Kraft Heinz sauces boost quarterly results as home-cooking rises
A mix of sticky inflation and heightened economic uncertainty has forced consumers to cook more affordable meals at home instead of eating out. People prioritizing protein in their diets has also boosted demand for Kraft Heinz's steak sauce and Worcestershire sauce.
The company's board is "working with urgency" to evaluate strategic options for some brands, executives said on a post-earnings call, following media reports earlier this month that it was exploring a spin-off of the grocery business.
Kraft Heinz recorded a $9.3 billion impairment charge in the second quarter due to a steady decline in its market capitalization to $33.8 billion, with the stock value dropping about 30% since 2022.
The company reiterated its annual targets and now expects a cost impact of about 100 basis points this year from President Donald Trump's tariffs.
Its shares were up 1% in early trade.
The Philadelphia Cream Cheese maker has worked on introducing healthier options in some categories such as desserts to capture consumer demand, and has said it would remove food dyes from its portfolio.
It also announced plans to change the packaging for Kraft Mayonnaise to highlight the absence of dyes and artificial flavors, weeks after snacks giant PepsiCo (PEP.O), opens new tab said it will rebrand its Lay's and Tostitos chips without those substances.
While Kraft Heinz's quarterly volumes fell about 2.7 percentage points due to some weakness in categories such as coffee, cold meat cuts and ready-to-eat meals, the decline was lower than the prior quarter's drop of 5.6 percentage points.
In North America, its biggest market by revenue, volumes fell 3.4 percentage points.
"Looking ahead, we continue to expect growth in our international business, but we are not contemplating an improvement in the U.S. industry for the rest of 2025," CEO Carlos Abrams-Rivera said in a statement.
With consumers seeking value, the company has been investing in promotions, and that, along with inflation, could pressure margins in the current quarter, said Arun Sundaram, analyst at CFRA Research.
Net sales for the three months ended June 28 came in at $6.35 billion, beating analysts' average estimate of $6.26 billion, according to data compiled by LSEG.
Its adjusted profit of 69 cents per share also beat estimates.
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Reuters
27 minutes ago
- Reuters
Trump again threatens India with harsh tariffs over Russian oil purchases
WASHINGTON, Aug 4 (Reuters) - U.S. President Donald Trump again threatened on Monday to raise tariffs on goods from India over its Russian oil purchases, while New Delhi called his attack "unjustified" and vowed to protect its economic interests, deepening the trade rift between the two countries. In a social media post, Trump wrote, "India is not only buying massive amounts of Russian Oil, they are then, for much of the Oil purchased, selling it on the Open Market for big profits. They don't care how many people in Ukraine are being killed by the Russian War Machine." "Because of this, I will be substantially raising the Tariff paid by India to the USA," he added. A spokesperson for India's foreign ministry said in response that India will "take all necessary measures to safeguard its national interests and economic security." "The targeting of India is unjustified and unreasonable," the spokesperson added. Trump has said that from Friday he will impose new sanctions on Russia as well as on countries that buy its energy exports, unless Moscow takes steps to end its 3-1/2 year war with Ukraine, opens new tab. Russian President Vladimir Putin has shown no public sign of altering his stance despite the deadline. Over the weekend, two Indian government sources told Reuters that India will keep purchasing oil from Russia despite Trump's threats. India has faced pressure from the West to distance itself from Moscow since Russia invaded Ukraine in early 2022. New Delhi has resisted, citing its longstanding ties with Russia and economic needs, opens new tab. Trump had already in July announced 25% tariffs on Indian imports, and U.S. officials have cited a range of geopolitical issues standing in the way of a U.S.-India trade accord. Trump has also cast the wider BRICS group of developing nations as hostile to the United States. Those nations have dismissed his accusation, saying the group promotes the interests of its members and of developing countries at large. India is the biggest buyer of seaborne crude from Russia, importing about 1.75 million barrels per day of Russian oil from January to June this year, up 1% from a year ago, according to data provided to Reuters by trade sources. India began importing oil from Russia because traditional supplies were diverted to Europe after the outbreak of the Ukraine conflict, the Indian spokesperson said, calling it a "necessity compelled by global market situation." The spokesperson also noted the West's, particularly the European Union's, bilateral trade with Russia: "It is revealing that the very nations criticizing India are themselves indulging in trade with Russia." Despite the Indian government's defiance, the country's main refiners paused buying Russian oil last week, sources told Reuters. Discounts to other suppliers narrowed after Trump threatened hefty tariffs on countries that make any such purchases. Indian government officials denied any policy change. The country's largest refiner, Indian Oil Corp, has bought 7 million barrels of crude from the United States, Canada and the Middle East, four trade sources told Reuters on Monday. India also has been frustrated by Trump repeatedly taking credit for an India-Pakistan ceasefire that he announced on social media in May, which halted days of hostilities between the nuclear-armed neighbors. The unpredictability of the Trump administration creates a challenge for Delhi, said Richard Rossow, head of the India program at Washington's Center for Strategic and International Studies. "India's continued energy and defense purchases from Russia presents a larger challenge, where India does not feel it can predict how the Trump administration will approach Russia from month to month," he said.
The Guardian
an hour ago
- The Guardian
Trump firing of labor statistics chief ‘undermines credibility', ex-leaders say
The former Bureau of Labor Statistics (BLS) commissioners and non-partisan economic groups have criticized Donald Trump's shock firing of BLS commissioner Erika McEntarfer after the July jobs report data revealed jobs growth stalled this summer. Trump, without any evidence to back his claims, alleged McEntarfer 'faked' employment numbers in the run-up to the 2024 election to boost Kamala Harris's chances and said that the recent data was 'rigged' to make Trump and Republicans look bad. The Trump administration has continued to repeat the allegations. The National Economic Council director Kevin Hassett, a Trump appointee, has claimed 'all over the US government, there have been people who have been resisting Trump everywhere they can,' in justifying the firing. Friends of BLS, a group chaired by former BLS commissioners Erica Groshen, an Obama appointee, and William Beach, Trump's appointee during his first term, strongly criticized the firing of McEntarfer, Trump's allegations, and called on Congress to act. 'We call on Congress to respond immediately, to investigate the factors that led to Commissioner McEntarfer's removal, to strongly urge the Commissioner's continued service, and ensure that the nonpartisan integrity of the position is retained,' Friends of BLS wrote in a statement. 'This rationale for firing Dr McEntarfer is without merit and undermines the credibility of federal economic statistics that are a cornerstone of intelligent economic decision-making by businesses, families, and policymakers.' The Association of Public Data Users, the National Association for Business Economics and the American Economic Association also criticized the firing. 'Under the law, disliking the data is not a qualifying reason to remove the BLS Commissioner from her four-year appointment. Under our democracy, it is unacceptable to fire someone for publishing data collected in accordance with scientific standards,' the Association of Public Data Users said in a statement, echoing the call for Congress 'to respond immediately, to investigate the factors that led to Commissioner McEntarfer's removal, to strongly urge the BLS Commissioner's continued service, and ensure that the nonpartisan integrity of the position is retained.' Beach added in a social media post: 'the totally groundless firing of Dr. Erika McEntarfer, my successor as Commissioner of Labor Statistics at BLS, sets a dangerous precedent and undermines the statistical mission of the Bureau.' Beach was nominated by Trump as commissioner of the Bureau of Labor Statistics in 2017, was confirmed by the Senate in 2019 and served a full four year term until 2023. In an email, former BLS commissioner Kathleen Utgoff, who was appointed and served under the George W Bush administration, told the Guardian: 'A functioning democracy requires accurate data so that workers, businesses, politicians and voters can make good decisions. I was at the BLS after the Iraq war. Many people asked me how to create something like the BLS there. They could not move forward without data on the state of the economy.' Republican US senators Rand Paul, Thom Tillis, Cynthia Lummis have also questioned the rationale behind Trump's firing of BLS commissioner McEntarfer. The last jobs report issued by BLS before the presidential election in November 2024 showed the US only added 12,000 jobs in October 2024, the slowest growth since 2020.
Reuters
an hour ago
- Reuters
Trading Day: Stocks bounce back, bonds more cautious
ORLANDO, Florida, Aug 4 (Reuters) - Investors shrugged off last week's worries over the U.S. economy to drive a powerful, tech-led rebound across global stocks on Monday, although U.S. Treasuries prices held onto Friday's gains, suggesting a fair degree of caution persists. More on all that below. In my column today I look at why rather than firing the head of the Bureau of Labor Statistics, President Donald Trump could have claimed that the weak jobs data and dramatic market reaction vindicated his stance that the Fed should cut rates. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. Today's Key Market Moves Stocks bounce back, bonds more cautious After getting slammed on Friday by unexpectedly poor U.S. employment figures, U.S. and world stocks rebounded on Monday. Whether this is a short-term technical recovery or the resumption of the bull run of recent months remains to be seen. In isolation, the positive start to the week has been pretty impressive. Wall Street more than recovered the ground it lost on Friday, led by the Nasdaq and Russell 2000, as investors bet that both tech and small caps would be among the big winners in a lower interest rate world. The global recovery was probably overdue. The MSCI All Country index's rise on Monday snapped a six-session losing streak, its worst run in nearly two years. While Friday's slump in U.S. bond yields reflected deepening growth fears and contributed to the huge equity selloff, the further drift lower in yields on Monday supported equity sentiment. The feel good factor could prove fleeting though. The U.S.-centric issues that drove last week's selloff - growth fears, tariff concerns and unusually high levels of policy uncertainty - haven't disappeared. Trump said on Monday he will substantially raise tariffs on goods from India over its Russian oil purchases, while Switzerland says it is ready to make a "more attractive offer" to Washington to avert the steep 39% tariffs it is facing. Investors are increasingly nervous about political interference in independent U.S. institutions after Trump fired Bureau of Labor Statistics Commissioner Erika McEntarfer for allegedly rigging the jobs data. This comes amid Trump's verbal attacks on Fed Chair Jerome Powell for not cutting interest rates, and as he prepares to announce his nomination to replace Fed Governor Adriana Kugler, who surprisingly resigned on Friday. Looking ahead to Tuesday, the U.S. earnings calendar heats up again and purchasing managers index data will give an insight into how the service sectors in many of the world's major economies fared in July. Trump scores major own goal with labor official firing U.S. President Donald Trump's decision to fire a top labor official following weak jobs data obviously sends ominous signals about political interference in independent institutions, but it is also a major strategic own goal. Trump has spent six months attacking the Federal Reserve, and Chair Jerome Powell in particular, for not cutting interest rates. The barbs culminated in Trump branding Powell a "stubborn MORON" in a social media post on Friday before the July jobs report was released. The numbers, especially the net downward revision of 258,000 for May and June payrolls growth, were much weaker than expected. In fact, this was "the largest two-month revision since 1968 outside of NBER-defined recessions (assuming the economy is not in recession now)," according to Goldman Sachs. This sparked a dramatic reaction in financial markets. Fed rate cut expectations soared, the two-year Treasury yield had its steepest fall in a year, and the dollar tumbled. A quarter-point rate cut next month and another by December were suddenly nailed-on certainties, according to rate futures market pricing. This was a huge U-turn from only 48 hours before, when Powell's hawkish steer in his post-FOMC meeting press conference raised the prospect of no easing at all this year. Trump's constant lambasting of "Too Late" Powell suddenly appeared to have a bit more substance behind it. The Fed chair's rate cut caution centers on the labor market, which now appears nowhere near as "solid" as he thought. Trump could have responded by saying: "I was right, and Powell was wrong." Instead, on Friday afternoon he said he was firing the head of the Bureau of Labor Statistics, Commissioner Erika McEntarfer, for faking the jobs numbers. Trump provided no evidence of data manipulation. So rather than point out that markets were finally coming around to his way of thinking on the need for lower interest rates, Trump has united economists, analysts and investors in condemnation of what they say is brazen political interference typically associated with underdeveloped and unstable nations rather than the self-proclaimed 'leader of the free world.' "A dark day in, and for, the U.S.," economist Phil Suttle wrote on Friday. "This is the sort of thing only the worst populists do in the worst emerging economies and, to use the style of President Trump, IT NEVER ENDS WELL." It's important to note that major – even historic – revisions to jobs growth figures are not necessarily indicative of underlying data collection flaws. As Ernie Tedeschi, director of economics at the Budget Lab at Yale, argued on X over the weekend: "BLS's first-release estimates of non-farm payroll employment have gotten more, not less, accurate over time." It should also be noted that the BLS compiles inflation as well as employment data, so, moving forward, significant doubt could surround the credibility of the two most important economic indicators for the U.S. - and perhaps the world. Part of what constitutes "U.S. exceptionalism" is the assumption that the experts leading the country's independent institutions are exactly that, independent, meaning their actions and output can be trusted, whatever the results. Baseless accusations from the U.S. president that the BLS, the Fed and other agencies are making politically motivated decisions to undermine his administration only undermine trust in the U.S. itself. "If doubts are sustained, it will lead investors to demand more of a risk premium to own U.S. assets," says Rebecca Patterson, senior fellow at the Council on Foreign Relations. "While only one of many forces driving asset valuations, it will limit returns across markets." This furor comes as Fed Governor Adriana Kugler's resignation on Friday gives Trump the chance to put a third nominee on the seven-person Fed board, perhaps a potential future chair to fill that slot as a holding place until Powell's term expires in May. Whoever that person is will likely be more of a policy dove than a hawk. Policy uncertainty, which had been gradually subsiding since the April 2 'Liberation Day' tariff turmoil, is now very much back on investors' radar. What could move markets tomorrow? Want to receive Trading Day in your inbox every weekday morning? Sign up for my newsletter here. Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, opens new tab, is committed to integrity, independence, and freedom from bias.
