What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-07-15 compared with 2025-07-10 · 136 added, 118 removed, 270 unchanged (48% of the section changed)

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These risks, uncertainties, and factors include:

risks associated with general economic and industry conditions, including inflation, reduced consumer confidence and spending, declining benefits or increased limitations under government food assistance programs for consumers, rising unemployment, recessions, increased energy costs, supply chain challenges, increased tariffs and taxes, labor cost increases or shortages, currency rate fluctuations, actual or threatened hostilities or war, and or other geopolitical conflicts;

risks related to the availability and prices of commodities and other supply chain resources, including raw materials, packaging, energy, and transportation, weather conditions, health pandemics or outbreaks of disease, or other geopolitical uncertainty;

risks associated with general economic and industry conditions, including inflation, oil, energy and fuel costs, reduced consumer confidence and spending, increased tariffs and taxes, actual or threatened hostilities or war and/or other geopolitical conflicts, declining benefits or changing eligibility requirements under government food assistance programs for consumers, rising unemployment, recessions, supply chain challenges, labor cost increases or shortages, interest rate and currency rate fluctuations;

risks related to the availability and prices of commodities and other supply chain resources, including raw materials, packaging, energy, and transportation, weather conditions, pandemics, epidemics, and disease, in humans, plants, and animals;

disruptions or inefficiencies in our supply chain and/or operations;

risks related to the effectiveness of our hedging activities and ability to respond to volatility in commodities;

risks related to the ultimate impact of, including reputational harm caused by, any product recalls and product liability or labeling litigation, including litigation related to lead-based paint and pigment and cooking spray;

risks related to the ultimate impact of, including reputational harm caused by, any product recalls and product liability or labeling litigation;

risks related to our ability to execute operating and value creation plans and achieve returns on our investments and targeted operating efficiencies from cost-saving initiatives, and to benefit from trade optimization programs;

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risks associated with our contract manufacturing arrangements and other third-party service provider dependencies;

risks associated with actions of governments and regulatory bodies that affect our businesses, including the ultimate impact of new or revised regulations or interpretations including to address climate change;

risks associated with actions of governments and regulatory bodies that affect our businesses, including regulations or interpretations designed to address climate change;

risks related to the Company’s ability to execute on its strategies or achieve expectations related to environmental, social, and governance matters, including as a result of evolving legal, regulatory, and other standards, processes, and assumptions, the pace of scientific and technological developments, increased costs, the availability of requisite financing, and changes in carbon pricing or carbon taxes;

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risks and uncertainties associated with intangible assets, including any future goodwill or intangible assets impairment charges;

risks relating to

our ability to protect our intellectual property rights;

risks relating to acquisition, divestiture, joint venture or investment activities;

risks relating to our ability to protect our intellectual property rights;

risks relating to acquisition,

divestiture, joint venture or investment activities;

the amount and timing of future dividends, which remain subject to Board approval and depend on market and other conditions;

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Conagra’s brands include Birds Eye ® , Duncan Hines ® , Healthy Choice ® , Marie Callender’s ® , Reddi-wip ® , Slim Jim ® , Angie’s ® BOOMCHICKAPOP ® , and many more.

Fiscal 2025 Results

Fiscal 2025 performance compared to fiscal 2024 reflected a decrease in net sales, with organic (excludes the impacts of foreign exchange, acquisitions, and divestitures) decreases in our Grocery & Snacks, Refrigerated & Frozen, and Foodservice segments, partially offset by an increase in our International segment.

Overall gross profit decreased primarily as a result of lower net sales, input cost inflation, and unfavorable operating leverage, partially offset by productivity.

Excluding items impacting comparability, overall segment operating profit decreased in all of our segments compared to the prior year.

Corporate expenses and selling, general and administrative (“SG&A”) expenses were higher primarily due to items impacting comparability, as discussed below, partially offset by lower incentive compensation expense.

We recognized higher equity method investment earnings, lower interest expense, and lower income tax expense, in each case compared to fiscal 2024.

Excluding items impacting comparability, our effective tax rate was lower compared to fiscal 2024.

Diluted earnings per share were $2.40 and $0.72 in fiscal 2025 and 2024, respectively.

The increase in diluted earnings per share reflected higher net income.

See “Items Impacting Comparability” below as several significant items affected the comparability of year-over-year results.

Trends Impacting our Business

Our industry continues to be impacted by shifting consumer behavior, commodity cost fluctuations, exchange rate volatility, labor cost inflation, input cost inflation, supply chain pressures, and other global macroeconomic challenges.

Although rapidly changing trade policies and announcements of potential tariff increases caused increased uncertainty in the second half of fiscal 2025, we saw little impact to our results in fiscal 2025 due to delayed implementation or effect of the announced tariffs.

Throughout fiscal 2025, we experienced an elevated amount of input cost inflation and negative impacts from foreign exchange rates, which we were able to partially offset through our on-going productivity initiatives.

Our industry is anticipating increased supply chain challenges, commodity cost volatility, and consumer and economic uncertainty due to rapid changes in global trade policies including increasing or fluctuating tariffs.

We expect inflation and tariffs to negatively impact our costs of goods sold in fiscal 2026.

We expect consumer trends to continue to evolve and our volumes to improve over time;

however, in the near-term, we expect economic pressures on consumers, including the challenges of high inflation and the impact of increased or fluctuating tariffs, and related price increases, to continue to negatively impact our volumes throughout fiscal 2026.

We also expect foreign exchange rates to continue to negatively impact our earnings through fiscal 2026.

We continue to expect our industry to be impacted by weak consumer sentiment, inflation, commodity cost fluctuations, supply chain pressures, trade and regulatory uncertainty, and other global macroeconomic challenges.

In fiscal 2026, these challenges resulted in input cost inflation, labor cost inflation, and higher oil, energy, and fuel costs.

Additionally, in fiscal 2026, rapidly changing U.S.

tariffs and reciprocal tariffs caused increased uncertainty as well as input cost inflation in key materials used in our products, including tin-plate steel used in packaging for our canned products, which we were able to partially offset with productivity initiatives and price increases on impacted products.

We will continue to evaluate the evolving macroeconomic environment to take action to mitigate the impact on our business, consolidated results of operations, and financial condition.

While we will continue to seek to offset input cost inflation with productivity initiatives and tariff mitigation efforts, we anticipate that we may need to increase prices on certain products in fiscal 2027 to mitigate margin impacts and would expect corresponding elasticity impacts.

Throughout fiscal 2027, continued consumer sensitivity to price increases may negatively impact our volumes while input cost inflation could negatively impact our earnings.

We expect consumer expectations to continue to evolve and we plan to continue our focus on innovation to meet consumers’ changing preferences.

With consumers prioritizing wellness and the increase in affordability and accessibility of weight loss drugs, we see consumers continuing to seek products that enhance their wellness and weight management goals, including portion-controlled, high protein, and high fiber meals and snacks, positioning our portfolio of products well for fiscal 2027.

Fiscal 2026 Results

Fiscal 2026 results compared to fiscal 2025 reflected lower net sales, inclusive of a 53 rd week in fiscal 2026.

On an organic basis, which excludes the impacts of foreign exchange, acquisitions, divestitures, and the 53 rd week, increased net sales in our Foodservice segment were more than offset by declines in our Grocery & Snacks, Refrigerated & Frozen, and International segments.

Gross profit decreased primarily due to lower net sales, input cost inflation, and unfavorable operating leverage, partially offset by productivity and the 53 rd week.

Segment operating profit decreased across all segments.

Selling, general and administrative (“SG&A”) expenses decreased due to items impacting comparability, partially offset by higher incentive compensation expense in fiscal 2026.

Compared to fiscal 2025, we recognized lower equity method investment earnings, lower interest expense, and higher income tax expense.

Excluding items impacting comparability, our effective tax rate increased from fiscal 2025.

Diluted loss per share was $4.00 in fiscal 2026 compared to diluted earnings per share of $2.40 in fiscal 2025, reflecting lower net income in fiscal 2026.

See “Items Impacting Comparability” below for a discussion of significant items affecting the comparability of year-over-year results.

Items Impacting Comparability

Items of note impacting comparability of results for fiscal 2026 included the following:

● charges totaling $2.93 billion ($2.73 billion after-tax) related to the impairments of goodwill and certain brand intangible assets,

● an income tax benefit of $35.2 million and related equity method investment benefit of $0.3 million ($35.5 million after-tax) associated with certain elections made on an income tax return of a joint venture ,

● a net gain of $42.2 million ($20.6 million after-tax loss) associated with the divestiture of our Chef Boyardee ® and frozen fish businesses,

● charges totaling $45.7 million ($34.6 million after-tax) in connection with our restructuring plans,

● a net benefit of $37.4 million ($28.3 million after-tax) related to legacy legal matters ,

● a net benefit of $22.5 million ($17.1 million after-tax) primarily related to our year-end remeasurement of certain hourly pension plan liabilities,

● income tax expense of $11.1 million related to a former divestiture,

● charges totaling $8.1 million ($8.1 million after-tax) related to the separation of our CEO,

● charges of $7.5 million ($5.7 million after-tax) related to restructuring activities of the Ardent Mills joint venture , and

● charges totaling $5.4 million ($4.1 million after-tax) related to environmental matters .

Items of note impacting comparability of results for fiscal 2025 included the following:

● income tax benefits of $253.5 million associated with the release of valuation allowances on certain deferred tax assets based primarily on interactions with the taxing authorities,

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● charges of $7.2 million ($5.5 million after-tax) related to restructuring activities of the Ardent Mills joint venture.

Items of note impacting comparability of results for fiscal 2024 included the following:

● charges totaling $956.7 million ($847.7 million after-tax) related to the impairments of goodwill and certain brand intangible assets,

● charges totaling $66.6 million ($49.9 million after-tax) in connection with our restructuring plans,

● charges totaling $36.4 million ($36.0 million after-tax) related to the impairment of a business held for sale,

● net charges totaling $34.8 million ($26.2 million after-tax) related to legacy legal matters,

● a benefit of $11.5 million ($8.7 million after-tax) related primarily to our year-end remeasurement of an hourly pension plan liability, and

● a net gain of $8.7 million ($6.6 million after-tax) primarily associated with insurance proceeds from the previous fire that occurred at one of our manufacturing facilities.

Segment presentation of gains and losses from derivatives used for economic hedging of anticipated commodity input costs and economic hedging of foreign currency exchange rate risks of anticipated transactions are discussed in the segment review below.

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International

Net sales for fiscal 2025 in our Grocery & Snacks segment included a decrease in organic volumes and price/mix of 1.1% and 0.9%, respectively, when compared to fiscal 2024.

Price/mix was impacted by an increase in strategic trade investments.

The acquisitions of Sweetwood Smoke & Co.

in August 2024 and an existing contract manufacturer of our cooking spray products in July 2024 contributed $38.0 million to our Grocery & Snacks segment net sales during fiscal 2025.

Net sales for fiscal 2025 in our Refrigerated & Frozen segment included a decrease in price/mix of 3.5% compared to fiscal 2024, primarily attributable to an increase in strategic trade investments.

Volume decreased by 0.7% compared to fiscal 2024.

During fiscal 2025, the largest impact to our volumes was a result of supply constraints impacting the company’s frozen meals containing chicken and frozen vegetable products.

Net sales for fiscal 2026 in our Grocery & Snacks segment included a decrease in organic volumes of 2.4% and an increase in price/mix of 2.3% when compared to fiscal 2025, primarily due to inflation-driven pricing and corresponding elasticity impacts.

The inclusion of an additional week of results in fiscal 2026 accounted for 1.8% of an increase in net sales when compared to fiscal 2025.

Fiscal 2026 and 2025 included $7.0 million and $385.9 million, respectively, of net sales related to our Chef Boyardee ® business, which was sold in the first quarter of fiscal 2026.

Fiscal 2026 also included inorganic net sales of $10.6 million associated with the acquisitions of Sweetwood Smoke & Co.

in August 2024 and a contract manufacturer in July 2024 through the respective one-year anniversary of each acquisition.

Net sales for fiscal 2026 in our Refrigerated & Frozen segment included a decrease in organic price/mix of 1.0% and an increase in organic volume of 0.3% compared to fiscal 2025.

The inclusion of an additional week of results in fiscal 2026 accounted for 1.8% of an increase in net sales when compared to fiscal 2025.

Fiscal 2026 and 2025 included $4.9 million and $76.8 million, respectively, of net sales related to our frozen fish business, which was sold in the first quarter of fiscal 2026.

Additionally, we estimate that net sales during fiscal 2025 were impacted by approximately $24 million due to temporary manufacturing disruptions in our Hebrew National ® business during the key grilling season.

Net sales for fiscal 2025 in our International segment reflected a 5.7% decrease due to unfavorable foreign exchange rates, a 3.9% increase in organic price/mix, and a 3.4% decrease in organic volume, in each case compared to fiscal 2024.

The unfavorable foreign exchange rates were primarily due to the devaluation of the Mexican Peso relative to the US dollar.

Fiscal 2025 and 2024 included $23.6 million and $93.2 million, respectively, of net sales related to our ownership stake in Agro Tech Foods Limited (“ATFL”), which was sold in the first quarter of fiscal 2025.

Net sales for fiscal 2025 in our Foodservice segment included a decrease in organic volume of 8.1% compared to fiscal 2024, driven by the ongoing softness in restaurant traffic and the impact of lost business from the prior year.

Organic price/mix increased by 3.3% compared to fiscal 2024, reflecting inflation-driven pricing.

Net sales for fiscal 2026 in our International segment reflected a 4.2% decrease in organic volume, a 3.2% increase due to favorable foreign exchange rates, and a 1.7% increase in organic price/mix, in each case compared to fiscal 2025.

The favorable foreign exchange rates were primarily due to the strength of the US dollar relative to the Mexican Peso in comparison to the prior year.

The inclusion of an additional week of results in fiscal 2026 accounted for 1.9% of an increase in net sales when compared to fiscal 2025.

Fiscal 2026 and 2025 included $1.1 million and $43.1 million, respectively, of net sales related to our Chef Boyardee ® business.

In addition, fiscal 2025 included $23.6 million of net sales related to our ownership stake in Agro Tech Foods Limited (“ATFL”), which was sold in the first quarter of fiscal 2025.

Net sales for fiscal 2026 in our Foodservice segment included an increase in organic price/mix of 3.6% compared to fiscal 2025, primarily due to inflation justified pricing actions.

Organic volume decreased by 2.2% compared to fiscal 2025, reflecting soft but generally stable trends in commercial traffic.

The inclusion of an additional week of results in fiscal 2026 accounted for 2.0% of an increase in net sales when compared to fiscal 2025.

Fiscal 2025 included $16.2 million of net sales related to our Chef Boyardee ® and frozen fish businesses.

Additionally, we estimate that net sales in our Foodservice segment during fiscal 2025 were impacted by approximately $3 million due to the temporary manufacturing disruptions in our Hebrew National ® business.

SG&A Expenses (Includes general corporate expenses)

SG&A expenses totaled $1.54 billion for fiscal 2025, an increase of $49.8 million compared to fiscal 2024.

SG&A expenses totaled $1.44 billion for fiscal 2026, a decrease of $97.9 million compared to fiscal 2025.

SG&A expenses for fiscal 2026 reflected the following:

Items impacting comparability of earnings

● net charges of $91.1 million in connection with our restructuring plans and

● net charges totaling $88.7 million related to legacy legal matters.

● net charges of $33.8 million in connection with our restructuring plans,

● a net benefit of $37.4 million related to legacy legal matters ,

● charges totaling $8.1 million related to the separation of our CEO, and

● charges totaling $5.4 million related to environmental matters.

Other changes in expenses compared to fiscal 2025

● a decrease in short-term incentive expense of $43.9 million primarily due to a decrease in the estimated level of achievement of certain performance targets,

● a decrease in advertising and promotion expense of $26.4 million,

● an increase in salary, wage, and fringe benefit expense of $18.4 million due to merit and employee insurance costs,

● a decrease in consulting and professional fees of $11.8 million, partially due to the implementation of a new enterprise resource planning software system in Mexico in the prior year, and

● an increase in short-term incentive expense of $41.6 million primarily due to an increase in the estimated level of achievement of certain performance targets,

● an increase in advertising and promotion expense of $16.2 million,

● an increase in share-based payment expense of $13.4 million,

● a decrease in consulting and professional fees of $12.9 million,

● an increase in salary, wage, and fringe benefit expense of $12.0 million primarily due to the 53 rd week in the current fiscal year,

● a decrease in amortization expense of $10.6 million,

● an increase in deferred compensation expense of $8.0 million primarily due to market volatility between periods, and

● an increase in information technology-related expenses of $7.4 million.

SG&A expenses for fiscal 2025 included the following items impacting the comparability of earnings:

● net charges of $47.5 million in connection with our restructuring plans,

● net charges of $34.8 million related to legacy legal matters, and

● a net gain of $8.1 million primarily associated with insurance proceeds from the previous fire that occurred at one of our manufacturing facilities.

● net charges of $91.1 million in connection with our restructuring plans and

● net charges totaling $88.7 million related to legacy legal matters.

Segment Operating Profit

($ in millions)

Segment Operating Profit 1

Reporting Segment

Operating Profit

Grocery & Snacks

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International

Segment operating profit in our Grocery & Snacks segment for fiscal 2025 reflected a decrease in gross profits of $86.6 million compared to fiscal 2024.

The decrease in gross profit was driven by the decrease in net sales discussed above, the impacts of input cost

inflation, and unfavorable operating leverage, partially offset by productivity.

In addition, we recognized a benefit of $11.3 million and $14.4 million in fiscal 2025 and 2024, respectively, related to insurance proceeds for lost sales from our fiscal 2023 brand recall on Armour Star ® .

The decrease in gross profits was partially offset by lower SG&A expenses compared to fiscal 2024.

Segment operating profit in our Refrigerated & Frozen segment for fiscal 2025 reflected a decrease in gross profits of $211.3 million compared to fiscal 2024.

The decrease was driven by the net sales decline discussed above, impacts of input cost inflation, and unfavorable operating leverage, partially offset by productivity.

In fiscal 2025, we also experienced manufacturing challenges at the primary facility that prepares and cooks chicken used in our frozen meals.

This resulted in increased product costs from utilizing third-party manufacturers, as well as abnormal inventory costs while we temporarily stopped production.

1 Segment operating profit is defined as operating profit excluding the effect of items impacting comparability.

See Note 20, “Business Segments and Related Information” , to the Consolidated Financial Statements contained in this report for further discussion.

Segment operating profit in our Grocery & Snacks segment for fiscal 2026 reflected a decrease in gross profit of $125.6 million compared to fiscal 2025.

The decrease in gross profit was driven by the impacts of input cost inflation, unfavorable operating leverage, and a reduction in profit associated with the sale of our Chef Boyardee ® business, partially offset by the inclusion of the 53 rd week of our current fiscal year and productivity.

In addition, we recognized a benefit of $11.3 million in fiscal 2025 related to insurance proceeds for lost sales from our fiscal 2023 brand recall on Armour Star ® .

Segment operating profit was also impacted by higher SG&A expenses compared to fiscal 2025.

Segment operating profit in our Refrigerated & Frozen segment for fiscal 2026 reflected a decrease in gross profit of $133.6 million compared to fiscal 2025.

The decrease was driven by the impacts of lower organic net sales, input cost inflation, unfavorable operating leverage, and a reduction in profit associated with the sale of our frozen fish business, partially offset by the inclusion of the 53 rd week of our current fiscal year and productivity.

In addition, we estimate that gross profits during fiscal 2025 were negatively impacted by approximately $10 million, primarily due to lost profits, abnormal manufacturing variances, and certain inventory write-offs resulting from the temporary manufacturing disruptions in our Hebrew National ® business.

The decrease in gross profits was partially offset by lower SG&A expenses compared to fiscal 2024, which included a decrease of $20.9 million in advertising and promotion expenses.

Segment operating profit in our International segment for fiscal 2025 reflected a decrease in gross profits of $29.9 million compared to fiscal 2024.

The decrease was driven by a reduction in profit associated with the sale of our ownership stake in ATFL, the impacts of input cost inflation, and unfavorable foreign exchange rates, partially offset by productivity.

The decrease in gross profits was partially offset by lower SG&A expenses, including a decrease of $5.1 million in advertising and promotion expenses due primarily to the sale of our ownership stake in ATFL.

Segment operating profit in our Foodservice segment for fiscal 2025 reflected a decrease in gross profits of $19.1 million compared to fiscal 2024.

The decrease in gross profits was driven by the net sales declines discussed above, the impacts of input cost inflation, and unfavorable operating leverage, partially offset by productivity.

Segment operating profit was also impacted by higher SG&A expenses compared to fiscal 2025, which included an increase of $15.5 million in advertising and promotion expenses.

Segment operating profit in our International segment for fiscal 2026 reflected a decrease in gross profit of $11.5 million compared to fiscal 2025.

The decrease was driven by the organic net sales decline discussed above, the impacts of input cost inflation, unfavorable operating leverage, and a reduction in profit associated with the sale of our ownership stake in ATFL, partially offset by the inclusion of the 53 rd week of our current fiscal year, productivity, and favorable foreign exchange rates.

Segment operating profit in our Foodservice segment for fiscal 2026 reflected a decrease in gross profit of $11.5 million compared to fiscal 2025.

The decrease in gross profits was driven by the impacts of input cost inflation, unfavorable operating leverage, and a reduction in profit from divested businesses, partially offset by the increase in organic net sales discussed above, the inclusion of the 53 rd week of our current fiscal year, and productivity.

Segment operating profit was also impacted by higher SG&A expenses compared to fiscal 2025.

Pension and Postretirement Non-service Income

In fiscal 2026, pension and postretirement non-service income was $45.9 million, an increase of $20.0 million compared to fiscal 2025.

Fiscal 2025 reflected lower interest costs and a non-cash settlement gain of $13.0 million associated with a partial transfer of our U.S.

defined benefit pension plan obligation to a third-party insurance provider through the purchase of an annuity contract.

Fiscal 2024 included a benefit of $11.5 million related primarily to our annual remeasurement of an hourly pension plan liability.

Fiscal 2026 reflected lower interest costs as a result of the partial transfer of our U.S.

defined benefit pension plan obligation to a third-party insurance provider through the purchase of an annuity contract in the fourth quarter of fiscal 2025.

Fiscal 2025 included a non-cash settlement gain of $13.0 million associated with the partial transfer.

In addition, fiscal 2026 included a net benefit of $22.5 million primarily related to our year-end remeasurement of certain hourly pension plan liabilities.

Interest Expense, Net

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Our share of earnings from our equity method investment earnings were $140.7 million and $182.4 million for fiscal 2026 and 2025, respectively.

Ardent Mills earnings for fiscal 2025 reflected improved commodity revenue, partially offset by continued lower volume trends as seen throughout the industry.

Results for fiscal 2025 included charges of $7.2 million related to Ardent Mills restructuring activities.

Ardent Mills earnings for fiscal 2026 reflected lower commodity trading revenue.

Results for fiscal 2026 and 2025 included net charges of $9.6 million and $7.2 million, respectively, primarily related to Ardent Mills restructuring activities.

Our income tax expense was $91.8 million and $3.7 million in fiscal 2026 and 2025, respectively.

The decrease in our income tax expense was principally related to a release of a valuation allowance from a federal audit settlement that gave rise to a $225.8 million tax benefit in fiscal 2025.

The effective tax rate (calculated as the ratio of income tax expense to pre-tax income, inclusive of equity method investment earnings) was approximately 0.3% and 43.0% for fiscal 2025 and 2024, respectively.

The effective tax rate (calculated as the ratio of income tax expense to pre-tax income (loss), inclusive of equity method investment earnings) was approximately (5.0)% and 0.3% for fiscal 2026 and 2025, respectively.

See Note 14, “Pre-Tax Income and Income Taxes” , to the Consolidated Financial Statements contained in this report for a further discussion on the change in effective tax rates.

We expect our effective tax rate in fiscal 2027, exclusive of any unusual transactions or tax events, to be approximately 24%.

Earnings Per Share

Diluted earnings per share in fiscal 2025 and 2024 were $2.40 and $0.72, respectively.

The increase in diluted earnings per share reflected higher net income.

Earnings (Loss) Per Share

Diluted loss per share in fiscal 2026 was $4.00 and diluted earnings per share in fiscal 2025 were $2.40.

The decrease in diluted earnings per share reflected lower net income.

See “Items Impacting Comparability” above as several significant items affected the comparability of year-over-year results of operations.

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At May 31, 2026, we had a revolving credit facility (the “Revolving Credit Facility”) with a syndicate of financial institutions providing for a maximum aggregate principal amount outstanding at any one time of $2.0 billion (subject to increase to a maximum aggregate principal amount of $2.5 billion with the consent of the lenders).

The Revolving Credit Facility matures on August 26, 2027 and is unsecured.

The Revolving Credit Facility terminated and replaced our

prior revolving credit facility in the first quarter of fiscal 2026.

The Revolving Credit Facility matures on June 27, 2030 and is unsecured.

The Company may request the term of the Revolving Credit Facility be extended for additional one-year or two-year periods from the then-applicable maturity date on an annual basis.

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As of May 31, 2026, there were no outstanding borrowings under the Revolving Credit Facility.

On June 27, 2025, subsequent to our fiscal year end, we terminated and replaced our existing revolving credit facility by entering into an amendment which extends the maturity date to June 27, 2030.

We had $259.0 million outstanding under our commercial paper program as of May 25, 2025 and $586.0 million outstanding as of May 26, 2024.

The highest level of borrowings during fiscal 2025 was $1.0 billion.

During the fourth quarter of fiscal 2025, we entered into an unsecured Term Loan with a financial institution and borrowed the full principal amount, $200.0 million, available thereunder (the “2025 Term Loan”).

The net proceeds were used to repay outstanding borrowings under our commercial paper program.

On June 4, 2025, subsequent to our fiscal year end, we repaid $100.0 million of the $200.0 million aggregate principal amount outstanding under the 2025 Term Loan with a portion of the proceeds received in connection with the sale of our Chef Boyardee ® business.

The 2025 Term Loan matures on October 29, 2025.

During the fourth quarter of fiscal 2024, we entered into an unsecured Term Loan with a financial institution and borrowed the full principal amount, $300.0 million, available thereunder (the “2024 Term Loan”).

During the fourth quarter of fiscal 2025, we entered into a letter agreement extending the maturity date of the 2024 Term Loan to October 29, 2025.

On June 4, 2025, subsequent to our fiscal year end, we repaid $150.0 million of the $300.0 million aggregate principal amount outstanding under the 2024 Term Loan with a portion of the proceeds received in connection with the sale of our Chef Boyardee ® business.

During the second quarter of fiscal 2025, we repaid the remaining $250.0 million aggregate principal amount outstanding under our unsecured Term Loan Agreement, dated August 26, 2023 (the “2023 Term Loan”).

The repayment was primarily funded by operating cash flows.

We had no outstanding borrowings under our commercial paper program as of May 31, 2026 and $259.0 million outstanding as of May 25, 2025.

The highest level of borrowings during fiscal 2026 was $642.0 million.

During the first quarter of fiscal 2026, we issued $500.0 million aggregate principal amount of 5.00% senior unsecured notes due August 1, 2030 and $500.0 million aggregate principal amount of 5.75% senior unsecured notes due August 1, 2035 (collectively, the “Senior Unsecured Notes”).

The net proceeds were partially used to repay the $300.0 million and $200.0 million aggregate principal amount outstanding under the unsecured term loan agreements dated April 29, 2024, as amended by a letter agreement dated April 29, 2025 (the “2024 Term Loan”) and April 29, 2025 (the “2025 Term Loan”), respectively, as well as outstanding borrowings under our commercial paper program.

The 2024 Term Loan and 2025 Term Loan repayments were also partially funded by the proceeds received in connection with the sale of our Chef Boyardee ® business.

During the second quarter of fiscal 2026, we repaid the entire $1.0 billion aggregate principal amount of 4.60% senior unsecured notes on the maturity date of November 1, 2025, using remaining proceeds from the Senior Unsecured Notes, cash on hand, and the issuance of commercial paper.

See Note 4, “Long-Term Debt” and Note 5, “Credit Facilities and Borrowings” , to the Consolidated Financial Statements contained in this report for additional information on our debt transactions.

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We expect to maintain or have access to sufficient liquidity to retire or refinance long-term debt at maturity or otherwise, from operating cash flows, our commercial paper program, access to the capital markets, and our Revolving Credit Facility.

billion aggregate principal amount of 4.6% senior notes maturing in November 2025 that we expect to pay and/or refinance using available sources which may include the investment grade note market, bank loans, commercial paper, and cash on hand.

We have $500.0 million aggregate principal amount of 5.3% senior unsecured notes and $262.5 million aggregate principal amount of 7.125% senior unsecured notes maturing in October 2026 that we expect to pay and/or refinance using available sources which may include the investment grade note market, bank loans, commercial paper, and cash on hand.

We continuously evaluate opportunities to refinance our debt;

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The Company’s total remaining share repurchase authorization as of May 31, 2026 was $837.6 million.

On April 2, 2025, we announced that our Board had authorized a quarterly dividend payment of $0.35 per share, which was paid on May 29, 2025, to stockholders of record as of the close of business on April 28, 2025.

Subsequent to our fiscal year end, on July 9, 2025, we announced that our Board had authorized a quarterly dividend of $0.35 per share to be paid on August 28, 2025 to stockholders of record as of the close of business on July 30, 2025.

On March 31, 2026, we announced that our Board had authorized a quarterly dividend payment of $0.35 per share, which was paid on June 3, 2026, to stockholders of record as of the close of business on April 30, 2026.

Subsequent to our fiscal year end, on July 15, 2026, we announced that our Board had authorized a quarterly dividend of $0.175 per share to be paid on September 2, 2026 to stockholders of record as of the close of business on July 30, 2026.

Contractual Obligations

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Our preliminary estimate of capital expenditures for fiscal 2027 is approximately $550 million.

In fiscal 2025, we used $11.0 million of cash, which was the net result of $1.69 billion generated from operating activities, $542.2 million used in investing activities, $1.16 billion used in financing activities, and a decrease of $2.4 million due to the effects of changes in foreign currency exchange rates.

In fiscal 2026, we generated $150.0 million of cash, which was the net result of $1.40 billion generated from operating activities, $262.6 million generated from investing activities, $1.52 billion used in financing activities, and an increase of $1.4 million due to the effects of changes in foreign currency exchange rates.

Cash generated from operating activities totaled $1.40 billion in fiscal 2026, as compared to $1.69 billion generated in fiscal 2025.

The decrease in operating cash flows for fiscal 2025 compared to fiscal 2024 was primarily driven by lower operating profits, lower dividend payments received from one of our equity method investments, and higher inventory balances.

These decreases were partially offset by the accelerated receipt of our outstanding receivables in exchange for a slightly higher prompt pay discount, which increased our cash flow from operations by approximately $140 million.

Operating cash flows in fiscal 2025 also benefited from lower tax payments as a result of lower taxable income and recent interactions with the U.S.

Internal Revenue Service (“IRS”) allowing for additional tax deductions.

Cash used in investing activities totaled $542.2 million in fiscal 2025 compared to $375.0 million in fiscal 2024.

The decrease in operating cash flows for fiscal 2026 compared to fiscal 2025 was primarily driven by lower operating profits and the accelerated receipt of our outstanding receivables initiated in the second quarter of fiscal 2025, partially offset by favorable inventory management.

Cash generated in investing activities totaled $262.6 million in fiscal 2026 compared to $542.2 million cash used in fiscal 2025.

Investing activities in fiscal 2026 consisted primarily of proceeds totaling $648.9 million from the sale of our Chef Boyardee ® and frozen fish businesses, which were partially offset by capital expenditures totaling $423.4 million.

Investing activities in fiscal 2025 consisted primarily of capital expenditures totaling $389.3 million and the purchases of an existing contract manufacturer and Sweetwood Smoke & Co.

for a total of $230.6 million, net of cash acquired, which were partially offset by net proceeds totaling $76.8 million from the sale of our ownership stake in ATFL.

Investing activities in fiscal 2024 consisted primarily of capital expenditures totaling $388.1 million.

Cash used in financing activities totaled $1.52 billion in fiscal 2026 compared to $1.16 billion in fiscal 2025.

Financing activities in fiscal 2026 principally reflected repayments of long-term debt of $1.03 billion, the issuance of long-term debt totaling $1.0 billion, net short-term borrowing repayments of $770.5 million, cash dividends paid of $669.7 million, and common stock repurchases

of $15.3 million.

Financing activities in fiscal 2025 principally reflected repayments of long-term debt of $281.3 million, net short-term borrowing repayments of $125.6 million, cash dividends paid of $669.2 million, and common stock repurchases of $64.0 million.

Financing activities in fiscal 2024 principally reflected repayments of long-term debt of $1.77 billion, the issuance of long-term debt totaling $500.0 million, net short-term borrowing issuances of $290.6 million, and cash dividends paid of $659.3 million.

Cash Held by International Subsidiaries

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As a result, in the case of significant acquisitions we normally obtain the assistance of a third-party valuation specialist in estimating fair values of tangible and intangible assets.

The fair value estimates are based on available historical information and on expectations and assumptions about the future, considering the perspective of marketplace participants.

The fair value estimates are based on available historical information and on expectations and assumptions about the future, considering the

perspective of marketplace participants.

While management believes those expectations and assumptions are reasonable, they are inherently uncertain.

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Estimating future cash flows requires significant judgment by management in such areas as future economic conditions, industry-specific conditions, product pricing, and necessary capital expenditures.

The use of different assumptions or

estimates for selected EBITDA multiples and future cash flows could produce different impairment amounts (or none at all) for goodwill and indefinite-lived intangible assets.

The use of different assumptions or estimates for selected EBITDA multiples and future cash flows could produce different impairment amounts (or none at all) for goodwill and indefinite-lived intangible assets.

For further information on our indefinite-lived intangible assets and goodwill, see Note 1, “ Summary of Significant Accounting Policies ”, to the Consolidated Financial Statements contained in this report.

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Historically, we have experienced material impairments in brand intangibles and goodwill as a result of declining sales, reductions to our assumed royalty rates due to lower-than-expected profit margins, and other economic conditions such as increases to interest rates.

In fiscal 2026, we recorded goodwill impairments of $2.38 billion in our Refrigerated & Frozen reporting unit.

The remaining carrying value in our Refrigerated & Frozen reporting unit was approximately $4.7 billion as of May 31, 2026.

This was the only reporting unit with 10% or less excess fair value over carrying value as of that date.

For our Refrigerated & Frozen reporting unit, we selected a discount rate of 11.0% and a long-term growth rate of 1.5%

In fiscal 2026, 2025, and 2024, we recorded total indefinite-lived intangibles impairments of $547.2 million, $72.1 million, and $430.2 million, respectively, primarily related to brands acquired as part of the Pinnacle acquisition that were recorded at fair value in fiscal 2019.

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Carrying Amount

(in billions)

(in millions)

Brands (<10% cushion)

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However, as it is reasonably possible that changes in assumptions could occur, as a sensitivity measure, we have presented the estimated effects of isolated changes in discount rates, long-term growth rates, and royalty rates on the fair value of our reporting unit and brands with 10% or less excess fair value over carrying amount.

These estimated changes in fair value are not necessarily representative of the actual impairment that would be recorded in the event of a fair value decline.

If we had changed the assumptions used to estimate the fair value of our brands with 10% or less excess fair value over carrying amount as of the fiscal 2025 annual impairment test, these isolated changes, which are reasonably possible to occur, would have led to the following increase/(decrease) in the aggregate fair value of certain brands (in millions):

These estimated

changes in fair value are not necessarily representative of the actual impairment that would be recorded in the event of a fair value decline.

If we had changed the assumptions used to estimate the fair value of our reporting unit and brands with 10% or less excess fair value over carrying amount as of the fiscal 2026 annual impairment test, these isolated changes, which are reasonably possible to occur, would have led to the following increase/(decrease) in the aggregate fair value of this reporting unit and certain brands (in millions):

Discount Rate

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100-Basis-Point

Reporting unit

Brands (<10% cushion)

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures , to provide more detailed income tax disclosure requirements.

The guidance requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as information on income taxes paid.

The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively.

The effective date for the standard is for fiscal years beginning after December 15, 2024.

Early adoption is permitted.

We are in the process of analyzing the impact of the ASU on our related disclosures.

We will adopt this guidance in the fourth quarter of fiscal 2026, when it becomes effective.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , to provide disaggregated disclosures of specific expense categories underlying certain income statement expense line items on an annual and interim basis.

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We are in the process of analyzing the impact of the ASU on our related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software , to modernize the outdated guidance for accounting for software costs by aligning the accounting with how software is developed today.

The effective date for the standard is for fiscal years beginning after December 15, 2027 and interim periods within those fiscal years.

Early adoption is permitted.

The amendments in this ASU should be applied either prospectively, retrospectively, or utilizing a modified transition approach.

We are in the process of analyzing the impact of the ASU on our consolidated financial statements and related disclosures.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815) , to more closely align financial reporting with the economics of an entity’s risk management activities.

The effective date for this standard is for fiscal years beginning after December 15, 2026 and interim periods within those fiscal years.

Early adoption is permitted.

The amendments in this ASU should be applied prospectively with an option to adopt the amendments for hedging relationships existing as of the date of adoption.

We are in the process of analyzing the impact of the ASU on our consolidated financial statements and related disclosures.

In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818) , to improve the financial accounting for and disclosure of environmental credits and environmental credit obligations.

The effective date for this standard is for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years.

Early adoption is permitted.

We are in the process of analyzing the impact of the ASU on our consolidated financial statements and related disclosures.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis