The Campbell’s Company (CPB) Q3 2026 Prepared remarks earnings summary

Executive summary

• Net sales declined 4% year-over-year to $2.37 billion, driven by lower volume/mix and divestitures, partially offset by favorable net price realization.

• Adjusted EBIT dropped 24% to $274 million, and adjusted EPS decreased 32% to $0.50; reported EPS rose to $0.41 due to lower non-recurring charges.

• Performance was pressured by inflation, supply chain costs, and competitive headwinds, especially in snacks and soup.

• Strategic focus remains on investing in core brands, innovation, and operational efficiency to drive future growth.

• Cooking-at-home trends remain a durable growth driver, while snacks show early signs of improvement.

Financial highlights

• Adjusted gross margin was 27.7%, down 240 basis points year-over-year; gross profit for the quarter was $650 million.

• Adjusted marketing and selling expenses rose 2% to $211 million; administrative expenses were $149 million, slightly down year-over-year.

• Operating cash flow year-to-date was $839 million; capital expenditures totaled $297 million.

• Net debt stood at $6.6 billion as of Q3 FY26; leverage ratio increased to 4.0x.

• Effective tax rate was 22.0% for the quarter, up from 18.5% in the prior year.

Outlook and guidance

• Fiscal 2026 guidance reaffirmed: organic net sales expected to decline 2% to 1%, adjusted EBIT down 20% to 17%, and adjusted EPS of $2.15–$2.25.

• Guidance incorporates divestiture headwinds, excludes the 53rd week in fiscal 2025, and assumes low-single-digit core inflation and $370 million in capital expenditures.

• La Regina acquisition expected to be neutral to adjusted EPS in fiscal 2026.

• Anticipates 2%-3% incremental inflation in fiscal 2027 if oil prices remain elevated.

• Company expects to generate annual ongoing savings of approximately $375 million by the end of 2028.