By Evie Liu and Nate Wolf

Shares of Campbell's slumped to a 33-year low on Wednesday after the packaged-food company reported weaker quarterly earnings than Wall Street expected and lowered its guidance for the coming quarters.

Campbell's, known for its canned soup, food staples, and snacks, has been scrambling to meet shifting consumer preferences.

For its fiscal second quarter ended on Feb. 1, the company posted adjusted earnings of 51 cents a share, down from 74 cents a year ago and below analysts' consensus of 57 cents.

Net sales declined 5% from last year to $2.56 billion, also below the $2.61 billion Wall Street had expected. Part of the sales decline was due to divestiture from some brands such as noosa yoghurt. Excluding those impact, organic sales declined 3%, partly due to storm-related shipment delays in January, the company said .

"Slowing demand and rising costs are not an ideal combination," wrote D.A. Davidson analyst Brian Holland in a Wednesday note.

Things likely won't improve any time soon. The company guided for a 1% to 2% decline in net sales for the fiscal year, down from a previous range of a 1% decline to a 1% gain. Adjusted per-share earnings was also adjusted lower to a range of $2.15 to $2.25, compared with an earlier estimate of $2.40 to $2.55. That's a 23% to 26% decline from fiscal 2025.

Following the earnings report, Campbell's stock dropped 6.5% in Wednesday trading to just above $23 -- the lowest level since May 19, 2003, when the stock closed at $22.95.

Other packaged-food stocks have also tumbled along with Campbell's. Conagra Brands lost nearly 6%, McCormick fell by 5.4%, General Mills declined 3%, and Kraft Heinz lost 2.6%.

Campbell's shares have tumbled more than 42% over the past 12 months. As of Wednesday, the stock has a market capitalization of $7.2 billion, making it the smallest company in the S&P 500 besides those removed in a reshuffle last week.

Campbell's could fall out of the market-cap-weighted index at the next reshuffle if its ranking stays low. For passive funds tracking the index, these adjustments trigger forced selling of the removed stocks and buying of the replacements, which can amplify short-term price movements.

Campbell Soup is one of the original members of the S&P 500 when the index was officially launched in 1957. There are only about 50 companies still left from that original group due to mergers, bankruptcies and other developments.

The S&P indexes are designed to represent the largest and most liquid companies in the market. When a company's market value declines relative to peers -- often due to weak earnings, strategic missteps, or sector headwinds -- it becomes a candidate for removal during periodic reviews.

This was highlighted last Friday. Four companies -- Match Group, Molina Healthcare, Lamb Weston Holdings, and Paycom Software -- were dropped from the S&P 500. Each of the stocks were ranked among the smallest constituents in the index, replaced by fast-growing names in technology and communications infrastructure.

Campbell's stock will need a nice rally in the coming months, or it could be next on the chopping block.

"To stabilize Snacks, we are taking decisive action, focused on sharpening our value, new product innovation and in-market execution," said CEO Mick Beekhuizen in Wednesday's earnings report.

Beekhuizen said Campbell's is also accelerating cost saving initiatives to mitigate cost headwinds and support continued investment in its brands. The company is targeting $375 million in cost savings by fiscal 2028.

Wall Street isn't seeing a rally soon. Analysts polled by FactSet have an average 12-month price target of $28 for the stock.

Write to Evie Liu at evie.liu@barrons.com

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March 11, 2026 10:51 ET (14:51 GMT)

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