Lululemon’s Disappointing Outlook Adds Urgency to CEO Search

Summary

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Bloomberg Intelligence Podcast

Episode: Lululemon’s Disappointing Outlook Adds Urgency to CEO Search

Date: March 18, 2026
Hosts: Paul Sweeney & Scarlet Fu

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Brief Overview

This episode explores the current state of Lululemon following disappointing financial guidance, growing competitive pressures, and an ongoing CEO search. The discussion includes Bloomberg Intelligence analysts dissecting company results, innovation efforts, boardroom dynamics—particularly the influence of founder Chip Wilson—and the urgent need for new leadership. The hosts also cover earnings updates and strategies from other major retailers, including Macy’s, Unilever, and General Mills, highlighting broader retail and consumer trends.

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Key Discussion Points and Insights

1. Lululemon: Financial Results & CEO Uncertainty

[01:57–07:33]

• Stock Performance:
  • Lululemon is up 3.2% on the day but down 20% YTD and 50% over 12 months.
  • The company is currently without a CEO, raising investor concerns.
• Quarterly Results:
  • Q4 revenue up 1%, beating expectations modestly.
  • Mixed results: "The concern was really the guidance. The outlook for the next quarter, which is 1Q, and the full year was still very light." (Putin Goyal, 02:32)
  • Ongoing inventory issues require markdowns to clear older products.
  • Analyst sentiment is cautious regarding a turnaround: "We're not confident that it's beginning to take hold just yet... maybe we've hit the bottom." (Goyal, 03:13)
• Product Innovation:
  • Fresh lines are arriving, with most new merchandise expected in spring and summer.
  • "On the women's side, that's where most of the work is needed. For men's though, they've done really, really well. Their men's lineup is pretty solid." (Goyal, 03:53)
  • North America’s women’s market is underperforming; international men’s is a relative strength.
• Founder's Boardroom Influence:
  • Chip Wilson, though without an official role, is vocally pushing for significant changes.
  • Recent board shakeup: New director appointed; an existing one stepping down.
  • "Lululemon has definitely lost its mojo over the last three years and it's given up a lot of the upside to competition." (Goyal, 04:58)
  • Anticipation for the CEO appointment as "the key inflection point."
• Analyst & Market Reaction:
  • On Bloomberg Terminal's ANR: 3 buys, 1 sell, 30 holds.
  • "What are those 30 analysts waiting for?" (Paul, 05:50)
    "A new CEO, new direction. We want to see the new product." (Goyal, 06:00)
• Qualities Needed in a CEO:
  • Must deeply understand Lululemon’s DNA and product-led strategy.
  • "Retail 101 is about the product first and everything else after." (Goyal, 06:10)
  • Past CEO Calvin McDonald brought initial merchandising success from Sephora but pushed unsuccessfully into beauty/skincare niches.

Notable Quotes

• Putin Goyal (on CEO search):
  "We need to make sure that we get a person who understands the DNA of Lululemon, who understands the athletic... space and really as a product-led person." (06:10)
• On Chip Wilson:
  "He's still calling for more, rightfully so... Lululemon has definitely lost its mojo..." (04:58)
• On Product Strategy:
  "Lululemon has to outshine the broader competition, and that's become harder with just technologies being almost available to everyone right now." (Goyal, 07:08)

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2. Macy’s and Bloomingdale’s: Signs of Retail Resilience

[07:54–13:32]

• Macy’s Results:
  • Macy’s has shifted to positive comparable sales (comps).
  • Guidance is conservative, but analysts see the potential to outperform.
  • "They were looking to achieve sustainable growth. We think they're there..." (Mary Ross Gilbert, 08:13)
  • Strength seen both in attracting middle-to-upper income customers and in-store execution.
• Customer Experience & Merchandising:
  • Addition of 60 new brands across stores.
  • Notable improvement in the in-store experience, especially via engaged sales staff and premium brand introductions.
  • "The merchandising is so strong and the salespeople... absolutely charming and engaging." (Gilbert, 09:18)
  • Bloomingdale’s, as an upmarket arm, is gaining from competitor weakness (e.g., Saks’s bankruptcy), opening new luxury boutiques, and benefiting from customer migration.
• Store Count Rationalization:
  • Macy’s will close additional stores (14 mostly completed, 65 more by 2028) but is not rushing closures, optimizing for real estate and profitability.
  • Core store base: around 350 outlets after closures.
  • "Once we move past that, the overall top line should look good." (Gilbert, 13:10)

Notable Quotes

• On Macy’s store experience:
  "This has been the best encounter that I've had with sales associates. When I went in the store just yesterday, I encountered at least three associates. They were well appointed, absolutely charming and engaging." (Mary Ross Gilbert, 09:18)
• On Bloomingdale’s:
  "Their comp sales were up 10% essentially in the fourth quarter... I think part of that is some of the gains coming from Saks and Neiman Marcus customers..." (Gilbert, 11:08)

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3. Unilever’s Strategic Transformation

[13:46–18:58]

• Shifting Focus and Divestitures:
  • Unilever has been reorganizing, notably spinning off the Magnum ice cream business to prioritize personal care and beauty (core growth areas).
  • "Unilever is really coming through a few years of transformation... to really focus more in their core business which is personal care and beauty..." (Diana Gomes, 14:24)
  • Foods division is shrinking through divestitures of lower-growth European brands.
  • Retains some foods for their accretive margins.
• Growth Challenges:
  • Short-term guidance is cautious, especially due to weak foods demand in Europe and geopolitical risks.
  • "In the medium term... trying to get to that 4 to 6% organic sales growth target." (Gomes, 14:24)
• Market & Analyst Sentiment:
  • Street is split: 11 buys, 11 holds, 4 sells.
  • Investors are looking for clear evidence of volume and premium-led innovation growth.
  • "The drive really is on the premium innovation and that focus." (Gomes, 17:45)

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4. General Mills and Consumer Goods: Struggles & Resilience

[19:19–24:23]

• Earnings Overview:
  • Mixed results; underlying volume growth is still lacking.
  • Stock is down 17% YTD, at a 52-week low.
  • "Volume growth is just not there and they're trying to increase marketing. They're not necessarily trying to rely on price cuts, but it seems that is going to have to start happening." (General Mills Analyst, 21:24)
• Brand vs. Private Label Competition:
  • Increased competition from store brands, now about 25% of grocery revenue.
  • Retailers are enhancing private label placement and quality.
  • "Retailers have been investing on their private label portfolio. It's about a quarter of their revenue at this point." (General Mills Analyst, 22:32)
• Tariffs and Margins:
  • New tariffs are creating margin pressures; companies are hesitant to further raise prices.
  • Passing costs to consumers is becoming harder—focus is on internal margin management.
• Dividend Policy:
  • Currently offering a 6.3% dividend yield, expected to grow at the pace of earnings.

Notable Quotes

• On competitive landscape:
  "Some people actually go to these stores to buy their private label." (General Mills Analyst, 22:32)

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Memorable Moments & Quotes

• Lululemon CEO Search:
  "What are those 30 analysts waiting for?" (Paul, 05:50) — On market hesitancy about Lululemon's future.
• Product-Centric Turnaround:
  "Retail 101 is about the product first and everything else after." (Goyal, 06:10)
• On Macy’s Store Experience:
  "This has been the best encounter that I've had with sales associates..." (Mary Ross Gilbert, 09:18)
• Unilever’s New Focus:
  "Unilever is really coming through a few years of transformation... to really focus more in their core business which is personal care and beauty..." (Gomes, 14:24)
• General Mills on Private Label:
  "Retailers have been investing on their private label portfolio. It's about a quarter of their revenue at this point." (General Mills Analyst, 22:32)

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Timestamps of Key Segments

• Lululemon Deep Dive (including CEO search, product, and founder influence): 01:57 – 07:33
• Macy’s & Bloomingdale’s Results and Store Strategy: 07:54 – 13:32
• Unilever’s Portfolio & Growth Discussion: 13:46 – 18:58
• General Mills and Consumer Products Landscape: 19:19 – 24:23

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Tone & Language

The episode blends financial expertise and light conversational banter (e.g., credit card perks and personal shopping anecdotes) with incisive industry analysis. Analysts offer candid, sometimes critical, takes on where companies are falling short and what changes are urgently needed.

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Summary

• Lululemon’s lackluster guidance and stalled turnaround deepen the urgency around recruiting a CEO with a product-first vision who understands both the brand and the evolving athleisure landscape.
• Macy’s shows resilience through strategic store management, brand expansion, and improved customer experiences.
• Unilever’s strategic shift to beauty and personal care—via major divestitures—is still a work in progress, with investors seeking more rapid growth.
• General Mills faces muted volume growth and margin pressures from store brand competition and tariffs, reflecting broader consumer headwinds in the sector.

This episode offers essential context for investors eyeing these retail and consumer names and the larger transformations shaping their industries.

Transcript

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[Bloomberg Intelligence Host (Paul)]

Lululem stocks up 3.2% today. That's the good news. The bad news? It's down 20% year to date. It's down 50% over the trailing 12 months. I understand they don't have a CEO either, so I'm not sure what's going on there. Big fan of Lululemon, don't get me wrong, but I think there's a little

[Bloomberg Intelligence Co-host]

bit of what's the last Lululemon item you bought?

[Bloomberg Intelligence Host (Paul)]

Not one, but I'm a big admirer.

[Bloomberg Intelligence Co-host]

Okay?

[Bloomberg Intelligence Host (Paul)]

Yep. Putin Goyal Senior US E Commerce and Retail Intelligence, joins us from Princeton Prince put them I know Lululemon reported some results here. What did you see in the results? And B what's the latest on their CEO search?

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

So the latest on their CEO search is that it's still undergoing and we don't know where they are as far as the results are concerned. They posted respectable 4Q numbers last night, a 1% increase in revenue was better than the 1% roughly decline that we expected. So a little better. The concern was really the guidance. The outlook for the next quarter, which is 1Q and the full year was still very light. Now, I don't know if it's that they're being conservative because clearly the turnaround hasn't begun to take hold or that things are still soft as they continue to mark down product to get rid of some of that inventory and bring in new product. So I'd say mixed results overall. Still cautious on the turnaround. We're not confident that it's beginning to take hold just yet, but we can. Some would say that, you know, maybe we've hit the bottom.

[Bloomberg Intelligence Co-host]

Okay. I have a $75 credit at Lululemon every quarter because I have an American Express Platinum card.

[Bloomberg Intelligence Host (Paul)]

Of course you do.

[Bloomberg Intelligence Co-host]

And this is one of the benefits of it. But I struggle to use it because I haven't found anything that I want to spend it on. And I, you know, I go on Reddit and a lot of people feel this way. They do, or they did talk about having a new designer and some new product, but that has not made its way into stores just yet. What is the latest in terms of just innovation, new design, freshening up Poonam.

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Yeah, so you're starting to see some of that trickle through. We were just at stores last week and we did see some new styles come through. I'd say the bulk of it, though, will be in the spring and summer. So that is when you will start to see some of the new product flow through and hopefully more exciting lineups that you will feel excited to spend your $75 credit on. I'd say on the women's side, that's where most of the work is needed. For men's though, they've done really, really well. Their men's lineup is pretty solid. They're doing really well internationally. I that in women's in North America specifically, they need to show more and deliver more. And we expect to see some of that in spring, summer, and we'll know more if they'll resonate to see if the turnaround can actually take hold.

[Bloomberg Intelligence Co-host]

So the other thing that Lululemon has to contend with is Chip Wilson, the founder. As far as I know, he doesn't actually have an operating role in the company. He's not on the board, but he is kind of in the peanut gallery agitating for changes, overhauls. What kind of influence does this have on the existing board and on investors expectations?

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Yeah, he's been advocating for change for quite some time now. We did see some change come through just recently where they did appoint a new board of director and one of the current board of directors will not be renewing. So you're starting to see some shake up. I think he's still calling for more, rightfully so. You know, Lululemon has definitely lost its mojo over the last three years and it's given up a lot of the upside to competition. So I think change is coming, especially as we wait for the new incoming CEO to see who that will be. I think that'll be the key inflection point to say, you know, can this new person bring Lululemon back on board? Can it reignite the double digit gains that we're used to? Because quite frankly, a low single digit increase is not what you expect to see out of Lululemon.

[Bloomberg Intelligence Host (Paul)]

So I'm looking at the ANR function on the Bloomberg terminal for Lululemon. I got three buys, one sell and 30 holds. What are those 30 analysts waiting for?

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Poonam, a new CEO, New Direction. We want to see the new product.

[Bloomberg Intelligence Host (Paul)]

I mean, I can go out there and go to LinkedIn and find that somebody.

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Paul, you're applying. You know, it has to be the right person. Right? You have to get the right person. We need to make sure that we get a person who understands the DNA of Lululemon, who understands the athletic. We're space and really as a product led a person like, for me, it's important to see that someone comes through who understands that retail, one on one, is about the product first and everything else after.

[Bloomberg Intelligence Co-host]

Okay, but Calvin McDonald, the CEO who has just left and who has come under pressure because things started to kind of slide at the end of his tenure, he was that person initially because when he first joined, sales took off and he came over from Sephora. So he clearly has a merchandising background.

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

He does, but it's in beauty. If you remember, as soon as he came on, I think the first big question he had was let's launch a skin care line, you know, the deodorants and some of the lotions, etc. That didn't go too well. It was a nice idea. Very high gross margins, 80%. So in theory sounded great, but it didn't really resonate and get Lululemon anywhere. I think what we need is someone who understands the apparel and the athleisure space. Someone who knows that you need style with performance because that is what this brand demands. And constant newness like Lululemon has to outshine the broader competition and that's become harder with just technologies being almost available to everyone right now.

[Bloomberg Intelligence Co-host]

Stay with us. More from Bloomberg Intelligence coming up after this.

[Bloomberg Intelligence Host]

You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at 10am Eastern on Apple CarPlay and Android Auto with the Bloomberg business app Listen on demand wherever you your podcasts or watch us live on YouTube.

[Bloomberg Intelligence Co-host]

All right. It is still earnings season, believe it or not, and the retailers are reporting results. We heard about Lululemon earlier. Let's talk about Macy's. The stock is up about 5% in this morning's trade. Mary Ross Gilbert is our senior equity analyst covering retail and she joins us now. Mary, what did we learn from Macy's?

[Mary Ross Gilbert, Senior Equity Analyst]

What we learned from Macy's is that Macy's has inflected to positive comp sales. They were looking to achieve sustainable growth. We think they're there and for this year they're providing, I think, very tepid guidance. They want to kind of budget, you know, do higher gas prices have an impact. But overall the consumer is very resilient and they're attracting more of the middle income to higher income consumer, you know, across their brands. Primarily, you know, the Macy's nameplate. So they're expecting comp sales, though they're guiding to be down half a percent to up a half a percent. But we think they'll easily beat that. And of course, for the first quarter they're already seeing strong traction and at the high end, they're guiding for comp sales to rise 1.5%. So what we're seeing is that the nameplate looks like it has inflected to positive comps. And we certainly see the changes when we go in the store.

[Bloomberg Intelligence Host (Paul)]

What do you see when you go in the store, Mary, that's different or maybe positive in general?

[Mary Ross Gilbert, Senior Equity Analyst]

Yeah. So what we're seeing is the stores are constantly evolving. I mean, every time I go in there I'm seeing something new. So I'm seeing new brands. And what the company reported on the call is they've added 60 brands. So when I go in there and I'm obviously focused on women's wear, but I did kind of take a look and I saw Rod and Gun in our local store. So that was kind of a nice addition. And the stores are just the merchandising is so strong and the salespeople. This has been the best encounter that I've had with sales associates. When I went in the store just yesterday, I encountered at least three associates. They were well appointed, absolutely charming and engaging. And because they have some of these new labels, I actually tried something on. I'm really a Bloomingdale's person. I really love the. The premium brands, but I did see some really good brands in there. My favorite is Avec Lafitte. And I tried on some of those jeans and they're. Oh, they were amazing. Absolutely amazing. So I really think that Macy's has come back. They're bringing in all the brands that consumers care about. They're attracting younger consumers. So I really see very good execution here with the company.

[Bloomberg Intelligence Co-host]

What about execution at Bloomingdale's? And I bring this up particularly with Saks's issues. Saks, of course, course, in bankruptcy protection right now and trying to find a way to get through all of its debt problems.

[Mary Ross Gilbert, Senior Equity Analyst]

That's all been a benefit for Bloomingdale's. Bloomingdale's has been executing for the last few years and it's an ongoing process. So just in our local store just opened was the Christian Louboutin shoe boutique. And of course, these are licensed businesses, but it doesn't matter. They're not reporting comp sales on all these different basis. It's just comp sales. So it does include the benefit of licensed brands. But so they now have a Chanel boutique and they now have the Christian Louboutin. But they're always, if you go to ready to wear, you're seeing constant, you know, new labels coming in. So it's very exciting. I love Bloomingdale's. And that explains why their comp sales were up 10% essentially in the fourth quarter. I think part of that is some of the gains coming from Saks and Neiman Marcus customers given the bankruptcy lack of product during that time. So they're the beneficiary. And that's why they really emphasized how they're focused on expanding the chain this year. And the company, one of the executives, did indicate probably a month ago that they would look at some of the stores that might be closing if it's relevant. So they're looking to see what opportunities are out there because they're only in 14 markets. So there's a great, I think, expansion opportunity too, with Bloomingdale's.

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Right.

[Bloomberg Intelligence Host (Paul)]

Scarlett Mary, she shops in only the best locations. Westfield, Century City, that's where she goes to the Macy's there. And you think the Short Hills Mall is nice. The Westfield Century City Mall is spectacular. And by the way, Bloomberg's offices are right there. Oh, so that's how it works. It's go down to lunch and go down to the mall. And that's how it works.

[Bloomberg Intelligence Co-host]

Love it.

[Bloomberg Intelligence Host (Paul)]

What's Macy say about their store count in general here? Because there is a decade or more of the department store industry really reducing store count.

[Mary Ross Gilbert, Senior Equity Analyst]

Yeah. So they're closing 14 stores. It's probably mostly closed at this point. And then going Forward there's about 65 more to go. To go and those will close through 2028. They're not in a hurry to close them. They want to make sure they maximize the real estate value. And it's okay because those stores are profitable. But the go forward store base continues to be the 350 stores. And so they will get there. Like I said, by 2028 they'll have gotten rid of the last of the 65 stores they plan to close. So I think, you know, once we move past that, you know, the overall top line should look good.

[Bloomberg Intelligence Co-host]

Stay with us. More from Bloomberg Intelligence coming up after this.

[Bloomberg Intelligence Host]

You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at 10am Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app Listen on demand wherever you get your podcasts or watch us live on YouTube.

[Bloomberg Intelligence Host (Paul)]

Let's get back to the marketplace. Talk about an individual name here. Unilever. What we've seen in the packaged goods sector is a lot of companies trying to figure out a way to jumpstart growth as inflation has eroded some of their pricing power and caused some challenges for their stocks. One of them is Unilever. We want to get the latest on what they may be thinking about in terms of maybe changing up the company strategies. We joined by Diana Gomes, Bloomberg Intelligence Senior Equity analyst. Diana, what can you tell us about Unilever? I mean, we kind of know the brands. There's a million brands underneath the Unilever umbrella. But what are they doing to think about juicing growth at that company?

[Diana Gomes, Senior Equity Analyst]

Yes. Thank you for having me. So Unilever is really coming through a few years of transformation where they split the Magnum ice cream, for instance, to really focus more in their core business which is personal care and beauty as central stage. That's where the company has been really refocus their premium and innovation and really getting the marketing machine behind that segment in order to get to the that 4 to 6% organic sales growth target. In the medium term, however, we see some challenges, especially in the near term to to get there. And the guidance for 2026 was already quite cautious partly because the foods business was or has been seeing quite weak demand, particularly in Europe Even though they have very strong brands so almonds and nor are the leading stars in that unit. But obviously with the geopolitics uncertainty that that has some level of additional risk.

[Putin Goyal, Senior US E-Commerce and Retail Intelligence Analyst]

Right.

[Bloomberg Intelligence Co-host]

And when it comes to its food business, Unilever has been consistently reducing its exposure. It sold off its spreads business, the part of the business that contains I can't believe it's not butter. Last year it spun off its ice cream division into Magnum Ice Cream and still holds a 20% stake but is steadily selling that down. Is the goal here to shrink foods into something that's not meaningful? Because the CEO is at the end of the day really a beauty and wellness guy rather than a foods guy?

[Diana Gomes, Senior Equity Analyst]

That's an interesting question when when asked about it. Unilever keeps defending that they are very behind the main brands of the foods business. But obviously they are in the middle of that program to divest about 1 1/2 billion euros in what they call non core brands foods brands. This would include some European local brands where probably the effort to to really pull up that growth is seen as too much for the return and it can be distracting for for management as well. But this food business is still quite margin accretive for the wall Unilever Group now without Magnum Ice Cream also cash accretive. So it still makes sense to to have it in the portfolio to some extent. But I especially in this background why there could be some vision to try and accelerate that split and considering different options as they have been saying that they are. But just a reiteration of that in the last day or so.

[Bloomberg Intelligence Host (Paul)]

So I look at the ANR function Diana for Unilever and I see 11 buys, 11 holds and 4 sells. It shows to me the street has no idea what to do with this stock. What do you think the bulls want out of Unilever today?

[Diana Gomes, Senior Equity Analyst]

So it is about where people would be I guess in terms of not wanting to put words in their into their mouths. But the way I look at it is it depends where we see the journey to get to accelerate that growth further. The main goal is really to to drive volume growth and Unilever already showed that they can get to the 2% at least 2% mark in the fourth, fourth quarter results in the back of some of the fixes they had been doing also in emerging markets. So it is about I would say where people's confidence is in terms of where it goes from here versus where it's already. And the the very the drive really is on the premium innovation and that focus. And we saw already a lot of the transformation bringing in benefits already in last year in 2025. So it's can they do better in, in the near term?

[Bloomberg Intelligence Host (Paul)]

Stay with us. More from Bloomberg Intelligence coming up after this.

[Bloomberg Intelligence Host]

You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at 10am Eastern on Apple CarPlay and Android Auto with the Bloomberg business app Listen on demand wherever you get your podcasts or watch us live on YouTube.

[Bloomberg Intelligence Host (Paul)]

General Mills Cheerios, right? Yes, that's how I start my day with, with a bowl of Cheerios. What happened with General Mills? What did they report?

[General Mills Analyst]

So basically it was, it was mixed. Results were mixed compared to consensus. They they seem to be doing better. Obviously there were some puts and takes some headwinds but they seem to be a little bit more quarter dense rather than something that we can extrapolate into next quarter. So yeah, I mean obviously I think the stock is down and it's because you know, while volume underneath underlying volume is improving, it's still, it's still weak and to get volume growth it's still very expensive.

[Bloomberg Intelligence Host (Paul)]

Just looking at the PGEO function that breaks down kind of where they get their revenue, boy, they break it down pretty finely. Baking mixes and ingredients, dough, super premium ice cream, cereal, convenient meal snacks, yogurt, pet, other where they break it down. So what's are there certain segments that are doing better than others? Are they one of these consumer products companies that are saying hey if something's not working we'll sell it and we'll try to invest in the areas that are growing.

[General Mills Analyst]

That is, you know, all of these companies have done some portfolio reshaping. You know, yogurt has been a headwind because they spin it off. So that is obviously one of the things, the latest, you know, spinoffs that they have done. But yeah, they are very sharp in terms of their portfolio, you know, reshaping. But it seems that now they're investing more on making the brands that they have grow and some of them are growing and some of them are not.

[Bloomberg Intelligence Host (Paul)]

Stock is year to date down about 17%, hit a 52 week low today here. How are the General Mills of the world of Proctor and the Gambles, how are they dealing with the consumer facing particularly the bottom end of the K shaped economy, facing economic pressures and now it's more money to fill up your car with gas. How are they dealing with that?

[General Mills Analyst]

Yes. So this company in particular, General Mills, they actually reduced guidance during Cagney last month and it was basically because volume growth is just not there and they're Trying to increase marketing. They're not necessarily trying to rely on price cuts, but it seems that that is going to have to start happening. More competition there' seen, for example, for snacking, they seem to be a little bit more competitive than the, the category used to be. Dog seems to be still a little bit of, of a headwind for them. So we're seeing, you know, there seems to be a little bit more of, of cautionary tale for the consumer and definitely with, with prices spiking for gas, it's not necessarily helping.

[Bloomberg Intelligence Host (Paul)]

You know, I don't know if it's just me, but I mean, when I go into a supermarket now, I see many more store brands in more categories and they're also getting better placement in the shelves, which I know is important for you guys.

[Mary Ross Gilbert, Senior Equity Analyst]

Yes.

[Bloomberg Intelligence Host (Paul)]

Talk to us about just the competitive landscape of brands, name brands versus kind of the store brands.

[General Mills Analyst]

Yes. So basically, retailers have been investing on their private label portfolio. It's about a quarter of their revenue at this point. They're trying to obviously navigate necessarily want to anger the national brands, but they, they tend to fill out certain white spaces that are not necessarily catered by, by these national brands. And at some point, you know, sometimes they're competitive, more competitive. They have tiers of, of, you know, pricing for, for these private label. And you know, some people actually go to these stores to buy their private label.

[Bloomberg Intelligence Host (Paul)]

What's the, where we're now? I guess, you know, roughly a year into these tariffs, what are the consumer products companies, what are the, what are they saying these days about tariffs and passing it along versus taking it in their margin? Where are we now on that?

[General Mills Analyst]

Yes, so some of, a lot of it has gone through the pnl. They, they're very hesitant about increasing prices. Again, they're thinking it's more on the price competition. They're going to be more price competitive going forward. So we're seeing headwinds on the, on the margins rather than, you know, just passing through.

[Bloomberg Intelligence Host (Paul)]

I'm looking at this company, General Mills, and they have a 6.3% dividend yield. That's pretty good.

[General Mills Analyst]

Yes.

[Bloomberg Intelligence Host (Paul)]

How safe is that? How are they committed? What's their policy on all that?

[General Mills Analyst]

Well, they usually try to grow it at the same rate of earnings. So we don't necessarily see them as, as, you know, being a little bit, you know, increasing share repurchases or probably like spiking the dividend. We're probably going to see a lot of the same, you know, just dividend growing at the same pace of earnings.

[Bloomberg Intelligence Host]

This is the Bloomberg Intelligence Podcast available on Apple, Spotify and anywhere else you get. Your podcasts listen live each weekday 10am to noon eastern on bloomberg.com the iHeartRadio app, TuneIn and the Bloomberg Business App. You can also watch us live Every weekday on YouTube and always on the Bloomberg Terminal.

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