Kraft Heinz has paused its plan to separate into two companies and will instead invest US$600 million into reviving its United States growth, saying many of its difficulties are “fixable”.
The foods company announced the split in September, with one business focused on grocery products and the other on condiments. Kraft Heinz will invest into marketing, research and development, and select pricing, it said today.
“Since joining the company, I have seen that the opportunity is larger than expected and that many of our challenges are fixable and within our control,” said Kraft Heinz CEO Steve Cahillane. Cahillane became CEO last month.
“My number one priority is returning the business to profitable growth, which will require ensuring all resources are fully focused on the execution of our operating plan. As a result, we believe it is prudent to pause work related to the separation and we will no longer incur related dis-synergies this year.”
The company had planned to complete the separation in the second half of 2026. Kraft Foods and the H.J. Heinz Company originally merged in 2015.
Kraft Heinz’s sales fell by 3.5% year-over-year last quarter to $6.35 billion, it said today. This was below Zacks estimates of $6.42 billion, and was weighed down by a 5.4% drop in North America sales.
Its adjusted earnings per share were $0.67, beating estimates of $0.61. Adjusted operating income was $1.16 billion, declining by 15.9%.
The company has forecast that net sales will decrease by 1.5-3.5% across 2026, with adjusted operating income dropping by 14-18%.
Kraft Heinz (NASDAQ: KHC) shares closed 0.2% higher at $24.99, but dipped 0.3% in after-hours trading. Its market capitalisation is $29.58 billion.
