Company: KHC
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0001637459-25-000152
Chunk: 57

Company: Kraft Heinz Co
Filing Date: 2025-07-30
Form: 10-Q
Item: Part I, Item 1
Chunk 57
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 the three months ended June 29, 2024.

Adjusted Operating Income decreased 7.5% to $1.3 billion for the three months ended June 28, 2025 compared to $1.4 billion for the three months ended June 29, 2024, primarily driven by increased commodity cost inflation, which more than offset our efficiency initiatives, and unfavorable volume/mix. These unfavorable impacts more than offset higher pricing, decreased SG&A, primarily due to lower advertising expenses, and the favorable impact of foreign currency (0.2 pp).

Six Months Ended June 28, 2025 Compared to the Six Months Ended June 29, 2024:

Operating income/(loss) decreased 471.6% to a loss of $6.8 billion for the six months ended June 28, 2025 compared to income of $1.8 billion for the six months ended June 29, 2024, primarily non-cash impairment losses that were $8.4 billion higher in the current year period. In addition to the impact of these non-cash impairment losses, operating income/(loss) decreased $190 million due to unfavorable volume/mix, increased commodity cost inflation, which more than offset our efficiency initiatives, and unfavorable changes in unrealized losses/(gains) on commodity hedges. These unfavorable impacts to operating income/(loss) were partially offset by higher pricing, and decreased SG&A, primarily due to decreased advertising expenses and lower variable compensation expense.

34

Net income/(loss) decreased 886.4% to a loss of $7.1 billion for the six months ended June 28, 2025 compared to income of $904 million for the six months ended June 29, 2024. This decrease was due to the unfavorable changes in operating income/(loss) factors discussed above and higher interest expense, partially offset by lower income tax expense and favorable changes in other expense/(income).

•Our effective tax rate for the six months ended June 28, 2025 was a benefit of 0.6% on pre-tax loss, which included the net unfavorable effective tax rate impact of goodwill and intangible asset impairment losses of 24.7%. Our effective tax rate for the six months ended June 29, 2024 was an expense of 34.4% on pre-tax income, which included the net unfavorable effective tax rate impact of goodwill and intangible asset impairment losses of 12.4%. The year-over-year change in the effective tax rate