We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kraft Heinz Q2 Earnings Beat as 2026 Organic Sales Outlook Improves
Read MoreHide Full Article
Key Takeaways
Kraft Heinz beat Q2 estimates with adjusted EPS of 56 cents and net sales of $6.262 billion.
KHC now expects 2026 organic sales to decline 0.5%-2%, improved from its prior 1.5%-3.5%% forecast.
Kraft Heinz's Emerging Markets organic sales rose 8.5%, while North America organic sales fell 2.7%.
The Kraft Heinz Company (KHC - Free Report) topped second-quarter earnings and sales expectations while raising its 2026 organic sales outlook. The results give investors some evidence that execution is improving as brand investment and international growth begin to show traction.
The recovery is still incomplete. North American volumes remain weak, full-year margins are expected to contract and adjusted operating income is projected to decline sharply, keeping the focus on whether better demand trends can become sustainable.
KHC's Q2 Beat Came With Softer Organic Sales
Kraft Heinz reported adjusted earnings of 56 cents per share, above the Zacks Consensus Estimate of 53 cents. Net sales of $6.262 billion also surpassed the consensus mark of $6.162 billion.
The beat did not erase the underlying pressure. Adjusted earnings fell 18.8% year over year, while organic net sales declined 1.3% as a 2.6-point drop in volume/mix more than offset 1.3 points of pricing.
Kraft Heinz Raised Its 2026 Sales Outlook
Management now expects fiscal 2026 organic net sales to decline 0.5% to 2%, compared with its prior forecast for a 1.5% to 3.5% decline. The updated range still includes an approximately 100-basis-point impact from incremental SNAP headwinds.
Demand trends have improved from earlier in the year. Management said consumption declined about 2.5% in the second quarter but improved to roughly 1% in July, with sequential improvement expected in the third and fourth quarters.
Image Source: Zacks Investment Research
KHC's North America Volumes Remain the Pressure Point
North America organic net sales fell 2.7% in the second quarter. A 3.8-point decline in volume/mix overwhelmed a 1.1-point pricing contribution, with softness in U.S. meats remaining a key drag.
The pressure is not unique to Kraft Heinz. The Campbell's Company (CPB - Free Report) reported a 4% decline in both reported and organic net sales in its fiscal third quarter of 2026, while adjusted earnings per share fell 32%.
Emerging Markets Offset Part of Kraft Heinz's Weakness
Emerging Markets net sales increased 10.4% and organic net sales rose 8.5% in the second quarter. Pricing contributed 4.5 points and volume/mix added 4 points, giving Kraft Heinz growth from both price and demand.
Management expects Emerging Markets growth to accelerate in the second half as an Indonesia-related drag is lapped. For broader branded-food context, Mondelez International, Inc. (MDLZ - Free Report) reported second-quarter 2026 organic net revenue growth of 2.2%, including a 0.7% volume/mix increase.
Image Source: Zacks Investment Research
KHC's Margin Outlook Limits the Earnings Upside
Adjusted gross profit margin was flat year over year at 34.1% in the second quarter. For fiscal 2026, Kraft Heinz still expects adjusted gross profit margin to decline 10 to 50 basis points.
Constant-currency adjusted operating income is projected to fall 16% to 18%. The outlook incorporates about $700 million of incremental investment versus 2025, while inflation and unfavorable volume/mix continue to pressure near-term earnings leverage.
KHC's Ratings Still Signal a Balanced Setup
Kraft Heinz's earnings beat and improved organic sales outlook strengthen the recovery narrative, but the investment case still depends on better volume trends and firmer profitability. The latest results improve visibility without removing the core execution risks.
KHC currently carries a Zacks Rank #3 (Hold). Its Value Score of A supports the value case, while the Growth Score of D, Momentum Score of F and VGM Score of C indicate that favorable valuation characteristics are not yet matched by equally strong growth and momentum signals. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
View the Zacks #1 Rank List
Image: Bigstock
Kraft Heinz Q2 Earnings Beat as 2026 Organic Sales Outlook Improves
Key Takeaways
The Kraft Heinz Company (KHC - Free Report) topped second-quarter earnings and sales expectations while raising its 2026 organic sales outlook. The results give investors some evidence that execution is improving as brand investment and international growth begin to show traction.
The recovery is still incomplete. North American volumes remain weak, full-year margins are expected to contract and adjusted operating income is projected to decline sharply, keeping the focus on whether better demand trends can become sustainable.
KHC's Q2 Beat Came With Softer Organic Sales
Kraft Heinz reported adjusted earnings of 56 cents per share, above the Zacks Consensus Estimate of 53 cents. Net sales of $6.262 billion also surpassed the consensus mark of $6.162 billion.
The beat did not erase the underlying pressure. Adjusted earnings fell 18.8% year over year, while organic net sales declined 1.3% as a 2.6-point drop in volume/mix more than offset 1.3 points of pricing.
Kraft Heinz Raised Its 2026 Sales Outlook
Management now expects fiscal 2026 organic net sales to decline 0.5% to 2%, compared with its prior forecast for a 1.5% to 3.5% decline. The updated range still includes an approximately 100-basis-point impact from incremental SNAP headwinds.
Demand trends have improved from earlier in the year. Management said consumption declined about 2.5% in the second quarter but improved to roughly 1% in July, with sequential improvement expected in the third and fourth quarters.
Image Source: Zacks Investment Research
KHC's North America Volumes Remain the Pressure Point
North America organic net sales fell 2.7% in the second quarter. A 3.8-point decline in volume/mix overwhelmed a 1.1-point pricing contribution, with softness in U.S. meats remaining a key drag.
The pressure is not unique to Kraft Heinz. The Campbell's Company (CPB - Free Report) reported a 4% decline in both reported and organic net sales in its fiscal third quarter of 2026, while adjusted earnings per share fell 32%.
Emerging Markets Offset Part of Kraft Heinz's Weakness
Emerging Markets net sales increased 10.4% and organic net sales rose 8.5% in the second quarter. Pricing contributed 4.5 points and volume/mix added 4 points, giving Kraft Heinz growth from both price and demand.
Management expects Emerging Markets growth to accelerate in the second half as an Indonesia-related drag is lapped. For broader branded-food context, Mondelez International, Inc. (MDLZ - Free Report) reported second-quarter 2026 organic net revenue growth of 2.2%, including a 0.7% volume/mix increase.
Image Source: Zacks Investment Research
KHC's Margin Outlook Limits the Earnings Upside
Adjusted gross profit margin was flat year over year at 34.1% in the second quarter. For fiscal 2026, Kraft Heinz still expects adjusted gross profit margin to decline 10 to 50 basis points.
Constant-currency adjusted operating income is projected to fall 16% to 18%. The outlook incorporates about $700 million of incremental investment versus 2025, while inflation and unfavorable volume/mix continue to pressure near-term earnings leverage.
KHC's Ratings Still Signal a Balanced Setup
Kraft Heinz's earnings beat and improved organic sales outlook strengthen the recovery narrative, but the investment case still depends on better volume trends and firmer profitability. The latest results improve visibility without removing the core execution risks.
KHC currently carries a Zacks Rank #3 (Hold). Its Value Score of A supports the value case, while the Growth Score of D, Momentum Score of F and VGM Score of C indicate that favorable valuation characteristics are not yet matched by equally strong growth and momentum signals. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.