Conagra Brands conceded in its latest earnings call that weak consumer sentiment and value-seeking behaviour contributed to its first-quarter profit and sales slump.

The maker of Boomchickapop, Duncan Hines and Orville Redenbacher said Wednesday that the company’s net sales decreased 5.8% year over year and organic net sales decreased 0.6%.

Net income attributable to Conagra Brands decreased 64.8% to $165 million USD in its first quarter of fiscal 2026, compared with $467 million USD in the prior-year period.

For the international segment, which includes Canada, net sales decreased 18.0% to $212 million USD, largely owing to a 13.2% decrease from the impact of mergers and acquisitions, according to Wednesday’s earnings call.

Conagra said it successfully completed the divestiture of its Chef Boyardee business to Hometown Food Company in a $600 million USD cash deal, along with its frozen-seafood business, using the proceeds to reduce net debt.

Advertising and promotional expense increased 5.0% compared with the prior year, to approximately $53 million USD, “slightly higher” but in line with expectations.

Net sales for the grocery and snacks segment decreased 8.7% to $1.1 billion USD in the quarter, reflecting a 7.7% decrease the brand said was caused by the divestiture of business.

Also, net sales for the refrigerated and frozen segment decreased 0.9% to $1.1 billion in the quarter.

In Wednesday’s earnings call, Conagra maintained a positive outlook for frozen, with president and CEO Sean Connolly saying the company is “extremely bullish” on the segment because of “fantastic innovations.”

Connolly said that substantial service interruptions and supply issues caused the company to lose share “for the first time in years.”