Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 30, 2024 | Apr. 27, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37482 | |
Entity Registrant Name | Kraft Heinz Co | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-2078182 | |
Entity Address, Address Line One | One PPG Place, | |
Entity Address, City or Town | Pittsburgh, | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 15222 | |
City Area Code | 412 | |
Local Phone Number | 456-5700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,214,298,182 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001637459 | |
Current Fiscal Year End Date | --12-28 | |
Common Stock | ||
Cover [Abstract] | ||
Title of 12(b) Security | Common stock, $0.01 par value | |
Trading Symbol | KHC | |
Security Exchange Name | NASDAQ | |
Document Information [Line Items] | ||
Title of 12(b) Security | Common stock, $0.01 par value | |
Trading Symbol | KHC | |
Security Exchange Name | NASDAQ | |
Floating Rate Senior Notes due 2025 | ||
Cover [Abstract] | ||
Title of 12(b) Security | Floating Rate Senior Notes due 2025 | |
Trading Symbol | KHC25 | |
Security Exchange Name | NASDAQ | |
Document Information [Line Items] | ||
Title of 12(b) Security | Floating Rate Senior Notes due 2025 | |
Trading Symbol | KHC25 | |
Security Exchange Name | NASDAQ | |
Senior Notes due 2029 | ||
Cover [Abstract] | ||
Title of 12(b) Security | 3.500% Senior Notes due 2029 | |
Trading Symbol | KHC29 | |
Security Exchange Name | NASDAQ | |
Document Information [Line Items] | ||
Title of 12(b) Security | 3.500% Senior Notes due 2029 | |
Trading Symbol | KHC29 | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Income Statement [Abstract] | ||
Net sales | $ 6,411 | $ 6,489 |
Cost of products sold | 4,168 | 4,376 |
Gross profit | 2,243 | 2,113 |
Selling, general and administrative expenses | 941 | 870 |
Operating income/(loss) | 1,302 | 1,243 |
Interest expense | 226 | 227 |
Other expense/(income) | 47 | (35) |
Income/(loss) before income taxes | 1,029 | 1,051 |
Provision for/(benefit from) income taxes | 225 | 214 |
Net income/(loss) | 804 | 837 |
Net income/(loss) attributable to noncontrolling interest | 3 | 1 |
Net income/(loss) attributable to common shareholders | $ 801 | $ 836 |
Per share data applicable to common shareholders: | ||
Basic earnings/(loss) per common share (in dollars per share) | $ 0.66 | $ 0.68 |
Diluted earnings/(loss) per common share (in dollars per share) | $ 0.66 | $ 0.68 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net income/(loss) | $ 804 | $ 837 |
Other comprehensive income/(loss), net of tax: | ||
Foreign currency translation adjustments | (184) | 119 |
Net deferred gains/(losses) on net investment hedges | 74 | (24) |
Amounts excluded from the effectiveness assessment of net investment hedges | 10 | 6 |
Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss) | (9) | (6) |
Net deferred gains/(losses) on cash flow hedges | 8 | (15) |
Amounts excluded from the effectiveness assessment of cash flow hedges | (2) | 4 |
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) | (14) | 16 |
Net postemployment benefit losses/(gains) reclassified to net income/(loss) | (4) | (2) |
Total other comprehensive income/(loss) | (93) | 66 |
Total comprehensive income/(loss) | 711 | 903 |
Comprehensive income/(loss) attributable to noncontrolling interest | (25) | 5 |
Comprehensive income/(loss) attributable to common shareholders | $ 736 | $ 898 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
ASSETS | ||
Cash and cash equivalents | $ 1,626 | $ 1,400 |
Trade receivables (net of allowances of $30 at March 30, 2024 and $38 at December 30, 2023) | 2,216 | 2,112 |
Inventories | 3,578 | 3,614 |
Prepaid expenses | 292 | 234 |
Other current assets | 521 | 566 |
Assets held for sale | 0 | 3 |
Total current assets | 8,233 | 7,929 |
Property, plant and equipment, net | 7,036 | 7,122 |
Goodwill | 30,390 | 30,459 |
Intangible assets, net | 42,296 | 42,448 |
Other non-current assets | 2,354 | 2,381 |
TOTAL ASSETS | 90,309 | 90,339 |
LIABILITIES AND EQUITY | ||
Current portion of long-term debt | 622 | 638 |
Trade payables | 4,421 | 4,627 |
Accrued marketing | 749 | 733 |
Interest payable | 304 | 258 |
Other current liabilities | 1,475 | 1,781 |
Total current liabilities | 7,571 | 8,037 |
Long-term debt | 19,923 | 19,394 |
Deferred income taxes | 10,220 | 10,201 |
Accrued postemployment costs | 140 | 143 |
Long-term deferred income | 1,414 | 1,424 |
Other non-current liabilities | 1,353 | 1,418 |
TOTAL LIABILITIES | 40,621 | 40,617 |
Commitments and Contingencies (Note 14) | ||
Redeemable noncontrolling interest | 35 | 34 |
Equity: | ||
Common stock, $0.01 par value (5,000 shares authorized; 1,253 shares issued and 1,214 shares outstanding at March 30, 2024; 1,249 shares issued and 1,218 shares outstanding at December 30, 2023) | 12 | 12 |
Additional paid-in capital | 52,050 | 52,037 |
Retained earnings/(deficit) | 1,680 | 1,367 |
Accumulated other comprehensive income/(losses) | (2,669) | (2,604) |
Treasury stock, at cost (39 shares at March 30, 2024 and 31 shares at December 30, 2023) | (1,551) | (1,286) |
Total shareholders' equity | 49,522 | 49,526 |
Noncontrolling interest | 131 | 162 |
TOTAL EQUITY | 49,653 | 49,688 |
TOTAL LIABILITIES AND EQUITY | $ 90,309 | $ 90,339 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss | $ 30 | $ 38 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | |
Common Stock, Shares Authorized | 5,000,000,000 | |
Common Stock, Shares, Issued | 1,253,000,000 | 1,249,000,000 |
Common Stock, Shares, Outstanding | 1,214,000,000 | 1,218,000,000 |
Treasury Stock, Common, Shares | 39,000,000 | 31,000,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Equity - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings/(Deficit) | Accumulated Other Comprehensive Income/(Losses) | Treasury Stock, Common | Noncontrolling Interest |
Beginning balance at Dec. 31, 2022 | $ 48,830 | $ 12 | $ 51,834 | $ 489 | $ (2,810) | $ (847) | $ 152 |
Total Shareholders' Equity [Roll forward] | |||||||
Net income/(loss) excluding redeemable noncontrolling interest | 837 | 836 | 1 | ||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest | 66 | 62 | 4 | ||||
Dividends declared-common stock | (494) | 0 | (494) | ||||
Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other | 74 | 76 | 0 | (5) | 3 | ||
Ending balance at Apr. 01, 2023 | 49,313 | 12 | 51,910 | 831 | (2,748) | (852) | 160 |
Beginning balance at Dec. 30, 2023 | 49,688 | 12 | 52,037 | 1,367 | (2,604) | (1,286) | 162 |
Total Shareholders' Equity [Roll forward] | |||||||
Net income/(loss) excluding redeemable noncontrolling interest | 803 | 801 | 2 | ||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest | (94) | (65) | (29) | ||||
Dividends declared-common stock | (488) | (488) | |||||
Dividends | (7) | (7) | |||||
Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other | (249) | 13 | 0 | (265) | 3 | ||
Ending balance at Mar. 30, 2024 | $ 49,653 | $ 12 | $ 52,050 | $ 1,680 | $ (2,669) | $ (1,551) | $ 131 |
Total Shareholders' Equity [Roll forward] | |||||||
Non-controlling Interest Dividends Per Share Declared | $ 98.77 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Equity (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Statement of Stockholders' Equity [Abstract] | ||
Common stock dividends declared (in dollars per share) | $ 0.40 | $ 0.40 |
Dividends declared-common stock | $ (488) | $ (494) |
Exercise of stock options, issuance of other stock awards, repurchase of common stock, and other | $ (249) | $ 74 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income/(loss) | $ 804 | $ 837 |
Adjustments to reconcile net income/(loss) to operating cash flows: | ||
Depreciation and amortization | 230 | 220 |
Amortization of postemployment benefit plans prior service costs/(credits) | (3) | (3) |
Divestiture-related license income | (14) | (13) |
Equity award compensation expense | 31 | 31 |
Deferred income tax provision/(benefit) | 1 | (3) |
Postemployment benefit plan contributions | (5) | (6) |
Nonmonetary currency devaluation | 3 | 3 |
Loss/(gain) on sale of business | 80 | 1 |
Other items, net | (14) | 29 |
Changes in current assets and liabilities: | ||
Trade receivables | (145) | (151) |
Inventories | (56) | (406) |
Accounts payable | (49) | (32) |
Other current assets | (32) | (53) |
Other current liabilities | (60) | 32 |
Net cash provided by/(used for) operating activities | 771 | 486 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (294) | (266) |
Proceeds from sale of business, net of cash disposed and working capital adjustments | (3) | 0 |
Other investing activities, net | 10 | 2 |
Net cash provided by/(used for) investing activities | (287) | (264) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayments of long-term debt | (1) | (1) |
Proceeds from issuance of long-term debt | 593 | 0 |
Dividends paid | (486) | (491) |
Other financing activities, net | (16) | 75 |
Net cash provided by/(used for) financing activities | (239) | (439) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (21) | 4 |
Cash, cash equivalents, and restricted cash | ||
Net increase/(decrease) | 224 | (213) |
Balance at beginning of period | 1,404 | 1,041 |
Balance at end of period | 1,628 | 828 |
Payments for Repurchase of Common Stock | $ (329) | $ (22) |
Basis of Presentation (Notes)
Basis of Presentation (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In management’s opinion, these interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary to fairly state our results for the periods presented. We operate on a 52- or 53-week fiscal year ending on the last Saturday in December in each calendar year. Unless the context requires otherwise, references to years and quarters contained herein pertain to our fiscal years and fiscal quarters. Our 2024 fiscal year is scheduled to be a 52-week period ending on December 28, 2024, and our 2023 fiscal year was a 52-week period that ended on December 30, 2023. The condensed consolidated balance sheet data at December 30, 2023 was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. These statements should be read in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 30, 2023. The results for interim periods are not necessarily indicative of future or annual results. Principles of Consolidation The condensed consolidated financial statements include The Kraft Heinz Company and all of our controlled subsidiaries. All intercompany transactions are eliminated. Reportable Segments In the first quarter of 2024, our internal reporting structure and reportable segments changed. We divided our International segment into three operating segments — Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”) — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan. Subsequently, we manage our operating results through four operating segments. We have two reportable segments defined by geographic region: North America and International Developed Markets. Our remaining operating segments, consisting of WEEM and AEM, are combined and disclosed as Emerging Markets. Use of Estimates We prepare our condensed consolidated financial statements in accordance with U.S. GAAP, which requires us to make accounting policy elections, estimates, and assumptions that affect the reported amount of assets, liabilities, reserves, and expenses. These accounting policy elections, estimates, and assumptions are based on our best estimates and judgments. We evaluate our policy elections, estimates, and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We believe these estimates to be reasonable given the current facts available. We adjust our policy elections, estimates, and assumptions when facts and circumstances dictate. Market volatility, including foreign currency exchange rates, increases the uncertainty inherent in our estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from estimates. If actual amounts differ from estimates, we include the revisions in our consolidated results of operations in the period the actual amounts become known. Historically, the aggregate differences, if any, between our estimates and actual amounts in any year have not had a material effect on our condensed consolidated financial statements. Reclassifications We made reclassifications and adjustments to certain previously reported financial information to conform to our current period presentation. Cash , Cash Equivalents , and Restricted Cash Cash equivalents include term deposits with banks, money market funds, and all highly liquid investments with original maturities of three months or less. The fair value of cash equivalents approximates the carrying amount. Cash and cash equivalents that are legally restricted as to withdrawal or usage are classified in other current assets or other non-current assets, as applicable, on the condensed consolidated balance sheets. At March 30, 2024, we had $2 million of restricted cash in other non-current assets. At December 30, 2023, we had restricted cash recorded in other current assets of $3 million and $1 million of restricted cash in other non-current assets. Total cash, cash equivalents, and restricted cash was $1,628 million at March 30, 2024 and $1,404 million at December 30, 2023. |
Significant Accounting Policies
Significant Accounting Policies (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies There were no significant changes to our accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 30, 2023. |
New Accounting Standards (Notes
New Accounting Standards (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Standards | New Accounting Standards Accounting Standards Not Yet Adopted Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures: In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2023-07 to improve segment disclosure requirements under Accounting Standards Codification (“ASC”) 280, Segment Reporting, through enhancing disclosures about significant segment expenses. The guidance requires entities to provide significant segment expenses that are regularly provided to the chief operating decision maker and other segment expenses included in each reported measure of segment profitability. This ASU also enhances interim segment reporting requirements by aligning interim disclosures with information that must be disclosed annually in accordance with ASC 280. This ASU will be effective beginning in 2024 for annual reports and in 2025 for quarterly reports. Early adoption is permitted. The new guidance must be applied retrospectively to all prior periods presented in the financial statements, with the significant segment expense and other segment item amounts disclosed based on categories identified in the period of adoption. We are still evaluating the impacts this ASU will have on our notes to the consolidated financial statements. Income Taxes (Topic 740) – Improvements to Income Tax Disclosures: In December 2023, the FASB issued ASU 2023-09 to improve income tax disclosure requirements under ASC 740, Income Taxes . The guidance requires entities to provide separate information about a reporting entity’s effective tax rate reconciliation and about income taxes paid. This ASU will be effective for annual periods beginning after December 15, 2024 and will impact our 2025 annual report. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. While the standard will require additional disclosures related to the Company’s income taxes, we do not expect this ASU to have a significant impact on our financial statements. |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures Divestitures Russia Infant Transaction: On March 11, 2024, we closed and finalized the sale of our infant nutrition business in Russia to a third party for total cash consideration of approximately $25 million (the “Russia Infant Transaction”). As a result of the Russia Infant Transaction, we recognized an insignificant pre-tax gain in other expense/(income) on our consolidated statement of income for the three months ended March 30, 2024. Papua New Guinea Transaction: On February 5, 2024, we closed and finalized the sale of 100% of the equity interests in our Papua New Guinea subsidiary, Hugo Canning Company Limited, to a third party for total cash consideration of approximately $22 million, which is to be paid incrementally over two years following the transaction closing date (the “Papua New Guinea Transaction”). As a result of the Papua New Guinea Transaction, we recognized a pre-tax loss on sale of business of approximately $80 million in other expense/(income) on our consolidated statement of income for the three months ended March 30, 2024, of which approximately $41 million relates to the release of accumulated foreign currency losses. Deal Costs: We incurred insignificant deal costs for the three months ended March 30, 2024 and the three months ended April 1, 2023 related to our divestitures. We recognized these deal costs in selling, general and administrative expenses (“SG&A”). |
Restructuring Activities (Notes
Restructuring Activities (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Activities | Restructuring Activities See our consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 30, 2023 for additional information on our restructuring activities. Restructuring Activities: We have restructuring programs globally, which are focused primarily on streamlining our organizational design. For the three months ended March 30, 2024, we eliminated approximately 50 positions related to these programs. As of March 30, 2024, we expect to eliminate approximately 100 additional positions during the remainder of 2024. For the three months ended March 30, 2024, restructuring activities resulted in income of $3 million and included a net benefit of $6 million from severance and employee benefit costs, $2 million of other restructuring costs, and $1 million of other exit costs. Restructuring activities resulted in income of $8 million for the three months ended April 1, 2023. Our net liability balance for restructuring project costs that qualify as exit and disposal costs under U.S. GAAP was (in millions): Severance and Employee Benefit Costs Other Exit Costs Total Balance at December 30, 2023 $ 23 $ 14 $ 37 Charges/(credits) (6) 1 (5) Cash payments (4) (1) (5) Balance at March 30, 2024 $ 13 $ 14 $ 27 We expect the majority of the liability for severance and employee benefit costs as of March 30, 2024 to be paid in the second quarter of 2024. The liability for other exit costs primarily relates to lease obligations. The cash impact of these obligations will continue for the duration of the lease terms, which expire between 2024 and 2031. Total Expenses/(Income): Total expense/(income) related to restructuring activities, by income statement caption, were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Severance and employee benefit costs - Cost of products sold $ — $ 2 Severance and employee benefit costs - SG&A (6) (4) Severance and employee benefit costs - Other expense/(income) — 2 Asset-related costs - Cost of products sold — 2 Other costs - Cost of products sold 1 2 Other costs - SG&A 2 (12) $ (3) $ (8) We do not include our restructuring activities within Segment Adjusted Operating Income (as defined in Note 16, Segment Reporting ). The pre-tax impact of allocating such expenses/(income) to our segments would have been (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 North America $ (2) $ 6 International Developed Markets (1) — Emerging Markets (a) — (1) General corporate expenses — (13) $ (3) $ (8) |
Inventories (Notes)
Inventories (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following (in millions): March 30, 2024 December 30, 2023 Packaging and ingredients $ 929 $ 1,014 Spare parts 235 233 Work in process 307 338 Finished products 2,107 2,029 Inventories $ 3,578 $ 3,614 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill: As described in Note 1, Basis of Presentation , in the first quarter of 2024, we divided our International segment into three operating segments — EPDM, WEEM, and AEM. While this reorganization resulted in a change to our operating segments, it did not impact the existing composition of our reporting units that formerly comprised the goodwill balance of our International segment — Northern Europe, Continental Europe, Latin America (“LATAM”), and Asia — and, therefore, was not indicative of an impairment trigger. We have reflected the impact of this segment change in all historical periods presented. Changes in the carrying amount of goodwill, by segment, were (in millions): North America International Developed Markets Emerging Markets (a) Total Balance at December 30, 2023 $ 27,248 $ 2,687 $ 524 $ 30,459 Translation adjustments and other (15) (43) (11) (69) Balance at March 30, 2024 $ 27,233 $ 2,644 $ 513 $ 30,390 (a) Emerging Markets represents the aggregation of our WEEM and AEM operating segments. As of March 30, 2024, we maintain 11 reporting units, seven of which comprise our goodwill balance. These seven reporting units had an aggregate goodwill carrying value of $30.4 billion at March 30, 2024. Accumulated impairment losses to goodwill were $11.8 billion as of March 30, 2024 and as of December 30, 2023 No events occurred during the three months ended March 30, 2024 or the three months ended April 1, 2023 that indicated it was more likely than not that our goodwill was impaired. Additional Goodwill Considerations Our reporting units that were impaired in 2023 were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates. As of our 2023 annual impairment test, our reporting units with 20% or less fair value over carrying amount had an aggregate goodwill carrying amount of $30.1 billion and included Taste, Meals, and Away From Home (“TMA”); Fresh, Beverages, and Desserts (“FBD”); Northern Europe; Continental Europe; Canada and North America Coffee (“CNAC”); and LATAM. Our Asia reporting unit had between 20-50% fair value over carrying amount with an aggregate goodwill carrying amount of $309 million as of our 2023 annual impairment test date. Accordingly, our reporting units that had 20% or less excess fair value over carrying amount as of our 2023 annual impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future. Although the remaining reporting unit had more than 20% excess fair value over carrying amount as of our 2023 annual impairment test, this amount is also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions. These assumptions and estimates include estimated future annual net cash flows (including net sales, cost of products sold, SG&A, depreciation and amortization, working capital, and capital expenditures), income tax rates, discount rates, growth rates, and other market factors. Our current expectations also include certain assumptions that could be negatively impacted if we are unable to meet our pricing expectations in relation to inflation. If current expectations of future growth rates and margins are not met, if market factors outside of our control, such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then one or more of our reporting units might become impaired in the future. Additionally, any decisions to divest certain non-strategic assets has led and could in the future lead to goodwill impairments. As of the first day of the second quarter 2024, certain organizational changes occurred that impacted our reporting unit composition within our North America segment. Our four North America reporting units — TMA, FBD, CNAC, and Other North America — were reorganized into the six reporting units: Taste Elevation, Ready Meals and Snacking (“TMS”), Hydration & Desserts (“HD”), Meat & Cheese (“M&C”), Away from Home & Kraft Heinz Ingredients (“AFH”), CNAC, and Other North America. We have determined these changes represent a change in composition for the TMA and FBD reporting units as they have been reorganized into TMS, HD, M&C, and AFH reporting units and will require an interim impairment test (or transition test) in the second quarter of 2024. Indefinite-lived intangible assets: Changes in the carrying amount of indefinite-lived intangible assets, which primarily consisted of trademarks, were (in millions): Balance at December 30, 2023 $ 38,502 Translation adjustments and other (62) Balance at March 30, 2024 $ 38,440 Our indefinite-lived intangible asset balance primarily consists of a number of individual brands, which had an aggregate carrying amount of $38.4 billion at March 30, 2024. No events occurred during the three months ended March 30, 2024 or the three months ended April 1, 2023 that indicated it was more likely than not that any brand was impaired. Additional Indefinite-Lived Intangible Asset Considerations Our brands that were impaired in 2023 were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates. As of the latest impairment test, brands with 20% or less fair value over carrying amount had an aggregate carrying amount after impairment of $18.7 billion, brands with between 20-50% fair value over carrying amount had an aggregate carrying amount of $4.2 billion, and brands that had over 50% fair value over carrying amount had an aggregate carrying amount of $15.7 billion. Accordingly, these and other individual brands that had 20% or less excess fair value over carrying amount as of our 2023 annual impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future. Although the remaining brands had more than 20% excess fair value over carrying amount as of our 2023 annual impairment test, these amounts are also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual brands requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions. These assumptions and estimates include estimated future annual net cash flows, income tax considerations, discount rates, growth rates, royalty rates, contributory asset charges, and other market factors. Our current expectations also include certain assumptions that could be negatively impacted if we are unable to meet our pricing expectations in relation to inflation. If current expectations of future growth rates and margins are not met, if market factors outside of our control, such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to our long-term operating plans, then one or more of our brands might become impaired in the future. Additionally, any decisions to divest certain non-strategic assets has led and could in the future lead to intangible asset impairments. Definite-lived intangible assets: Definite-lived intangible assets were (in millions): March 30, 2024 December 30, 2023 Gross Accumulated Net Gross Accumulated Net Trademarks $ 2,292 $ (776) $ 1,516 $ 2,313 $ (755) $ 1,558 Customer-related assets 3,691 (1,360) 2,331 3,710 (1,331) 2,379 Other 12 (3) 9 12 (3) 9 $ 5,995 $ (2,139) $ 3,856 $ 6,035 $ (2,089) $ 3,946 Amortization expense for definite-lived intangible assets was $64 million for the three months March 30, 2024 and $62 million for the three months ended April 1, 2023. Aside from amortization expense, the change in definite-lived intangible assets from December 30, 2023 to March 30, 2024 primarily related to the impacts of foreign currency. We estimate that amortization expense related to definite-lived intangible assets will be approximately $260 million in 2024, $260 million in each of the following three years, and $250 million in 2028 and 2029. |
Income Taxes (Notes)
Income Taxes (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision for income taxes consists of provisions for federal, state, and non-U.S. income taxes. We operate in an international environment; accordingly, the consolidated effective tax rate is a composite rate reflecting the earnings in various locations and the applicable tax rates. Additionally, the calculation of the percentage point impact of goodwill impairment and other items on the effective tax rate is affected by income/(loss) before income taxes. Further, small movements in tax rates due to a change in tax law or a change in tax rates that cause us to revalue our deferred tax balances produce volatility in our effective tax rate. Our quarterly income tax provision is determined based on our estimated full year effective tax rate, adjusted for tax attributable to infrequent or unusual items, which are recognized on a discrete period basis in the income tax provision for the period in which they occur. Our effective tax rate for the three months ended March 30, 2024 was an expense of 21.9% on pre-tax income. Our effective tax rate was favorably impacted by the geographic mix of pre-tax income in various non-U.S. jurisdictions. This impact was partially offset by unfavorable items, primarily from establishing a valuation allowance on the deferred tax asset for the U.S. capital loss carryover generated from our divestiture activities. Our effective tax rate for the three months ended April 1, 2023 was an expense of 20.3% on pre-tax income. Our effective tax rate was favorably impacted by the geographic mix of pre-tax income in various non-U.S. jurisdictions. The year-over-year increase in the effective tax rate for the three month period was driven by certain net discrete items, primarily due to establishing a valuation allowance on the deferred tax asset for the U.S. capital loss carryover generated from our divestiture activities, as well as from a less favorable geographic mix of pre-tax income. Other Income Tax Matters: We are currently under examination for income taxes by the Internal Revenue Service (“IRS”) for the years 2018 through 2022. In the third quarter of 2023, we received two Notices of Proposed Adjustment (the “NOPAs”) relating to transfer pricing with our foreign subsidiaries. The NOPAs propose an increase to our U.S. taxable income that could result in additional U.S. federal income tax expense and liability of approximately $200 million for 2018 and approximately $210 million for 2019, excluding interest, and assert penalties of approximately $85 million for each of 2018 and 2019. We strongly disagree with the IRS’s positions, believe that our tax positions are well documented and properly supported, and intend to vigorously contest the positions taken by the IRS and pursue all available administrative and judicial remedies. Therefore, we have not recorded any reserves related to this issue. We continue to maintain the same operating model and transfer pricing methodology with our foreign subsidiaries that was in place for the years 2018 and 2019, and the IRS began its audit of 2020, 2021, and 2022 during the first quarter of 2024. We believe our income tax reserves are appropriate for all open tax years and that final adjudication of this matter will not have a material impact on our results of operations and cash flows. However, the ultimate outcome of this matter is uncertain, and if we are required to pay the IRS additional U.S. taxes, interest, and/or potential penalties, our results of operations and cash flows could be materially affected. |
Employees' Stock Incentive Plan
Employees' Stock Incentive Plans (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Employees' Stock Incentive Plans | Employees’ Stock Incentive Plans Stock Options: Our stock option activity and related information was: Number of Stock Options Weighted Average Exercise Price Outstanding at December 30, 2023 8,022,540 $ 46.87 Granted 654,724 35.13 Forfeited (1,199,934) 46.75 Exercised (168,861) 22.60 Outstanding at March 30, 2024 7,308,469 46.39 The aggregate intrinsic value of stock options exercised during the period was insignificant for the three months ended March 30, 2024 . Restricted Stock Units: Our restricted stock unit (“RSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value Outstanding at December 30, 2023 7,722,870 $ 36.80 Granted 2,855,557 35.19 Forfeited (249,375) 37.39 Vested (2,799,172) 34.28 Outstanding at March 30, 2024 7,529,880 37.10 The aggregate fair value of RSUs that vested during the period was $99 million for the three months ended March 30, 2024. Performance Share Units: Our performance share unit (“PSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value Outstanding at December 30, 2023 4,855,432 $ 33.65 Granted 2,589,797 29.14 Forfeited (308,513) 32.98 Vested (951,164) 34.56 Outstanding at March 30, 2024 6,185,552 31.77 The aggregate fair value of PSUs that vested during the period was $33 million for the three months ended March 30, 2024. |
Postemployment Benefits (Notes)
Postemployment Benefits (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Retirement Benefits [Abstract] | |
Postemployment Benefits | Postemployment Benefits See our consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 30, 2023 for additional information on our postemployment-related accounting policies. Pension Plans Components of Net Pension Cost/(Benefit): Net pension cost/(benefit) consisted of the following (in millions): For the Three Months Ended U.S. Plan Non-U.S. Plans March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023 Service cost $ — $ — $ 2 $ 2 Interest cost 34 36 14 15 Expected return on plan assets (49) (49) (21) (21) Amortization of unrecognized losses/(gains) — — 3 4 Special/contractual termination benefits — — — 2 Net pension cost/(benefit) $ (15) $ (13) $ (2) $ 2 We present all non-service cost components of net pension cost/(benefit) within other expense/(income) on our condensed consolidated statements of income. Employer Contributions: Related to our non-U.S. pension plans, we contributed $2 million during the three months ended March 30, 2024 and plan to make further contributions of approximately $8 million during the remainder of 2024. We did not contribute to our U.S. pension plans during the three months ended March 30, 2024 and do not plan to make contributions during the remainder of 2024. Estimated future contributions take into consideration current economic conditions, which at this time are expected to have minimal impact on expected contributions for the remainder of 2024. Our actual contributions and plans may change due to many factors, including changes in tax, employee benefit, or other laws and regulations, tax deductibility, significant differences between expected and actual pension asset performance or interest rates, or other factors. Postretirement Plans Components of Net Postretirement Cost/(Benefit): Net postretirement cost/(benefit) consisted of the following (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Service cost $ 1 $ 1 Interest cost 8 9 Expected return on plan assets (14) (14) Amortization of prior service costs/(credits) (3) (3) Amortization of unrecognized losses/(gains) (5) (4) Net postretirement cost/(benefit) $ (13) $ (11) We present all non-service cost components of net postretirement cost/(benefit) within other expense/(income) on our condensed consolidated statements of income. Employer Contributions: During the three months ended March 30, 2024, we contributed $3 million to our postretirement benefit plans. We plan to make further contributions of approximately $9 million to our postretirement benefit plans during the remainder of 2024. Estimated future contributions take into consideration current economic conditions, which at this time are expected to have minimal impact on expected contributions for the remainder of 2024. Our actual contributions and plans may change due to many factors, including changes in tax, employee benefit, or other laws and regulations, tax deductibility, significant differences between expected and actual postretirement plan asset performance or interest rates, or other factors. |
Financial Instruments (Notes)
Financial Instruments (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments See our consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 30, 2023 for additional information on our overall risk management strategies, our use of derivatives, and our related accounting policies. Derivative Volume: The notional values of our outstanding derivative instruments were (in millions): Notional Amount March 30, 2024 December 30, 2023 Commodity contracts $ 957 $ 954 Foreign exchange contracts 4,826 4,618 Cross-currency contracts 6,997 6,133 Fair Value of Derivative Instruments: The fair values and the levels within the fair value hierarchy of derivative instruments recorded on the condensed consolidated balance sheets were (in millions): March 30, 2024 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts (a) $ — $ — $ 19 $ 15 $ 19 $ 15 Cross-currency contracts (b) — — 128 115 128 115 Derivatives not designated as hedging instruments: Commodity contracts (c) 37 44 4 6 41 50 Foreign exchange contracts (a) — — 13 8 13 8 Cross currency contracts (b) — — — 18 — 18 Total fair value $ 37 $ 44 $ 164 $ 162 $ 201 $ 206 (a) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets ($29 million) and other non-current assets ($3 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($21 million) and other non-current liabilities ($2 million). (b) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets ($52 million) and other non-current assets ($76 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($44 million) and other non-current liabilities ($89 million). (c) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets and the fair value of derivative liabilities was recorded in other current liabilities. December 30, 2023 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts (a) $ — $ — $ 12 $ 42 $ 12 $ 42 Cross-currency contracts (b) — — 140 165 140 165 Derivatives not designated as hedging instruments: Commodity contracts (c) 20 59 3 7 23 66 Foreign exchange contracts (a) — — 17 23 17 23 Total fair value $ 20 $ 59 $ 172 $ 237 $ 192 $ 296 (a) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets ($21 million) and other non-current assets ($8 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($51 million) and other non-current liabilities ($14 million). (b) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets ($37 million) and other non-current assets ($103 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($31 million) and other non-current liabilities ($134 million). (c) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets and the fair value of derivative liabilities was recorded in other current liabilities ($64 million) and other non-current liabilities ($2 million). Our derivative financial instruments are subject to master netting arrangements that allow for the offset of assets and liabilities in the event of default or early termination of the contract. We elect to record the gross assets and liabilities of our derivative financial instruments on the condensed consolidated balance sheets. If the derivative financial instruments had been netted on the condensed consolidated balance sheets, the asset and liability positions each would have been reduced by $156 million at March 30, 2024 and $130 million at December 30, 2023. We had posted collateral related to commodity derivative margin requirements of $15 million at March 30, 2024 and $41 million at December 30, 2023, which were included in prepaid expenses on our condensed consolidated balance sheets. Level 1 financial assets and liabilities consist of commodity future and options contracts and are valued using quoted prices in active markets for identical assets and liabilities. Level 2 financial assets and liabilities consist of commodity swaps, foreign exchange forwards, options, and swaps, and cross-currency swaps. Commodity swaps are valued using an income approach based on the observable market commodity index prices less the contract rate multiplied by the notional amount. Foreign exchange forwards and swaps are valued using an income approach based on observable market forward rates less the contract rate multiplied by the notional amount. Foreign exchange options are valued using an income approach based on a Black-Scholes-Merton formula. This formula uses present value techniques and reflects the time value and intrinsic value based on observable market rates. Cross-currency swaps are valued based on observable market spot and swap rates. We did not have any Level 3 financial assets or liabilities in any period presented. Our calculation of the fair value of financial instruments takes into consideration the risk of nonperformance, including counterparty credit risk. Net Investment Hedging: At March 30, 2024, we had the following items designated as net investment hedges: • Non-derivative foreign-currency denominated debt with principal amounts of €100 million and £400 million; and • Cross-currency contracts with notional amounts of C$1.4 billion ($1.0 billion), €2.3 billion ($2.5 billion), and JPY9.6 billion ($68 million). We periodically use non-derivative instruments such as non-U.S. dollar financing transactions or non-U.S. dollar assets or liabilities, including intercompany loans, to hedge the exposure of changes in underlying foreign-currency denominated subsidiary net assets, and they are designated as net investment hedges. At March 30, 2024, we had euro intercompany loans with an aggregate notional amount of $782 million designated as net investment hedges. The component of the gains and losses on our net investment in these designated foreign operations, driven by changes in foreign exchange rates, are economically offset by fair value movements on the effective portion of our cross-currency contracts and foreign exchange contracts and remeasurements of our foreign-currency denominated debt. Cash Flow Hedge Coverage: At March 30, 2024, we had entered into foreign exchange contracts designated as cash flow hedges for periods not exceeding the next 22 months and into cross-currency contracts designated as cash flow hedges for periods not exceeding the next 50 months. Deferred Hedging Gains and Losses on Cash Flow Hedges: Based on our valuation at March 30, 2024 and assuming market rates remain constant through contract maturities, we expect transfers to net income/(loss) of the existing losses reported in accumulated other comprehensive income/(losses) on cross-currency cash flow hedges and interest rate cash flow hedges during the next 12 months to be insignificant. Additionally, we expect transfers to net income/(loss) of the existing gains reported in other comprehensive income/(losses) on foreign-currency cash flow hedges during the next 12 months to be insignificant. Derivative Impact on the Statements of Comprehensive Income: The following table presents the pre-tax amounts of derivative gains/(losses) deferred into accumulated other comprehensive income/(losses) and the income statement line item that will be affected when reclassified to net income/(loss) (in millions): Accumulated Other Comprehensive Income/(Losses) Component Gains/(Losses) Recognized in Other Comprehensive Income/(Losses) Related to Derivatives Designated as Hedging Instruments Location of Gains/(Losses) When Reclassified to Net Income/(Loss) For the Three Months Ended March 30, 2024 April 1, 2023 Cash flow hedges: Foreign exchange contracts 19 (4) Cost of products sold Foreign exchange contracts (excluded component) (4) (2) Cost of products sold Foreign exchange contracts 21 — Other expense/(income) Foreign exchange contracts (excluded component) (3) — Other expense/(income) Cross-currency contracts (36) (1) Other expense/(income) Cross-currency contracts (excluded component) — 6 Other expense/(income) Cross-currency contracts (8) (6) Interest expense Interest rate contracts — (3) Interest expense Net investment hedges: Foreign exchange contracts — 1 Other Cross-currency contracts 74 (12) Other expense/(income) Cross-currency contracts (excluded component) 12 8 Interest expense Total gains/(losses) recognized in statements of comprehensive income $ 75 $ (13) Derivative Impact on the Statements of Income: The following tables present the pre-tax amounts of derivative gains/(losses) reclassified from accumulated other comprehensive income/(losses) to net income/(loss) and the affected income statement line items (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Cost of products sold Interest expense Other expense/(income) Cost of products sold Interest expense Other expense/(income) Total amounts presented in the condensed consolidated statements of income in which the following effects were recorded $ 4,168 $ 226 $ 47 $ 4,376 $ 227 $ (35) Gains/(losses) related to derivatives designated as hedging instruments: Cash flow hedges: Foreign exchange contracts $ 3 $ — $ 21 $ 10 $ — $ — Foreign exchange contracts (excluded component) (2) — — (3) — — Cross-currency contracts — (8) (44) — (6) 14 Cross-currency contracts (excluded component) — — — — — 6 Net investment hedges: Cross-currency contracts (excluded component) — 12 — — 8 — Gains/(losses) related to derivatives not designated as hedging instruments: Commodity contracts 9 — — (47) — — Foreign exchange contracts — — 8 — — (12) Interest rates contracts (a) — — (3) — — — Cross-currency contracts — — (21) — — — Total gains/(losses) recognized in statements of income $ 10 $ 4 $ (39) $ (40) $ 2 $ 8 (a) Represents recognition of realized hedge losses resulting from the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring. Non-Derivative Impact on Statements of Comprehensive Income: Related to our non-derivative foreign currency denominated debt instruments designated as net investment hedges, we recognized pre-tax gains of $24 million for the three months ended March 30, 2024 and pre-tax losses of $20 million for the three months ended April 1, 2023. These amounts were recognized in other comprehensive income/(loss). |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income/(Losses) (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income/(Losses) | Accumulated Other Comprehensive Income/(Losses) The components of, and changes in, accumulated other comprehensive income/(losses), net of tax, were as follows (in millions): Foreign Currency Translation Adjustments Net Postemployment Benefit Plan Adjustments Net Cash Flow Hedge Adjustments Total Balance as of December 30, 2023 $ (2,634) $ 15 $ 15 $ (2,604) Foreign currency translation adjustments (156) — — (156) Net deferred gains/(losses) on net investment hedges 74 — — 74 Amounts excluded from the effectiveness assessment of net investment hedges 10 — — 10 Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss) (9) — — (9) Net deferred gains/(losses) on cash flow hedges — — 8 8 Amounts excluded from the effectiveness assessment of cash flow hedges — — (2) (2) Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) — — 14 14 Net postemployment benefit losses/(gains) reclassified to net income/(loss) — (4) — (4) Total other comprehensive income/(loss) (81) (4) 20 (65) Balance as of March 30, 2024 $ (2,715) $ 11 $ 35 $ (2,669) The gross amount and related tax benefit/(expense) recorded in, and associated with, each component of other comprehensive income/(loss) were as follows (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ (156) $ — $ (156) $ 115 $ — $ 115 Net deferred gains/(losses) on net investment hedges 98 (24) 74 (31) 7 (24) Amounts excluded from the effectiveness assessment of net investment hedges 12 (2) 10 8 (2) 6 Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss) (12) 3 (9) (8) 2 (6) Net deferred gains/(losses) on cash flow hedges (4) 12 8 (14) (1) (15) Amounts excluded from the effectiveness assessment of cash flow hedges (7) 5 (2) 4 — 4 Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) 33 (19) 14 (21) 5 (16) Net postemployment benefit losses/(gains) reclassified to net income/(loss) (5) 1 (4) (3) 1 (2) The amounts reclassified from accumulated other comprehensive income/(losses) were as follows (in millions): Accumulated Other Comprehensive Income/(Losses) Component Reclassified from Accumulated Other Comprehensive Income/(Losses) to Net Income/(Loss) Affected Line Item in the Statements of Income For the Three Months Ended March 30, 2024 April 1, 2023 Losses/(gains) on net investment hedges: Cross-currency contracts (a) $ (12) $ (8) Interest expense Losses/(gains) on cash flow hedges: Foreign exchange contracts (b) (1) (7) Cost of products sold Foreign exchange contracts (b) (21) — Other expense/(income) Cross-currency contracts (b) 44 (20) Other expense/(income) Cross-currency contracts (b) 8 6 Interest expense Interest rate contracts (c) 3 — Other expense/(income) Losses/(gains) on hedges before income taxes 21 (29) Losses/(gains) on hedges, income taxes (16) 7 Losses/(gains) on hedges $ 5 $ (22) Losses/(gains) on postemployment benefits: Amortization of unrecognized losses/(gains) (d) $ (2) $ — Amortization of prior service costs/(credits) (d) (3) (3) Losses/(gains) on postemployment benefits before income taxes (5) (3) Losses/(gains) on postemployment benefits, income taxes 1 1 Losses/(gains) on postemployment benefits $ (4) $ (2) (a) Represents recognition of the excluded component in net income/(loss). (b) Includes amortization of the excluded component and the effective portion of the related hedges. (c) Represents recognition of realized hedge losses resulting from the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring. (d) These components are included in the computation of net periodic postemployment benefit costs. See Note 10, Postemployment Benefits , for additional information. In this note we have excluded activity and balances related to noncontrolling interest due to their insignificance. This activity was primarily related to foreign currency translation adjustments. |
Financing Arrangements (Notes)
Financing Arrangements (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Transfers and Servicing [Abstract] | |
Financing Arrangements | Financing Arrangements Transfers of Financial Assets: We have a nonrecourse accounts receivable factoring program whereby certain eligible receivables are sold to third party financial institutions in exchange for cash. The program provides us with an additional means for managing liquidity. Under the terms of the arrangement, we act as the collecting agent on behalf of the financial institutions to collect amounts due from customers for the receivables sold. We account for the transfer of receivables as a true sale at the point control is transferred through derecognition of the receivable on our condensed consolidated balance sheet. There were no receivables sold under this accounts receivable factoring program during the three months ended March 30, 2024, and no amounts outstanding as of March 30, 2024. Receivables sold under this accounts receivable factoring program were $100 million during the three months ended April 1, 2023, and there were no amounts outstanding as of December 30, 2023. There were no incremental costs of factoring receivables under this arrangement for the three months ended March 30, 2024 and an insignificant amount for the three months ended April 1, 2023. The proceeds from the sales of receivables are included in cash flows from operating activities on the condensed consolidated statement of cash flows. As collecting agent on the sold receivables, we had no cash collected that was not yet remitted to the third party financial institution as of March 30, 2024 or December 30, 2023.We had $68 million of cash collected that was not yet remitted to the third party financial institutions as of April 1, 2023. This obligation is reported within other current liabilities on the condensed consolidated balance sheet as of April 1, 2023 and within cash flows from financing activities on the condensed consolidated statement of cash flows for the three months ended April 1, 2023. Trade Payables Programs: |
Commitments, Contingencies and
Commitments, Contingencies and Debt (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Debt Disclosure [Abstract] | |
Commitments, Contingencies and Debt | Commitments, Contingencies, and Debt Legal Proceedings We are involved in legal proceedings, claims, and governmental inquiries, inspections, or investigations (“Legal Matters”) arising in the ordinary course of our business. While we cannot predict with certainty the results of Legal Matters in which we are currently involved or may in the future be involved, we do not expect that the ultimate costs to resolve the Legal Matters that are currently pending will have a material adverse effect on our financial condition, results of operations, or cash flows. Class Actions and Stockholder Derivative Actions: Certain of The Kraft Heinz Company’s current and former officers and directors and 3G Capital, Inc. and several of its subsidiaries and affiliates (the “3G Entities”) are named as defendants in two stockholder derivative actions pending in the Delaware Court of Chancery, Datnoff, et al. v. Behring, et al. , which was filed on May 6, 2022, and Felicetti, et al. v. Behring, et al. , which was filed on March 6, 2023. The complaints allege state law claims and contend that The Kraft Heinz Company’s Board of Directors wrongfully refused plaintiffs’ demands to pursue legal action against the named defendants. Specifically, the complaints allege that certain of the Company’s current and former officers and directors breached their fiduciary duties to the Company by purportedly making materially misleading statements and omissions regarding the Company’s financial performance and the impairment of its goodwill and intangible assets. The complaints further allege that the 3G Entities and certain of the Company’s current and former officers and directors breached their fiduciary duties by engaging in insider trading and misappropriating the Company’s material, non-public information, or aided and abetted such alleged breaches of fiduciary duty. The complaints seek relief against the defendants, principally in the form of damages, disgorgement of all profits obtained from the alleged insider trading, contribution and indemnification, and an award of attorneys’ fees and costs. We intend to vigorously defend against these lawsuits; however, we cannot reasonably estimate the potential range of loss, if any, due to the early stage of the proceedings. Certain of The Kraft Heinz Company’s current and former officers and directors and the 3G Entities were also named as defendants in a consolidated stockholder derivative action, In re Kraft Heinz Company Derivative Litigation , which was filed in the Delaware Court of Chancery. The consolidated amended complaint, which was filed on April 27, 2020, alleged state law claims, contending that the 3G Entities were controlling stockholders who owed fiduciary duties to the Company, and that they breached those duties by allegedly engaging in insider trading and misappropriating the Company’s material, non-public information. The complaint further alleged that certain of The Kraft Heinz Company’s current and former officers and directors breached their fiduciary duties to the Company by purportedly making materially misleading statements and omissions regarding the Company’s financial performance and the impairment of its goodwill and intangible assets, and by supposedly approving or allowing the 3G Entities’ alleged insider trading. The complaint sought relief against the defendants in the form of damages, disgorgement of all profits obtained from the alleged insider trading, contribution and indemnification, and an award of attorneys’ fees and costs. The defendants filed a motion to dismiss the consolidated amended complaint, which motion the Delaware Chancery Court granted in an order dated December 15, 2021. The plaintiffs filed a notice of appeal on January 13, 2022, and the Delaware Supreme Court affirmed the trial court’s dismissal with prejudice of the consolidated amended complaint in an order dated August 1, 2022. One of the plaintiffs in said dismissed derivative litigation subsequently filed a new complaint, Erste Asset Management v. Hees, et al. , against certain current and former officers and directors of The Kraft Heinz Company on November 28, 2023 in the Delaware Court of Chancery, seeking to reinstate the plaintiff’s previously-dismissed claims and recover attorneys’ fees and costs incurred in the dismissed litigation on the basis of alleged newly discovered evidence. Specifically, the plaintiff alleges the 3G Entities caused the Company to make false and misleading public disclosures regarding the independence of two directors of The Kraft Heinz Company, one of whose independence plaintiff contends formed a basis for the court’s prior dismissal of the consolidated amended complaint. We intend to vigorously defend against this lawsuit; however, we cannot reasonably estimate the potential range of loss, if any, due to the early stage of the proceedings. Environmental Actions: Since March 2024, the Company has been engaged in ongoing discussions with the U.S. Department of Justice, joined by the U.S. Environmental Protection Agency (“U.S. EPA”) and the Indiana Department of Environmental Management, concerning alleged violations of the Clean Water Act related to a Company facility in Kendallville, Indiana. Previously, the Company entered into an Administrative Order on Consent with the U.S. EPA that requires the Company to implement a compliance plan to address related alleged violations of the Clean Water Act related to the facility in Kendallville, Indiana. While we cannot predict with certainty the resolution of these discussions, we do not expect that the ultimate costs to resolve this matter will have a material adverse effect on our financial condition, results of operations, or cash flows. Debt We may from time to time seek to retire or purchase our outstanding debt through redemptions, tender offers, cash purchases, prepayments, refinancing, exchange offers, open market or privately negotiated transactions, Rule 10b5-1 plans, or otherwise. Borrowing Arrangements: See Note 16, Debt , to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 30, 2023 for information on our borrowing arrangements. Our long-term debt contains customary representations, covenants, and events of default. We were in compliance with all financial covenants as of March 30, 2024 . Debt Issuances: In the first quarter of 2024, Kraft Heinz Foods Company (“KHFC”), our 100% owned operating subsidiary, issued 550 million euro aggregate principal amount of 3.500% senior notes due March 2029 (the “2024 Notes”). The 2024 Notes are fully and unconditionally guaranteed by The Kraft Heinz Company as to payment of principal, premium, and interest on a senior unsecured basis. We expect to use the net proceeds from the 2024 Notes for general corporate purposes, including to fund the repayment of our 550 million euro senior notes due May 2024. Debt Issuance Costs: Debt issuance costs related to the 2024 Notes were insignificant. Fair Value of Debt: At March 30, 2024, the aggregate fair value of our total debt was $19.7 billion as compared with a carrying value of $20.5 billion. At December 30, 2023, the aggregate fair value of our total debt was $19.6 billion as compared with a carrying value of $20.0 billion. Our short-term debt had a carrying value that approximated its fair value at March 30, 2024 and December 30, 2023. We determined the fair value of our long-term debt using Level 2 inputs. Fair values are generally estimated based on quoted market prices for identical or similar instruments. |
Earnings Per Share (Notes)
Earnings Per Share (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Our earnings per common share (“EPS”) were: For the Three Months Ended March 30, 2024 April 1, 2023 (in millions, except per share data) Basic Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 801 $ 836 Weighted average shares of common stock outstanding 1,214 1,226 Net earnings/(loss) $ 0.66 $ 0.68 Diluted Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 801 $ 836 Weighted average shares of common stock outstanding 1,214 1,226 Effect of dilutive equity awards 9 8 Weighted average shares of common stock outstanding, including dilutive effect 1,223 1,234 Net earnings/(loss) $ 0.66 $ 0.68 We use the treasury stock method to calculate the dilutive effect of outstanding equity awards in the denominator for diluted EPS. Anti-dilutive shares were 6 million for the three months ended March 30, 2024 and 7 million for the three months ended April 1, 2023. |
Segment Reporting (Notes)
Segment Reporting (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting In the first quarter of 2024, our internal reporting and reportable segments changed. We divided our International segment into three operating segments — EPDM, WEEM, and AEM — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan. Subsequently, we manage our operating results through four operating segments. We have two reportable segments defined by geographic region: North America and International Developed Markets. Our remaining operating segments, consisting of WEEM and AEM, are combined and disclosed as Emerging Markets. We have reflected this segment change in all historical periods presented. As part of the segment reorganization, management reallocated certain corporate expenses previously reported within our International segment to general corporate expenses. This reflects management’s approach to centrally manage these expenses. We have reflected this reallocation in all historical periods presented. Our chief operating decision maker (“CODM”) evaluates segment performance based on several factors, including net sales and Segment Adjusted Operating Income. In the first quarter of 2024, following changes to our segments, our CODM reevaluated and changed the primary measure utilized to evaluate segment profitability from Segment Adjusted EBITDA to Segment Adjusted Operating Income. This change is expected to allow our CODM to better evaluate segment performance in line with our long-term strategic plan. Segment Adjusted Operating Income is defined as operating income/(loss) excluding, when they occur, the impacts of restructuring activities, deal costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized; once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters. Emerging Markets represents the aggregation of our WEEM and AEM operating segments. Adjusted Operating Income for WEEM and AEM is the measure reported to our chief operating decision maker for purposes of making decisions about allocating resources to these operating segments and assessing their performance. Segment Adjusted Operating Income is a financial measure that assists our CODM in comparing our performance on a consistent basis by removing the impact of certain items that our CODM believes do not directly reflect our underlying operations. Our CODM also uses Segment Adjusted Operating Income to allocate resources. We have reflected this change from Segment Adjusted EBITDA to Segment Adjusted Operating Income in all historical periods presented. Our CODM does not use assets by segment to evaluate performance or allocate resources. Therefore, we do not disclose assets by segment. Net sales by segment were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Net sales: North America $ 4,828 $ 4,885 International Developed Markets 855 860 Total segment net sales $ 5,683 $ 5,745 Emerging Markets net sales $ 728 $ 744 Total net sales $ 6,411 $ 6,489 Segment Adjusted Operating Income was (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Segment Adjusted Operating Income: North America $ 1,215 $ 1,209 International Developed Markets 136 107 Total Segment Adjusted Operating Income 1,351 1,316 Emerging Markets (a) 82 101 General corporate expenses (168) (172) Restructuring activities 3 10 Unrealized gains/(losses) on commodity hedges 34 (11) Certain non-ordinary course legal and regulatory matters — (1) Operating income/(loss) 1,302 1,243 Interest expense 226 227 Other expense/(income) 47 (35) Income/(loss) before income taxes $ 1,029 $ 1,051 (a) Emerging Markets represents the aggregation of our WEEM and AEM operating segments. In the first quarter of 2024, we changed the way we manage our product portfolio to align with our future growth strategy. As of March 30, 2024, we manage our product portfolio through eight consumer-driven product platforms: Taste Elevation, Easy Ready Meals, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, and Meats. A platform is a lens created for the portfolio based on a grouping of consumer needs. The platforms help us to manage and organize our business effectively by providing insight into our various product categories and brands. Taste Elevation includes condiments, sauces, dressings, and spreads. Easy Ready Meals includes Kraft Mac & Cheese varieties, frozen potato products, and other frozen meals. Substantial Snacking includes Lunchables meal kits, frozen snacks, and pickles. Desserts includes dry packaged desserts, refrigerated ready to eat desserts, and other dessert toppings. Hydration includes ready to drink beverages, powdered beverages, and liquid concentrates. Cheese includes American sliced and recipe cheeses. Coffee includes mainstream coffee, coffee pods, and premium coffee. Meats includes cold cuts, bacon, and hot dogs. Each platform is assigned a role within our business to help inform our resource allocation and investment decisions, which are made at the operating segment level. These roles include: Accelerate, Protect, and Balance. Our Accelerate role contains platforms that are expected to have high growth potential, generate higher gross margins, and are in markets in which we have higher market share. Our Protect role contains platforms that are expected to have moderate growth potential, tend to generate higher gross margins, and are in markets in which we have higher market share. Our Balance role contains platforms that include commodity-heavy categories with relatively flat growth potential but help us to maintain our brand footprint. We have reflected this change to our platforms in all historical periods presented. Net sales by platform were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 ACCELERATE Taste Elevation $ 2,803 $ 2,759 Easy Ready Meals 1,116 1,108 Substantial Snacking 443 462 Total Accelerate 4,362 4,329 PROTECT Desserts 241 245 Hydration 534 576 Total Protect 775 821 BALANCE Cheese 413 433 Coffee 221 219 Meats 511 524 Other 129 163 Total Balance 1,274 1,339 Total net sales $ 6,411 $ 6,489 |
Other Financial Data (Notes)
Other Financial Data (Notes) | 3 Months Ended |
Mar. 30, 2024 | |
Other Income and Expenses [Abstract] | |
Other Financial Data | Other Financial Data Condensed Consolidated Statements of Income Information Other expense/(income) consists of the following (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Amortization of postemployment benefit plans prior service costs/(credits) $ (3) $ (3) Net pension and postretirement non-service cost/(benefit) (a) (30) (22) Loss/(gain) on sale of business 80 1 Interest income (16) (6) Foreign exchange losses/(gains) (27) 6 Derivative losses/(gains) 39 (8) Other miscellaneous expense/(income) 4 (3) Other expense/(income) $ 47 $ (35) (a) Excludes amortization of postemployment benefit plans prior service costs/(credits). We present all non-service cost components of net pension cost/(benefit) and net postretirement cost/(benefit) within other expense/(income) on our condensed consolidated statements of income. See Note 10, Postemployment Benefits , for additional information on these components, including any curtailments and settlements, as well as information on our prior service costs/(credits) amortization. See Note 11, Financial Instruments , for information related to our derivative impacts. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) Attributable to Parent | $ 801 | $ 836 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 30, 2024 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | (c) Insider Stock Trading Arrangements: On February 29, 2024, Melissa Werneck, Executive Vice President and Global Chief People Officer, adopted a trading plan intended to satisfy Rule 10b5-1(c) to sell up to 81,438 shares of Kraft Heinz common stock between June 3, 2024 and May 30, 2025, subject to certain conditions. On March 13, 2024, Cory Onell, Executive Vice President and Chief Omnichannel Sales and Asian Emerging Markets Officer, adopted a trading plan intended to satisfy Rule 10b5-1(c) to sell up to 35,424 shares of Kraft Heinz common stock, as well as any shares of common stock underlying dividend equivalent units that accrue on RSUs when dividends are paid on shares of Kraft Heinz common stock (less any shares that may be withheld for taxes upon vesting) between June 13, 2024 and March 31, 2025, subject to certain conditions. |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Melissa Werneck [Member] | |
Trading Arrangements, by Individual | |
Name | Melissa Werneck, |
Title | Executive Vice President and Global Chief People Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | February 29, 2024, |
Arrangement Duration | 361 days |
Aggregate Available | 81,438 |
Cory Onell [Member] | |
Trading Arrangements, by Individual | |
Name | Cory Onell |
Title | Executive Vice President and Chief Omnichannel Sales and Asian Emerging Markets Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 13, 2024 |
Arrangement Duration | 291 days |
Aggregate Available | 35,424 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Period | We operate on a 52- or 53-week fiscal year ending on the last Saturday in December in each calendar year. Unless the context requires otherwise, references to years and quarters contained herein pertain to our fiscal years and fiscal quarters. Our 2024 fiscal year is scheduled to be a 52-week period ending on December 28, 2024, and our 2023 fiscal year was a 52-week period that ended on December 30, 2023. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include The Kraft Heinz Company and all of our controlled subsidiaries. All intercompany transactions are eliminated. |
Reportable Segments | Reportable Segments In the first quarter of 2024, our internal reporting structure and reportable segments changed. We divided our International segment into three operating segments — Europe and Pacific Developed Markets (“EPDM” or “International Developed Markets”), West and East Emerging Markets (“WEEM”), and Asia Emerging Markets (“AEM”) — to enable enhanced focus on the different strategies required for each of these regions as part of our long-term strategic plan. Subsequently, we manage our operating results through four operating segments. We have two reportable segments defined by geographic region: North America and International Developed Markets. Our remaining operating segments, consisting of WEEM and AEM, are combined and disclosed as Emerging Markets. |
Use of Estimates | Use of Estimates We prepare our condensed consolidated financial statements in accordance with U.S. GAAP, which requires us to make accounting policy elections, estimates, and assumptions that affect the reported amount of assets, liabilities, reserves, and expenses. These accounting policy elections, estimates, and assumptions are based on our best estimates and judgments. We evaluate our policy elections, estimates, and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We believe these estimates to be reasonable given the current facts available. We adjust our policy elections, estimates, and assumptions when facts and circumstances dictate. Market volatility, including foreign currency exchange rates, increases the uncertainty inherent in our estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from estimates. If actual amounts differ from estimates, we include the revisions in our consolidated results of operations in the period the actual amounts become known. Historically, the aggregate differences, if any, between our estimates and actual amounts in any year have not had a material effect on our condensed consolidated financial statements. |
Reclassifications | Reclassifications We made reclassifications and adjustments to certain previously reported financial information to conform to our current period presentation. |
Cash and Cash Equivalents, Policy | Cash , Cash Equivalents , and Restricted Cash Cash equivalents include term deposits with banks, money market funds, and all highly liquid investments with original maturities of three months or less. The fair value of cash equivalents approximates the carrying amount. Cash and cash equivalents that are legally restricted as to withdrawal or usage are classified in other current assets or other non-current assets, as applicable, on the condensed consolidated balance sheets. At March 30, 2024, we had $2 million of restricted cash in other non-current assets. At December 30, 2023, we had restricted cash recorded in other current assets of $3 million and $1 million of restricted cash in other non-current assets. Total cash, cash equivalents, and restricted cash was $1,628 million at March 30, 2024 and $1,404 million at December 30, 2023. |
New Accounting Standards (Polic
New Accounting Standards (Policies) | 3 Months Ended |
Mar. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Standards | Accounting Standards Not Yet Adopted Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures: In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2023-07 to improve segment disclosure requirements under Accounting Standards Codification (“ASC”) 280, Segment Reporting, through enhancing disclosures about significant segment expenses. The guidance requires entities to provide significant segment expenses that are regularly provided to the chief operating decision maker and other segment expenses included in each reported measure of segment profitability. This ASU also enhances interim segment reporting requirements by aligning interim disclosures with information that must be disclosed annually in accordance with ASC 280. This ASU will be effective beginning in 2024 for annual reports and in 2025 for quarterly reports. Early adoption is permitted. The new guidance must be applied retrospectively to all prior periods presented in the financial statements, with the significant segment expense and other segment item amounts disclosed based on categories identified in the period of adoption. We are still evaluating the impacts this ASU will have on our notes to the consolidated financial statements. Income Taxes (Topic 740) – Improvements to Income Tax Disclosures: In December 2023, the FASB issued ASU 2023-09 to improve income tax disclosure requirements under ASC 740, Income Taxes . The guidance requires entities to provide separate information about a reporting entity’s effective tax rate reconciliation and about income taxes paid. This ASU will be effective for annual periods beginning after December 15, 2024 and will impact our 2025 annual report. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. While the standard will require additional disclosures related to the Company’s income taxes, we do not expect this ASU to have a significant impact on our financial statements. |
Restructuring Activities (Table
Restructuring Activities (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | Our net liability balance for restructuring project costs that qualify as exit and disposal costs under U.S. GAAP was (in millions): Severance and Employee Benefit Costs Other Exit Costs Total Balance at December 30, 2023 $ 23 $ 14 $ 37 Charges/(credits) (6) 1 (5) Cash payments (4) (1) (5) Balance at March 30, 2024 $ 13 $ 14 $ 27 |
Restructuring Costs by Type and Income Statement Location | Total expense/(income) related to restructuring activities, by income statement caption, were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Severance and employee benefit costs - Cost of products sold $ — $ 2 Severance and employee benefit costs - SG&A (6) (4) Severance and employee benefit costs - Other expense/(income) — 2 Asset-related costs - Cost of products sold — 2 Other costs - Cost of products sold 1 2 Other costs - SG&A 2 (12) $ (3) $ (8) |
Restructuring Costs Excluded from Segments | The pre-tax impact of allocating such expenses/(income) to our segments would have been (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 North America $ (2) $ 6 International Developed Markets (1) — Emerging Markets (a) — (1) General corporate expenses — (13) $ (3) $ (8) |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following (in millions): March 30, 2024 December 30, 2023 Packaging and ingredients $ 929 $ 1,014 Spare parts 235 233 Work in process 307 338 Finished products 2,107 2,029 Inventories $ 3,578 $ 3,614 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill by Segment | Changes in the carrying amount of goodwill, by segment, were (in millions): North America International Developed Markets Emerging Markets (a) Total Balance at December 30, 2023 $ 27,248 $ 2,687 $ 524 $ 30,459 Translation adjustments and other (15) (43) (11) (69) Balance at March 30, 2024 $ 27,233 $ 2,644 $ 513 $ 30,390 (a) Emerging Markets represents the aggregation of our WEEM and AEM operating segments. |
Changes in the Carrying Amount of Indefinite-Lived Intangible Assets | Changes in the carrying amount of indefinite-lived intangible assets, which primarily consisted of trademarks, were (in millions): Balance at December 30, 2023 $ 38,502 Translation adjustments and other (62) Balance at March 30, 2024 $ 38,440 |
Schedule of Definite-Lived Intangible Assets By Major Asset Class | Definite-lived intangible assets were (in millions): March 30, 2024 December 30, 2023 Gross Accumulated Net Gross Accumulated Net Trademarks $ 2,292 $ (776) $ 1,516 $ 2,313 $ (755) $ 1,558 Customer-related assets 3,691 (1,360) 2,331 3,710 (1,331) 2,379 Other 12 (3) 9 12 (3) 9 $ 5,995 $ (2,139) $ 3,856 $ 6,035 $ (2,089) $ 3,946 |
Employees' Stock Incentive Pl_2
Employees' Stock Incentive Plans (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity and Related Information | Our stock option activity and related information was: Number of Stock Options Weighted Average Exercise Price Outstanding at December 30, 2023 8,022,540 $ 46.87 Granted 654,724 35.13 Forfeited (1,199,934) 46.75 Exercised (168,861) 22.60 Outstanding at March 30, 2024 7,308,469 46.39 |
Schedule of RSU Activity and Related Information | Our restricted stock unit (“RSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value Outstanding at December 30, 2023 7,722,870 $ 36.80 Granted 2,855,557 35.19 Forfeited (249,375) 37.39 Vested (2,799,172) 34.28 Outstanding at March 30, 2024 7,529,880 37.10 |
Schedule of PSU Activity and Related Information | Our performance share unit (“PSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value Outstanding at December 30, 2023 4,855,432 $ 33.65 Granted 2,589,797 29.14 Forfeited (308,513) 32.98 Vested (951,164) 34.56 Outstanding at March 30, 2024 6,185,552 31.77 |
Postemployment Benefits (Tables
Postemployment Benefits (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Pension Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Net Cost/(Benefit) | Net pension cost/(benefit) consisted of the following (in millions): For the Three Months Ended U.S. Plan Non-U.S. Plans March 30, 2024 April 1, 2023 March 30, 2024 April 1, 2023 Service cost $ — $ — $ 2 $ 2 Interest cost 34 36 14 15 Expected return on plan assets (49) (49) (21) (21) Amortization of unrecognized losses/(gains) — — 3 4 Special/contractual termination benefits — — — 2 Net pension cost/(benefit) $ (15) $ (13) $ (2) $ 2 |
Postretirement Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Net Cost/(Benefit) | Net postretirement cost/(benefit) consisted of the following (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Service cost $ 1 $ 1 Interest cost 8 9 Expected return on plan assets (14) (14) Amortization of prior service costs/(credits) (3) (3) Amortization of unrecognized losses/(gains) (5) (4) Net postretirement cost/(benefit) $ (13) $ (11) |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Notional Values of Outstanding Derivatives | The notional values of our outstanding derivative instruments were (in millions): Notional Amount March 30, 2024 December 30, 2023 Commodity contracts $ 957 $ 954 Foreign exchange contracts 4,826 4,618 Cross-currency contracts 6,997 6,133 |
Schedule of Derivative Fair Values | The fair values and the levels within the fair value hierarchy of derivative instruments recorded on the condensed consolidated balance sheets were (in millions): March 30, 2024 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts (a) $ — $ — $ 19 $ 15 $ 19 $ 15 Cross-currency contracts (b) — — 128 115 128 115 Derivatives not designated as hedging instruments: Commodity contracts (c) 37 44 4 6 41 50 Foreign exchange contracts (a) — — 13 8 13 8 Cross currency contracts (b) — — — 18 — 18 Total fair value $ 37 $ 44 $ 164 $ 162 $ 201 $ 206 (a) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets ($29 million) and other non-current assets ($3 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($21 million) and other non-current liabilities ($2 million). (b) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets ($52 million) and other non-current assets ($76 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($44 million) and other non-current liabilities ($89 million). (c) At March 30, 2024, the fair value of our derivative assets was recorded in other current assets and the fair value of derivative liabilities was recorded in other current liabilities. December 30, 2023 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts (a) $ — $ — $ 12 $ 42 $ 12 $ 42 Cross-currency contracts (b) — — 140 165 140 165 Derivatives not designated as hedging instruments: Commodity contracts (c) 20 59 3 7 23 66 Foreign exchange contracts (a) — — 17 23 17 23 Total fair value $ 20 $ 59 $ 172 $ 237 $ 192 $ 296 (a) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets ($21 million) and other non-current assets ($8 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($51 million) and other non-current liabilities ($14 million). (b) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets ($37 million) and other non-current assets ($103 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($31 million) and other non-current liabilities ($134 million). (c) At December 30, 2023, the fair value of our derivative assets was recorded in other current assets and the fair value of derivative liabilities was recorded in other current liabilities ($64 million) and other non-current liabilities ($2 million). |
Derivative Impact on Statements of Other Comprehensive Income | The following table presents the pre-tax amounts of derivative gains/(losses) deferred into accumulated other comprehensive income/(losses) and the income statement line item that will be affected when reclassified to net income/(loss) (in millions): Accumulated Other Comprehensive Income/(Losses) Component Gains/(Losses) Recognized in Other Comprehensive Income/(Losses) Related to Derivatives Designated as Hedging Instruments Location of Gains/(Losses) When Reclassified to Net Income/(Loss) For the Three Months Ended March 30, 2024 April 1, 2023 Cash flow hedges: Foreign exchange contracts 19 (4) Cost of products sold Foreign exchange contracts (excluded component) (4) (2) Cost of products sold Foreign exchange contracts 21 — Other expense/(income) Foreign exchange contracts (excluded component) (3) — Other expense/(income) Cross-currency contracts (36) (1) Other expense/(income) Cross-currency contracts (excluded component) — 6 Other expense/(income) Cross-currency contracts (8) (6) Interest expense Interest rate contracts — (3) Interest expense Net investment hedges: Foreign exchange contracts — 1 Other Cross-currency contracts 74 (12) Other expense/(income) Cross-currency contracts (excluded component) 12 8 Interest expense Total gains/(losses) recognized in statements of comprehensive income $ 75 $ (13) |
Derivative Impact on Statements of Income | For the Three Months Ended March 30, 2024 April 1, 2023 Cost of products sold Interest expense Other expense/(income) Cost of products sold Interest expense Other expense/(income) Total amounts presented in the condensed consolidated statements of income in which the following effects were recorded $ 4,168 $ 226 $ 47 $ 4,376 $ 227 $ (35) Gains/(losses) related to derivatives designated as hedging instruments: Cash flow hedges: Foreign exchange contracts $ 3 $ — $ 21 $ 10 $ — $ — Foreign exchange contracts (excluded component) (2) — — (3) — — Cross-currency contracts — (8) (44) — (6) 14 Cross-currency contracts (excluded component) — — — — — 6 Net investment hedges: Cross-currency contracts (excluded component) — 12 — — 8 — Gains/(losses) related to derivatives not designated as hedging instruments: Commodity contracts 9 — — (47) — — Foreign exchange contracts — — 8 — — (12) Interest rates contracts (a) — — (3) — — — Cross-currency contracts — — (21) — — — Total gains/(losses) recognized in statements of income $ 10 $ 4 $ (39) $ (40) $ 2 $ 8 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income/(Losses) (Tables) - AOCI Attributable to Parent | 3 Months Ended |
Mar. 30, 2024 | |
Accumulated Other Comprehensive Income/(Loss) [Line Items] | |
Components of and Changes in Accumulated Other Comprehensive Income/(Losses) | The components of, and changes in, accumulated other comprehensive income/(losses), net of tax, were as follows (in millions): Foreign Currency Translation Adjustments Net Postemployment Benefit Plan Adjustments Net Cash Flow Hedge Adjustments Total Balance as of December 30, 2023 $ (2,634) $ 15 $ 15 $ (2,604) Foreign currency translation adjustments (156) — — (156) Net deferred gains/(losses) on net investment hedges 74 — — 74 Amounts excluded from the effectiveness assessment of net investment hedges 10 — — 10 Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss) (9) — — (9) Net deferred gains/(losses) on cash flow hedges — — 8 8 Amounts excluded from the effectiveness assessment of cash flow hedges — — (2) (2) Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) — — 14 14 Net postemployment benefit losses/(gains) reclassified to net income/(loss) — (4) — (4) Total other comprehensive income/(loss) (81) (4) 20 (65) Balance as of March 30, 2024 $ (2,715) $ 11 $ 35 $ (2,669) |
Gross Amount and Related Tax Benefit/(Expense) Recorded in and Associated with each Component of Other Comprehensive Income/(Loss) | The gross amount and related tax benefit/(expense) recorded in, and associated with, each component of other comprehensive income/(loss) were as follows (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ (156) $ — $ (156) $ 115 $ — $ 115 Net deferred gains/(losses) on net investment hedges 98 (24) 74 (31) 7 (24) Amounts excluded from the effectiveness assessment of net investment hedges 12 (2) 10 8 (2) 6 Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss) (12) 3 (9) (8) 2 (6) Net deferred gains/(losses) on cash flow hedges (4) 12 8 (14) (1) (15) Amounts excluded from the effectiveness assessment of cash flow hedges (7) 5 (2) 4 — 4 Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss) 33 (19) 14 (21) 5 (16) Net postemployment benefit losses/(gains) reclassified to net income/(loss) (5) 1 (4) (3) 1 (2) |
Amounts Reclassified From Accumulated Other Comprehensive Income/(Losses) | The amounts reclassified from accumulated other comprehensive income/(losses) were as follows (in millions): Accumulated Other Comprehensive Income/(Losses) Component Reclassified from Accumulated Other Comprehensive Income/(Losses) to Net Income/(Loss) Affected Line Item in the Statements of Income For the Three Months Ended March 30, 2024 April 1, 2023 Losses/(gains) on net investment hedges: Cross-currency contracts (a) $ (12) $ (8) Interest expense Losses/(gains) on cash flow hedges: Foreign exchange contracts (b) (1) (7) Cost of products sold Foreign exchange contracts (b) (21) — Other expense/(income) Cross-currency contracts (b) 44 (20) Other expense/(income) Cross-currency contracts (b) 8 6 Interest expense Interest rate contracts (c) 3 — Other expense/(income) Losses/(gains) on hedges before income taxes 21 (29) Losses/(gains) on hedges, income taxes (16) 7 Losses/(gains) on hedges $ 5 $ (22) Losses/(gains) on postemployment benefits: Amortization of unrecognized losses/(gains) (d) $ (2) $ — Amortization of prior service costs/(credits) (d) (3) (3) Losses/(gains) on postemployment benefits before income taxes (5) (3) Losses/(gains) on postemployment benefits, income taxes 1 1 Losses/(gains) on postemployment benefits $ (4) $ (2) (a) Represents recognition of the excluded component in net income/(loss). (b) Includes amortization of the excluded component and the effective portion of the related hedges. (c) Represents recognition of realized hedge losses resulting from the discontinuance of cash flow hedges because the forecasted transactions were no longer probable of occurring. (d) These components are included in the computation of net periodic postemployment benefit costs. See Note 10, Postemployment Benefits , for additional information. In this note we have excluded activity and balances related to noncontrolling interest due to their insignificance. This activity was primarily related to foreign currency translation adjustments. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Common Share, Basic and Diluted | Our earnings per common share (“EPS”) were: For the Three Months Ended March 30, 2024 April 1, 2023 (in millions, except per share data) Basic Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 801 $ 836 Weighted average shares of common stock outstanding 1,214 1,226 Net earnings/(loss) $ 0.66 $ 0.68 Diluted Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 801 $ 836 Weighted average shares of common stock outstanding 1,214 1,226 Effect of dilutive equity awards 9 8 Weighted average shares of common stock outstanding, including dilutive effect 1,223 1,234 Net earnings/(loss) $ 0.66 $ 0.68 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Segment Reporting [Abstract] | |
Net Sales by Segment | Net sales by segment were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Net sales: North America $ 4,828 $ 4,885 International Developed Markets 855 860 Total segment net sales $ 5,683 $ 5,745 Emerging Markets net sales $ 728 $ 744 Total net sales $ 6,411 $ 6,489 |
Segment Adjusted EBITDA | Segment Adjusted Operating Income was (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Segment Adjusted Operating Income: North America $ 1,215 $ 1,209 International Developed Markets 136 107 Total Segment Adjusted Operating Income 1,351 1,316 Emerging Markets (a) 82 101 General corporate expenses (168) (172) Restructuring activities 3 10 Unrealized gains/(losses) on commodity hedges 34 (11) Certain non-ordinary course legal and regulatory matters — (1) Operating income/(loss) 1,302 1,243 Interest expense 226 227 Other expense/(income) 47 (35) Income/(loss) before income taxes $ 1,029 $ 1,051 (a) Emerging Markets represents the aggregation of our WEEM and AEM operating segments. |
Net Sales by Platform | Net sales by platform were (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 ACCELERATE Taste Elevation $ 2,803 $ 2,759 Easy Ready Meals 1,116 1,108 Substantial Snacking 443 462 Total Accelerate 4,362 4,329 PROTECT Desserts 241 245 Hydration 534 576 Total Protect 775 821 BALANCE Cheese 413 433 Coffee 221 219 Meats 511 524 Other 129 163 Total Balance 1,274 1,339 Total net sales $ 6,411 $ 6,489 |
Other Financial Data (Tables)
Other Financial Data (Tables) | 3 Months Ended |
Mar. 30, 2024 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Expense/(Income) | Other expense/(income) consists of the following (in millions): For the Three Months Ended March 30, 2024 April 1, 2023 Amortization of postemployment benefit plans prior service costs/(credits) $ (3) $ (3) Net pension and postretirement non-service cost/(benefit) (a) (30) (22) Loss/(gain) on sale of business 80 1 Interest income (16) (6) Foreign exchange losses/(gains) (27) 6 Derivative losses/(gains) 39 (8) Other miscellaneous expense/(income) 4 (3) Other expense/(income) $ 47 $ (35) |
Basis of Presentation (Details)
Basis of Presentation (Details) $ in Millions | 3 Months Ended | |||
Mar. 30, 2024 USD ($) operatingSegment segment | Dec. 30, 2023 USD ($) | Apr. 01, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Number of reportable segments | segment | 2 | |||
Restricted cash included in other non-current assets | $ 2 | $ 1 | ||
Cash, cash equivalents, and restricted cash | $ 1,628 | 1,404 | $ 828 | $ 1,041 |
Number of Operating Segments | operatingSegment | 4 | |||
Restricted Cash, Current | $ 3 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Business Acquisition [Line Items] | ||
Pre-tax gain (loss) on disposition of business | $ (80) | $ (1) |
Papua New Guinea Transaction | ||
Business Acquisition [Line Items] | ||
Pre-tax gain (loss) on disposition of business | 80 | |
Accumulated foreign currency loss | 41 | |
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Russia Infant Transaction | ||
Business Acquisition [Line Items] | ||
Proceeds from sale of business, net of cash disposed | 25 | |
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Papua New Guinea Transaction | ||
Business Acquisition [Line Items] | ||
Proceeds from sale of business, net of cash disposed | $ 22 |
Restructuring Activities - Addi
Restructuring Activities - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 USD ($) employee | Apr. 01, 2023 USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ (3) | $ (8) |
Asset-related costs - Cost of products sold | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ 0 | 2 |
Restructuring Activities | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, number of positions eliminated | employee | 50 | |
Restructuring and related cost, expected number of positions eliminated | employee | 100 | |
Restructuring and related cost, incurred cost (credit) | $ (3) | $ (8) |
Restructuring Activities | Severance and Employee Benefit Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | (6) | |
Restructuring Activities | Other Exit Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 1 | |
Restructuring Activities | Other Implementation Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ 2 |
Restructuring Activities - Rest
Restructuring Activities - Restructuring Reserve Roll-forward (Details) - Restructuring Activities $ in Millions | 3 Months Ended |
Mar. 30, 2024 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 37 |
Charges/(credits) | (5) |
Cash payments | (5) |
Ending balance | 27 |
Severance and Employee Benefit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 23 |
Charges/(credits) | (6) |
Cash payments | (4) |
Ending balance | 13 |
Other Exit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 14 |
Charges/(credits) | 1 |
Cash payments | (1) |
Ending balance | $ 14 |
Restructuring Activities - Re_2
Restructuring Activities - Restructuring Costs by Type and Income Statement Location (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ (3) | $ (8) |
Severance and Employee Benefit Costs | Cost of products sold | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 0 | 2 |
Severance and Employee Benefit Costs | SG&A | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | (6) | (4) |
Severance and Employee Benefit Costs | Other expense/(income) | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 0 | 2 |
Asset-related costs - Cost of products sold | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 0 | 2 |
Other Costs | Cost of products sold | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 1 | 2 |
Other Costs | SG&A | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ 2 | $ (12) |
Restructuring Activities - Re_3
Restructuring Activities - Restructuring Costs Excluded from Segments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Segment Reporting Information [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ (3) | $ (8) |
General corporate expenses | ||
Segment Reporting Information [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | 0 | (13) |
North America | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | (2) | 6 |
International Developed Markets | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | (1) | 0 |
Emerging Markets | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Restructuring and related cost, incurred cost (credit) | $ 0 | $ (1) |
Inventories Components of Inven
Inventories Components of Inventories (Details) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
Inventory Disclosure [Abstract] | ||
Packaging and ingredients | $ 929 | $ 1,014 |
Spare parts | 235 | 233 |
Work in process | 307 | 338 |
Finished products | 2,107 | 2,029 |
Inventories | $ 3,578 | $ 3,614 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Changes in the Carrying Amount of Goodwill by Segment (Details) $ in Millions | 3 Months Ended |
Mar. 30, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 30,459 |
Translation adjustments and other | (69) |
Ending balance | 30,390 |
International Developed Markets | |
Goodwill [Roll Forward] | |
Translation adjustments and other | (43) |
Ending balance | 2,644 |
International Developed Segment | |
Goodwill [Roll Forward] | |
Beginning balance | 2,687 |
North America | |
Goodwill [Roll Forward] | |
Beginning balance | 27,248 |
Translation adjustments and other | (15) |
Ending balance | 27,233 |
Emerging Markets | |
Goodwill [Roll Forward] | |
Beginning balance | 524 |
Translation adjustments and other | (11) |
Ending balance | $ 513 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Goodwill Additional Information (Details) $ in Millions | 3 Months Ended | ||
Mar. 30, 2024 USD ($) employee | Dec. 30, 2023 USD ($) | Jul. 02, 2023 USD ($) | |
Goodwill [Line Items] | |||
Number of reporting units | employee | 11 | ||
Goodwill | $ 30,390 | $ 30,459 | |
Goodwill, impaired, accumulated impairment loss | $ (11,800) | ||
Reporting Units With More Than 20% Excess Fair Value Over Carrying Amount | Minimum | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Reporting Units With More Than 20% Excess Fair Value Over Carrying Amount | Maximum | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 50% | ||
Reporting unit, goodwill balance held | |||
Goodwill [Line Items] | |||
Number of reporting units | employee | 7 | ||
Reporting unit, goodwill balance held | 20% or less | |||
Goodwill [Line Items] | |||
Goodwill | $ 30,100 | ||
Reporting unit, goodwill balance held | 20 to 50% | |||
Goodwill [Line Items] | |||
Goodwill | $ 309 | ||
Reporting Units With 20% Or Less Excess Fair Value Over Carrying Amount | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Reporting Units With More Than 20% Excess Fair Value Over Carrying Amount | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Impaired Brands | 20% or less | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Impaired Brands | 20 to 50% | Minimum | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Impaired Brands | 20 to 50% | Maximum | |||
Goodwill [Line Items] | |||
Percentage of fair value in excess of carrying amount | 50% |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Changes in the Carrying Amount of Indefinite-Lived Intangible Assets (Details) $ in Millions | 3 Months Ended |
Mar. 30, 2024 USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Beginning balance | $ 38,502 |
Translation adjustments and other | (62) |
Ending balance | $ 38,440 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets - Indefinite-Lived Intangible Assets Additional Information (Details) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 | Jul. 02, 2023 |
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 38,440 | $ 38,502 | |
Brand, percentage of fair value in excess of carrying value | 20% | ||
Impaired Brands | 20% or less | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 18,700 | ||
Percentage of fair value in excess of carrying amount | 20% | ||
Impaired Brands | 20 to 50% | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 4,200 | ||
Impaired Brands | In Excess of 50% | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 15,700 | ||
Percentage of fair value in excess of carrying amount | 50% | ||
Impaired Brands | Minimum | 20 to 50% | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Percentage of fair value in excess of carrying amount | 20% | ||
Impaired Brands | Maximum | 20 to 50% | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Percentage of fair value in excess of carrying amount | 50% |
Goodwill and Intangible Asset_7
Goodwill and Intangible Assets - Summary of Definite-Lived Intangible Assets (Details) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | $ 5,995 | $ 6,035 |
Accumulated Amortization | (2,139) | (2,089) |
Net | 3,856 | 3,946 |
Trademarks | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 2,292 | 2,313 |
Accumulated Amortization | (776) | (755) |
Net | 1,516 | 1,558 |
Customer-related assets | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 3,691 | 3,710 |
Accumulated Amortization | (1,360) | (1,331) |
Net | 2,331 | 2,379 |
Other | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 12 | 12 |
Accumulated Amortization | (3) | (3) |
Net | $ 9 | $ 9 |
Goodwill and Intangible Asset_8
Goodwill and Intangible Assets - Definite Lived Intangible Assets Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 64 | $ 62 |
Amortization of definite-lived intangible assets, current year | 260 | |
Amortization of definite-lived intangible assets, year one | 260 | |
Amortization of definite-lived intangible assets, year two | 260 | |
Amortization of definite-lived intangible assets, year three | 260 | |
Amortization of definite-lived intangible assets, year four | 250 | |
Amortization of definite-lived intangible assets, year five | $ 250 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 30, 2024 | Apr. 01, 2023 | Jun. 29, 2019 | Jun. 30, 2018 | |
Income Tax Contingency [Line Items] | ||||
Effective tax rate | 21.90% | 20.30% | ||
Provision for/(benefit from) income taxes | $ 225 | $ 214 | ||
Internal Revenue Service (IRS) | ||||
Income Tax Contingency [Line Items] | ||||
Income Tax Examination, Estimate of Possible Loss | $ 210 | $ 200 | ||
income tax examination, estimate of possible loss from penalties | $ 85 |
Employees' Stock Incentive Pl_3
Employees' Stock Incentive Plans - Schedule of Stock Option Activity and Related Information (Details) | 3 Months Ended |
Mar. 30, 2024 $ / shares shares | |
Number of Stock Options | |
Beginning balance (in shares) | shares | 8,022,540 |
Granted (in shares) | shares | 654,724 |
Forfeited (in shares) | shares | (1,199,934) |
Exercised (in shares) | shares | (168,861) |
Ending balance (in shares) | shares | 7,308,469 |
Weighted Average Exercise Price (per share) | |
Options outstanding at period start, weighted average exercise price (in dollars per share) | $ / shares | $ 46.87 |
Options granted, weighted average exercise price (in dollars per share) | $ / shares | 35.13 |
Options forfeited, weighted average exercise price (in dollars per share) | $ / shares | 46.75 |
Options exercised, weighted average exercise price (in dollars per share) | $ / shares | 22.60 |
Options outstanding at period end, weighted average exercise price (in dollars per share) | $ / shares | $ 46.39 |
Employees' Stock Incentive Pl_4
Employees' Stock Incentive Plans - Schedule of RSU Activity and Related Information (Details) - RSUs | 3 Months Ended |
Mar. 30, 2024 $ / shares shares | |
Number of Units | |
Beginning balance (in shares) | shares | 7,722,870 |
Granted (in shares) | shares | 2,855,557 |
Forfeited (in shares) | shares | (249,375) |
Vested (in shares) | shares | (2,799,172) |
Ending balance (in shares) | shares | 7,529,880 |
Weighted Average Grant Date Fair Value (per share) | |
Outstanding at period start, weighted average grant date fair value (in dollars per share) | $ / shares | $ 36.80 |
Granted, weighted average grant date fair value (in dollars per share) | $ / shares | 35.19 |
Forfeited, weighted average grant date fair value (in dollars per share) | $ / shares | 37.39 |
Vested, weighted average grant date fair value (in dollars per share) | $ / shares | 34.28 |
Outstanding at period end, weighted average grant date fair value (in dollars per share) | $ / shares | $ 37.10 |
Employees' Stock Incentive Pl_5
Employees' Stock Incentive Plans - Schedule of PSU Activity and Related Information (Details) - PSUs | 3 Months Ended |
Mar. 30, 2024 $ / shares shares | |
Number of Units | |
Beginning balance (in shares) | shares | 4,855,432 |
Granted (in shares) | shares | 2,589,797 |
Forfeited (in shares) | shares | (308,513) |
Vested (in shares) | shares | (951,164) |
Ending balance (in shares) | shares | 6,185,552 |
Weighted Average Grant Date Fair Value (per share) | |
Outstanding at period start, weighted average grant date fair value (in dollars per share) | $ / shares | $ 33.65 |
Granted, weighted average grant date fair value (in dollars per share) | $ / shares | 29.14 |
Forfeited, weighted average grant date fair value (in dollars per share) | $ / shares | 32.98 |
Vested, weighted average grant date fair value (in dollars per share) | $ / shares | 34.56 |
Outstanding at period end, weighted average grant date fair value (in dollars per share) | $ / shares | $ 31.77 |
Employees' Stock Incentive Pl_6
Employees' Stock Incentive Plans - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 30, 2024 USD ($) | |
RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Equity instruments other than options, vested in period, fair value | $ 99 |
PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Equity instruments other than options, vested in period, fair value | $ 33 |
Postemployment Benefits Pension
Postemployment Benefits Pension Plans - Net Cost/(Benefit) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Amortization of postemployment benefit plans prior service costs/(credits) | $ (3) | $ (3) |
U.S. Plan | Pension Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 0 | 0 |
Interest cost | 34 | 36 |
Expected return on plan assets | (49) | (49) |
Amortization of unrecognized losses/(gains) | 0 | 0 |
Special/contractual termination benefits | 0 | 0 |
Net postretirement cost/(benefit) | (15) | (13) |
Non-U.S. Plans | Pension Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 2 | 2 |
Interest cost | 14 | 15 |
Expected return on plan assets | (21) | (21) |
Amortization of unrecognized losses/(gains) | 3 | 4 |
Special/contractual termination benefits | 0 | 2 |
Net postretirement cost/(benefit) | $ (2) | $ 2 |
Postemployment Benefits - Addit
Postemployment Benefits - Additional Information (Details) | 3 Months Ended |
Mar. 30, 2024 USD ($) | |
Pension Plans | Non-U.S. Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Employer contributions | $ 2,000,000 |
Estimated future employer contributions | 8,000,000 |
Pension Plans | U.S. Plan | |
Defined Benefit Plan Disclosure [Line Items] | |
Employer contributions | 0 |
Estimated future employer contributions | 0 |
Postretirement Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Employer contributions | 3,000,000 |
Estimated future employer contributions | $ 9,000,000 |
Postemployment Benefits - Postr
Postemployment Benefits - Postretirement Benefit Plans Net Cost/(Benefit) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Amortization of postemployment benefit plans prior service costs/(credits) | $ (3) | $ (3) |
Postretirement Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 1 | 1 |
Interest cost | 8 | 9 |
Expected return on plan assets | (14) | (14) |
Amortization of postemployment benefit plans prior service costs/(credits) | (3) | (3) |
Amortization of unrecognized losses/(gains) | (5) | (4) |
Net postretirement cost/(benefit) | $ (13) | $ (11) |
Financial Instruments - Schedul
Financial Instruments - Schedule of Notional Values of Outstanding Derivatives (Details) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
Commodity contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 957 | $ 954 |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | 4,826 | 4,618 |
Cross-currency contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 6,997 | $ 6,133 |
Financial Instruments - Sched_2
Financial Instruments - Schedule of Derivative Fair Values (Details) - USD ($) $ in Millions | Mar. 30, 2024 | Dec. 30, 2023 |
Derivatives Fair Value [Line Items] | ||
Assets | $ 201 | $ 192 |
Liabilities | 206 | 296 |
Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 19 | 12 |
Liabilities | 15 | 42 |
Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 13 | 17 |
Liabilities | 8 | 23 |
Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 128 | 140 |
Liabilities | 115 | 165 |
Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | |
Liabilities | 18 | |
Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 41 | 23 |
Liabilities | 50 | 66 |
Level 1 | ||
Derivatives Fair Value [Line Items] | ||
Assets | 37 | 20 |
Liabilities | 44 | 59 |
Level 1 | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | |
Liabilities | 0 | |
Level 1 | Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 37 | 20 |
Liabilities | 44 | 59 |
Level 2 | ||
Derivatives Fair Value [Line Items] | ||
Assets | 164 | 172 |
Liabilities | 162 | 237 |
Level 2 | Foreign exchange contracts | Other current assets | ||
Derivatives Fair Value [Line Items] | ||
Assets | 29 | 21 |
Level 2 | Foreign exchange contracts | Other non-current assets | ||
Derivatives Fair Value [Line Items] | ||
Assets | 3 | 8 |
Level 2 | Foreign exchange contracts | Other current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Liabilities | 21 | 51 |
Level 2 | Foreign exchange contracts | Other non-current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Liabilities | 2 | 14 |
Level 2 | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 19 | 12 |
Liabilities | 15 | 42 |
Level 2 | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 13 | 17 |
Liabilities | 8 | 23 |
Level 2 | Cross-currency contracts | Other current assets | ||
Derivatives Fair Value [Line Items] | ||
Assets | 52 | 37 |
Level 2 | Cross-currency contracts | Other non-current assets | ||
Derivatives Fair Value [Line Items] | ||
Assets | 76 | 103 |
Level 2 | Cross-currency contracts | Other current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Liabilities | 44 | 31 |
Level 2 | Cross-currency contracts | Other non-current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Liabilities | 89 | 134 |
Level 2 | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 128 | 140 |
Liabilities | 115 | 165 |
Level 2 | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 0 | |
Liabilities | 18 | |
Level 2 | Commodity contracts | Other current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Liability, Fair Value, Gross Liability Including Not Subject to Master Netting Arrangement | 64 | |
Level 2 | Commodity contracts | Other non-current liabilities | ||
Derivatives Fair Value [Line Items] | ||
Derivative Liability, Fair Value, Gross Liability Including Not Subject to Master Netting Arrangement | 2 | |
Level 2 | Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Assets | 4 | 3 |
Liabilities | $ 6 | $ 7 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) € in Millions, £ in Millions, $ in Millions, ¥ in Billions, $ in Billions | 3 Months Ended | ||||||
Mar. 30, 2024 USD ($) | Apr. 01, 2023 USD ($) | Mar. 30, 2024 EUR (€) | Mar. 30, 2024 GBP (£) | Mar. 30, 2024 CAD ($) | Mar. 30, 2024 JPY (¥) | Dec. 30, 2023 USD ($) | |
Derivative [Line Items] | |||||||
Derivative, collateral, obligation to return cash | $ 156 | $ 130 | |||||
Derivative, collateral, right to reclaim cash | 156 | 130 | |||||
Collateral posted related to commodity derivative margin requirements, asset | $ 15 | $ 41 | |||||
Cross-currency contracts | |||||||
Derivative [Line Items] | |||||||
Maximum length of time hedged in cash flow hedge | 50 months | ||||||
Foreign exchange contracts | |||||||
Derivative [Line Items] | |||||||
Maximum length of time hedged in cash flow hedge | 22 months | ||||||
Designated as hedging instrument | Debt | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Non-derivative instruments, loss (gain) recognized in other comprehensive income (loss), net | $ (24) | $ (20) | |||||
Designated as hedging instrument | Debt | Euro Member Countries, Euro | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative, amount of hedged item | € | € 100 | ||||||
Designated as hedging instrument | Debt | United Kingdom, Pounds | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative, amount of hedged item | £ | £ 400 | ||||||
Designated as hedging instrument | Cross-currency contracts | Euro Member Countries, Euro | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative asset, notional amount | 2,500 | € 2,300 | |||||
Designated as hedging instrument | Cross-currency contracts | Canada, Dollars | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative liability, notional amount | 1,000 | $ 1.4 | |||||
Designated as hedging instrument | Cross-currency contracts | Japan, Yen | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative asset, notional amount | 68 | ¥ 9.6 | |||||
Designated as hedging instrument | Other contract | Euro Member Countries, Euro | Net Investment Hedging | |||||||
Derivative [Line Items] | |||||||
Derivative, amount of hedged item | $ 782 |
Financial Instruments - Derivat
Financial Instruments - Derivative Impact on Statements of Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Derivative [Line Items] | ||
Other comprehensive income (loss), derivatives, gain (loss), before reclassification and tax | $ 75 | $ (13) |
Cash Flow Hedging | Cost of products sold | Foreign exchange contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on cash flow hedges, before tax | 19 | (4) |
Amounts excluded from the effectiveness assessment of cash flow hedges, before tax | (4) | (2) |
Cash Flow Hedging | Other expense/(income) | Foreign exchange contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on cash flow hedges, before tax | 21 | 0 |
Cash Flow Hedging | Other expense/(income) | Cross-currency contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on cash flow hedges, before tax | (36) | (1) |
Amounts excluded from the effectiveness assessment of cash flow hedges, before tax | 0 | 6 |
Cash Flow Hedging | Interest expense | Cross-currency contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on cash flow hedges, before tax | (8) | (6) |
Cash Flow Hedging | Interest expense | Interest rate contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on cash flow hedges, before tax | 0 | (3) |
Net Investment Hedging | Other expense/(income) | Foreign exchange contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on net investment hedges, before tax | 0 | 1 |
Amounts excluded from the effectiveness assessment of net investment hedges, before tax | (3) | 0 |
Net Investment Hedging | Other expense/(income) | Cross-currency contracts | ||
Derivative [Line Items] | ||
Gains/(losses) recognized in other comprehensive income (loss) on net investment hedges, before tax | 74 | (12) |
Net Investment Hedging | Interest expense | Cross-currency contracts | ||
Derivative [Line Items] | ||
Amounts excluded from the effectiveness assessment of net investment hedges, before tax | $ 12 | $ 8 |
Financial Instruments - Deriv_2
Financial Instruments - Derivative Impact on Statements of Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Total amounts presented in the condensed consolidated statements of income in which the following effects were recorded | ||
Cost of products sold | $ 4,168 | $ 4,376 |
Selling, general and administrative expenses | 941 | 870 |
Interest expense | 226 | 227 |
Other expense/(income) | 47 | (35) |
Cost of products sold | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 10 | (40) |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 10 | (40) |
Cost of products sold | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Cost of products sold | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Cost of products sold | Commodity contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 9 | (47) |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 9 | (47) |
Interest expense | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 4 | 2 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 4 | 2 |
Interest expense | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Interest expense | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Interest expense | Commodity contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Other expense/(income) | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (39) | 8 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (39) | 8 |
Other expense/(income) | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 8 | (12) |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 8 | (12) |
Other expense/(income) | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (21) | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (21) | 0 |
Other expense/(income) | Commodity contracts | Not designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Cash Flow Hedging | Cost of products sold | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 3 | 10 |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | (2) | (3) |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 3 | 10 |
Cash Flow Hedging | Cost of products sold | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Cash Flow Hedging | Interest expense | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 0 | 0 |
Cash Flow Hedging | Interest expense | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (8) | (6) |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (8) | (6) |
Cash Flow Hedging | Other expense/(income) | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 21 | 0 |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 0 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | 21 | 0 |
Cash Flow Hedging | Other expense/(income) | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (44) | 14 |
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 6 |
Derivatives not designated as hedging instruments: | ||
Net gains/(losses) on derivatives, reclassified to net income | (44) | 14 |
Net Investment Hedging | Cost of products sold | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 0 | 0 |
Net Investment Hedging | Interest expense | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gain/(loss) on derivatives, excluded component, reclassified to net income | 12 | 8 |
Net Investment Hedging | Other expense/(income) | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives designated as hedging instruments: | ||
Net gain/(loss) on derivatives, excluded component, reclassified to net income | $ 0 | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income/(Losses) - Components of and Changes in Accumulated Other Comprehensive Income/(Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 49,526 | |
Total other comprehensive income/(loss) | (65) | |
Ending balance | 49,522 | |
Foreign currency translation adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (2,634) | |
Other comprehensive income/(loss) before reclassifications | (156) | $ 115 |
Total other comprehensive income/(loss) | (81) | |
Ending balance | (2,715) | |
Net investment hedge adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Other comprehensive income/(loss) before reclassifications | 74 | (24) |
Amounts excluded from effectiveness assessment | 10 | 6 |
Reclassifications from AOCI | (9) | (6) |
Net postemployment benefit plan adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 15 | |
Reclassifications from AOCI | (4) | (2) |
Total other comprehensive income/(loss) | (4) | |
Ending balance | 11 | |
Net cash flow hedge adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 15 | |
Other comprehensive income/(loss) before reclassifications | 8 | (15) |
Amounts excluded from effectiveness assessment | (2) | 4 |
Reclassifications from AOCI | 14 | $ (16) |
Total other comprehensive income/(loss) | 20 | |
Ending balance | 35 | |
AOCI Attributable to Parent | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (2,604) | |
Ending balance | $ (2,669) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income/(Losses) - Gross Amount and Related Tax Benefit/(Expense) Recorded in and Associated with each Component of Other Comprehensive Income/(Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Foreign currency translation adjustments | ||
OCI Before Reclassifications | ||
Before Tax Amount | $ (156) | $ 115 |
Tax | 0 | 0 |
Net of Tax Amount | (156) | 115 |
Net investment hedge adjustments | ||
OCI Before Reclassifications | ||
Before Tax Amount | 98 | (31) |
Tax | (24) | 7 |
Net of Tax Amount | 74 | (24) |
Amounts Excluded from Effectiveness Assessment | ||
Before Tax Amount | 12 | 8 |
Tax | (2) | (2) |
Net of Tax Amount | 10 | 6 |
Reclassifications | ||
Before Tax Amount | (12) | (8) |
Tax | 3 | 2 |
Net of Tax Amount | (9) | (6) |
Net cash flow hedge adjustments | ||
OCI Before Reclassifications | ||
Before Tax Amount | (4) | (14) |
Tax | 12 | (1) |
Net of Tax Amount | 8 | (15) |
Amounts Excluded from Effectiveness Assessment | ||
Before Tax Amount | (7) | 4 |
Tax | 5 | 0 |
Net of Tax Amount | (2) | 4 |
Reclassifications | ||
Before Tax Amount | 33 | (21) |
Tax | (19) | 5 |
Net of Tax Amount | 14 | (16) |
Net postemployment benefit plan adjustments | ||
Reclassifications | ||
Before Tax Amount | (5) | (3) |
Tax | 1 | 1 |
Net of Tax Amount | $ (4) | $ (2) |
Accumulated Other Comprehensi_5
Accumulated Other Comprehensive Income/(Losses) - Amounts Reclassified from Accumulated Other Comprehensive Income/(Losses) (Details) € in Millions, $ in Millions | 3 Months Ended | ||
Mar. 30, 2024 USD ($) | Apr. 01, 2023 USD ($) | Mar. 01, 2024 EUR (€) | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Interest expense | $ 226 | $ 227 | |
Cost of products sold | 4,168 | 4,376 | |
Selling, general and administrative expenses | 941 | 870 | |
Other expense/(income) | 47 | (35) | |
Income/(loss) before income taxes | 1,029 | 1,051 | |
Provision for/(benefit from) income taxes | 225 | 214 | |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | (804) | (837) | |
Senior Notes due May 2025 | Senior Notes | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Outstanding aggregate principal amount | € | € 550 | ||
Reclassification out of Accumulated Other Comprehensive Income | Net investment hedge adjustments | Cross-currency contracts | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Interest expense | (12) | (8) | |
Reclassification out of Accumulated Other Comprehensive Income | Net cash flow hedge adjustments | Foreign exchange contracts | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Cost of products sold | (1) | (7) | |
Other expense/(income) | (21) | 0 | |
Reclassification out of Accumulated Other Comprehensive Income | Net cash flow hedge adjustments | Cross-currency contracts | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Interest expense | 8 | 6 | |
Other expense/(income) | 44 | (20) | |
Reclassification out of Accumulated Other Comprehensive Income | Net cash flow hedge adjustments | Interest rate contracts | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Other expense/(income) | (3) | 0 | |
Reclassification out of Accumulated Other Comprehensive Income | Hedge adjustments | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Income/(loss) before income taxes | (21) | 29 | |
Provision for/(benefit from) income taxes | (16) | 7 | |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | 5 | (22) | |
Reclassification out of Accumulated Other Comprehensive Income | Net postemployment benefit plan adjustments | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Income/(loss) before income taxes | 5 | 3 | |
Provision for/(benefit from) income taxes | 1 | 1 | |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | (4) | (2) | |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of unrecognized losses/(gains) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Other expense/(income) | (2) | 0 | |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of prior service costs/(credits) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | |||
Other expense/(income) | $ (3) | $ (3) |
Financing Arrangements - Additi
Financing Arrangements - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 30, 2024 | Dec. 30, 2023 | Apr. 01, 2023 | |
Assets that Continue to be Recognized, Securitized or Asset-Backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Accounts Receivable, Sale | $ 0 | ||
Cash proceeds received for assets derecognized, amount | $ 100 | ||
Transfer of Financial Assets Accounted for as Sales, Unremitted Cash Collections | $ 0 | $ 68 | |
Minimum | |||
Assets that Continue to be Recognized, Securitized or Asset-Backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Supplier payment term | 0 days | ||
Maximum | |||
Assets that Continue to be Recognized, Securitized or Asset-Backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Supplier payment term | 250 days | ||
Accounts Payable and Accrued Liabilities | |||
Assets that Continue to be Recognized, Securitized or Asset-Backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Supplier finance program, amount outstanding | $ 800 | $ 800 |
Commitments, Contingencies an_2
Commitments, Contingencies and Debt - Debt Narrative (Details) € in Millions, $ in Billions | Mar. 30, 2024 USD ($) | Mar. 01, 2024 EUR (€) | Dec. 30, 2023 USD ($) |
Loss Contingencies [Line Items] | |||
Interest rate | 3.50% | ||
Fair value of total debt | $ | $ 19.7 | $ 19.6 | |
Carrying value of total debt | $ | $ 20.5 | $ 20 | |
Senior Notes due May 2025 | Senior Notes | |||
Loss Contingencies [Line Items] | |||
Outstanding aggregate principal amount | € | € 550 | ||
Senior Notes due May 2024 | Senior Notes | |||
Loss Contingencies [Line Items] | |||
Outstanding aggregate principal amount | € | € 550 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Common Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Basic EPS | ||
Net income/(loss) attributable to common shareholders | $ 801 | $ 836 |
Weighted average shares of common stock outstanding (in shares) | 1,214 | 1,226 |
Basic earnings/(loss) per common share (in dollars per share) | $ 0.66 | $ 0.68 |
Diluted EPS | ||
Net income/(loss) attributable to common shareholders | $ 801 | $ 836 |
Weighted average shares of common stock outstanding (in shares) | 1,214 | 1,226 |
Effect of dilutive equity awards (in shares) | 9 | 8 |
Weighted average shares of common stock outstanding, including dilutive effect (in shares) | 1,223 | 1,234 |
Diluted earnings/(loss) per common share (in dollars per share) | $ 0.66 | $ 0.68 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Earnings Per Share [Abstract] | ||
Anti-dilutive shares | 6 | 7 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 3 Months Ended |
Mar. 30, 2024 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Reporting - Net Sales b
Segment Reporting - Net Sales by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Net sales | $ 6,411 | $ 6,489 |
Operating Segments | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Net sales | 5,683 | 5,745 |
North America | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Net sales | 4,828 | 4,885 |
International Developed Markets | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Net sales | 855 | 860 |
Emerging Markets | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Net sales | $ 728 | $ 744 |
Segment Reporting - Segment Adj
Segment Reporting - Segment Adjusted EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Segment Reporting Information [Line Items] | ||
Restructuring activities | $ 3 | $ 10 |
Unrealized gains/(losses) on commodity hedges | 34 | (11) |
Certain non-ordinary course legal and regulatory matters | 0 | (1) |
Operating income/(loss) | 1,302 | 1,243 |
Interest expense | 226 | 227 |
Other expense/(income) | 47 | (35) |
Income/(loss) before income taxes | 1,029 | 1,051 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment Adjusted EBITDA | 1,351 | 1,316 |
General corporate expenses | ||
Segment Reporting Information [Line Items] | ||
Segment Adjusted EBITDA | (168) | (172) |
North America | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment Adjusted EBITDA | 1,215 | 1,209 |
International Developed Markets | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment Adjusted EBITDA | 136 | 107 |
Emerging Markets | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment Adjusted EBITDA | $ 82 | $ 101 |
Segment Reporting - Net Sales_2
Segment Reporting - Net Sales by Platform (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Revenue from External Customer [Line Items] | ||
Net sales | $ 6,411 | $ 6,489 |
Taste Elevation | ||
Revenue from External Customer [Line Items] | ||
Net sales | 2,803 | 2,759 |
Easy Ready Meals | ||
Revenue from External Customer [Line Items] | ||
Net sales | 1,116 | 1,108 |
Substantial Snacking | ||
Revenue from External Customer [Line Items] | ||
Net sales | 443 | 462 |
Desserts | ||
Revenue from External Customer [Line Items] | ||
Net sales | 241 | 245 |
Hydration | ||
Revenue from External Customer [Line Items] | ||
Net sales | 534 | 576 |
Cheese | ||
Revenue from External Customer [Line Items] | ||
Net sales | 413 | 433 |
Coffee | ||
Revenue from External Customer [Line Items] | ||
Net sales | 221 | 219 |
Meats | ||
Revenue from External Customer [Line Items] | ||
Net sales | 511 | 524 |
Other | ||
Revenue from External Customer [Line Items] | ||
Net sales | 129 | 163 |
Accelerate | ||
Revenue from External Customer [Line Items] | ||
Net sales | 4,362 | 4,329 |
Protect | ||
Revenue from External Customer [Line Items] | ||
Net sales | 775 | 821 |
Balance | ||
Revenue from External Customer [Line Items] | ||
Net sales | $ 1,274 | $ 1,339 |
Other Financial Data - Schedule
Other Financial Data - Schedule of Other Expense/(Income) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Other Income and Expenses [Abstract] | ||
Amortization of postemployment benefit plans prior service costs/(credits) | $ (3) | $ (3) |
Net pension and postretirement non-service cost/(benefit)(a) | (30) | (22) |
Loss/(gain) on sale of business | 80 | 1 |
Interest income | 16 | 6 |
Foreign exchange losses/(gains) | (27) | 6 |
Derivative losses/(gains) | 39 | (8) |
Other miscellaneous expense/(income) | 4 | (3) |
Other expense/(income) | $ (47) | $ 35 |
Other Financial Data - Addition
Other Financial Data - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 30, 2024 | Apr. 01, 2023 | |
Other Income and Expenses [Abstract] | ||
Other expense/(income) | $ (47) | $ 35 |
Derivative losses/(gains) | 39 | (8) |
Loss/(gain) on sale of business | 80 | 1 |
Foreign exchange losses/(gains) | (27) | 6 |
Investment Income, Interest | $ (16) | $ (6) |