By Savyata Mishra
(Reuters) -Campbell’s Co executives on Wednesday said it will remove synthetic dyes from its food and beverage portfolio starting in fiscal 2026 and forecast annual profit below Wall Street expectations, citing tariff pressures.
The New Jersey-based company joins other U.S. packaged food makers including PepsiCo, Kraft Heinz and Nestle USA in eliminating the use of FD&C colors, responding to Health Secretary Robert F. Kennedy Jr.’s “Make America Healthy Again” initiative and shifting consumer preferences.
Campbell’s expects annual adjusted profit per share to fall up to 18% to between $2.40 and $2.55, including tariffs, below the analyst consensus of $2.63, according to data compiled by LSEG.
Tariffs are projected to account for roughly 4% of cost of goods sold in fiscal 2026, the company said, adding it plans to mitigate about 60% of the impact through measures including selective price increases and inventory management.
The comments highlight mounting challenges for consumer companies from the Trump administration’s trade policies, as they contend with tepid demand from inflation-weary customers.
“(the) demand backdrop remains challenged with limited clarity on recovery timing will likely temper investor enthusiasm in the near term,” RBC analyst Nik Modi wrote in a note.
Campbell’s shares, down 25% this year, rose 2.7% in premarket trading after it projected fiscal 2026 net sales in the range of flat to decline up to 2%, compared with analysts’ expectations for a 2.4% decline.
“Consumers continue to be increasingly deliberate in their food choices with a focus on premiumization, flavor exploration, health and wellness and cooking at home,” CEO Mick Beekhuizen said.
For the fourth quarter, net sales rose 1% to $2.32 billion, missing estimates of $2.33 billion. Adjusted profit was 62 cents per share, topping expectations of 56 cents, according to data compiled by LSEG.
Campbell’s expects relief from higher export costs to Canada due to removed retaliatory tariffs, while a recent U.S.-EU trade agreement set tariffs at 15% on most EU products.
(Reporting by Anshi Sancheti and Savyata Mishra in Bengaluru; Editing by Tasim Zahid)
Comments