Problems arose from the snack’s 65-day shelf life as well as changing consumer habits

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Elizabeth Arvelos Coetzee/WSJ

By Jesse Newman

July 7, 2026 8:17 pm ET

In 2024, Mark Smucker, chief executive of food giant J.M. Smucker, took the stage at an industry conference and bit into a golden, creamy Twinkie. “Tastes like growth,” he said.

His company had just acquired Hostess, the maker of Twinkies, in a $5 billion deal and it seemed like a coup.

The Covid-19 pandemic had supercharged America’s snacking habit: Some 70% of consumers were eating at least two per day, Smucker said. Buying the owner of Ding Dongs and Donettes gave the jam-and-jelly maker entry into a $65 billion market for snacks. Smucker had beat out other suitors for Hostess, most notably General Mills.

Three years later, the deal isn’t tasting quite so sweet.

J.M. Smucker chief executive officer Mark Smucker.

J.M. Smucker chief executive officer Mark Smucker. Christopher Goodney/Bloomberg News

Sales for Smucker’s snack division, which includes Hostess, have declined for the last six quarters and have fallen short of the company’s expectations at the time of the acquisition. Profits also tumbled during that time, in all but the latest quarter. Shares of Smucker SJM -0.52%decrease; red down pointing triangle are down 14% since the day the deal was announced in September 2023.

Over the course of the last year, Smucker has taken three impairment charges tied to Hostess, totaling nearly $3 billion, and ratcheted back expectations for the brand’s long-term growth. In February, Smucker announced an agreement with activist investor Elliott Investment Management that handed the hedge fund two seats on the company’s board. Elliott said it had become one of the company’s biggest shareholders.

Some problems Smucker is facing are bedeviling other food makers. Snacking slowed as people cut discretionary spending, and weight-loss drugs and the “Make America Healthy Again” movement gained traction. U.S. snack sales by units are down 4% in the past four years, according to data from market-research firm NIQ. Sales of sweet snacks, generally, have dropped 17%, the data showed.

But some are of the company’s own making. Hostess donuts and cupcakes, it turned out, are surprisingly unlike Smucker jams, peanut butter and coffee. When it folded Hostess into its business, Smucker weakened key Hostess operating strengths tied to distribution and sales, several former and current executives and employees say.

Chief Financial Officer Tucker Marshall, in a recent interview, said: “We did have some internal execution issues that we’ve really right-sized and worked through our last fiscal year.”

A 14-year veteran of Smucker’s financial operations who now oversees Hostess, Marshall added that the company is focused on stabilizing the business.

“Really what we’ve seen is just a slowdown,” Marshall said of the sweet baked goods category. “Snacking is still important, indulgent snacking is still important.”

Hostess is a roughly $1 billion business inside a much bigger, $9 billion company, he said. “Hostess is very important to Smucker, but Smucker as a total company is much larger than that.”

The snack’s shelf life has presented logistical challenges for Smucker.

The snack’s shelf life has presented logistical challenges for Smucker. Elizabeth Arvelos Coetzee/WSJ

Twinkies’ shelf life is considered a wonder of food science. But it tripped up Smucker.

The enriched flour, high-fructose corn syrup, and tallow that help make up the American classic give each small sponge cake about 65 days to be consumed. Hostess had worked, before the Smucker acquisition, to lengthen that shelf life.

Still, 65 days is a blink of an eye compared to the shelf life of many core Smucker products—fruit spreads, canned coffee and dog food—which can last for at least a year.

As a result, Hostess products require quicker delivery than Smucker’s. Products must turn faster through a central warehouse, and there is a greater risk that spoilage or production hiccups result in unfilled orders, executives and employees said.

When Hostess was a small, stand-alone company, the Hostess IT systems controlled every step of a Twinkie’s journey, from a retailer’s order to production to shipping. Smucker’s efforts to fold Hostess into its own systems stumbled, resulting in late and incomplete orders, the current and former executives and employees say.

Twinkies must move faster than other products in Smucker’s lineup.

Twinkies must move faster than other products in Smucker’s lineup. Jill Toyoshiba/The Kansas City Star/Zuma Press

Former executives and employees say that Smucker’s separation of employees overseeing sales to supermarkets and convenience stores made it harder to forecast demand.

Former executives and employees say that Smucker’s separation of employees overseeing sales to supermarkets and convenience stores made it harder to forecast demand. Matt Rourke/Associated Press

Previously, Hostess could be nimble. If necessary, employees could call a plant and divert a truckload of strawberry CupCakes to a store that needed more inventory. Such moves became harder under Smucker, whose systems and longer lead times were less well suited to more perishable items.

There was another problem: Smucker mainly serves supermarkets’ center aisles, with brands like Jif, Folgers and Meow Mix. By contrast, some 40% of Hostess sales are in convenience stores.

Smucker separated Hostess employees who handled sales to grocery stores from those in charge of convenience stores, making it harder to forecast total demand, the current and former executives and employees say. Hostess lost shelf space and display opportunities to competitors.

“It’s just a different customer, consumption dynamic, an entirely different route to market I don’t think they were prepared for,” said TD Cowen analyst Rob Moskow of Smucker. He said the rollout of new Hostess products slowed dramatically under Smucker, a problem for a brand that has relied on rapid innovation.

There had been booms and busts for Hostess before, including two trips to bankruptcy court. Smucker said the company has worked on its supply chain and distribution and made improvements. It said innovation remains a focus, particularly on key brands and occasions, and that sweet baked goods broadly have had challenges hanging on to shelf space.

Select U.S. food manufacturer and category unit sales, change from year prior

−8−6−4−20%

Little Debbie parent company

Entenmann's parent company

Food

Grupo Bimbo

Sweet snacks

McKee Foods

Hostess

Note: Data are as of the week ending on June 13. Does not include company products that fall outside of the sweet snack category.

Source: BNP Paribas analysis of NIQ data

Select U.S. food category sales, change in units from 2022

−20−100%

Hostess products fall into sweet snacks and desserts

Salty snacks

All snacks

Sweet snacks

Desserts

Note: Data compare the 52 weeks ending in May of each year.

Source: NIQ

“Ultraprocessed food with no protein is doing badly,” said Max Gumport, an analyst at BNP Paribas. “The Twinkie business is at the center of these.”

Inside the Orrville, Ohio, company, executives have done mea culpas, telling employees in meetings that Smucker made mistakes in how it integrated Hostess.

“We’ve been pretty clear that we haven’t been satisfied with our performance on Hostess,” Smucker, the CEO, told investors at a conference last year. “Some of that has been some challenges in the category in total, some with our own execution.”

Smucker has been working since 2024 to turn around Hostess, again. The company updated the brand’s logo and packaging, launched a new marketing campaign targeting millennials and Gen Z consumers and rolled out $1 packs of key donut and cake products. Smucker says that GLP-1s have not materially impacted its Hostess business and that consumers still want to treat themselves.

It has reduced the number of Hostess products by 25% in order to focus on core brands like Donettes and Cupcakes, and introduced mini versions of key products to feed consumer appetite for what it called “permissible indulgence.” It reintroduced Suzy Qs, a snack cake that resembles an ice cream sandwich, and launched Fritter Rings, which the CEO said bring a “country fair kind of vibe.”

It also closed an Indianapolis plant, a move it said would save $30 million annually, and has worked to make its supply chain more efficient.

The company said that Hostess has offered benefits to Smucker, such as contributing to Uncrustables’ sales growth by enabling the brand’s expansion in convenience stores.

Earlier this year, Elliott and the jam-and-jelly maker struck an information-sharing agreement; Smucker appointed two new members to its board, which the company said was focused on driving sales, profits and disciplined capital allocation. Smucker had already parted with several smaller brands it inherited in the Hostess deal, selling Voortman cookies and Cloverhill packaged pastries.

Smucker has made several moves aimed at a turnaround. It appointed new board members and struck an information-sharing agreement with Elliott Investment Management.

Smucker has made several moves aimed at a turnaround. It appointed new board members and struck an information-sharing agreement with Elliott Investment Management. Bing Guan/Bloomberg News

The efforts are starting to make a difference. Smucker said Donettes sales rose 13% in its latest quarter, helped by more breakfast-time purchases. In June, Smucker’s sweet baked snacks division posted its first year-over-year increase in profits. Sales declines are beginning to moderate.

“It’s going to take a bit of time until we actually see top-line growth,” said Smucker, the CEO, in a June earnings call. “But suffice it to say, stabilizing the business and improving profitability is where we’re focused right now.”

https://www.wsj.com/business/retail/smucker-hostess-twinkies-365614e5

(http://www.autoadmit.com/thread.php?thread_id=5837502&forum_id=2#49986352)