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Kraft Heinz is putting the brakes on plans to break up the company, with its new chief executive saying the food giant’s challenges are “fixable and within our control” as it shifts focus to reigniting profitable growth through a $600 million investment.
In a note to the company fourth quarter routine report, Chief executive Steve Cahillane said that rather than splitting up, the company would double down on rebuilding growth, supporting this with a massive investment in marketing, sales and brand research and development.
“When I decided to join Kraft Heinz, I knew this was an exciting opportunity to contemporize iconic brands, better serve consumers and customers, and create meaningful shareholder value,” Cahillane said in the press release.
“Since joining the company, I have seen that the opportunity is greater than expected and that many of our challenges are solvable and within our control,” he continued. “My number one priority is to return the business to profitable growth, which will require all resources to be fully focused on executing our operating plan.”
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“As a result, we believe it is prudent to halt work related to the separation and we will no longer incur related dissynergies this year.”
Kraft Heinz announced that it would pause plans to separate the company on Wednesday, February 11, 2026. (Michael Nagle/Bloomberg via Getty Images/Getty Images)
Kraft Heinz announced in September that its board of directors approved a plan to split it into two independent publicly traded companies through a tax-free spin-off. The goal was to create two more focused and less complex organizations that could maximize their brands and increase profitability.
Cahillane was slated to lead the business, which is called Global Taste Elevation, overseeing brands such as Heinz, Philadelphia and Kraft Mac & Cheese. The other company, called North American Grocery, would oversee its portfolio of grocery staples including Oscar Mayer, Kraft Singles and Lunchables.
As of December, the official names of the new companies had not yet been determined, and the company had also not announced who would lead its US grocery business.
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In the fourth quarter report, Kraft Heinz also announced its $600 million commitment to marketing, sales, research and development, product improvements and select pricing initiatives through 2026. Cahillane said Kraft’s solid balance and $3.7 billion in free cash flow give it the financial flexibility to fund this push while generating excess cash.
“We are confident in the opportunity before us and believe this investment will accelerate our return to profitable growth,” he said.
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While leadership is upbeat, Kraft’s 2025 numbers showed clear strain: full-year net sales fell 3.5% to $24.9 billion, organic sales fell 3.4%, volume fell 4.1% and adjusted operating income fell 11.5%.
Kraft’s biggest pressure points were coffee, deli meats, frozen meals, bacon and select condiments as commodity and manufacturing cost inflation outpaced efficiency efforts. The company posted an operating loss of $4.7 billion last year, largely driven by “non-cash impairment charges.”
Daniella Genovese of FOX Business contributed to this report.
