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REPORTABLE SEGMENTS (Notes) | 6 Months Ended
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Jun. 28, 2025
Segment Reporting [Abstract] |
Reportable Segments | REPORTABLE SEGMENTS Kellanova is the world's second largest producer of crackers and a leading producer of cereal, savory snacks, and frozen foods. Additional product offerings include toaster pastries, cereal bars, veggie foods and noodles. Kellanova products are manufactured and marketed globally. Principal markets for these products include the United States, United Kingdom, France, Nigeria, Canada, Mexico, Brazil, and Australia. The Company manages its operations through four operating segments that are based on geographic location – North America which includes U.S. businesses and Canada; Europe which consists of European countries; Latin America which consists of Central and South America and includes Mexico; and AMEA (Asia Middle East Africa) which consists of Africa, Middle East, Australia and other Asian and Pacific markets. These operating segments also represent our reportable segments. Each reportable segment derives its revenues primarily from the production and distribution of a mix of food products including snacks, cereal, frozen foods, noodles and other foods. Corporate includes corporate administration and initiatives as well as share-based compensation. The Chairman and Chief Executive Officer is the Chief Operating Decision Maker (CODM) of the Company. The CODM uses operating profit as the reportable segment profitability measure to assess performance and allocate resources. This measure is utilized during our budgeting and forecasting process to assess profitability and enable decision making regarding strategic initiatives and capital investments across all reportable segments. Reportable segment operating profit is consistent with the presentation of operating profit in the Consolidated Statement of Income. The accounting policies of each reportable segment are consistent with those described in the summary of significant accounting policies in Note 1 included in the Company's 2024 Annual Report on Form 10-K. Inter-segment sales are not included in the segment profitability measure used by the CODM to assess performance of the reportable segments. Reportable segment results including details of the significant expense categories provided to the CODM for the quarter and year-to-date periods ended June 28, 2025 and June 29, 2024 were as follows:
Quarter ended June 28, 2025 | Reportable segments |  |
(millions) | North America | Europe | Latin America | AMEA | Corporate | Consolidated
Net sales | $ | 1,594 |  | $ | 651 |  | $ | 309 |  | $ | 648 |  | $ | 1 |  | $ | 3,203 |
Cost of goods sold | 978 |  | 436 |  | 205 |  | 477 |  | 17 |  | 2,113 |
Selling, general, and administrative expense | 281 |  | 122 |  | 68 |  | 109 |  | 72 |  | 652 |
Operating profit | $ | 335 |  | $ | 93 |  | $ | 36 |  | $ | 62 |  | $ | (88) |  | $ | 438 |
Year-to-date period ended June 28, 2025 | Reportable segments |  |
(millions | North America | Europe | Latin America | AMEA | Corporate | Consolidated
Net sales | $ | 3,213 |  | $ | 1,230 |  | $ | 575 |  | $ | 1,268 |  | $ | — |  | $ | 6,286 |
Cost of good sold | $ | 1,984 |  | $ | 816 |  | $ | 390 |  | $ | 929 |  | $ | 18 |  | $ | 4,137 |
Selling, general, and administrative expense | $ | 589 |  | $ | 231 |  | $ | 130 |  | $ | 203 |  | $ | 128 |  | $ | 1,281 |
Operating profit | $ | 640 |  | $ | 183 |  | $ | 55 |  | $ | 136 |  | $ | (146) |  | $ | 868 |
Quarter ended June 29, 2024 | Reportable segments |  |
(millions) | North America | Europe | Latin America | AMEA | Corporate | Consolidated
Net sales | $ | 1,658 |  | $ | 639 |  | $ | 333 |  | $ | 564 |  | $ | (2) |  | $ | 3,192 |
Cost of goods sold | 1,017 |  | 406 |  | 217 |  | 397 |  | (6) |  | 2,031 |
Selling, general, and administrative expense | 302 |  | 122 |  | 70 |  | 107 |  | 67 |  | 668 |
Operating profit | $ | 339 |  | $ | 111 |  | $ | 46 |  | $ | 60 |  | $ | (63) |  | $ | 493 |
Year-to-date period ended June 29, 2024 | Reportable segments |  |
(millions) | North America | Europe | Latin America | AMEA | Corporate | Consolidated
Net Sales | $ | 3,346 |  | $ | 1,238 |  | $ | 647 |  | $ | 1,164 |  | $ | (3) |  | $ | 6,392 |
Cost of goods sold | $ | 2,072 |  | $ | 866 |  | $ | 434 |  | $ | 824 |  | $ | 4 |  | $ | 4,200 |
Selling, general, and administrative expense | $ | 600 |  | $ | 233 |  | $ | 140 |  | $ | 205 |  | $ | 128 |  | $ | 1,306 |
Operating profit | $ | 674 |  | $ | 139 |  | $ | 73 |  | $ | 135 |  | $ | (135) |  | $ | 886 |
Certain items such as interest expense and income taxes, while not included in the measure of reportable segment operating results, are regularly reviewed by the chief operating decision maker (CODM) for the Company's internationally based reportable segments as shown below.
| Quarter ended |  | Year-to-date period ended
(millions) | June 28, 2025 | June 29, 2024 |  | June 28, 2025 | June 29, 2024
Depreciation and amortization |  |  |  |  |
North America (a) | $ | 44 |  | $ | 48 |  |  | $ | 85 |  | $ | 111 |
Europe (a) | 24 |  | 25 |  |  | 46 |  | 85 |
Latin America | 7 |  | 9 |  |  | 20 |  | 17 |
AMEA | 14 |  | 12 |  |  | 28 |  | 25 |
Total Reportable Segments | 89 |  | 94 |  |  | 179 |  | 238 |
Corporate | 2 |  | 1 |  |  | 4 |  | 3 |
Consolidated | $ | 91 |  | $ | 95 |  |  | $ | 183 |  | $ | 241 |
Interest expense |  |  |  |  |
North America | $ | — |  | $ | 2 |  |  | $ | — |  | $ | 4 |
Europe | 7 |  | 18 |  |  | 16 |  | 35 |
Latin America | 1 |  | 2 |  |  | 2 |  | 3 |
AMEA | 5 |  | 4 |  |  | 10 |  | 10 |
Corporate | 50 |  | 57 |  |  | 98 |  | 114 |
Consolidated | $ | 63 |  | $ | 83 |  |  | $ | 126 |  | $ | 166 |
Income taxes |  |  |  |  |
Europe | $ | 9 |  | $ | 13 |  |  | $ | 20 |  | $ | 17 |
Latin America | 4 |  | 18 |  |  | $ | 9 |  | $ | 25 |
AMEA | 16 |  | 11 |  |  | $ | 29 |  | $ | 25 |
Corporate & North America | 54 |  | 55 |  |  | $ | 98 |  | $ | 112 |
Consolidated | $ | 83 |  | $ | 97 |  |  | $ | 156 |  | $ | 179 |
(a) Quarter ended March 30, 2024, includes asset impairment charges as discussed in Note 9. Assets are reviewed by the CODM on a consolidated basis and therefore are not presented by reportable segment. The CODM does review additions to property by reportable segment.
| Quarter ended |  | Year-to-date period ended
(millions) | June 28, 2025 | June 29, 2024 |  | June 28, 2025 | June 29, 2024
Additions to property |  |  |  |  |
North America | $ | 54 |  | $ | 52 |  |  | $ | 105 |  | $ | 120 |
Europe | 46 |  | 28 |  |  | 97 |  | 69 |
Latin America | 16 |  | 26 |  |  | 49 |  | 50 |
AMEA | 28 |  | 32 |  |  | 64 |  | 51 |
Corporate | 4 |  | 4 |  |  | 9 |  | 7 |
Consolidated | $ | 148 |  | $ | 142 |  |  | $ | 324 |  | $ | 297 |
Supplemental product information is provided below for net sales to external customers:
|  | Quarter ended |  | Year-to-date period ended
(millions) |  | June 28, 2025 | June 29, 2024 |  | June 28, 2025 | June 29, 2024
Snacks |  | $ | 2,008 |  | $ | 2,069 |  |  | $ | 3,905 |  | $ | 4,084 |
Cereal |  | 672 |  | 689 |  |  | 1,317 |  | 1,376 |
Frozen |  | 256 |  | 262 |  |  | 546 |  | 552 |
Noodles and other |  | 267 |  | 172 |  |  | 518 |  | 380 |
Consolidated |  | $ | 3,203 |  | $ | 3,192 |  |  | $ | 6,286 |  | $ | 6,392 |

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