Restructuring Charges and Cost Savings Initiatives

9 Months Ended

May 03, 2026

Restructuring Charges, Cost Savings Initiatives and Other Optimization Initiatives

2025 Cost Savings Initiatives

On September 10, 2024, we announced plans to implement cost savings initiatives beginning in 2025, including initiatives to further optimize our supply chain and manufacturing network, optimization of our information technology infrastructure and targeted cost management. We also identified additional opportunities for cost synergies as we integrated Sovos Brands. As of July 28, 2024, we substantially completed our previous multi-year cost savings initiatives and Snyder's-Lance, Inc. cost transformation program and integration and had identified initial opportunities for cost synergies as we integrated Sovos Brands. Certain initiatives from those programs have been incorporated into our 2025 cost savings initiatives. In the third quarter of 2026, we commenced a voluntary early retirement program as part of our cost savings initiatives. The program was available to certain salaried employees who met age and length-of-service criteria. The eligible employees were entitled to receive severance pay and benefits, including enhanced pension benefits for certain employees. Substantially all electing employees will depart the company by December 2026. Cost estimates for the 2025 initiatives, as well as timing for certain activities, are continuing to be developed.

A summary of the pre-tax charges recorded in the Consolidated Statements of Earnings related to these initiatives is as follows:


	Three Months Ended				Nine Months Ended
(Millions)	May 3, 2026		April 27, 2025		May 3, 2026		April 27, 2025		Recognized as of May 3, 2026
Restructuring charges	$	9	$	6	$	15	$	17	$	39
Administrative expenses	6		7		21		26		62
Cost of products sold	12		7		28		25		60
Marketing and selling expenses	1		—		3		2		7
Research and development expenses	1		1		2		3		5
Other expenses / (income)	38		—		38		—		38
Total pre-tax charges	$	67	$	21	$	107	$	73	$	211

A summary of the cumulative pre-tax costs associated with the initiatives is as follows:


(Millions)	Recognized as of May 3, 2026
Severance pay and benefits	$	76
Asset impairment/accelerated depreciation	52
Implementation costs and other related costs	83
Total	$	211

The total estimated pre-tax costs for actions that have been identified to date are approximately $310 million, and we expect to incur substantially all of the costs through 2028. These estimates will be updated as the detailed plans are developed.

We expect the costs for the actions that have been identified to date to consist of the following: approximately $90 million in severance pay and benefits; approximately $55 million in asset impairment and accelerated depreciation; and approximately $165 million in implementation costs and other related costs. We expect these pre-tax costs to be associated with our segments as follows: Meals & Beverages - approximately 54%; Snacks - approximately 26% and Corporate - approximately 20%.

Of the aggregate $310 million of pre-tax costs identified to date, we expect approximately $215 million will be cash expenditures. In addition, we expect to invest approximately $220 million in capital expenditures, of which we invested $208 million as of May 3, 2026. The capital expenditures primarily relate to optimization of production within our manufacturing network, optimization of information technology infrastructure and applications and implementation of our existing SAP enterprise-resource planning system for Sovos Brands.

A summary of the restructuring activity and related reserves is as follows:


(Millions)	Severance Pay and Benefits		Pension Benefits(3)	Implementation Costs and Other Related Costs(4)	Asset Impairment/Accelerated Depreciation	Other Non-Cash Exit Costs(5)	Total Charges
Accrued balance at August 3, 2025(1)	$	33
2026 charges	14		38	33	21	1	$	107
2026 cash payments	(16)

Accrued balance at May 3, 2026(2)	$	31

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(1)Includes $14 million of severance pay and benefits recorded in Other liabilities in the Consolidated Balance Sheet.

(2)Includes $2 million of severance pay and benefits recorded in Other liabilities in the Consolidated Balance Sheet.

(3)Represents special termination pension benefits offered under the voluntary early retirement program. See Note 10.

(4)Includes other costs recognized as incurred that are not reflected in the restructuring reserve in the Consolidated Balance Sheet. The costs are included in Administrative expenses, Cost of products sold, Marketing and selling expenses and Research and development expenses in the Consolidated Statements of Earnings.

(5)Includes non-cash costs that are not reflected in the restructuring reserve in the Consolidated Balance Sheet.

Segment operating results do not include restructuring charges, implementation costs and other related costs because we evaluate segment performance excluding such charges. A summary of the pre-tax costs associated with segments is as follows:


	May 3, 2026
(Millions)	Three Months Ended		Nine Months Ended		Costs Incurred to Date
Meals & Beverages	$	31	$	51	$	125
Snacks	25		38		52
Corporate	11		18		34
Total	$	67	$	107	$	211

Other Optimization Initiatives

In the second quarter of 2024, we began implementation of an initiative to improve the effectiveness of our Snacks direct-store-delivery route-to-market network. Pursuant to this initiative we will purchase certain Pepperidge Farm and Snyder's-Lance routes where there are opportunities to unlock greater scale in select markets, combine them and sell the combined routes to independent contractor distributors. We expect to execute this program in a staggered rollout and to incur expenses of up to approximately $115 million through 2029. In the three- and nine-month periods ended May 3, 2026, we incurred $2 million and $20 million in Marketing and selling expenses related to this initiative, respectively. In the three- and nine-month periods ended April 27, 2025, we incurred $9 million and $17 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative, respectively. As of May 3, 2026, we have incurred $45 million in Marketing and selling expenses and $1 million in Administrative expenses related to this initiative.