Revenue contracted 1.4% YoY in 2026Q2 with gross margin down 300bps to 32.4%, while operating income swung to -$6.4B due to a massive impairment, masking an otherwise 18.3% average operating margin in non-impairment quarters.
The Kraft Heinz Company (KHC) annual income statement — 15-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 |
|---|
| Sales/Revenue | 24.9B | 24.94B | 25.85B | 26.64B | 26.48B | 26.04B | 26.18B | 24.98B | 26.27B | 26.08B | 26.3B | 18.34B | 18.2B | 18.22B | 18.27B | 18.58B |
| Revenue Growth % | -1.62% | -3.5% | -2.98% | 0.59% | 1.7% | -0.55% | 4.84% | -4.91% | 0.74% | -0.85% | 43.42% | 0.73% | -0.07% | -0.29% | -1.64% | - |
| Cost of Goods Sold | 16.73B | 16.63B | 16.88B | 17.71B | 18.36B | 17.36B | 17.01B | 16.83B | 17.35B | 17.04B | 17.15B | 12.58B | 13.36B | 11.39B | 12.5B | 12.81B |
| COGS % of Revenue | - | 66.69% | 65.3% | 66.49% | 69.33% | 66.66% | 64.95% | 67.38% | 66.04% | 65.36% | 65.22% | 68.58% | 73.39% | 62.55% | 68.41% | 68.98% |
| Gross Profit | 8.17B | 8.31B | 8.97B | 8.93B | 8.12B | 8.68B | 9.18B | 8.15B | 8.92B | 9.03B | 9.15B | 5.76B | 4.84B | 6.82B | 5.77B | 5.76B |
| Gross Margin % | 32.82% | 33.31% | 34.7% | 33.51% | 30.67% | 33.34% | 35.05% | 32.62% | 33.96% | 34.64% | 34.78% | 31.42% | 26.61% | 37.45% | 31.59% | 31.02% |
| Gross Profit Growth % | - | -7.35% | 0.47% | 9.9% | -6.45% | -5.39% | 12.64% | -8.68% | -1.24% | -1.24% | 58.76% | 18.91% | -28.99% | 18.21% | 0.16% | - |
| Operating Expenses | 11.42B | 12.98B | 7.29B | 4.35B | 4.49B | 5.22B | 7.05B | 5.08B | 19.13B | 2.98B | 3.54B | 3.12B | 2.96B | 2.23B | 3.1B | 2.94B |
| OpEx % of Revenue | - | 52.03% | 28.19% | 16.34% | 16.95% | 20.05% | 26.92% | 20.33% | 72.81% | 11.41% | 13.48% | 17.02% | 16.23% | 12.25% | 16.98% | 15.8% |
| Selling, General & Admin | 3.84B | 3.67B | 3.49B | 3.59B | 3.43B | 3.37B | 3.17B | 2.7B | 2.84B | 2.93B | 3.53B | 3.12B | 2.96B | 2.12B | 2.96B | 2.94B |
| SG&A % of Revenue | - | 14.72% | 13.49% | 13.49% | 12.94% | 12.96% | 12.09% | 10.81% | 10.81% | 11.22% | 13.41% | 17.02% | 16.24% | 11.66% | 16.21% | 15.81% |
| Research & Development | 167M | 0 | 0 | 147M | 0 | 140M | 119M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | 0.55% | - | 0.54% | 0.45% | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 3M | 9.31B | 3.8B | 614M | 1.06B | 1.71B | 3.77B | 2.38B | 16.29B | 49M | 18M | 0 | -1M | 108M | 141M | -2M |
| Operating Income | -3.25B | -4.67B | 1.68B | 4.57B | 3.63B | 3.46B | 2.13B | 3.07B | -10.21B | 6.06B | 5.6B | 2.64B | 1.89B | 4.59B | 2.67B | 2.83B |
| Operating Margin % | -13.04% | -18.72% | 6.51% | 17.16% | 13.72% | 13.29% | 8.13% | 12.29% | -38.85% | 23.23% | 21.3% | 14.39% | 10.38% | 25.2% | 14.61% | 15.22% |
| Operating Income Growth % | - | -377.42% | -63.19% | 25.81% | 5.03% | 62.59% | -30.68% | 130.08% | -268.48% | 8.14% | 112.24% | 39.63% | -58.83% | 71.95% | -5.59% | - |
| EBITDA | -2B | -3.7B | 2.63B | 5.53B | 4.57B | 4.37B | 3.1B | 4.06B | -9.22B | 7.09B | 6.94B | 3.38B | 2.27B | 4.98B | 3.1B | 3.19B |
| EBITDA Margin % | -8.03% | -14.84% | 10.18% | 20.77% | 17.24% | 16.78% | 11.83% | 16.27% | -35.11% | 27.18% | 26.38% | 18.43% | 12.5% | 27.36% | 16.96% | 17.18% |
| EBITDA Growth % | 66.5% | -240.67% | -52.45% | 21.15% | 4.51% | 41.1% | -23.79% | 144.07% | -230.11% | 2.16% | 105.33% | 48.53% | -54.35% | 60.88% | -2.94% | - |
| D&A (Non-Cash Add-back) | 1.25B | 968M | 948M | 961M | 933M | 910M | 969M | 994M | 983M | 1.03B | 1.34B | 740M | 385M | 393M | 428M | 364M |
| EBIT | -3.08B | -4.5B | 1.77B | 4.54B | 3.89B | 3.75B | 2.42B | 4.02B | -10.04B | 6.68B | 6.07B | 2.33B | 1.89B | 4.59B | 2.71B | 2.88B |
| Net Interest Income | -644M | -825M | -843M | -872M | -894M | -2.03B | -1.37B | -1.32B | -1.25B | -1.23B | -1.13B | -1.32B | -484M | -501M | -258M | -4M |
| Interest Income | 113M | 122M | 69M | 40M | 27M | 15M | 27M | 36M | 35M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 757M | 947M | 912M | 912M | 921M | 2.05B | 1.39B | 1.36B | 1.28B | 1.23B | 1.13B | 1.32B | 484M | 501M | 258M | 4M |
| Other Income/Expense | -416M | -776M | -827M | -939M | -668M | -1.75B | -1.1B | -409M | -1.12B | -607M | -662M | -1.63B | -484M | -501M | -217M | 48M |
| Pretax Income | -3.66B | -5.45B | 856M | 3.63B | 2.97B | 1.71B | 1.03B | 2.66B | -11.32B | 5.45B | 4.94B | 1.01B | 1.41B | 4.09B | 2.45B | 2.88B |
| Pretax Margin % | -14.71% | -21.83% | 3.31% | 13.64% | 11.2% | 6.56% | 3.93% | 10.65% | -43.1% | 20.9% | 18.78% | 5.52% | 7.72% | 22.45% | 13.43% | 15.48% |
| Income Tax | -262M | 403M | -1.89B | 787M | 598M | 684M | 669M | 728M | -1.07B | -5.48B | 1.33B | 366M | 363M | 1.38B | 811M | 1.1B |
| Effective Tax Rate % | 7.15% | -7.4% | -220.79% | 21.66% | 20.16% | 40.05% | 64.95% | 27.36% | 9.42% | -100.59% | 26.99% | 36.13% | 25.82% | 33.62% | 33.06% | 38.28% |
| Net Income | -3.4B | -5.85B | 2.74B | 2.85B | 2.36B | 1.01B | 356M | 1.94B | -10.19B | 10.94B | 3.6B | 634M | 1.04B | 2.71B | 1.64B | 1.77B |
| Net Margin % | -13.64% | -23.44% | 10.62% | 10.72% | 8.92% | 3.89% | 1.36% | 7.75% | -38.8% | 41.96% | 13.67% | 3.46% | 5.73% | 14.9% | 8.99% | 9.56% |
| Net Income Growth % | 35.57% | -313.05% | -3.89% | 20.82% | 133.5% | 184.27% | -81.6% | 118.99% | -193.15% | 204.25% | 467.19% | -39.21% | -61.58% | 65.35% | -7.49% | - |
| Net Income (Continuing) | -3.4B | -5.85B | 2.75B | 2.85B | 2.37B | 1.02B | 361M | 1.93B | -10.25B | 10.93B | 3.61B | 647M | 1.04B | 2.71B | 1.64B | 1.77B |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 124M | 125M | 140M | 196M | 192M | 154M | 140M | 126M | 121M | 213M | 216M | 231M | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -2.86 | -4.93 | 2.26 | 2.31 | 1.91 | 0.82 | 0.29 | 1.58 | -8.44 | 8.95 | 2.81 | -0.34 | 1.74 | 4.51 | 2.75 | 3.00 |
| EPS Growth % | 35.73% | -318.14% | -2.16% | 20.94% | 132.93% | 182.76% | -81.65% | 118.72% | -194.3% | 218.51% | 926.47% | -119.54% | -61.42% | 64% | -8.33% | - |
| EPS (Basic) | - | -4.93 | 2.27 | 2.33 | 1.93 | 0.83 | 0.29 | 1.58 | -8.44 | 9.03 | 2.84 | -0.34 | 1.75 | 4.55 | 2.77 | 3.00 |
| Diluted Shares Outstanding | 1.19B | 1.19B | 1.22B | 1.24B | 1.24B | 1.24B | 1.23B | 1.22B | 1.22B | 1.23B | 1.23B | 786M | 598M | 599M | 598M | 591M |
| Basic Shares Outstanding | 1.19B | 1.19B | 1.21B | 1.23B | 1.23B | 1.22B | 1.22B | 1.22B | 1.22B | 1.22B | 1.22B | 782.35M | 593M | 594M | 593M | 591M |
| Dividend Payout Ratio | - | - | 70.37% | 68.83% | 82.95% | 193.58% | 550% | 100.93% | - | 26.4% | 99.67% | 205.36% | 121.38% | 44.46% | - | - |
Quick answers to the most common questions about buying KHC stock.
For fiscal year 2025, The Kraft Heinz Company (KHC) reported total revenue of $24.94B. This represents a 34.3% increase compared to $18.58B in 2011.
The Kraft Heinz Company (KHC) reported a net loss of $5.85B for the fiscal year ending 2025.
The Kraft Heinz Company (KHC) reported an operating income of $-4669.0M, resulting in an operating profit margin of -18.7%. This margin reflects the operational efficiency of the business before interest and taxes.
The Kraft Heinz Company (KHC) generated $8.31B in gross profit for the year, representing a gross profit margin of 33.3%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Impairment-driven earnings volatility
Metrics are mathematically derived from official filings.
Revenue Stagnation Amid Pricing Ceiling
KHC's revenue has contracted in seven of the last ten quarters, with 2026Q2 down 1.4% YoY, suggesting price increases are no longer offsetting volume declines, per recent financial statements.
The consistent negative organic growth, despite a slight uptick in 2026Q1, indicates that the company's pricing power may be hitting a ceiling as consumers trade down to private labels. The 2026Q2 beat on EPS, driven by cost controls, does not mask the underlying revenue stagnation, which appears structural rather than cyclical. Investors should monitor whether the planned split can unlock growth in the higher-margin condiments segment.
Gross Margin Compression Signals Pricing Limits
Gross margin has slipped from 35.4% in 2024Q2 to 32.4% in 2026Q2, a 300 basis point decline, indicating that input cost inflation is outpacing pricing power, as reported in quarterly filings.
The persistent decline in gross margin, despite the company's iconic brands, suggests that the 'taste-standard' moat in foodservice is not fully insulating it from commodity cost pressures. The gap between KHC's gross margin and McCormick's 37.9% highlights a competitive disadvantage in pricing power. This compression, if sustained, could erode the company's ability to fund marketing reinvestment, a critical driver for brand health.
Operating Leverage Masked by Impairments
Excluding impairment quarters, operating margin averaged 18.3% in 2025Q1-2026Q1, but the -102.7% in 2026Q2 reveals how non-cash charges distort underlying leverage, based on reported figures.
The sharp swings in operating income, driven by massive impairments in 2025Q2 and 2026Q2, obscure the company's true operating leverage. In clean quarters, SG&A as a percentage of revenue has been relatively stable, indicating that the core business is not scaling efficiently. The recurring impairments suggest that the balance sheet carries overvalued intangibles, which may continue to distort reported profitability.
Impairments Distort Earnings Quality
Net income swung from -$7.8B in 2025Q2 to +$798M in 2026Q1, with EPS volatility driven by non-cash impairments, as disclosed in income statements, raising questions about underlying earnings power.
The massive negative net income in impairment quarters, coupled with a positive EPS in 2026Q1, indicates that reported earnings are heavily influenced by non-cash write-downs rather than operational performance. The tax benefit in 2024Q4 (net margin of 32.4% on negative operating income) further complicates earnings quality. Investors should focus on cash-based metrics and adjusted EBITDA to gauge the true profitability of the business.
COGS Pressure Outweighs SG&A Discipline
COGS as a percentage of revenue has risen from 64.6% in 2024Q2 to 67.6% in 2026Q2, while SG&A has been relatively flat, indicating that cost inflation is the primary margin drag, per financial data.
The increase in COGS ratio suggests that raw material costs, including dairy, meat, and packaging, are rising faster than the company can pass through to consumers. SG&A discipline, with only a slight increase in absolute terms, shows management's focus on cost control, but it may be insufficient to offset input cost pressures. The company's high variable cost structure leaves it vulnerable to commodity price spikes, which could further compress margins.
2025Q2 Impairment Marks Strategic Shift
The -$8.0B operating loss in 2025Q2, driven by a massive impairment, represents a pivotal inflection point, signaling a reset of brand valuations and a shift toward portfolio streamlining, as reported.
This quarter's impairment, along with the subsequent 2026Q2 charge, appears to be part of a broader strategic reassessment, possibly ahead of the planned split. The write-downs suggest that management is acknowledging that some brands are worth less than previously carried, which may lead to divestitures. The lasting impact is a cleaner balance sheet but also a recognition that the legacy portfolio's growth prospects are limited, making the split a logical next step.
Earnings Recovery May Be Episodic
Despite the 2026Q2 EPS beat, TTM net margin remains -23.4%, and the Z-Score is in the distress zone, suggesting that the recovery may not be sustainable, based on reported financials.
The sharp contrast between the quarterly beat and the deeply negative TTM figures indicates that the impairments are not yet fully absorbed, and the underlying business may still be losing value. The company's tight liquidity (current ratio ~1.06) and high leverage, if the reported D/E is understated, could constrain its ability to invest in growth. Short-sellers would argue that the planned split is a value-destructive move that fails to address the core issue of declining brand equity and pricing power.