General Mills Stock Plummets as Snacking Slowdown Hits Hard

Ladies and gentlemen, buckle up! We're diving headfirst into the chaos of the market as General Mills (GIS) shares take a nosedive. The cereal giant just reported its fiscal third-quarter results, and let me tell you, it's not pretty. The stock is down 5% in premarket trading, and for good reason. The company's sales missed expectations by a mile, and the outlook for the rest of the year is grim. So, what's the deal? Let's break it down!

First off, the numbers are ugly. General Mills reported net sales of $4.84 billion, a 5% drop from last year and way below the $4.96 billion analysts were expecting. The company's adjusted earnings per share (EPS) of $1.00 was a 15% decline on a constant-currency basis, but at least it beat the $0.95 consensus. But here's the kicker: the company lowered its fiscal 2025 outlook for sales and earnings. They now expect organic net sales to fall between 1.5% and 2%, compared with their previous forecast of flat to up 1%. Adjusted EPS is seen down 7% to 8% in constant currency versus its previous projection for a decline of 2% to 4%. Ouch!

So, what's causing this mess? Well, it's a perfect storm of macroeconomic uncertainty and consumer behavior shifts. CEO Jeff Harmening pointed to retailer inventory headwinds in North America Retail and North America Pet, a slowdown in U.S. snacking categories, and softer demand in U.S. away-from-home food channels. In other words, consumers are tightening their belts, and General Mills is feeling the pinch.

But here's the thing: General Mills isn't sitting idly by. They've got a plan. The company is doubling down on its Holistic Margin Management productivity program, which aims to deliver at least 5% savings in the cost of goods sold in fiscal 2026. That's $600 million in gross productivity savings! Plus, they're reviewing additional cost-savings initiatives that could save at least $100 million in fiscal 2026. This is a company that's fighting back, folks!

Now, let's talk about the snacking slowdown. This is a big deal for General Mills, as snacking has been a major growth driver in recent years. But with consumers cutting back, the company needs to pivot. They need to focus on segments that are still growing, like Pet, Foodservice, and International. And they need to innovate, innovate, innovate! New products, new flavors, new packaging—whatever it takes to get consumers excited again.



But here's the thing: this isn't just about General Mills. This is about the broader market. The market hates uncertainty, and right now, there's plenty of it. Inflation, interest rates, geopolitical tensions—it's all adding up to a volatile environment. And companies like General Mills are feeling the heat.

So, what do you do? Do you sell? Do you hold? Do you buy more? Well, let me tell you, this is a tough call. On one hand, General Mills is a blue-chip company with a strong brand and a proven track record. On the other hand, the outlook is uncertain, and the stock is under pressure. But here's what I think: this is a buying opportunity. General Mills is a company that's been around for over 150 years, and it's not going anywhere. They've weathered storms before, and they'll weather this one too. So, if you're a long-term investor, this could be a chance to pick up shares at a discount. But if you're a short-term trader, be careful. This stock could be volatile in the coming months.

In conclusion, General Mills is facing some serious headwinds, but the company is fighting back. They're cutting costs, innovating, and focusing on growth segments. And while the outlook is uncertain, this could be a buying opportunity for long-term investors. So, do your homework, stay informed, and make the call that's right for you. But remember, this is a no-brainer! General Mills is a company that's been around for over 150 years, and it's not going anywhere. So, if you're a long-term investor, this could be a chance to pick up shares at a discount. But if you're a short-term trader, be careful. This stock could be volatile in the coming months.