Campbell's sticks to annual targets as US consumers tighten spending

Consumer sentiment sank to record lows as rising gasoline prices linked to the Iran war dampened household purchasing power long weakened by stubborn inflation. The pressure is pushing lower-income consumers toward cheaper private-label brands, while the rise of GLP-1 weight-loss drugs is further denting demand, weighing on companies such as Campbell’s that raised prices to offset higher costs. Campbell’s expects organic sales to fall 1 percent to 2 percent and adjusted earnings per share at $2.15 to $2.25, factoring in early impacts from the Middle East conflict, including higher logistics costs. It expects to offset these pressures through tariff refunds of 3 to 4 cents in the fourth quarter. “From a net-sales perspective, I think the lower end... is probably a more realistic assumption at this point,” Chief Financial Officer Todd Cunfer said on a post-earnings call. Oil near $100 a barrel could lift fiscal 2027 inflation 2 percent to 3 percent above normal, the company said, adding it would rely on cost savings and price hikes if needed. CEO Mick Beekhuizen said Campbell’s is focused on simplifying operations while accelerating productivity and cost savings. The company identified its salty snacks business, including Snyder’s of Hanover, Kettle Brand and Pepperidge Farm, as its biggest opportunity, with plans to revive growth by prioritizing core brands, adjusting pack sizes and streamlining its product range. Campbell’s posted third-quarter adjusted profit of 50 cents per share, beating analysts’ estimate of 48 cents, according to data compiled by LSEG. “[The] road ahead likely remains long and tough,” RBC Capital Markets analyst Nik Modi said, adding there is no clear catalyst other than stronger, more consistent results. Quarterly net sales of Campbell’s, set to drop out of the S&P 500 index this month, fell 4 percent to $2.37 billion, slightly missing analysts’ expectations. Its shares were down about 1 percent.