Wall Street hammered shares of Campbell Soup Co. on Thursday for another quarter of lackluster sales.
The company's overall sales fell 1 percent in the fourth quarter from the same time last year. Soup sales fell 4 percent, and profit and revenue fell shy of expectations. Shares of Campbell skidded about 7 percent to their lowest level since September 2015.
Summer isn't the most popular season for soup, but the declines reflect broader trends in the food industry. Consumers are increasingly searching for fresh foods. They are skipping the center of the store, where the aisles of packaged foods like Campbell products are typically located.
"The seismic shifts we've described in the past continue to alter the consumer, food and retail landscapes," CEO Denise Morrison told investors on a call Thursday. "These disruptions include shifting demographics, changing consumer preferences for food with a focus on fresh and health and well-being, and increase snacking behavior, a range of socioeconomic forces and technology advancements that are reshaping the consumer shopping experience."
Campbell Soup's stock price has plunged nearly 23 percent this year
Morrison said soup is still a large and profitable business for Campbell. However, today's retail landscape is not helping the company. Amazon's acquisition of Whole Foods and the expansion of German discount grocers Aldi and Lidl have escalated competition, Morrison said.
She attributed today's retail pressures to Campbell's inability to reach an agreement with a large retail store on a future promotional program. The food company now projects that soup sales will fall at that retailer, which Campbell declined to name, and it accordingly expects soup sales to decline overall in the upcoming fiscal year.
Campbell does expect to see some growth. It's expecting sales of biscuits and snacks, which includes brands like Pepperidge Farm Goldfish crackers, to increase. The snack category has been growing, thanks to millennials who love to snack.
Campbell will continue to pursue "smart" and "disciplined" mergers and acquisitions in better-for-you snacking brands, Morrison said. The company announced plans last month to acquire Pacific Foods, maker of natural and organic broths, soups and plant-based beverages and meals.
Thursday's share-price loss dragged down Campbell's year-to-date stock price nearly 23 percent.