Financial Data and Key Metrics Changes - For fiscal year 2025, organic net sales decreased by 2%, adjusted operating profit and adjusted diluted EPS were down 7% in constant currency, reflecting a decision to increase investments in response to consumer behavior changes [4][46] - The fourth quarter reported net sales were $4.6 billion, down 3%, with organic net sales also down 3% from the prior year [34][46] - Adjusted operating profit for the fourth quarter was $622 million, down 22% in constant currency, and adjusted diluted EPS totaled $0.74, down 27% in constant currency [35][46] Business Line Data and Key Metrics Changes - North America Retail's fourth quarter organic net sales were down 7%, lagging Nielsen measured U.S. retail sales by approximately three points [37] - North America Pet segment saw a 3% increase in organic net sales driven by higher volume, with reported net sales up double digits for wet food and treats [39] - North America Foodservice organic net sales decreased by 1% in the quarter, while full year organic net sales grew by 2% [42] - International segment posted a 9% increase in fourth quarter organic net sales, driven by strong growth in Brazil and distributor markets [43] Market Data and Key Metrics Changes - North America Retail faced challenges due to value-seeking consumer behavior and weaker sentiment, particularly impacting sales trends [5][6] - The International segment experienced modest organic net sales growth, with declines in China offset by growth in other markets [44] Company Strategy and Development Direction - The company aims to restore volume-driven organic sales growth by investing in product innovation, packaging, and consumer value [3][11] - Plans for fiscal 2026 include maintaining a balance of reinvesting for long-term growth while driving cost savings [12][28] - The company is focusing on enhancing brand remarkability through a structured framework assessing product, packaging, communication, and value [12][15] Management's Comments on Operating Environment and Future Outlook - Management anticipates a volatile operating environment with consumers remaining cautious due to economic uncertainties [10][11] - The company expects to face headwinds from input cost inflation and tariffs, but plans to mitigate these through strategic actions [50][51] - For fiscal 2026, organic net sales are expected to range between down 1% and up 1%, with adjusted operating profit projected to decline by 10% to 15% in constant currency [53] Other Important Information - The company returned $2.5 billion to shareholders through dividends and net share repurchases in fiscal 2025 [10][48] - A global transformation initiative is expected to generate $100 million in cost savings, which will be reinvested in growth [31][33] Q&A Session Summary Question: What are the expectations for organic sales growth in fiscal 2026? - The company expects organic sales growth to improve, driven by stronger competitiveness and investments in product innovation [49][53] Question: How is the company addressing input cost inflation? - The company is working to mitigate impacts through product reformulation and ingredient substitution while planning for significant investments in value and innovation [50][51] Question: What are the plans for the North America Pet business? - The company plans to accelerate growth in the North America Pet segment by expanding the Blue Buffalo portfolio and launching new products [22][24]