Kraft Heinz tops US sales estimates as CEO Cahillane's turnaround efforts take root
Strong First-Quarter Performance and Strategic Initiatives
May 6 (Reuters) - Kraft Heinz Co exceeded first-quarter sales estimates on Wednesday as demand improved in its U.S. business under new CEO Steve Cahillane's focus on reviving sales at the ketchup maker.
Shares of the company rose about 4% in premarket trading.
Maintaining Forecasts Amid Volatile Market Conditions
The packaged-food maker maintained its annual forecasts, with Cahillane citing a volatile operating environment characterized by rising inflationary pressures and consistently weak consumer sentiment.
Investment in U.S. Business Revival
Kraft Heinz, which hit pause on plans of splitting its business, said in February it would invest about $600 million in marketing and research to revive its U.S. business, which has taken a hit from weak demand.
Cost-Saving Measures and Strategic Flexibility
The move comes even as Cahillane remains in favor of preserving the option of splitting the company. The pause is expected to save the company $300 million in costs in 2026.
Early Results from Leadership and Investments
Cahillane, a former Kellanova executive who began his leadership role at Kraft Heinz in January, said the investments made in 2025 were beginning to drive early traction in the sauces and condiments business.
Pricing and Volume Trends
Overall, quarterly prices were up 0.8 percentage points, while volumes were down 1.2 percentage points from a year ago. The company said it raised prices in some categories to mitigate the impact from higher input costs.
Financial Highlights and Outlook
Kraft Heinz reported quarterly sales of $6.05 billion, compared with analysts' estimate of $5.89 billion, according to data compiled by LSEG.
Annual Guidance
It expects annual organic sales to be in the range of a 1.5% to 3.5% decline and adjusted earnings in the range of $1.98 to $2.10 per share.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Pooja Desai)
