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Kellogg's Q1 2025 Earnings Report
WK Kellogg Co reported a decrease in net sales and net income for the first quarter of 2025, leading to a revised full-year financial outlook.
Key Takeaways
WK Kellogg Co's first quarter 2025 results showed a 6.2% decrease in reported net sales and a 45.5% decrease in reported net income year-over-year. This performance led the company to lower its full-year 2025 guidance for organic net sales growth and adjusted EBITDA growth.
Reported net sales decreased by 6.2% year-over-year to $663 million.
Reported net income decreased by 45.5% year-over-year to $18 million.
Adjusted EBITDA decreased by 4.0% year-over-year to $72 million.
The company lowered its 2025 organic net sales growth guidance to a range of (2.0)% to (3.0)% and adjusted EBITDA growth guidance to flat to (2.0)%.
Forward Guidance
WK Kellogg Co has lowered its full-year 2025 guidance for organic net sales growth and adjusted EBITDA growth due to first-quarter results and weaker-than-expected consumption trends.
Positive Outlook
- The company continues to make progress on strategic priorities, including supply chain modernization.
- The company remains on track to deliver ~500 bps of margin improvement by the end of 2026.
- Consumers' focus on health and nutrition is viewed as a positive development for the category.
- The company believes its portfolio is well-positioned to meet consumer needs.
- Further actions are being taken to accelerate plans in the health and nutrition area.
Challenges Ahead
- 2025 organic net sales growth is now projected to be approximately (2.0)% to (3.0)%, a decrease from prior guidance of ~(1.0)%.
- 2025 adjusted EBITDA growth is now projected to be flat to (2.0)%, a decrease from prior guidance of 4.0% to 6.0%.
- The financial outlook includes a modest impact from tariffs, primarily related to raw material sourcing outside North America.
Historical Earnings Impact
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