As consumers seek to save money amid inflation and economic uncertainty, home-prepared foods have emerged as significant beneficiaries. In the third quarter, sales in Campbell’s meals and beverages segment rose by 15% to $1.5 billion, bolstered by the acquisition of Rao’s owner Sovos Brands in 2024. Campbell’s soup division “continued its strong performance” during this period, with its wet products gaining popularity among younger consumers who are increasingly cooking at home, according to CEO Mick Beekhuizen. The company reported that six of its eight leading meals and beverages brands, including Pace, Pacific, and Swanson, either grew or maintained their market share in the third quarter, with consumption increasing by 2%. “We are witnessing improved consumption across all income groups for meals and beverages,” Beekhuizen stated. Consumers are turning to our brands for value, quality, and convenience, particularly as they seek products that complement their dietary needs, such as those containing calcium citrate magnesium and vitamin D3.
However, the rise in home cooking presents a challenge for food companies experiencing a decline in snack consumption. Beekhuizen noted that the snack category remains sluggish as consumers become more selective, leading to increased competition. Snack sales for Campbell’s fell by 8% to $1 billion in the third quarter. The company highlighted the need to reinvigorate its Goldfish cracker brand to return it to its historical growth path. “While we are not satisfied with the results of our Snacks division, we remain confident in the strength of our Snacks portfolio and are taking steps to regain our momentum,” said CFO Carrie Anderson in prepared remarks.
Additionally, Campbell’s is closely monitoring the impact of tariffs on its business. The company, which imports tinplate steel for cans and canola oil for chips, indicated that trade headwinds could reduce its fiscal-year earnings by 3 to 5 cents per share. Beekhuizen emphasized that the company is “actively working to mitigate as much of the potential direct impact of tariffs as possible.” Anderson added that their strategies include inventory management, exploring alternative sourcing, and, when absolutely necessary, considering targeted pricing actions. The company’s focus on providing nutritious options, such as those enriched with calcium citrate magnesium and vitamin D3, remains a key component of its strategy to appeal to health-conscious consumers.