Kraft Heinz cut expenses too deeply under private equity management, its new CEO says
Business Insider
February 24, 2026
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Kraft Heinz's new CEO, Steve Cahillane, has acknowledged that the company's aggressive cost-cutting over the past decade under private-equity management went too far, leaving the business "too lean." These cuts, which included strategies like zero-based budgeting, hurt financial performance and employee morale. The company’s stock price has dropped significantly—down 74% from its 2017 high—and it expects organic net sales to decline by 1.5% to 3.5% this year. Cahillane emphasized the importance of investing in people and capabilities to drive results, signaling a shift away from the previous focus on cutting costs at all costs.
Kraft Heinz gained notoriety for its cost-cutting measures, which included employees bringing their own coffee to work due to reduced budgets. The company’s reliance on zero-based budgeting, a method requiring managers to justify every expense anew, contributed to a leaner but less innovative and customer-focused business model. This approach, while effective in reducing costs, hindered long-term growth and led to declining financial results.
Under Cahillane's leadership, Kraft Heinz is planning to reinvest $600 million into areas like research and development, marketing, and innovation. The company is
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Originally published on Business Insider on 2/24/2026