WK Kellogg Co. (KLG) shares plummeted 13.59% in pre-market trading on Tuesday following the release of disappointing first-quarter results and a downward revision of its full-year outlook. The cereal giant's performance fell significantly short of analyst expectations, raising concerns about the company's growth prospects in a challenging economic environment.

For the first quarter, WK Kellogg reported earnings per share of $0.20, down from $0.37 a year earlier and well below the analyst consensus estimate of $0.34. Net sales for the quarter ended March 29 were $663 million, missing the analyst expectations of $679.5 million and representing a 6.22% decrease from the same period last year. The company cited weaker-than-expected consumption trends and reduced retailer inventory as factors contributing to the sales decline.

In response to the softer demand and potential impact from tariffs, WK Kellogg significantly lowered its 2025 guidance. The company now expects organic net sales to decline 2% to 3%, compared to its previous forecast of a 1% decline. Additionally, the adjusted EBITDA growth guidance was revised to flat to -2%, down from the earlier projection of 4% to 6% growth. WK Kellogg acknowledged that its 2025 financial outlook now includes a modest impact from tariffs, primarily related to sourcing raw materials outside of North America. The combination of disappointing quarterly results and reduced annual forecasts has clearly shaken investor confidence, leading to the sharp sell-off in pre-market trading.