The paragraph is a transcript from a General Mills earnings conference call where the company's executives, including Vice President Jeff Siemon, CEO Jeff Harmening, and CFO Kofi Bruce, address participants. After introductory remarks, Andrew Lazar from Barclays poses a question about General Mills' strategy for accelerating organic growth in fiscal 2026. He refers to the company's initiatives like achieving at least 5% in Holistic Margin Management (HMM) savings, additional $100 million in cost savings, and plans to reinvest in a 53rd week. Lazar seeks clarity on the level of incremental investment that will be needed for fiscal 2026, beyond what is already planned for the fourth quarter of the current fiscal year.

In the paragraph, Jeff Harmening discusses how the consumer environment did not improve as anticipated, with consumer confidence declining and people continuing to seek value. He highlights the company's focus on adjusting investment strategies, particularly sharpening price points and enhancing marketing efforts for brands like Blue Buffalo, Pillsbury, and Totino's. By aligning value with effective marketing and product innovation, these brands have been able to compete more effectively in the challenging market.

The company is focusing on strategic investments to enhance its global competitiveness and drive growth. This includes increasing investment in pricing strategies, particularly in fruit snacks to meet consumer demand for value, and significantly boosting marketing efforts for major brands such as Blue Buffalo, Pillsbury, and Cereal. They plan to reinvest in innovation and new product development, utilizing resources for R&D and supply chain improvements. The upcoming fiscal year will prioritize reinvesting savings and efficiencies to support continuous growth and value optimization, beginning in the fiscal fourth quarter.

The paragraph involves a conversation between Ken Goldman from JPMorgan and Kofi Bruce about the company's financial outlook and factors impacting growth. Ken lists potential tailwinds for the next year, including increased trade, better marketing, innovation, easier trade destocks, and cost efficiencies. However, he also notes headwinds such as unexpected trade increases, brand communication investments, slotting costs, tariffs, stock-based compensation, and Yoplait dilution. Ken suggests that headwinds might outweigh tailwinds, a sentiment echoed by investors. Kofi acknowledges Ken's points, emphasizing that the Yoplait closure remains a significant uncertainty, potentially impacting growth by about 5 points.

The paragraph discusses a company's financial outlook and innovation strategies. It acknowledges a 5-point headwind on profit due to recent investments but emphasizes a commitment to flexibility and growth for the next year. The company plans to enhance its competitiveness and provide more guidance on commercial investments in Q4. Additionally, there's a conversation between the operator, David Palmer from Evercore ISI, and Jeff Harmening about innovation in the food industry. Palmer notes a slow recovery in packaged food innovation post-COVID-19. Harmening agrees but mentions that their company has significantly increased its new product innovation as a percentage of sales compared to the previous year.

The paragraph discusses a company's strategy for the upcoming year, emphasizing the need to robustly support their product innovations, such as Cheerios Protein and Nature Valley Granola Protein bars. The company plans to focus on fewer but larger innovations, with some significant ones scheduled for the first half of next year. The importance of supporting existing ideas well is also highlighted. During a Q&A session, Michael Lavery from Piper Sandler inquires about the company's approach to managing value and price gaps, specifically referencing the sales growth seen in certain product categories like Dough, which experienced a 4% sales growth and an 8% volume increase.

The paragraph discusses the strategic planning and pricing approach of the company led by Jeff Harmening, focusing on fiscal year 2026. The company is confident in its planned pricing investments, considering the competitive zone rather than matching competitors exactly. The strategy involves category-specific analyses and adjustments, using the remarkable experience framework to align marketing, innovation, and value elements. Successful past implementations with brands like Blue Buffalo and Totino's provide confidence, as the firm plans to apply these strategies across various categories, including fruit snacks, into the fourth quarter and fiscal 2026.

In the article, Jeff Harmening discusses the company's efforts to expand improvements across its portfolio, expecting positive changes in the cereal and soup businesses by Q4. He mentions completing an evaluation exercise across the company, leading to improvements, though some changes take longer. He emphasizes the need for agility as the context and environment change. Michael Lavery and Alexia Howard inquire about potential issues with snacks in the current economic climate, with Howard suggesting factors like the uptake of GLP-1 drugs and health concerns about indulgent snacks as possible influences, indicating a shift from past economic slowdowns when snacks performed well.

Jeff Harmening discusses the factors behind the weakness in categories like salty snacks and fruit snacks, attributing it largely to changes in consumer confidence rather than increased GLP-1 use for weight loss. He notes that, unlike previous recessions, there is already a high rate of food consumed at home, which has been consistent since the pandemic. This high rate of at-home consumption limits further increases even during uncertain economic times. Harmening suggests that consumers have become more value-conscious, influencing their choices within snack categories and across the store.

The paragraph discusses trends in grocery store sales and the snacks business. Staples, like baking staples and perimeter items, are growing faster due to their value, while restaurant occasions have decreased slightly, emphasizing value. Peter Galbo from Bank of America queries Jeff Harmening about the snacks business, particularly fruit snacks. Harmening confirms Gushers' capacity increased in Q2 and expresses confidence in its trajectory despite the overall decline in the fruit snacks category. This decline is partly due to its discretionary nature and competition from private labels. Harmening highlights the need to prioritize value and innovation to address these challenges.

The paragraph discusses the marketing and pricing strategies for various snack products, comparing the efforts for Harry Potter fruit snacks to those of Blue Buffalo wet pet food and treats. The company improved marketing and pricing for these items, leading to eventual success. Similarly, the bars segment, despite recent challenges, is expected to rebound thanks to innovations and strong marketing, particularly for Nature Valley bars. In the salty snacks category, which is smaller compared to fruit snacks and Nature Valley, the company sees potential in focusing on value and introducing products with bold flavors to meet consumer demand.

In the paragraph, John Baumgartner and Jeff Harmening discuss consumers' willingness to pay for healthier and higher-quality ingredients amidst a competitive market. Harmening notes that value to consumers can come from both pricing and the benefits of the products, emphasizing that value doesn't always mean lowering prices. He highlights innovation in protein products such as Cheerios Protein and Progresso Protein and notes that consumers' preferences are becoming more varied, with interest in both value and premium products. The key is to find the right balance of value, especially after a period of inflation. He mentions that the benefits of products can vary by brand, with some focusing on functional health benefits and others on taste and texture.

The paragraph involves an interaction between Chris Carey from Wells Fargo and Jeff Harmening. Chris asks for clarification on whether the savings targets for the next year are intended to be fully reinvested into the business or are still developing. Additionally, he inquires about why the company's portfolio isn't growing in line with its category growth rates, asking whether value, innovation, or marketing might be contributing factors. Jeff responds by acknowledging that their categories are indeed growing at about 1%, but this is below the future growth expectation of 2% to 3%. He indicates that Kofi will address the question about the savings targets.

The paragraph discusses the company's strategy for growth, emphasizing the importance of getting back to being competitive by focusing on volume share initially, with an eventual emphasis on dollar share. Despite limited price mix opportunities in the current environment, the company is confident in achieving its goals. They plan to do this by leveraging competitive areas like Foodservice and Haagen-Dazs internationally and realigning value. Kofi Bruce adds that the company's $100 million in cost savings above inflation is intended to be reinvested into growth, not just improving margins, to enhance competitiveness and drive growth.

In the paragraph, Jeff Harmening discusses the importance of not just pricing but also holistic value in being competitive as a CPG company. He emphasizes that success requires good marketing of core products, new product innovation, and maintaining value. He notes that this approach has proven successful in various categories and plans to apply it to areas like cereal and soup in the fourth quarter. This includes a double-digit increase in media for cereal and new products for soup. The focus is on effectively marketing both established and new products. Following Jeff, Leah Jordan from Goldman Sachs addresses concerns about a mid-single-digit decline in U.S. retail cereal sales, asking for more details on its performance against internal expectations and confidence in future improvements.

Jeff Harmening discusses the performance and future prospects of the cereal category for the company. In the third quarter, cereal sales were in line with expectations despite challenges like inventory buildup and reduced media and merchandising. He expresses optimism for the fourth quarter, citing increased media efforts, better merchandising, and successful promotions. Harmening highlights the importance of meeting consumer preferences, noting successful products like Cheerios Protein and Nature Valley Granola Protein, and emphasizing that consumer demand varies between functional benefits like protein and great taste, as seen with cereals like Lucky Charms and Cinnamon Toast Crunch. The long-term growth strategy focuses on delivering what consumers want.

Max Gumport from BNP Paribas asked about the unexpected inventory issues in North America Retail and Pet businesses, wondering if it's an industry-wide issue or specific to certain categories. Jeff Harmening explained that the volatility in pet inventory, particularly in dry pet food, was a significant factor, primarily due to the e-commerce nature of the business. Despite a 5-point drag in pet inventory this quarter, overall inventory levels are flat compared to the start of the year. This stability gives confidence that there won't be further inventory drawdowns in the fourth quarter. Harmening couldn't comment on broader industry trends, only their own. The call concluded with Jeff Siemon wrapping up, inviting follow-ups, and noting plans to discuss Q4 results in June.

This summary was generated with AI and may contain some inaccuracies.