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Falling revenue did not prevent S&P 500 (NYSE:SPY) component Kraft Foods Inc. (NYSE:KFT) from reporting a profit boost in the second quarter. Kraft Foods manufactures and markets packaged food products, including snacks, beverages, cheese, and convenient meals.
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Kraft Foods Inc. Earnings Cheat Sheet
Results: Net income for the food-miscellaneous/diversified rose to $1.03 billion (58 cents per share) vs. $976 million (55 cents per share) in the same quarter a year earlier. This marks a rise of 5.9% from the year-earlier quarter.
Revenue: Fell 4.3% to $13.29 billion from the year-earlier quarter.
Actual vs. Wall St. Expectations: Kraft Foods Inc. fell short of the mean analyst estimate of 67 cents per share. Analysts were expecting revenue of $13.04 billion.
Quoting Management: “Our second quarter and first half results reflect the success of our brand-building investments over the past few years and the resilience of our businesses,” said Irene Rosenfeld, Chairman and CEO.
The company has now seen its net income increase for three consecutive quarters. In the first quarter, net income rose 1.8% and in the fourth quarter of the last fiscal year, the figure rose 53.7%.
A year-over-year revenue decrease last quarter breaks a four-quarter streak of revenue increases. The best quarter in that span was the second quarter of the last fiscal year, which saw revenue rise 13.3%.
The company fell short of estimates last quarter after beating the mark the quarter before with net income of 57 cents versus a mean estimate of net income of 56 cents per share.
Gross margins grew to 36.7% last quarter, a 1.6 percentage points difference from the year-earlier quarter. This snaps a streak of two consecutive quarters of shrinking margins.
Looking Forward: The average estimate for the third quarter remains unchanged at 63 cents a share. The average estimate for the fiscal year is now $2.50 per share, down from $2.52 sixty days ago.
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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
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