The Kraft Heinz Company reported a 6.4% decrease in Net Sales to $6.0 billion for the first quarter of 2025, with Organic Net Sales down 4.7%. This decline was primarily driven by unfavorable volume/mix across all segments, partially offset by pricing and growth in Emerging Markets.
Adjusted Operating Income decreased by 5.2% to $1.2 billion, reflecting pressures from volume/mix, cost inflation, and foreign currency impacts, despite lower selling, general and administrative expenses. Net cash provided by operating activities was $720 million, down from $771 million in Q1 2024.
Kraft Heinz lowered its full-year guidance for 2025, citing persistent consumer trade-down, competitive pressures, and the impact of President Donald Trump’s tariffs. Management does not expect to reach its long-term algorithm pace in 2025, although sequential improvement in revenue and volume trends is anticipated.
The company is prioritizing investments in marketing (targeting ~4.8% of sales), R&D (aiming for 1% of net sales), and a $3 billion U.S. manufacturing upgrade to enhance efficiency and accelerate innovation. Key challenges include specific brand turnarounds like Lunchables and Spoonables, which are contributing to the difficult U.S. Retail environment.
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