Campbell's plans to introduce gluten-free, whole-grain and protein-packed versions of Goldfish to meet growing demand for healthy alternatives and combat rising competition
Campbell's, the parent company of Goldfish crackers, reported quarterly earnings on Thursday.
Campbell's Co. is depending on Goldfish crackers to revive its struggling snacks business, and it's giving the brand a revamp in the process.
During its earnings call Thursday, the company $(CPB)$ - known for its namesake soups as well as Rao's pasta sauces, Snyder's pretzels and Cape Cod potato chips - said it would refresh the packaging on Goldfish and introduce gluten-free, whole-grain and protein-packed versions of the cracker in the fall.
"We are listening to our consumers and the team has responded with speed and agility," CEO Mick Beekhuizen said during Campbell's earnings call.
The company is making those moves as its snacks business faces steeper competition, as smaller brands enter the fray and retailers lure increasingly price-conscious consumers with their cheaper store brands. Snack volume, a measure of the amount of product sold, fell 6% during Campbell's fourth quarter, which ended on Aug. 2.
Meanwhile, the food industry has tried to keep up with consumers' interests in things like protein and fiber, as wellness trends and increased GLP-1 use reshape diets.
PepsiCo $(PEP)$ has added protein to Doritos and fiber to its namesake cola, while Kraft Heinz $(KHC)$ has launched a macaroni and cheese with more fiber. Campbell's itself this summer rolled out a new line of "Protein Soups" geared toward people looking for more protein and fiber.
Goldfish crackers were first launched in the U.S. in 1962. Campbell's on Thursday said that it has tried to refocus Goldfish on families with children over the past year. Through 2023 and 2024, new flavors, popularity among teenagers and products like Goldfish Crisps helped drive Goldfish sales past the $1 billion marker. But last year, growth leveled off, and management said the company had "more work to do to reinvigorate this brand and get it back on its historical growth trajectory."
During the fourth quarter, Goldfish consumption overall fell 1.1%. But management said that figure masked progress it was making in its efforts to appeal to families, as well as gains made from e-commerce sales and a collaboration with Pokémon.
Still, shares of Campbell's slid 8.9% on Thursday, thanks to a dividend cut and expectations for falling overall sales. The stock was down 22.5% so far this year.
Management on Thursday said the company board approved a quarterly dividend payment of 25 cents a share, a 36% cut from the previous quarterly dividend payment of 39 cents a share. Campbell's said it lowered the dividend to save money and help pay off debt, adding that it was launching a new effort to save $500 million by fiscal 2030.
The company said it expects fiscal 2027 sales to be down 2% to 4% year over year, worse than the roughly 1.1% drop forecast by FactSet analysts. It forecast adjusted earnings per share of $1.65 to $1.80 for that period, below estimates for $1.83.
Campbell's sales fell 8% from a year before to $2.137 billion during the quarter. Analysts polled by FactSet were expecting sales of $2.144 billion. Adjusted earnings per share fell 37% to 39 cents, in line with Wall Street's estimates.
Meanwhile, the company called out strength in its soup business, although consumption slipped for its condensed and ready-to-serve offerings. Campbell's saw gains in demand for the broths that it sells, as cautious consumers try to cook more meals at home more quickly - generally, in less than 30 minutes.
"It's a behavior that the consumer is focused on," Beekhuizen said on the earnings call. "The consumer is seeking convenience and affordability by cooking smarter."
-Bill Peters