General Mills got a boost in its stock value with its Q2 earnings report, which showed better‑than‑expected revenue of about $4.86 billion and improving volumes as the company cuts prices on two‑thirds of its North America retail portfolio.
The market reacted to the company’s financial results, with General Mills’ stock price rising about 3.38% over the course of the day.
The manufacturer of popular brands like Cheerios, Nature Valley granola bars, Bugles and Betty Crocker baking mixes reported earnings of $1.10 per share on revenue of $4.86 billion for Q2, beating the consensus earnings estimate of $1.02 per share on revenue of $4.78 billion, according to Earnings Whispers.
“Our investments in remarkability are working, helping restore organic volume growth in North America retail this quarter and driving strong competitiveness across each of our segments with improved momentum in the first half and confidence in our plans to drive further improvement in the rest of the year, we are reaffirming our full-year fiscal 2026 outlook,” said General Mills Chairman and Chief Executive Officer Jeff Harmening.
Price cuts gambit
Dana McNabb, group president of General Mills’ North America retail segment, said the company has seen sales performance improve on 90% of its portfolio where it has made price investments.
“If we think we need to add more, we’ll consider it. But at this point, we believe that our price is at the right place,” she said.
McNabb added that it’s not just price that’s helping General Mills, but “remarkability,” she said.
General Mills expects to see continued improvement in the second half of the fiscal year, according to Harmening.
“And it will be based on price mix, as we start to lapse some of our initial pricing from last year; although, it won’t fully be reflected until fiscal 2027, so I think it’s important to keep that in mind,” he said.
Channel switching for deals
Consumers are still struggling, particularly those making under $100,000 a year, according to Harmening.
“In the middle and lower income range we continue to see the consumer being stressed, even as consumers in the higher end of the range, are faring a lot better with the current stock market,” he said.
That’s resulted in consumers switching where and what they purchase, Harmening added.
“When there is a discount, we see them buying more because they’re financially strained,” he said.
Protein power
McNabb said General Mills is most excited about category innovation during the second half of fiscal year 2026.
She noted that Cheerios Protein is already a category leader and on track to be a $100 million product by the end of the fiscal year.
In Q2, the core Cheerios franchise grew dollars and pounds for the first time in three years, she said.
“And then if you look at the granola segment, which is what’s driving growth in cereal right now, we have the biggest brand,” McNabb added. “We’re the category leader that’s growing double digits, but granola is only about 6% of our business. It’s 12% of the category.”
That success has prompted General Mills to launch 10 new granola SKUs in January, she said.
“And so we think focusing on the areas that we’re growing faster and leaning into our leadership role, we’ll see both the category and our performance improve in the back half,” she said.
