The Kraft Heinz Company (KHC) Q2 2026 Prepared Remarks earnings summary

Executive summary

• Delivered second quarter results ahead of expectations, with broad-based over-delivery in U.S. retail, global away from home, and Emerging Markets.

• Raised full-year Organic Net Sales outlook, reflecting confidence in ongoing investments and brand strength.

• Incremental investments for 2026 increased by $100 million to $700 million, focusing on marketing, R&D, and talent.

• Strategic focus on turning around the U.S. business and accelerating international growth, especially in Emerging Markets.

• Net sales declined 1.4% year-over-year to $6.3 billion, with organic net sales down 1.3%.

Financial highlights

• Organic Net Sales declined 1.3% year-over-year, with a 100 basis point headwind from Easter timing.

• Adjusted gross profit margin was flat year-over-year at 34.1%, supported by productivity gains offsetting inflation.

• Constant currency adjusted operating income declined 18.4% to $1.0 billion due to increased marketing and higher variable compensation.

• Adjusted EPS was $0.56 for the quarter, down 18.8% or $0.13 year-over-year.

• Free cash flow up 10% year-over-year to $1.7 billion, with conversion at 123%.

Outlook and guidance

• Raised full-year Organic Net Sales outlook to down 2% to down 0.5% (previously down 3.5% to down 1.5%).

• Constant currency adjusted operating income guidance narrowed to down 18%-16%.

• Adjusted EPS expected in the range of $2.03-$2.09; effective tax rate ~24.5%.

• Free cash flow conversion expected at 110% for the year.

• At least 6% of net sales to be invested in marketing; inflation expected slightly above 4%.