Conagra Brands Reports 3.6% Decline in Net Sales for Fiscal Year Ending May 25, 2025

Conagra Brands, Inc. reported a decline in financial performance for the fiscal year ending May 25, 2025, with total net sales of $11.61 billion, a decrease of 3.6% from $12.05 billion in the previous fiscal year. The company's diluted earnings per share increased to $2.40 from $0.72, primarily due to a significant tax benefit of $253.5 million related to the release of valuation allowances on deferred tax assets. However, overall gross profit fell to $3.00 billion from $3.33 billion, driven by lower net sales, input cost inflation, and unfavorable operating leverage.

The company experienced organic sales declines across its Grocery & Snacks, Refrigerated & Frozen, and Foodservice segments, which were partially offset by growth in the International segment. Notably, the Grocery & Snacks segment saw net sales decrease by 1.2%, while the Refrigerated & Frozen segment reported a 4.2% decline. The International segment's sales were impacted by unfavorable foreign exchange rates, contributing to an 11.3% decrease. Conagra's largest customer, Walmart, accounted for approximately 29% of consolidated net sales, consistent with previous years.

Strategically, Conagra made significant acquisitions, including Sweetwood Smoke & Co. and a contract manufacturer for cooking spray products, which contributed $38 million to net sales. The company also announced the sale of its Chef Boyardee business for $601.2 million, which is expected to enhance its focus on core brands. Additionally, Conagra recognized impairment charges of $72.1 million related to certain brand intangible assets, reflecting ongoing challenges in the market.

Operationally, Conagra's employee headcount stood at approximately 18,300 as of May 25, 2025, with 44% of employees covered by collective bargaining agreements. The company reported an Occupational Safety and Health Administration incident rate of 1.32 incidents per 100 full-time workers, a decrease from 1.40 in the previous year. Looking ahead, Conagra anticipates continued challenges from inflation, supply chain pressures, and evolving consumer preferences, which may impact sales volumes in fiscal 2026. The company plans to focus on productivity initiatives to mitigate these challenges while navigating a complex economic landscape.