General Mills stock jumped roughly 6% to $36.74 per share by mid-morning Wednesday following news that the company beat quarterly expectations and laid out a $3 billion cost-savings plan over the next few years.
The Minneapolis, Minn.-based food giant firmly beat fourth quarter consensus earnings estimates, reporting 95 cents per share on revenue of $4.61 billion, compared to Wall Street projections of 82 cents per share on revenue of $4.60 billion.
The stock price bump was also driven by a better-than-expected fiscal year 2027 outlook of $3 to $3.20 per share on revenue of $18.15 billion to $18.52 billion. Consensus Wall Street estimates pegged the outlook at $3.16 per share on revenue of $18.02 billion.
“Our focus is on driving cash flow, working on leverage, and restoring profitable growth over time,” said General Mills Chairman and CEO Jeff Harmening. “While fiscal ‘27 will include elevated inflation and some mechanical headwinds, we believe the combination of stronger brand remarkability, sharper execution and a more aggressive productivity agenda positions us to build momentum and create sustainable shareholder value over the long-term.”
Harmening noted that the 2027 outlook assumes General Mills will retain its Brazil businesses and its Häagen-Dazs shops business in mainland China, although the company has announced plans to divest both.
Net sales were up 1% to $4.6 billion for the quarter and down 5% to $18.4 billion for the full fiscal year. Gross margin improved by 240 basis points to 34.8% of net sales for the quarter and was down for the fiscal year by 100 basis points to 33.6% of net sales.
Cost savings through 2030
The biggest news out of the earnings report was General Mills’ plan to offset inflation by $3 billion in cost savings over the next four years, beginning with $750 million in fiscal year 2027.
“We are laser-focused on driving cost efficiency, cash generation, and sustainable capital returns to our shareholders,” Harmening said in a prepared statement.
Approximately $2 billion will come from the company’s Holistic Margin Management (HMM) productivity program, and the remainder from General Mills’ Global Transformation Initiative.
“We remain committed to balancing investment behind the business with healthy margins, strong cash generation and thoughtful capital allocation,” he said.
The HMM program was launched in 2007, with the goal of looking at margin management across the company, according to a profile in Cereal Food World.
The initiative analyzes “all costs, from product development to packaging, ingredients to manufacturing, and logistics to trade, with business units taking the lead coordinating role,” the profile noted.
“The business incentive for this type of cross-functional effort is to free up money to reinvest in businesses and in turn grow the top line,” noted the 2015 article written by Jennifer Barta, senior R&D manager, baked goods for General Mills.
The remaining $1 billion is from the Global Transformation Initiative, which was launched in 2025 as a “multi-year global transformation initiative intended to drive increased productivity by enhancing end-to-end business processes, enabled by targeted organizational actions.”
The efficiency plan was initially expected to be completed by 2028 and result in “total charges of approximately $130 million, of which approximately $120 million will be cash,” General Mills said in 2025.
The two-part plan aims to restore consistent and profitable organic sales growth, Harmening said.
“In fiscal ‘26, we made clear progress in strengthening our foundation, and now fiscal ‘27 is all about building on that strong foundation and converting it into improved topline performance,” he said.
Challenges in fiscal year 2026
The fiscal year brought substantial challenges to General Mills, with slower category volume growth hitting the company’s human and pet food businesses, Harmening explained.
“The consumer backdrop became more challenging, with recent consumer sentiment in the U.S. hitting record lows,” he said. “As consumers remained pressured, we saw them buying more on promotion and less at everyday prices, driving a less profitable mix of volume through our profit and loss.”
General Mills expects the consumer market to remain consistent with 2026, prompting the company to “meet consumers where they are and capture more of the growth that’s currently available,” Harmening explained.
The company plans to achieve this growth through its Remarkable Experiences Framework, a measuring tool used by the company to improve aspects of the consumer experience that matter most for growth.
“In fiscal ‘26, we strengthened that foundation by addressing our everyday shelf prices, which helped improve base volume and restore household penetration growth. In fiscal ‘27, we’ll build from that stronger base by putting more emphasis on other elements of remarkability, including product innovation and renovation, packaging and brand communications,” he said.
Better-for-you product innovation
It was General Mills’ first earnings call since promoting Dana McNabb to chief operating officer on June 1. McNabb previously served as group president of North America Retail and North America Pet.
McNabb reiterated that General Mills’ commitment to “remarkability” in product innovation is the company’s path to restoring consistent and profitable growth.
“To build successful consumer growth plans, we need to focus on deeply understanding our consumers and the benefits they’re looking for in their food,” she said, noting that consumer “demand spaces” include better-for-you options.
These options include protein, fiber, clean-label, bold flavors and fun and indulgent offerings.
She pointed to innovations in cereal, bars, mac and cheese and other products. This includes:
- Cheerios Protein platform expansion, putting the brand at nearly $100 million in sales. “In fiscal ‘27, the company will extend high-protein options to its Honey Nut Cheerios brand. We’ll support the launch with a full-surround, social-first communication campaign,” McNabb said.
- Leaning in on strong growth trends in snack bars. “This includes new Nature Valley Packed protein bars, clean-label highlights on our core Crunchy line, and tasty, fun innovation with soft-baked kids’ bars and PB&J bars,” she said. “We’re doubling down on Nature Valley granola cereal, which generated double-digit retail sales growth in fiscal ‘26, with taste-forward renovation news and packaging innovation with new cups and tubs.”
- Expanding the Annie’s mac and cheese brand to Annie’s Super Mac, “which delivers 15 grams of protein and 6 grams of fiber per serving, and which grew retail sales by more than 80% in fiscal ’26,” she said.
- Launching new flavors for their Old El Paso sauces, broths and soups. General Mills is partnering with Tabasco and “tapping into the better-for-you trend with new Protein Advantage taco shells, the first hard shell in the category with at least 10 grams of protein per serving,”
