General Mills’ sales failed to meet forecast expectations in the company’s most recent quarter after the organization’s sales and shipping volumes fell by 6%. According to The Wall Street Journal, the international and North American markets experienced the quickest falls.

Despite the volume drop-off, the company behind Bisquick pancake mix and Cheerios increased its revenues through core business operations by 3% during the most recent quarter thanks to “higher pricing,” according to The Wall Street Journal’s Dean Seal. Additionally, General Mills still expects its sales to grow by 3% to 4% in 2024.

During a call with analysts, company executives said that some of General Mills’ bigger customers are working to get inventories back to normal while pandemic-era disruptions lessen, and the cost of goods continues to rise.

Food and beverage stores have had more stable inventories when compared to other retailers, based on government data. However, rising interest rates have increased inventory carrying costs.

When discussing inventory drawdowns, General Mills CEO Jeff Harmening said, “In retrospect, perhaps it shouldn’t have been a surprise, but it certainly was an order of magnitude.”