Kraft Heinz Company
Q1 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: +0.73%.
Did KHC Beat Earnings? Q1 2026 Results
Kraft Heinz delivered a stronger-than-expected first quarter, posting adjusted EPS of $0.58 against a consensus estimate of $0.50, a 15.38% beat that extended the company's streak of topping Wall Street's earnings expectations to four consecutive quarters. Revenue came in at $6.05 billion, ahead of the $5.88 billion estimate by 2.85% and up 0.8% year over year, though the surface-level headline masked underlying pressure, with organic net sales slipping 0.4% as volume weakness in coffee, cold cuts, and Indonesia weighed on results. A sharply lower tax provision, $211 million versus $304 million a year ago, was the single most material driver lifting GAAP net income 11.9% to $799 million even as Adjusted Operating Income fell 11.8% to $1.06 billion amid heavier marketing spend and manufacturing cost inflation. Free cash flow was a genuine bright spot, jumping 58.9% to $766 million. For the full year, management reiterated guidance for Adjusted EPS of $1.98 to $2.10, with organic net sales expected to decline 1.5% to 3.5%, reflecting a volatile consumer backdrop and roughly $600 million in planned incremental investments.
- Pricing increases in certain categories to mitigate higher input costs contributed 0.8pp to organic net sales
- Volume/mix declined 1.2pp, driven by declines in coffee, cold cuts, and Indonesia
- Increased advertising expenses pressured Adjusted Operating Income
- Inflationary pressures in manufacturing and logistics costs outpaced efficiency initiatives
- Lower income tax expense boosted GAAP net income and diluted EPS
- Favorable working capital changes from inventory optimization and improved supplier payment terms drove operating cash flow growth of 39.7%
- Certain nonrecurring procurement cost recoveries partially offset cost headwinds
- Favorable foreign currency impact of 1.9pp on reported net sales
“Our first quarter results demonstrate steady progress, and I am encouraged by the early signs of momentum we're building. The investments we made in 2025 are now driving early traction, with improving market share trends, particularly within must-win parts of our portfolio like Taste Elevation. This is proof that our brands respond well when we invest behind them.”
Kraft Heinz CEO, on the earnings call
Forward Guidance & Outlook
Kraft Heinz reiterated its full-year 2026 outlook: Organic Net Sales down 1.5% to 3.5% (including ~100 bps SNAP headwind); Constant Currency Adjusted Operating Income down 14% to 18% (reflecting ~$600 million in incremental investments and ~300 bps headwind from lapping lower variable compensation in 2025); Adjusted Gross Profit Margin down 25 to 75 basis points; Adjusted EPS of $1.98 to $2.10; effective tax rate on Adjusted EPS of approximately 25%; interest expense of approximately $920 million; other income of approximately $200 million; and Free Cash Flow Conversion of approximately 100%.
KHC YoY Financials
KHC Revenue by Segment
KHC Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.