WK Kellogg Co ( KLG ) reported first-quarter results on Tuesday.

The company clocked earnings per share of 20 cents, missing the street view of 34 cents. Quarterly sales of $663 million missed the analyst consensus estimate of $679.49 million.

Quarterly reported net sales declined 6.2% year-over-year, while organic net sales were down 5.6% from the prior year. The drop in organic net sales was driven by reduced retailer inventory tied to Easter holiday timing, the comparison against a major prior-year promotion, and softer-than-expected consumption trends.

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Adjusted EBITDA in the quarter under review was $72 million, down 4% year over year. This decrease was driven by lower sales volume. Adjusted EBITDA margin expanded to 10.8% from 10.6% in the year-ago period.

In the first quarter, price/mix rose 3.0% while volume declined 8.6%.

Chairman and CEO Gary Pilnick said the company remains on track to achieve a margin improvement of around 500 basis points by the end of 2026.

“In the first quarter, we saw consumers continue to focus on health and nutrition, which we view as a positive development for the category,” Pilnick added.

Outlook: The company said 2025 organic net sales are now projected to fall approximately between (2.0)% and (3.0)%, compared to the prior guidance of a (1.0)% decline.

2025 adjusted EBITDA growth is now projected to be flat to down (2.0)%, compared to the prior guidance of 4% to 6% growth.

The 2025 financial outlook includes a modest impact from tariffs, mainly tied to raw materials sourced outside North America.

It assumes most production remains exempt from tariffs on trade with Canada and Mexico.

However, the company said, there is no guarantee that these exemptions will continue or that future tariffs will not further affect the business and financial results.

Price Action: KLG shares are trading higher by 2.25% to $17.75 at last check on Tuesday.

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