- General Mills revised its sales and profit outlook to reflect a deeper dip than previously expected.
- The company's CEO said a weakening consumer is weighing on results.
- The Cheerios maker's stock fell 7% on Tuesday, along with other food stocks like Campbell's and Kraft-Heinz.
Packaged food stocks fell during Tuesday's trading session after General Mills lowered its outlook, underlining weakening consumer sentiment.
The Cheerios maker updated its outlook to reflect a more significant slump in sales and operating profit than previously projected. General Mills stock ended Tuesday down 7% on the cut outlook and other packaged food names also slid into the red.
The Campbell's Company stock closed 6% lower while Slim Jim maker ConAgra Foods and Kraft-Heinz were down more than 4%. McCormick & Co. and J.M. Smuckers also recorded intraday declines.
General Mills CEO Jeff Harmening said there is a "heightened focus on value" among consumers, particularly low- and mid-income shoppers, a nod to the K-shaped economy.
"Cost of living and housing pressures are reshaping spending patterns and value is core expectation that is here to stay," the CEO said during General Mills' presentation at an annual consumer analyst group conference.
Harmening added that General Mills faces a "challenging" background amid "historically low consumer sentiment."
He flagged inflation, SNAP cuts, and geopolitical uncertainty have contributed to the financial stress for customers that is weighing on General Mills' results.
The executive reported weak sales for the company's cereal, snacks, and dog food segments. He also said consumers are prioritizing promotions, buying more when products are on sale.
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