Kraft Heinz posts mixed Q4 earnings, pauses separation plans

Core Insights - Kraft Heinz Co reported mixed financial results for Q4 and full year 2025, pausing its business separation plans [2][5] Financial Performance - For Q4, adjusted earnings per share were $0.67, surpassing Wall Street's consensus of $0.61, while revenue was $6.35 billion, slightly below the forecast of $6.38 billion [2] - Net sales declined by 3.4%, with organic net sales down 4.2% [3] - Gross profit margin decreased by 150 basis points to 32.6%, and adjusted gross profit margin fell by 130 basis points to 33.1% [3] - Operating income reached $1.1 billion, with adjusted operating income down 15.9% to $1.2 billion [3] - For the full year 2025, net sales totaled $26 billion, down 3.5%, while adjusted operating income was $4.7 billion, an 11.5% decline [3] Impairment and Cash Flow - The company recorded a net loss of $4.7 billion, primarily due to $9.3 billion in non-cash impairment charges [4] - Net cash provided by operating activities rose by 6.6% to $4.5 billion, and free cash flow increased by 15.9% to $3.7 billion [4] - The company returned $2.3 billion in capital to shareholders [4] Strategic Initiatives - Kraft Heinz announced a $600 million investment in marketing, sales, research and development, product quality initiatives, and select pricing adjustments to accelerate growth in its US business and Taste Elevation portfolio [5] - The company will pause work related to the previously planned separation to focus resources on profitable growth [5][6] Leadership Statement - CEO Steve Cahillane emphasized the priority of returning the business to profitable growth and the decision to pause separation work to avoid related dis-synergies this year [6]