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(Sharecast News) - Kraft Heinz shares dropped sharply on Wednesday after the American food giant revealed it was pausing its planned separation, announcing a $600m investment to return to growth.
The company said that the planned split of its condiment and staples divisions, first announced in September, would no longer be on the table for 2026.
Chief executive Steve Cahillane, who joined Kraft Heinz in January, said in a statement that many of the company's challenges are "fixable and within our control".
"My number one priority is returning the business to profitable growth, which will require ensuring all resources are fully focused on the execution of our operating plan. As a result, we believe it is prudent to pause work related to the separation and we will no longer incur related dis-synergies this year," he said.
As part of this new direction, the firm said it is investing $600m across marketing, sales and R&D, along with product developments and select pricing.
The news came as Kraft Heinz reported a 4.2% fall in fourth-quarter organic net sales, while adjusted operating income sank 15.9% to $1.2bn as margins weakened.
Full-year organic net sales were down 3.4% compared with 2024, with the firm guiding to another 1.5-3.5% decline in 2026.
The stock was trading 3.2% lower at $24.15 shortly after the opening bell on Wall Street, having dropped over 6% in pre-market activity.
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