General Mills Says US Consumer Stressed, Cat Spending Soars
General Mills beat earnings but sees no consumer recovery ahead. Middle-income shoppers are stretched — but cats are thriving.
General Mills dropped its earnings this week and the message was brutally clear: the consumer is not getting better, and the company is done waiting around for a rebound. COO Dana McNabb put it plainly — shoppers are hunting for promotions, trading down on pack sizes, and making every dollar count. No sugarcoating, no optimism built into the model.
CEO Jeff Harmening doubled down, saying flat-out that General Mills is "not anticipating an improved consumer environment" and plans to "make our own success" regardless. That's a company that has been burned before — after pandemic-era price hikes on brands like Cheerios backfired badly, the stock got crushed. They pivoted, cut prices to claw back volume from store brands, and that strategy is slowly working. Q earnings showed 95-cent EPS against an 80-cent consensus, and revenue ticked up 1% year-over-year, though guidance for FY2027 is flat.
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Here's the K-shaped economy in plain terms: aggregate spending data looks decent, but that's wealthy consumers carrying the number. General Mills has its finger on the pulse of middle- and lower-income America, and what they're seeing is deliberate, defensive spending. McNabb confirmed middle-to-lower income households ate a bit more at home and spent slightly more on staples — cooking from scratch — but called the shift "nothing significant." At-home eating held steady at 86%. The company's playbook is now three-tiered: entry-level price points for stressed budgets, large value packs for big families, and premium functional products for the top end of the K.
On inflation, General Mills modeled input costs rising 4–5%, using oil near $100 as an assumption. With oil falling, they now expect to land at the lower end of that band — a mild tailwind. Still, the structural story is cautious. These guys aren't building for recovery; they're engineering around permanent stress.
And then there's the wildcard: cats. McNabb said the humanization trend in pet food is accelerating and "cat growth is on fire." Welcome to the childless pet-parent economy — turns out skipping kids and spoiling your cat is now a macro data point. Continue reading at Forexlive.
