General Mills has launched a “global transformation” program expected to cost approximately $130 million as the U.S. food manufacturer aims to enhance productivity.
In a filing with the U.S. Securities and Exchange Commission on May 27, the owner of the Blue Buffalo pet food and Cheerios cereals brands announced that the “multi-year” plan received management approval on May 20.
This initiative aims “to drive increased productivity by enhancing end-to-end business processes, enabled by targeted organizational actions.”
Although details are sparse, this initiative follows disappointing results reported in March for General Mills’ third quarter of the 2025 fiscal year. The company indicated that the transformation program might involve job reductions.
Sales during this period experienced a 5% drop in organic terms, a performance that the company acknowledged as below expectations, with volume declining by four percentage points.
Simultaneously, General Mills downgraded its full-year expectations for sales to a flat-to-higher range, previously confirmed during the second quarter in December. The Pillsbury cookies maker now anticipates organic sales to decline by 1.5% to 2%.
General Mills stated that of the anticipated $130 million in total charges, nearly $70 million will be recorded in the fourth quarter of 2025, “primarily reflecting severance expenses.”
In their filing, the Old El Paso brand owner elaborated: “The company anticipates that the series of actions related to the transformation initiative will be substantially completed by the end of fiscal 2028 and will result in total charges of approximately $130 million, of which approximately $120 million will be cash.”
While General Mills did not provide additional specifics, the firm suggested in its filings that the initiative may have broader implications.
“The estimate of costs that the company expects to record, and the timing thereof, are subject to a number of assumptions, and actual results may differ from current expectations,” the publicly listed business added.
“The company may also record other charges or cash expenditures not currently contemplated due to events associated with the transformation initiative.”
When discussing the third-quarter results in March, chairman and CEO Jeff Harmening pledged to reinvest $100 million from targeted savings into fiscal 2026.
“We’re reviewing new cost-efficiency initiatives that are anticipated to generate at least $100 million in additional savings in fiscal ’26, with further savings expected in fiscal ’27 and beyond,” Harmening explained.
“Our top priority is to accelerate organic sales growth by delivering exceptional consumer experiences across our leading food brands, leading to stronger volume and improved market share performance.”
General Mills is on track to achieve 5% savings in cost of goods sold this year through its Holistic Margin Management (HMM) program and plans to replicate this in fiscal 2026, totaling more than $600 million in “gross productivity savings,” Harmening stated in March.
