximately 2 points) and lower incentive compensation (approximately 2 points), partially offset by higher general administrative costs (approximately 4 points).

Previous wording

Segment operating earnings decreased 21% in 2026 from 2025.

Current wording

Segment operating earnings decreased 22% in 2026 from 2025.

Previous wording

Operating earnings from Meals & Beverages decreased 15%. The decrease was primarily due to lower gross profit and the impact of the divestiture, partially offset by lower marketing and selling expenses. Gross profit margin decreased primarily due to the gross impact of tariffs, cost inflation and other supply chain costs and unfavorable volume/mix, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.

Current wording

Operating earnings from Meals & Beverages decreased 16%. The decrease was primarily due to lower gross profit. Gross profit margin decreased primarily due to the gross impact of tariffs, cost inflation and other supply chain costs and unfavorable volume/mix, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.

Previous wording

Operating earnings from Snacks decreased 22%. The decrease was primarily due to lower gross profit. Gross profit margin decreased primarily due to cost inflation and other supply chain costs, the gross impact of tariffs and unfavorable volume/mix, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.

Current wording

Operating earnings from Snacks decreased 32%. The decrease was primarily due to lower gross profit. Gross profit margin decreased primarily due to cost inflation and other supply chain costs, unfavorable volume/mix and the gross impact of tariffs, partially offset by supply chain productivity improvements, favorable net price realization and benefits from cost savings initiatives.

Previous wording

•costs of $21 million related to costs savings and optimization initiatives;

Current wording

•costs of $60 million related to costs savings and optimization initiatives;

Previous wording

•$2 million of costs associated with a pending acquisition;

Current wording

•$2 million of costs associated with an acquisition;

Previous wording

•costs of $20 million related to cost savings and optimization initiatives;

Current wording

•costs of $25 million related to cost savings and optimization initiatives;

Previous wording

•$14 million of accelerated amortization expense;

Current wording

•$6 million of accelerated amortization expense; and

Previous wording

Interest expense of $82 million in 2026 decreased from $88 million in 2025 primarily due to lower levels of debt.

Current wording

Interest expense of $83 million in 2026 decreased from $85 million in 2025 primarily due to lower levels of debt.

Previous wording

The effective tax rate was 24.9% in 2026 and 30.0% in 2025. The decrease 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 prior year, partially offset by lower tax expense associated with stock-based compensation awards in the prior year.

Current wording

The effective tax rate was 22.0% in 2026 and 18.5% in 2025. The increase in the effective tax rate was primarily due to timing of recognition of tax expense related to the impairment charge in the prior year.

Previous wording

In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Prego pasta sauces, Canada, V8 beverages and Pace Mexican sauces, partially offset by gains in Rao's. Unfavorable volume/mix was partially offset by favorable net price realization. Sales were impacted by an approximate 1% headwind as a result of storm-related shipment delays in January. Sales of U.S. soup decreased 3% primarily due to decreases in ready-to-serve soups and condensed soups, partially offset by increases in broth.

Current wording

In Meals & Beverages, sales decreased 4%. Excluding the impact from the divestiture of the noosa yoghurt business, sales decreased primarily due to declines in U.S. soup, Canada, V8 beverages and Pace Mexican sauces, partially offset by gains in Rao's. Unfavorable volume/mix was partially offset by favorable net price realization. Sales of U.S. soup decreased 4% primarily due to decreases in ready-to-serve soups and condensed soups, partially offset by increases in broth.

Previous wording

In Snacks, sales decreased 4%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased primarily due to declines in chips, third-party partner brands and contract manufacturing, fresh bakery related to supply constraints, and declines in crackers and pretzels, partially offset by gains in Pepperidge Farm cookies. Sales were impacted by volume/mix declines, partially offset by favorable net price realization.

Current wording

In Snacks, sales decreased 4%. Excluding the impact from the divestiture of the Pop Secret popcorn business, sales decreased primarily due to declines in chips, crackers, third-party partner brands and contract manufacturing, fresh bakery related to supply constraints and declines in pretzels, partially offset by gains in Pepperidge Farm cookies. Sales were impacted by volume/mix declines, partially offset by favorable net price realization.

Previous wording

Gross profit, defined as Net sales less Cost of products sold, decreased by $177 million in 2026 from 2025. As a percent of sales, gross profit declined to 28.8% in 2026 from 30.9% in 2025, due in part to the negative impact of tariffs.

Current wording

Gross profit, defined as Net sales less Cost of products sold, decreased by $255 million in 2026 from 2025. As a percent of sales, gross profit declined to 28.4% in 2026 from 30.4% in 2025, due in part to the negative impact of tariffs.

Previous wording

The 210 basis-point decrease in gross profit margin was due to the following factors:

Current wording

The 200 basis-point decrease in gross profit margin was due to the following factors:

Previous wording

(1)Includes an estimated negative margin impact of 220 basis points from the gross impact of tariffs and a negative margin impact of 10 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges, partially offset by an estimated positive margin impact of 20 basis points from the benefit of cost savings initiatives.

Current wording

(1)Includes an estimated negative margin impact of 240 basis points from the gross impact of tariffs, partially offset by an estimated positive margin impact of 30 basis points from the benefit of cost savings initiatives and a positive margin impact of 20 basis points from the change in unrealized mark-to-market adjustments on outstanding undesignated commodity hedges.

Previous wording

Marketing and selling expenses as a percent of sales were 9.6% in 2026 compared to 9.3% in 2025. Marketing and selling expenses were comparable in 2026 and 2025. Lower selling expenses (approximately 2 points) and increased benefits from cost savings initiatives (approximately 1 point) were offset by higher costs associated with costs savings and optimization initiatives (approximately 2 points) and higher benefit-related costs (approximately 1 point).

Current wording

Marketing and selling expenses as a percent of sales were 9.5% in 2026 compared to 9.1% in 2025. Marketing and selling expenses were comparable in 2026 and 2025. Lower selling expenses (approximately 1 point); increased benefits from cost savings initiatives (approximately 1 point) and lower incentive compensation (approximately 1 point) were offset by higher marketing expenses (approximately 1 point); higher costs associated with costs savings and optimization initiatives (approximately 1 point) and higher benefit-related costs (approximately 1 point).