Conagra Volumes Fall 2.1% as Grocery and Snacks Drop 5.4% in First Quarter

Conagra Brands reported weaker sales volumes in its first fiscal quarter as inflation and softer consumer demand continued to pressure some of the largest categories in packaged food.

Net sales fell 1.4 percent to about US$2.6 billion, while organic net sales declined 1.1 percent. The companywide volume decline was 2.1 percent, partially offset by a 1 percent positive contribution from price and product mix.

The sharpest pressure appeared in Grocery and Snacks, where organic sales fell 2 percent and volumes declined 5.4 percent even as price and mix increased 3.4 percent.

Refrigerated and Frozen sales declined 2.1 percent, with organic sales down 1.6 percent. Foodservice moved in the opposite direction, with organic sales up 3.3 percent and volume up 2.5 percent.

Conagra said adjusted gross profit fell 3.9 percent to US$619 million as productivity gains and about US$4 million in tariff refunds were outweighed by lower sales, cost of goods inflation and weaker operating leverage.

The company nevertheless reported adjusted earnings per share of US$0.41, up 5.1 percent, and reaffirmed its fiscal 2027 guidance for organic sales to decline between 1 percent and 3 percent.

The category split matters because it shows how uneven consumer demand has become. Some frozen vegetables, breakfast products, hot dogs and desserts gained dollar share, while aggregate grocery and snack volumes remained under significantly more pressure.

For food manufacturers, the quarter highlights the challenge of balancing price increases against consumer resistance. Productivity and portfolio actions can protect earnings, but sustained volume declines eventually put more pressure on factory utilisation, promotional spending and supplier demand.