General Mills (GIS) Q2 2025 (Q&A) earnings summary

Executive summary

• Net sales increased 2% to $5.24B in Q2 2025, with organic net sales up 1% year-over-year, driven by volume growth and targeted investments in product innovation, advertising, and promotional support.

• Operating profit rose 33% to $1.08B, with adjusted operating profit up 7% in constant currency; diluted EPS grew 39% to $1.42, and adjusted diluted EPS up 12% in constant currency.

• Q2 results benefited from timing items expected to reverse in the second half, leading to a revised full-year outlook reflecting higher investment and lower profit growth.

• Six-month net sales were flat at $10.1B; operating profit up 10%, adjusted operating profit up 2% in constant currency.

• Fiscal 2025 guidance revised downward to reflect increased investment aimed at driving volume and share gains.

Financial highlights

• Q2 net sales: $5,240.1M (+2% YoY); six-month net sales: $10,088.2M (flat YoY).

• Q2 operating profit: $1,077.9M (+33% YoY); six-month: $1,909.4M (+10% YoY).

• Q2 net earnings attributable to shareholders: $795.7M (+34% YoY); six-month: $1,375.6M (+8% YoY).

• Q2 adjusted gross margin increased to 36.3% from 35.0% last year; operating profit margin rose to 20.3% from 19.3%.

• Cash from operations for six months up 19% to $1.8B; capital investments $301M.

Outlook and guidance

• Organic net sales for FY25 expected flat to up 1%, now targeting the lower end due to increased promotions and investment.

• Adjusted operating profit expected down 4% to down 2% in constant currency; adjusted diluted EPS expected down 3% to down 1%.

• Free cash flow conversion expected at least 95% of adjusted after-tax earnings.

• Guidance excludes impact from pending yogurt divestitures and Whitebridge Pet Brands acquisition.

• Expect reversal of Q2 timing benefits and increased spending to impact Q3 and Q4 operating profit.