General Mills forecasts weak annual profit as economic uncertainty weighs

General Mills forecast annual profit below expectations on Wednesday, as weak demand for its refrigerated baked goods and snacks in the U.S. in a tariff-driven, uncertain macroeconomic background weighed on the Pillsbury owner.

Economic uncertainty arising from President Donald Trump’s shifting tariff policies has weighed on consumer spending in the U.S., challenging General Mills’ efforts to drum up sales.

“We expect the operating environment will remain volatile, with consumers pressured by widespread uncertainty from tariffs, global conflicts, and changing regulations,” CEO Jeff Harmening said.

“Amid this uncertainty, we expect consumers to remain cautious and continue seeking value.”

Shares of the Cheerios-maker were down 2% in early trading.

The company has been trying to boost demand through new products, such as a fresh version of its Blue Buffalo pet food, betting on a rise in demand for the minimally processed fresh pet food market. But analysts expect investments in marketing and acquisitions to take a toll on its margins.

“While increased investments will pressure profitability, returning to volume growth, especially in North America Retail, is the first step to return to on-algorithm delivery, and might be a necessary pill to swallow,” said Consumer Edge analyst Connor Rattigan.

The company expects full-year adjusted profit to decline between 10% and 15%, compared to analysts’ estimates of a 4.8% decline, according to data compiled by LSEG.

For the fourth quarter ended May 25, General Mills posted sales of $4.56 billion, narrowly missing expectations of $4.59 billion.

Net sales at its North America retail segment, a major revenue contributor, were down 10%, offsetting gains from a 12% rise in General Mills’ pet segment sales in the region.

The company, however, posted an adjusted profit per share of 74 cents for the reported quarter, above analysts’ estimates of 71 cents.