Kraft Heinz Q3 2025 – Net Sales Decline by 2.3%

By Ahmed Jameison • Wednesday, October 29 10:42 • Permanent Link

Kraft Heinz Company (NASDAQ: KHC) has reported its financial results for the third quarter of 2025. The company's net sales decreased by 2.3% to $6.2 billion, with organic net sales declining by 2.5%. The gross profit margin decreased by 230 basis points to 31.9%, and the adjusted gross profit margin decreased by 200 basis points to 32.3%. Operating income was $1.0 billion, while adjusted operating income was $1.1 billion, down 16.9% from the previous year.

Year-to-date net cash provided by operating activities was $3.1 billion, up 10.4%, and free cash flow was $2.5 billion, up 23.3%, with free cash flow conversion increasing by 34 percentage points to 109%. Return of capital to stockholders year-to-date was $1.8 billion.

The company's net sales for the quarter saw a 3.8% decrease in North America, a 1.6% increase in international developed markets, and a 3.8% increase in emerging markets. For the nine months ended, net sales in North America decreased by 4.7%, international developed markets decreased by 0.5%, and emerging markets increased by 0.9%.

The company's gross profit for the quarter decreased by 9.0% to $1.99 billion, and the operating income for the quarter was $1.025 billion, up significantly from the previous year. The net income for the quarter was $613 million, compared to a loss of $290 million in the previous year. Adjusted EPS was $0.61, down 18.7% from the previous year.

Kraft Heinz also provided an update on its strategic transactions, announcing a separation into two independent, publicly traded companies through a tax-free spin-off. The company expects the transaction to close in the second half of 2026.

Looking ahead, Kraft Heinz revised its outlook for fiscal year 2025, expecting organic net sales to decline by 3.0% to 3.5%, constant currency adjusted operating income to decline by 10% to 12%, and adjusted EPS to be in the range of $2.50 to $2.57. The company also expects free cash flow to increase versus the prior year, with a free cash flow conversion of at least 100%.

The market has reacted to these announcements by moving the company's shares -0.27% to a price of $25.52. Check out the company's full 8-K submission here.

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