By Dean Seal

WK Kellogg cut its guidance to account for tariff impacts and a weaker first-quarter performance than it had been expecting.

The cereal maker now forecasts sales to decline 2% to 3% for the year instead of 1%, as previously projected. The company also now expects a decline rather than a gain in its key adjusted earnings metric.

The revised view includes a modest impact from tariffs primarily tied to the source of raw materials outside of North America, Kellogg said. The company assumes most of its production remains exempt from tariffs on imports and exports to Canada and Mexico, but acknowledged that the tariff situation could change going forward.

For the first three months of the year, Kellogg posted a profit of $18 million, or 20 cents a share, compared with $33 million, or 37 cents a share, in the same quarter a year earlier.

Revenue fell 6.2% to $663 million, missing analyst estimates for $679 million, according to FactSet.

The decline was driven by a big drop in volumes that wasn't offset by higher prices and a more favorable mix of products sold.

Organic sales were down due to the later timing of the Easter holiday and the lapping of a large retailer promotion in the year-earlier quarter, leading to reduced retailer inventory. Weaker consumption trends also cut into the top line, Kellogg said.

Shares slid 4% to $16.66 in premarket trading.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

May 06, 2025 08:39 ET (12:39 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.