# General Mills and FedEx Report Demand Woes and Lower Sales Outlook
Two big companies weighed in on persistent demand woes this week. General Mills, which reported earnings Wednesday morning, said tepid demand and pricing pressures are compounding problems for the Dunkaroos and Bisquick maker. That echoed what FedEx said in its report after the bell Tuesday.
FedEx shares fell 10% Wednesday, on pace for its worst day in 15 months, while General Mills’ stock slipped about 3%.
## Trimmed Sales Outlook
Both General Mills and FedEx have trimmed their full-year sales outlook. General Mills now sees revenue down 1% to flat, compared with previous guidance of a 3% to 4% increase. This adjustment is due to the lower demand forecast and a more cautious consumer economic outlook.
## Disappointing Revenue and Organic Sales Growth
General Mills reported its eighth-consecutive quarterly earnings beat, but revenue fell well short of estimates. The company reported $5.14 billion in revenue, compared to the expected $5.35 billion. This was General Mills’ biggest revenue miss in eight years.
Organic sales growth was also disappointing, contracting 2% instead of the expected 3.1% positive growth. Every business segment, from consumer food to pet food, from domestic to international, saw disappointing sales.
## Volume Decline and Pricing Deceleration
Volumes fell 4% overall, with North America retail volumes experiencing a 5% drop. Pricing increases also decelerated, contributing only 3 percentage points to sales in the latest quarter.
To address the challenging consumer landscape and value-seeking behaviors, General Mills has been boosting promotions.
## CEO’s Statement
CEO Jeff Harmening acknowledged the slower-than-expected volume recovery in the second quarter and the continued challenging consumer landscape. He stated, “We’re seeing consumers continue to display stronger-than-anticipated value-seeking behaviors across our key markets, and this dynamic is delaying volume recovery in our categories.”
In conclusion, General Mills and FedEx are facing demand woes and pricing pressures, leading to lower sales outlooks. Both companies are adjusting their guidance and implementing strategies to address the challenging consumer landscape.
