Aug 5 (Reuters) – Kraft Heinz raised its annual forecasts after beating quarterly sales estimates on Wednesday, as CEO Steve Cahillane’s turnaround efforts gained traction and price hikes helped counter lower volumes in North America and other markets.
The better-than-expected results give credence to Cahillane’s turnaround strategy, which has driven an uptick in marketing and innovation spends as the company leans aggressively into protein-heavy foods and electrolyte-infused drinks to attract health-conscious consumers.
The packaged goods company said it would increase its incremental investments by $100 million to about $700 million in 2026, a cash injection Cahillane had hinted at during an interview with Reuters in June. Cahillane became Kraft Heinz’s CEO in January.
The company now expects annual organic sales to fall between 0.5% and 2.0%, compared with its prior view of a 1.5% to 3.5% decline.
It also expects annual adjusted earnings per share of $2.03 to $2.09, compared with its prior forecast of $1.98 to $2.10.
While Kraft Heinz benefited from price-led growth, its volumes remained under pressure in key markets including North America. “Growth in Canada and Away From Home was offset by declines in U.S. Retail, which were primarily driven by meats,” CFO Andre Maciel said in prepared remarks.
Shares of the company remained largely unchanged in volatile premarket trading. A non-cash $7.4 billion impairment charge contributed to an operating loss during the quarter, though one smaller than the company reported a year earlier.
Kraft Heinz has been navigating a challenging environment as energy and raw material costs surge amid ongoing geopolitical conflicts.
Maciel said the company was well hedged on energy and edible oils for most of 2026, but was hedged on certain resins and metals only through the middle of the third quarter.
“As those roll off, we expect greater exposure to spot prices in the fourth quarter,” he said.
Kraft Heinz’s quarterly sales fell 1.4% to $6.26 billion from a year earlier, compared with analysts’ expectations of a 3.6% decline to $6.12 billion, according to data compiled by LSEG.
On an adjusted basis, the company reported a profit of 56 cents per share, down 18.8% from a year ago but beating analysts’ estimates of 53 cents per share.
(Reporting by Anuja Bharat Mistry in Bengaluru and Alexander Marrow in London; Editing by Jonathan Ananda)
