Kraft Heinz scraps split plan as $9.3B charge drives steep loss

The Kraft Heinz Company (NASDAQ:KHC) reported a massive $4.7 billion operating loss for 2025, primarily driven by $9.3 billion in non-cash impairment charges linked to a sustained decline in the company’s stock price.

Alongside the results, newly appointed CEO Steve Cahillane announced a major strategic pivot: the company will pause work on its previously disclosed plan to separate its businesses to focus exclusively on returning its iconic brands to "profitable growth."

The fourth quarter reflected the persistent volume challenges facing the packaged food industry.

Organic net sales fell 4.2%, with volume/mix declining 4.7 percentage points as price-sensitive consumers pushed back against previous hikes.

While adjusted EPS of $0.67 beat analyst estimates, total revenue of $6.35 billion missed expectations, leading to a 7% slide in the stock during Wednesday trading.

Despite the GAAP losses, the company’s cash-generation engine remained a bright spot.

Free cash flow surged 15.9% to $3.7 billion for the full year, a record conversion rate that allowed Kraft Heinz to return $2.3 billion to stockholders through dividends and buybacks.

However, the 2026 roadmap suggests more pain before a recovery; management plans to reinvest $600 million into marketing, R&D, and selective price cuts to regain lost market share.

The company’s 2026 outlook envisions a further organic sales decline of 1.5% to 3.5%, with adjusted EPS projected between $1.98 and $2.10—well below the $2.49 analysts had forecast.