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Inside the General Mills Earnings Beat That Has the Stock Rising
By Kit Norton
and Evie Liu
Updated July 01, 2026, 12:02 pm EDT / Original July 01, 2026, 7:16 am EDT
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General Mills stock popped on Wednesday after the company reported better-than-expected fourth-quarter profit and said it’s efforts to adjust product prices have started to show positive results.
Shares gained 8.6% to $37.77, placing it near the top of the S&P 500. Shares are down 19% this year on sluggish sales, increased cost pressure, and shifting consumer behavior.
The cereal and packaged foods maker posted adjusted earnings of 95 cents a share for the fiscal fourth quarter ended in May, up significntly from 74 cents a year ago and above Wall Street’s expectations for 80 cents.
Revenue grew 1% from a year ago to $4.6 billion, in line with the analyst consensus call for $4.59 billion, according to FactSet.
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Over the past year, the company has reset prices on many key products to below important “price cliffs” after consumers pushed back against higher grocery bills, CEO Jeff Harmening said on the earnings call. This has helped boost volume and improve household penetration for the first time in several years.
The next step is less about cutting prices and more about product innovation and brand communication. Consumers remain pressured, the company said, but they are still willing to pay for things that serve a certain need, such as products offering “functional nutrition” and “bold flavors.”
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“With our price investment work behind us, our focus in fiscal 2027 is to improve our top-line growth by driving a step change in the remarkability of our brands. This includes a significant increase in innovation and renovation centered on the benefits that matter most to today’s consumers,” Harmening said in a press release.
The company said the better-than-expected quarterly earnings were primarily due to higher operating profit, a lower effective tax rate, and lower net shares outstanding.
Cost savings remain central to General Mills’ plan to offset inflation and fund growth investments. Management expects to cut costs by $750 million in fiscal 2027 and $3 billion over four years through fiscal 2030.
Elevated crude oil prices have been a major pressure point for many companies’ margins. General Mills said it’s already locked in oil prices for eight to nine months of fiscal year 2027. That means even if oil moves meaningfully, the impact should stay within the company’s guidance range, management said.
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The company’s outlook calls for fiscal 2027 earnings of $3 to $3.20 a share with organic net sales ranging from a 1.5% decline to 0.5% growth. Wall Street expects fiscal 2027 earnings of $3.13, according to FactSet.
Write to Kit Norton at kit.norton@barrons.comExternal link and Evie Liu at evie.liu@barrons.comExternal link
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