Prego pasta sauce maker Campbell’s Co beat third-quarter sales and profit estimates on Monday, helped by strong demand for its popular canned food and soups as consumers increasingly prefer to eat at home in the face of an uncertain economy.
Fears of a potential recession and price hikes triggered by the imposition of hefty tariffs dented consumer sentiment in the U.S. and prompted people to be more judicious in their spending patterns, including trading down to cheaper brands and ditching costly dine-outs.
“Consumers are cooking at home at the highest levels since early 2020 and turning to our brands for value, quality and convenience,” said Campbell’s CEO Mick Beekhuizen.
The company maintained its fiscal 2025 forecast for net sales growth in the range of 6 per cent and 8 per cent.
It, however, projected annual adjusted profit per share to be at the lower end of its prior forecast range of $2.95 and $3.05, owing to weak demand for snacks.
Campbell’s, which excluded tariffs from its forecast, expects a hit of between 3 cents and 5 cents per share, accounting for levies currently in place.
Volumes for the company’s meals and beverages unit rose 7 per cent during the quarter ended April 27, while its snacks business reported a 5 per cent fall.
Campbell’s has introduced new products such as the Milano white chocolate cookie through its Pepperidge Farm brand and Pop’ums, a snack hybrid combining pretzels and popcorn, to revive demand in its snacks business.
Its net sales rose 4 per cent to $2.48 billion during the quarter, compared with analysts’ average estimate of $2.43 billion, according to data compiled by LSEG.
Adjusted per-share profit of 73 cents also surpassed the estimate of 66 cents.
Shares of the company, which have fallen about 18 per cent so far this year, were flat in premarket trading.
(Reporting by Neil J Kanatt in Bengaluru; Editing by Shilpi Majumdar)
