General Mills Inc Q4 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Ken Goldman - J.P. Morgan - Analyst : It's certainly exciting to see Blue go national from a refrigerated standpoint. One of the things you had talked about previously in the past, to paraphrase is, you were always, I think, confident in the revenue opportunity. It was a little more on the margin and cash story that was, less tested. So I'm trying to get a better sense if possible of, if something has changed or you've learned a little bit more about the margin potential there. And then as a corollary to that, just trying to get a little bit of sense for your merchandizing strategy for that just given, the obviously limited shelf space for that particular category. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 1:00PM, GIS.N - Q4 2025 General Mills Inc Earnings Call

Question: Andrew Lazar - Barclays - Analyst : I think the level of reinvestment planned for fiscal '26 is certainly deeper than most anticipated, and I understand the organic top line growth priority and the investment behind fresh. My question is, how do you ensure that the margin profile that comes with this reinvestment is being done in a sort of responsible way? Than giving up too much margin that may be tougher to ultimately rebuild, I guess, are there certain aspects of the reinvestment that maybe you see as more one-off or temporary in nature that give you confidence that you can rebuild this margin in a reasonable time frame, versus being maybe at a structurally lower level sort of going forward, if you will. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 1:00PM, GIS.N - Q4 2025 General Mills Inc Earnings Call

Question: Peter Galbo - Bank of America - Analyst : Maybe just a quick clarification and then a question. Kofi, I think on Pet specifically in Q4, you talked about the inventory build at retail that you're expecting to reverse. So is that a full reversal in Q1? I just want to kind of understand the magnitude there. And then Jeff, like, there's been obviously a lot of lumpiness, I think, in the reported figures on Pet. So maybe you can just give us a broader sense from your prepared remarks on just the state of underlying Pet and how you're thinking about the different verticals within that, just, again, given some of the lumpiness that we've seen quarter to quarter.

Question: Peter Galbo - Bank of America - Analyst : And just anything on the underlying pet kind of performance, how you're --

Question: Peter Grom - UBS - Analyst : I was just hoping to get an understanding on just kind of the organic revenue phasing for the year, just in the context of the down 1% to plus 1%, and kind of starting off, I think, in kind of this down 3% range. So just curious how you're thinking about the phasing of growth as we move through the year. And I guess, specifically, do you expect to see a return to growth at some point in time? And then just related in the prepared remarks, you outlined an expectation for category growth to be similar. And not to get too specific, are you simply assuming what we're seeing today continues? Or do you expect to see some sequential improvement, but where you win for the year ultimately is similar to what we saw in '25?

Question: Chris Carey - Wells Fargo - Analyst : I think kind of a holistic question and more of a quantitative follow-up. From the more holistic side, you're probably the most intentional when it comes to pricing reinvestments in the space. And I think it's really a couple of questions related to that. First, what are you seeing from a competitive response to some of these early actions? And then secondly, how do you ensure that this isn't a race to the bottom with branded competitors or private label? And then the more quantitative question is, in the context of really strong HMM, 5%, you've got the incremental $100 million of savings, but obviously, like substantial pricing investments. Can you just frame kind of like gross margins versus SG&A, how you see those line up -- stacking up through the year?

Question: Robert Moskow - TD Cowen - Analyst : Jeff, I wanted to know if you think pricing can get back into positive territory at some point during the course of the year. It's hard to get the algorithm to work without having some pricing power to some degree. So maybe you could talk about your philosophy in that regard. And then secondly, I wanted to ask about the assumptions on how big the fresh business can get in pet? When you started working on this, the category was probably growing at around 25%, but our channel checks indicate that it's more like 12% to 13% now, including DTC. So does that have any impact on your expectations for how big this business can get longer term?

Question: David Palmer - Evercore ISI - Analyst : First, a quick one and a clarification off of a line in slide number 38. You said category growth below long-term expectations and similar to fiscal '25, reflecting lower price/mix. What was your category growth all in for fiscal '25? And I asked that because it looks like, lately, the category growth on a weighted basis for mills would be over 2% lately, just looking at the MULO+ data, which would be in line with -- so it looks like the -- hearteningly, the categories that you're in are doing pretty well. So just curious about what sort of category growth assumptions you are seeing.

Question: David Palmer - Evercore ISI - Analyst : So if we were to kind of keep it simple and thinking about your business in terms of getting your sales trends in line or better than your categories, '26 versus '25, for all of us look -- trying to think about whether -- how you're thinking about the must get rights for this year, what categories and brands perhaps will get the most improved awards? What are going to be those? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 1:00PM, GIS.N - Q4 2025 General Mills Inc Earnings Call It looks like from your slides, you have a lot in snacks, Totino's, maybe even cereal. You mentioned Pets on firmer footing. But what are really going to be the must get rights from a total sales perspective that you're looking for improvement into '26?

Question: Scott Marks - Jefferies - Analyst : I have two quick ones. The first, I guess, on the innovation front, I guess, we saw a lot of products that are putting protein front and center. So just wondering how those are performing thus far in kind of initial launches and markets where you're getting into. And then secondly, on the price investment front. We've heard some of your competitors investing around key events and key seasons as opposed to more kind of steady-state investment. So just wondering how you're thinking about that and whether you see different consumer responses throughout the year at different points in time.

Question: Max Gumport - BNP Paribas - Analyst : You're clearly stepping up your investment posture as you're prioritizing, turning volumes positive. And it's nice to see that in the platforms that you started investing earlier like refrigerated dough and Totino's and dog food. You're seeing that improved volume performance. The question is, though, taking refrigerated dough as an example, the improved volume, it is not outpacing the price decline. So even though refrigerated dough is a great example of the place where you've turned volumes positive, dollar sales really are still struggling at least in the Nielsen data we're looking at. And given the midpoint of your guidance calls for flat organic sales growth, I'm trying to get a sense for what's giving you the confidence that as you roll out these investments more fully, you'll see a more favorable relationship between volume and price.

Question: Max Gumport - BNP Paribas - Analyst : Great. And your guidance, it is clearly embedding a pretty big step-up in investment spend in FY26. And it feels like a portion of that is around the national expansion into fresh pet food. Is there's any way you could quantify just how much investment is going behind that national expansion into fresh pet food? And I'll leave it there.

Question: Michael Lavery - Piper Sandler - Analyst : Two quick ones. Maybe just following up on the launch spending comment. Can you give a sense of how you evaluate and balance organic innovation versus acquiring a fresh pet business? And obviously, the consideration set is extremely limited to acquire. But how do you just think about which is the better way to go? Or what drove you to come back after a test a couple of years ago to launch now?

Question: Michael Lavery - Piper Sandler - Analyst : That's helpful. And can I just come back to one other comment you said about hoping for improvement across the board? Where does salty snacks fit into that? It didn't really get much mentioned. I know it's a smaller piece of the portfolio, but is that just more challenged because of a discretionary component or some reason that it isn't maybe getting some of the same investments? Or how does that just fit into your thinking and strategy for the year?