REPORTABLE SEGMENTS (Notes)

6 Months Ended

Jun. 28, 2025

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

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

KELLANOVA 10-Q