GIS FY2025 10-K: Pet Food Growth Offsets Retail Weakness

In its latest annual 10-K filing, General Mills (GIS) paints a picture of a company in transition. This post will dig into the numbers to see how GIS is navigating a challenging consumer landscape while making strategic bets on growth. While total net sales for fiscal year 2025 saw a slight 2% dip to $19.5 billion, the real story lies in the shifting performance of its core business segments.

A Tale of Shifting Tastes

The company's largest segment, North America Retail, which includes iconic brands like Cheerios cereal and Pillsbury dough, faced headwinds. Net sales in this division fell 5% to $11.9 billion, primarily driven by a decrease in sales volume. This suggests consumers are pulling back on spending in traditional grocery categories.

However, other areas of the business are picking up the slack. The North America Pet segment was a standout performer, with sales climbing 4% to nearly $2.5 billion. This growth was bolstered by the recent $1.4 billion acquisition of Whitebridge Pet Brands, signaling a strong strategic push into the resilient pet food market. The North America Foodservice division also posted a healthy 2% sales increase to $2.3 billion, indicating recovery and strength in the away-from-home food sector.

Following the Money

To understand how these different revenue streams and costs impact the bottom line, the chart below illustrates the flow from the company's total revenue down to its net earnings.

As the chart shows, after accounting for all costs and expenses, General Mills reported a net profit of $2.3 billion for the fiscal year, a decrease of 8% from the prior year.

Strategic Capital and Shareholder Returns

Despite the dip in profits, General Mills remains focused on returning value to its shareholders. In fiscal 2025, the company paid out $1.3 billion in dividends and repurchased $1.2 billion of its own stock.

The company is actively reshaping its portfolio, divesting its Canada yogurt business for $242 million while investing heavily in the high-growth pet category. These moves highlight a clear strategy: streamline and focus on the most promising market segments. While the legacy retail business faces pressure, General Mills' strategic shifts and continued growth in its Pet and Foodservice divisions will be critical to watch in the coming year.