Kraft Heinz has increased its market share as new CEO Steve Cahillane’s spending plan boosts sales.
Cahillane praised “steady progress” on the group’s plan to revitalise volumes and win back cash-strapped, health-conscious consumers.
Against market expectations of a 2.7% drop, the company’s organic sales shrank just 0.4%. Net sales came to $6.0bn. The near-halt to decline was a significant improvement from Q4 2025’s 4.2% fall in organic sales.
“Our first quarter results demonstrate steady progress, and I am encouraged by the early signs of momentum we’re building,” said Cahillane, who joined the group from Kellanova at the start of 2026.
“The investments we made in 2025 are now driving early traction, with improving market share trends, particularly within must-win parts of our portfolio like [sauces and condiments division] Taste Elevation. This is proof that our brands respond well when we invest behind them.”
Cahillane’s first quarter as leader saw him surprise investors by calling off Kraft Heinz’s break-up in February. Instead, the company has dedicated a $600m investment package to win growth, especially in the US.
Organic sales in the company’s $18.6bn North America division fell 4.7% in 2025, as volumes slumped 5%.
First quarter results released last night have rewarded the company’s efforts, with a 37% increase in marketing spend resulting in a boost to market share.
But the company has also noted that organic sales declines will drop back to -3% to -5% in the second quarter, as the early Easter and better weather count against Q2 growth, alongside the US government’s cuts to food benefits.
Even though new innovation is expected to improve group sales in the second half of the year, successful turnaround is by no means assured, according to Bernstein analyst Alexia Howard.
“Share gains are all very well, but if your categories are shrinking, they may not be enough,” she said.
“We wonder whether continued portfolio changes may be needed to return the company to sustainable growth.”
Input cost inflation remained a “wild card” that “begs the question” of the company’s ability to raise price, especially in areas where it may tactically want to reinvest in price to win short-term growth, she added.
Kraft Heinz’s adjusted operating profits were down 11.8% to $1.1bn in the quarter, though free cash flow was substantially improved at $0.8bn – up 58.9%.
The group reiterated full-year guidance that organic sales would fall approximately 1.5% to 3.5%, with adjusted operating profits down by 14% to 18%.
“While we are encouraged by the strong start to the year, we are reiterating our 2026 outlook,” Cahillane said.
“This reflects an operating environment that remains volatile, with increasing inflationary pressures and persistently low consumer sentiment. At the same time, we are retaining the flexibility to increase investments in areas that are delivering strong returns.”
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