Campbell's FY2026 sales fell 5% to $9.74B and diluted EPS dropped 35% to $1.31 as tariffs cut about 230 bps from gross margin and Snacks profit fell 28%; the quarterly dividend was reset to $0.25 from $0.39.
Revenue
$9.7B
-5.0% YoY
Net income
$403M
-33.1% YoY
Diluted EPS
$1.31
-34.8% YoY
Operating margin
8.7%
Overview: lower sales, a tariff-driven margin squeeze and a dividend reset
Campbell's fiscal 2026 (the 52 weeks ended August 2, 2026) was a year of shrinking sales and sharply lower profit. Net sales fell 5% to $9.744 billion, gross margin dropped 2.3 percentage points to 28.1%, and diluted earnings per share (EPS, profit divided by the number of shares) fell 35% to $1.31 from $2.01. The most consequential disclosure in the 10-K sits in the financing section rather than the income statement: effective September 3, 2026, the Board reset the quarterly dividend to $0.25 per share from $0.39, a 36% cut. Management also says it does not expect to buy back shares in fiscal 2027.
Some of the sales decline is an accounting comparison rather than lost business. Fiscal 2025 had 53 weeks, and the extra week alone accounts for about 2 points of the 5-point decline. Selling the noosa yoghurt and Pop Secret popcorn businesses removed roughly another point.
Key metrics
Metric
FY2026
FY2025
YoY Change
Net sales
$9,744M
$10,253M
-5.0%
Gross margin
28.1%
30.4%
-2.3 pts
Earnings before interest and taxes (EBIT)
$852M
$1,124M
-24.2%
Operating margin (EBIT / net sales)
8.7%
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11.0%
-2.3 pts
Net earnings attributable to Campbell's
$403M
$602M
-33.1%
Diluted EPS
$1.31
$2.01
-34.8%
Volume/mix contribution to sales change
-3 pts
-1 pt
n/a
Net price realization contribution
+1 pt
-1 pt
n/a
Segment operating earnings (total)
$1,329M
$1,636M
-19%
Cash from operations
$1,039M
$1,131M
-8.1%
Quarterly dividend (declared Sept 2026 vs. FY2026 Q4)
$0.25
$0.39
-36%
Operating margin is calculated here as reported earnings before interest and taxes divided by net sales. Fiscal 2025 contained 53 weeks versus 52 in fiscal 2026.
What drove sales: fewer units sold, with small price increases
The 10-K's sales bridge splits the 5% decline into its causes:
Driver
Meals & Beverages
Snacks
Total
Volume/mix
-2%
-5%
-3%
Net price realization
+1%
+1%
+1%
Divestitures
-2%
—
-1%
53rd week in FY2025
-1%
-2%
-2%
Reported change
-4%
-6%
-5%
"Volume/mix" means how many units were sold and whether customers shifted toward cheaper or pricier products. "Net price realization" is the effect of list-price changes after the cost of promotions and coupons. Once the extra week and the divestitures are stripped out, the table implies an underlying decline of about 2%, based on our reading of the company's bridge. Campbell's did not publish an "organic" figure in the 10-K. The pattern matters: Campbell's raised prices only slightly (+1 point) and still lost 3 points of volume/mix. In other words, it did not buy volume with price cuts, and it did not have enough pricing power to cover rising costs.
Segment performance
Segment
Net sales FY26
YoY
Operating earnings FY26
YoY
Segment margin FY26
FY25
Meals & Beverages
$5,928M
-4%
$943M
-14%
15.9%
17.8%
Snacks
$3,816M
-6%
$386M
-28%
10.1%
13.2%
Segment margins are our calculation: segment operating earnings divided by segment net sales.
Meals & Beverages (soups, Rao's, Prego, Pace, V8). Sales fell mainly because of declines in U.S. soup, V8 beverages, Canada, Pace Mexican sauces and Prego pasta sauces, partly offset by gains in Rao's. U.S. soup sales fell 5%, including a 1-point hit from the extra week. Condensed and ready-to-serve soups declined while broth grew. Operating earnings dropped 14%. The filing puts this down to lower gross profit, the divestiture and the extra week, with tariffs named first among the margin pressures.
Snacks (Goldfish, Pepperidge Farm, Snyder's, Kettle, Cape Cod). This is the weaker business. Sales fell because of declines in chips, third-party partner brands and contract manufacturing, crackers, fresh bakery (which faced supply constraints) and pretzels. Only Pepperidge Farm cookies grew. Operating earnings fell 28%, and segment margin dropped about 3 points to 10.1%. The filing attributes the decline to "cost inflation and other supply chain costs, unfavorable volume/mix and the gross impact of tariffs."
Margins: tariffs erased most of the productivity gains
Gross margin, the share of sales left after the direct cost of making the products, fell 230 basis points (2.3 percentage points). The company's own bridge shows where it went:
Gross margin driver
Impact (bps)
Cost inflation, supply chain costs and other (includes ~230 bps gross tariff impact)
-520
Volume/mix (includes lost operating leverage)
-90
Higher costs of cost-savings initiatives
-10
Productivity improvements
+300
Net price realization
+90
Total
-230
The tariff line alone equals the entire net margin decline. Campbell's estimates the net cost of tariffs at about $0.21 per share in fiscal 2026, up from about $0.02 in fiscal 2025. It cites higher costs for ingredients, imported finished goods and packaging, especially the tinplate steel used to make cans. Lower overhead cushioned the blow: administrative expenses fell 4% and marketing and selling fell 2%, mostly from savings initiatives and, in Snacks, lower advertising.
One-off items: large, but smaller than last year
GAAP (the standard accounting rules) earnings again include sizable charges that Campbell's treats as affecting comparability:
Trademark impairments of $117M ($0.29 per share), booked in Q4. $60M relates to Kettle Brand and $57M to Cape Cod because their "sales and operating performance were below expectations due in part to competitive pressures and reduced margins." An impairment is an accounting write-down of an asset's book value, not a cash outflow. This is the third straight year of Snacks brand write-downs, after $176M in FY2025 (Snyder's of Hanover, Late July and a group of smaller "Allied" brands) and $129M in FY2024.
Cost-savings and route-optimization costs of $202M ($0.51 per share), up from $125M. Restructuring charges rose to $67M from $24M, partly because of a voluntary early-retirement program started in Q3.
La Regina acquisition costs of $26M ($0.06).
Pension gains of $23M were a small offset.
In total these items reduced EPS by $0.86 in FY2026, compared with $0.97 in FY2025. Adding them back gives roughly $2.17 versus $2.98, about 27% lower (our arithmetic from the company's reconciliation table). So the underlying profit decline is only somewhat milder than the 35% GAAP drop. Management's own explanation is that the adjusted decline came "primarily due to lower gross profit."
Balance sheet, cash and the La Regina deal
Cash flow: operating cash flow fell to $1.039B from $1.131B. Capital spending was $361M, and management expects about $300M in FY2027. Dividends paid totaled $470M.
Debt: fixed-rate debt was $6.747B and variable-rate debt $0.472B at year end. Interest expense eased to $331M from $345M as borrowings came down. $500M of 5.20% notes mature in March 2027, which the company expects to repay or refinance.
La Regina: in May 2026 Campbell's paid $146M for 49% of La Regina, which produces all of its Rao's tomato-based pasta sauces, and owes another $140M in May 2027, payable in cash or stock. Because Campbell's is deemed the primary beneficiary, it consolidates the business, meaning La Regina's full results appear in Campbell's statements. This is why a small noncontrolling-interest line ($2M) appears in the income statement for the first time. The deal secures supply for Rao's, the company's largest trademark by book value ($1.47B), and one of its few growing brands.
Takeaway: Campbell's grew no volume in FY2026. It raised prices by only about 1 point while volume/mix fell 3 points, and tariffs cost about 230 bps of gross margin, roughly as much as the entire margin decline. The dividend cut from $0.39 to $0.25 a quarter and the halt to buybacks are the clearest sign that management does not expect earnings to recover quickly enough to fund the old payout.
Outlook
The 10-K does not give numeric sales or EPS guidance for fiscal 2027. Its qualitative outlook is cautious. Management says that "in 2027, we expect inflationary pressures and volatility in various input costs to persist, primarily driven by impacts from tariffs, logistics costs and ongoing geopolitical conflicts." It plans to respond with cost savings and "surgical pricing actions where necessary." It also flags regulatory risk from scrutiny of "ultra-processed" foods, including the MAHA Commission's proposals.
The concrete forward commitments are:
A new FY2027 cost-savings program (announced September 3, 2026). It targets about $500M of annual savings by the end of fiscal 2030, with about $90M of costs identified so far. The FY2025 program delivered about $225M of savings to date.
Capex of about $300M, no share repurchases, and the lower $0.25 quarterly dividend.
Our read: Fiscal 2027 no longer has a 53rd-week comparison or divestitures distorting the numbers, so reported and underlying growth should converge. The tariff hit, however, is now built into the cost base. The Snacks segment is the swing factor. Repeated trademark write-downs and a 28% drop in segment profit point to a competitive problem in chips and pretzels, not only a cost problem. The dividend reset frees about $170M a year of cash on today's share count, which gives room to cut debt ahead of the 2027 maturities and the La Regina payment. Watch Snacks volume/mix and gross margin in the Q1 FY2027 report: a return to positive volume at stable prices would be the first sign that the savings program is being reinvested successfully rather than just offsetting inflation.