General Mills (GIS) Q4 2026 (Q&A) earnings summary

Executive summary

• Fiscal 2026 ended with a stronger foundation, improved household penetration, and base volume growth, despite a tough consumer environment and headwinds in key businesses like Totino's and Wilderness.

• Fourth-quarter adjusted results met expectations, with net sales up 1% to $4.6B and organic net sales flat year-over-year.

• Fiscal 2027 will pivot from price-based investments to innovation and renovation, focusing on brand remarkability, packaging, and communication to drive top-line growth.

• Targeting $3 billion in cost savings by fiscal 2030, with $750 million expected in fiscal 2027, to offset inflation, fund investments, and restore earnings growth.

• Operating loss of $2.1B in Q4 and $88M net loss for the year, driven by non-cash goodwill and intangible asset charges and a valuation loss on the planned Brazil divestiture.

Financial highlights

• Q4 net sales were $4.61B, up 1% year-over-year; organic net sales were flat.

• Fiscal 2026 net sales were $18.43B, down 5% year-over-year; organic net sales declined 2%.

• Q4 adjusted operating profit rose 13% and adjusted diluted EPS grew 27% year-over-year; full-year adjusted operating profit fell 16% and adjusted diluted EPS dropped 16%.

• Adjusted gross margin for fiscal 2026 was 33.5%, down from 34.5% in fiscal 2025.

• Cash from operations $2.2B; free cash flow conversion 85% of adjusted after-tax earnings.

Outlook and guidance

• Fiscal 2027 organic net sales growth expected between -1.5% and +0.5%.

• Adjusted operating profit projected to decline 8–13%; adjusted diluted EPS expected at $3.00–$3.20.

• Free cash flow conversion targeted at ~95%.

• Outlook includes significant headwinds from lapping a 53rd week, incentive compensation normalization, and yogurt divestiture.

• Cost inflation forecasted at 4%-5%, with oil assumptions at $100/barrel for uncovered periods; most costs are hedged 8-9 months out.