General Mills (GIS) is in for a tough 2025 as it tries to sell its lineup of cereals and snacks. 

The Cheerios maker reported earnings on Wednesday that included lower guidance. It expects organic net sales to drop 2% to 1.5% for the year, compared to the previous range of flat to up 1%. 

"Coming into this year, we thought the consumer environment would improve as the year [goes] on, and that hasn't really been the case," CEO Jeffrey Harmening said on its earnings call. General Mills stock fell 2% in morning trading and is down 7% year to date. 

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He added that value-seeking behavior has ramped up. If "you look at the most recent confidence indices, it would indicate that consumer confidence is actually below where it was three months ago and about where it was in 2008." 

The Conference Board Consumer Confidence Index declined 7 points in February to 98.3, showing "pessimism about the future returned" last month. 

Last month, Kraft Heinz (KHC) also posted a cautionary outlook. It expects organic net sales to come in flat to down 2.5% compared to the prior year. 

Kraft Heinz CEO Carlos Abrams-Rivera said on its recent earnings call that consumers are shopping at more stores to get the best price and purchasing less per trip. 

Campbell's (CPB) also expects organic net sales to come in flat to a 2% decline in 2025. CEO Mick Beekhuizen said the guidance reflects "the slower-than-anticipated recovery of our snacking categories, impacting the outlook for our second half." 

Here's what General Mills posted in its fiscal 2025 third quarter, compared to Bloomberg estimates: 

Adjusted earnings per share: $1.00, versus $0.97

Revenue: $4.84 billion, versus $4.97 billion

Organic year-over-year volume growth: -4%, versus -1.61% 

• North America Retail: -5%, versus -3.93% 

• International: -4%, versus +2.72%

• Pet: -3%, versus +0.17%

• North American Food Service: -1%, versus +2.73%

Organic pricing year-over-year growth: -1%, versus -1.12%

• North America Retail: -1%, versus -0.88%

• International: 0%, versus -3%

• Pet: -1%, versus -2.64% 

• North American Food Service: +2%, versus +1.79% 

Harmening said in the release that lower-than-expected revenue is "driven largely by greater-than-expected retailer inventory headwinds and a slowdown in snacking categories."

Consumers spent less on snack bars, fruit snacks, and salty snacks. The company plans to focus on value, pack sizes, and innovation to retain shoppers. 

Its North American food service segment saw volumes decline by 1%. Strong net sales growth for cereal and bread was dragged lower by a decline in Pillsbury and Gold Medal bakery flour. However, General Mills did see market share gains in schools, healthcare, and colleges. 

Bank of America analyst Peter Galbo maintained his Buy rating on shares of General Mills, saying it could "benefit in a defensive rotation." 

"This is in line with food peer group ... which we think balances the near-term volume pressures with the positive medium-term growth prospects across key geographies and categories," he wrote in a note to clients. 

Mizuho analyst John Baumgartner has a Neutral rating on shares. He wrote that General Mills "features a multi-year history of industry-leading execution encompassing supply chain, digitization, innovation, and marketing, which have supported consistent market share gains." 

On the flip side, the company's "long-term algorithm may not be achievable until fiscal year 2027 estimates ... given weak macros and need to reinvest and further refine execution." 

According to Bloomberg, there are currently five Buys, 17 Holds, and one Sell rating on General Mills. 

Baumgartner also has a Neutral rating on Kraft Heinz, citing a "much lighter than expected" 2025 guidance "even relative to market expectations."

Galbo has an Underperform rating on Campbell's, citing challenges from "known headwinds in Meals & Beverages" as well as the "sluggishness of snacks recovery and potential elongated path to achieving snacks margin target of 17%."  

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Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

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