Dee-Ann Durbin
Kraft Heinz lowered its full-year sales and revenue guidance on Tuesday, citing weaker customer spending in the US and the impact of President Donald Trump’s tariffs.
It is the latest major food companies that are stoking trade tensions and wary of weak consumer demand. Last week, PepsiCo cited tariffs to lower its annual revenue forecast. And early on Tuesday, Coca-Cola looked at pullbacks in U.S. consumer spending due to economic uncertainty.
Kraft Heinz admitted it was in a tough place. Prices need to be kept low to prevent consumers from moving to cheaper brands of product brands like ketchup, mayonnaise, macaroni and cheese. However, tariffs that affect imported materials like coffee add that cost.
“When it comes to tariff pricing, we are trying to do everything we can to minimize the required prices,” Kraft Heinz Chief Financial Officer Andre Maciel said Tuesday in a conference call with investors.
Maciel said the company is considering many alternatives, including shifting suppliers and reorganizing products in the long run. Kraft Heinz also said it had built some stock earlier this year to mitigate the impact from tariffs.
Pittsburgh and Chicago-based Craft Heinz said North American revenue fell 7% to $4.5 billion from January to March. The weakness in the US has overcome some strong outcomes in Canada.
Kraft Heinz said it expects operating profit to be up to 10% this year. Previously, a decline of up to 5% was expected. The company said it needs flexibility to provide promotions and enhance marketing. We also want to add value options, such as the new 11oz Kraft Mac & Cheese, designed to feed a family about 50% more than the original 7.25oz box.
The company said it may need to accommodate changes to federal regulations as well. Last week, U.S. health officials urged food manufacturers to phase out oil-based artificial colors in the country’s food supply.
Kraft Heinz CEO Carlos Abrams-Rivera said Kraft Mac & Cheese has no artificial flavors and colours since 2016.
Kraft Heinz said its net revenue fell 6% to $5.9 billion from January to March. According to analysts voted by FactSet, it was shy that Wall Street was expecting a $6 billion Wall Street. The company currently expects its adjusted revenue to fall 3.5% this year. Previously, a 1.5% decline was expected.
Kraftheinz shares were flat in trading Tuesday afternoon.
Original issue: April 29, 2025, 4:09pm EDT
