Campbell's (CPB) FY2026 10-K: Why It Cut the Dividend 36% and the Snack Problem Behind It
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Initiating coverage · Nasdaq: CPB · FY2026 10-K (52 weeks ended August 2, 2026, filed September 24, 2026) · Filing figures read from the XBRL; market data as of the September 25, 2026 close.
The Hook
Campbell's $CPB declared $1.56 a share in dividends in fiscal 2026 and earned $1.31 a share. It paid out more than it made, and its retained earnings shrank from $4.694B to $4.620B to cover the difference. On September 3, the board "reset the quarterly dividend" from $0.39 to $0.25, a 36% cut and, per 24/7 Wall St, the first since 2001.
The filing is clear about where the earnings went. It was not soup. Snacks operating earnings fell from $622M in fiscal 2024 to $538M to $386M, down 38% in two years, and over those same three years Campbell's wrote down $422M of snack brand value: Pop Secret and the Allied brands, then Snyder's of Hanover and Late July, and now Kettle Brand and Cape Cod. The soup company is paying for a snack company it has struggled to run.
Company Snapshot
The Campbell's Company (renamed from Campbell Soup in 2024) runs two segments. Meals & Beverages is the soup, Prego, Pace, V8 and, since the $2.899B Sovos Brands deal in March 2024, Rao's. Snacks is Goldfish, Pepperidge Farm, and the Snyder's-Lance portfolio acquired in 2018: Snyder's of Hanover pretzels, Lance crackers, Kettle Brand and Cape Cod chips. Fiscal 2026 net sales were $9.744B.
This brief reads the FY2026 10-K. One calendar quirk matters before any comparison: fiscal 2025 had 53 weeks, and the filing puts the extra week at about 2 points of the year's 5% sales decline and about $.06 of fiscal 2025 EPS.
The Financial Story
Volume is the problem, and price is no longer fixing it. Net sales fell 5%, from $10.253B to $9.744B. The filing's bridge splits that into volume/mix down 3 points, net price up 1, divestitures (noosa yogurt, Pop Secret) down 1, and the lost 53rd week down 2. Strip out the calendar and the portfolio moves, and Campbell's still sold 3% less. In Snacks, volume/mix was down 5%; the filing names declines in chips, crackers, pretzels, partner brands and fresh bakery, with Pepperidge Farm cookies the one gainer.
| Segment | FY2024 | FY2025 | FY2026 |
|---|---|---|---|
| Snacks net sales | $4.255B | $4.074B | $3.816B |
| Snacks operating earnings | $622M | $538M | $386M |
| Snacks operating margin | 14.6% | 13.2% | 10.1% |
| Meals & Beverages net sales | $5.381B | $6.179B | $5.928B |
| Meals & Beverages operating earnings | $1,000M | $1,098M | $943M |
| Meals & Beverages operating margin | 18.6% | 17.8% | 15.9% |
Snacks is the segment that broke. Its operating earnings fell 28% this year and 14% the year before, while its margin went from 14.6% to 10.1%. Meals & Beverages fell too, 14% this year, but it still earns $943M, 2.4 times what Snacks does. And the impairments are not in these segment numbers at all. Campbell's books its trademark write-downs in corporate expense, so the $386M is the operating decline before any accounting charge. The write-downs sit on top: $129M in fiscal 2024, $176M in fiscal 2025, $117M in fiscal 2026 ($60M on Kettle Brand, $57M on Cape Cod), every dollar of it on snack brands. None of it touched goodwill, which is tested at the reporting-unit level and, per the filing, passed with fair values that "significantly exceeded" carrying values.
Tariffs took the whole margin decline. Gross margin fell 230 basis points, from 30.4% to 28.1%. The filing's own margin bridge estimates the gross impact of tariffs at exactly 230 basis points, with productivity (+300) and price (+90) offsetting cost inflation and volume. The estimated net cost of tariffs to earnings was about $.21 a share, against about $.02 in fiscal 2025. Diluted EPS fell from $2.01 to $1.31; adjusted EPS, per the company's release, fell 27% to $2.17.
The balance sheet is what forced the choice. Campbell's carries $7.137B of debt: $977M due within a year, including $500M of senior notes maturing in March 2027, and $6.160B long-term. Earnings before interest and taxes of $852M covered $331M of interest just 2.6 times. Cash rose from $132M to $394M, but do not read that as deleveraging. Short-term borrowings rose $215M over the same year, and the new La Regina entities brought $147M of their own cash onto the balance sheet.
La Regina is the new, quiet claim. In May, Campbell's bought 49% of La Regina, the Italian company that makes every jar of Rao's sauce, for $146M in cash. A second $140M tranche is due May 4, 2027, payable at Campbell's discretion in cash or unregistered shares (capped at 19.9% of outstanding stock), and the other 51% sits under a put and a call. Because Campbell's is the primary beneficiary, it consolidates La Regina as a variable interest entity: that is where the $335M of new goodwill (all in Meals & Beverages) and the $304M of redeemable noncontrolling interest came from. Securing Rao's supply was the logic of the Sovos deal. It also means the one brand growing inside Meals & Beverages now carries a future cash-or-shares obligation.
The cash covered the dividend, but not by much. Operating cash flow was $1.039B and capital spending $361M, leaving $678M of free cash flow. Dividends took $470M of it, 69%. Buybacks shrank to $26M. At the new $1.00 annual rate, the dividend costs roughly $300M a year, freeing about $170M for debt. That is the whole point of the cut: the company said it was made "to help accelerate the path to reducing debt."
Valuation: What It Is Worth as a Normal Business
Where it trades. Campbell's closed at $19.37 on September 25, a market capitalization of about $5.78B, per stockanalysis.com, near the bottom of a $19.26 to $33.81 52-week range. The market value of the equity is now smaller than the $7.137B of debt. Enterprise value, adding debt and the La Regina noncontrolling interest and subtracting cash, is about $12.8B, or roughly 8.0 times fiscal 2026 adjusted EBITDA of about $1.59B (the company's $1.181B adjusted EBIT plus $413M of depreciation and amortization, our computation). On the fiscal 2027 guide of $1.65 to $1.80 of adjusted EPS, the forward P/E is about 11 times, and the reset dividend yields about 5.2% at a 58% payout of the guide midpoint. Trailing free cash flow yield on the equity is 11.7%. Consensus, per stockanalysis.com, is Hold across 20 analysts with an average target of $20.79.
Scenario DCF on equity free cash flow. Fiscal 2027 guidance calls for organic sales down 2% to 4%, adjusted EBIT down 7% to 12%, and capital spending of about $300M. We value the free cash flow left for shareholders after interest, divided by roughly 298M shares.
| Case | Annual equity FCF | Cost of equity | Perpetual growth | Implied value per share |
|---|---|---|---|---|
| Bear | $550M | 10.0% | -1% | about $16.76 |
| Base | $650M | 9.0% | 0% | about $24.20 |
| Bull | $750M | 8.5% | +1% | about $33.51 |
Peer re-rating. Packaged food has de-rated as a group. Using the July 2026 multiples from our Conagra coverage, Conagra at about 7.5 times EV to adjusted EBITDA and General Mills near 9.7 times, and applying them to an estimated fiscal 2027 adjusted EBITDA of about $1.48B (the guide midpoint plus fiscal 2026 D&A), implies equity of about $13.63 to $24.56 a share after net debt of $6.743B and the $304M La Regina claim.
What the price implies. At $19.37, and a 9% cost of equity, the market is paying for $650M of free cash flow that shrinks about 2% a year forever. That is not an absurd assumption for a company whose volume has fallen for two years. The combined implied range, roughly $14 to $34, straddles today's price. Implied value under stated assumptions; not a price target and not investment advice.
Risks
The next write-down is already sized. The filing says indefinite-lived trademarks with roughly 10% or less of fair-value cushion total $1.225B, and names them: Snyder's of Hanover, Pace, Kettle Brand, Cape Cod, Late July and the Allied brands. Management guided fiscal 2027 gross margin down again and assumes no new tariffs. The $500M of March 2027 notes has to be repaid or refinanced at a coverage ratio of 2.6 times, and the filing lists a credit rating downgrade among the consequences of its "substantial indebtedness." The La Regina second tranche can be settled in shares. And the new $500M savings program through fiscal 2030 runs through plant closures and workforce reductions that carry their own execution risk.
The Bottom Line
Campbell's is not a broken company. It is a soup and sauce business with a growing Rao's franchise, attached to a snack portfolio that has lost more than a third of its operating earnings in two years, financed at a leverage level that no longer leaves room to pay shareholders more than it earns. The cut does not fix Snacks; it buys time to pay down debt while the company tries to. Watch three things: whether Snacks operating earnings stabilize above the fiscal 2026 $386M, whether the $1.225B of thin-cushion trademarks survives the next annual test, and how the March 2027 notes and the La Regina tranche are settled, in cash, debt, or shares. Framework, not a recommendation.
No analyst wrote this. The payout gap, the segment split and the trademark trail all came out of Campbell's own 10-K, read straight from its XBRL, and the same pipeline reads any company that files, or any private company that reports its books in the same format.
Every filing figure above comes from The Campbell's Company FY2026 Form 10-K (accession 0000016732-26-000026, filed September 24, 2026), read directly from its XBRL. Adjusted EBIT, adjusted EPS and fiscal 2027 guidance are from the company's September 3, 2026 earnings release; market price, market capitalization, consensus and the dividend-history note are attributed inline. Filing data via RoboSystems.