By Neil J Kanatt
(Reuters) -Campbell’s Co lowered its annual sales and profit forecasts on Wednesday, signaling weak demand for snacks and intense competition from cheaper private-label brands, sending the company’s shares down 4%.
Consumer packaged food companies including PepsiCo (NASDAQ:PEP) and Campbell’s have seen cautious spending from customers, particularly on snacks, after multiple price hikes over the past year.
Campbell’s now expects fiscal 2025 net sales to rise between 6% and 8%, compared with its previous forecast of a 9% to 11% growth.
The revised forecast does not reflect any impact from the import tariffs imposed by the U.S. government and potential retaliatory tariffs from other countries, the company said.
"Depending on how long these tariffs would be in place as well as the extent of the tariffs, we might need to take other actions ... for instance, pricing for some of our products," Campbell’s CEO Mick Beekhuizen said.
Soup produced in the U.S. and imported into Canada may be hit by retaliatory tariffs by the Canadian government, Beekhuizen added, in a post-earnings call.
The company, which makes Goldfish crackers, lowered its adjusted profit per share forecast to between $2.95 and $3.05, from a prior expectation of $3.12 to $3.22.
"It’s encouraging that Beekhuizen is ripping off the Band-Aid now rather than waiting for the third quarter ... however, this is cold comfort on what should be a red day for the stock," J.P.Morgan analyst Ken Goldman said.
For the quarter ended January 26, Campbell’s net sales rose 9% to $2.69 billion, below the average analyst estimate of $2.74 billion, according to data compiled by LSEG.
On an adjusted basis, it earned 74 cents per share, compared with estimates of 72 cents.