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READ MORE: Money-savvy shoppers snap up promos at budget supermarkets
Shoppers are buying more soup. That might be a bad sign for the economy.
Campbell’s — the
company behind its namesake soups
, as well as brands like Pepperidge Farm and V8 juices — just posted a profit of $66 million.
The food maker’s CEO, Mick Beekhuizen, said customers have been snapping up low-cost meal soups from grocery stores. The company reported 15 percent sales growth in its meals and beverages division.
‘Consumers are cooking at home at the highest levels since early 2020,’ he said while reporting the company’s earnings.
Still, Campbell’s noted that customers have been pulling back on snack purchases as shoppers cut discretionary spending.
It saw an 8 percent sales decline for its snack brands.
Executives
reiterated their full-year forecast
, saying they expect sales to grow by around 6 percent by the end of 2025. That’s down from the company’s previous projection of 9 to 11 percent growth.
The company’s meal growth and snack decline reflect how many Americans are responding to
slumping consumer sentiment reports
and
higher costs in grocery stores
.
American shoppers are worried about
inflation
. Monthly inflation rates have cooled to just above the Federal Reserve’s target of 2 percent, after peaking at over 9 percent in 2022.
But elevated food prices haven’t come down: many of those increases are now baked into the cost of everyday goods.
Now, shoppers are contending with President Donald Trump’s tariffs, which
threaten to push food prices even higher
.
Dozens of food providers — including mid-tier restaurant chains, grocery stores, and budget brands — say their customers are spending less and opting for cheaper options.
Casual dining restaurants have been hit particularly hard.
These establishments, which rely on discretionary spending from middle-income Americans, are reporting slower traffic and reduced spending.
At the same time, they’re facing rising costs for the ingredients they use.
Bloomin’ Brands, the owner of Outback Steakhouse, posted an 8.3 percent sales decline in April. McDonald’s also
posted a 3.6 percent sales decline
.
The toxic mix of slowing sales and higher costs
has spelled doom for hundreds of restaurant locations
and some of America’s most recognizable brands.
In the past year and change, several iconic brands have filed for bankruptcy, including
TGI Fridays
,
Red Lobster
,
Hooters
,
Bertucci’s
, and
On The Border
.
The wave of closures highlights a broader reality: more Americans are trading nights out for meals at home — and not by choice.
That belt-tightening is being echoed by low-cost retailers like Dollar General, which cater to budget-conscious consumers.
Executives there are also seeing signs that financial stress is reshaping how people shop.
‘Our customers continue to report that their financial situation has worsened over the last year, as they have been negatively impacted by ongoing inflation,’ CEO Todd Vasos said during Dollar General’s fourth-quarter earnings call.
‘Many of our customers report they only have enough money for basic essentials, with some noting that they have had to sacrifice even on the necessities.’
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