Lamb Weston Holdings, Inc.LW
Lamb Weston Holdings, Inc. Segments Disclosure
SEGMENTS
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We manage operations in two business segments, North America and International. As a result of how we manage the business, we have two operating segments, each of which is a reportable segment: North America and International. North America includes activity that occurs in the United States, Canada, and Mexico. International includes all activity that does not occur within the North America segment. Both segments primarily manufacture frozen potato products for sale to our customers. These reportable segments are each managed by a general manager and supported by a cross functional team assigned to support the segment.
Our president and chief executive officer is our chief operating decision maker (the “CODM”). The CODM assesses the performance of our reportable segments and decides how to allocate resources based on segment adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”). The adjustments to EBITDA include unrealized mark-to-market derivative gains and losses (which are a component of both cost of sales and selling, general and administrative expenses), foreign currency exchange gains and losses (which are a component of selling, general and administrative expenses), blue chip swap transaction gains (which are a component of selling, general and administrative expenses), and other items impacting comparability (which are a component of both cost of sales and selling, general and administrative expenses) that are described below (“Segment Adjusted EBITDA”).
Segment Adjusted EBITDA, along with volume and net sales, informs operating decisions, performance assessment, and resource allocation decisions at the segment level. Our CODM uses volume, net sales, and Segment Adjusted EBITDA in the annual operating plan and forecasting process and considers actual versus plan variances in assessing the performance of each segment. Total asset information by segment is not regularly provided to our CODM or utilized for purposes of assessing performance or allocating resources by segment and, as a result, such information has not been presented below.
The following tables illustrate reportable segment net sales and Segment Adjusted EBITDA for fiscal years 2025, 2024, and 2023. The tables also reconcile these amounts to net income for each fiscal year.
| For the Fiscal Year Ended May 25, 2025 | ||||||||||||||||||||
| (in millions) | North America | International | Total | |||||||||||||||||
| Net sales | $ | 4,265.2 | $ | 2,186.1 | $ | 6,451.3 | ||||||||||||||
| Less: Other segment items (a) | 3,163.8 | 1,932.4 | 5,096.2 | |||||||||||||||||
| Segment Adjusted EBITDA (b) | $ | 1,101.4 | $ | 253.7 | $ | 1,355.1 | ||||||||||||||
| Unallocated corporate costs (c) | (134.6) | |||||||||||||||||||
| Depreciation and amortization (d) | 378.2 | |||||||||||||||||||
| Unrealized derivative gains | (23.1) | |||||||||||||||||||
| Foreign currency exchange losses | 15.2 | |||||||||||||||||||
| Blue chip swap gains (e) | (21.1) | |||||||||||||||||||
| Items impacting comparability: | ||||||||||||||||||||
| Restructuring Plan and other expenses (f) | 185.8 | |||||||||||||||||||
| Shareholder activism expense (g) | 5.2 | |||||||||||||||||||
| Interest expense, net | 180.0 | |||||||||||||||||||
| Income before income taxes | 500.3 | |||||||||||||||||||
| Income tax expense | 143.1 | |||||||||||||||||||
| Net income | $ | 357.2 | ||||||||||||||||||
(a)Other segment items include cost of sales, selling, general, and administrative expenses, and equity method investment income or loss for each segment.
(b)Segment Adjusted EBITDA for fiscal 2025 included the following:
i.Net income associated with our equity method investments. Refer to Note 6, “Other Assets,” in these Notes to Consolidated Financial Statements of this Form 10-K.
ii.An estimated $31 million loss related to the voluntary product withdrawal that was initiated in the fourth quarter of fiscal 2024. The total charge to reporting segments was approximately $19 million to the North America segment and approximately $12 million to the International segment.
(c)Unallocated corporate costs include costs related to corporate support staff and support services, which include, but are not limited to, our administrative, information technology, human resources, finance, and accounting functions that are not specifically allocated to the segments. In the table, unallocated costs exclude unrealized mark-to-market derivative gains and losses, foreign currency exchange gains and losses, gains from blue chip swap transactions in Argentina, and items impacting comparability. These items are added back to reconcile Segment Adjusted EBITDA to Net income.
(d)Depreciation and amortization includes interest expense, income tax expense, and depreciation and amortization from equity method investments of $8.2 million for the fiscal year ended May 25, 2025.
(e)We enter into blue chip swap transactions to transfer U.S. dollars into Argentina primarily related to funding some of our capacity expansion in Argentina. The blue chip swap rate can diverge significantly from Argentina’s official exchange rate.
(f)Restructuring plan and other expenses relate to the FY25 Restructuring Plan and includes $32.8 million of accelerated depreciation related to the closure of our manufacturing facility in Connell, Washington . See Note 4, Restructuring, of these Notes to Consolidated Financial Statements for additional information.
(g)Represents advisory fees related to shareholder activism matters.
| For the Fiscal Year Ended May 26, 2024 | ||||||||||||||||||||
| (in millions) | North America | International | Total | |||||||||||||||||
| Net sales | $ | 4,363.2 | $ | 2,104.4 | $ | 6,467.6 | ||||||||||||||
| Less: Other segment items (a) | 3,100.1 | 1,772.5 | 4,872.6 | |||||||||||||||||
| Segment Adjusted EBITDA (b) | $ | 1,263.1 | $ | 331.9 | $ | 1,595.0 | ||||||||||||||
| Unallocated corporate costs (c) | (178.3) | |||||||||||||||||||
| Depreciation and amortization (d) | 306.2 | |||||||||||||||||||
| Unrealized derivative gains | (24.9) | |||||||||||||||||||
| Foreign currency exchange losses | 28.6 | |||||||||||||||||||
| Blue chip swap gains (e) | (18.0) | |||||||||||||||||||
| Items impacting comparability: | ||||||||||||||||||||
| Inventory step-up from acquisition | 20.7 | |||||||||||||||||||
| Integration and acquisition-related items, net | 12.8 | |||||||||||||||||||
| Interest expense, net | 135.8 | |||||||||||||||||||
| Income before income taxes | 955.5 | |||||||||||||||||||
| Income tax expense | 230.0 | |||||||||||||||||||
| Net income | $ | 725.5 | ||||||||||||||||||
(a)Other segment items include cost of sales, selling, general, and administrative expenses, and equity method investment income or loss for each segment
(b)Segment Adjusted EBITDA for fiscal 2024 included the following:
i.Net income associated with our equity method investments. Refer to Note 6, “Other Assets,” in these Notes to Consolidated Financial Statements of this Form 10-K.
ii.An estimated $40 million loss related to the voluntary product withdrawal that was initiated in the fourth quarter of fiscal 2024. The total charge to reporting segments was approximately $19 million to the North America segment and approximately $21 million to the International segment.
(c)Unallocated corporate costs include costs related to corporate support staff and support services, which include, but are not limited to, our administrative, information technology, human resources, finance, and accounting functions that are not specifically allocated to the segments. In the table, unallocated costs exclude unrealized mark-to-market derivative gains and losses, foreign currency exchange gains and losses, gains from blue chip swap transactions in Argentina, and items impacting comparability. These items are added back to reconcile Segment Adjusted EBITDA to Net income.
(d)Depreciation and amortization includes interest expense, income tax expense, and depreciation and amortization from equity method investments of $8.3 million for the fiscal year ended May 26, 2024.
(e)We enter into blue chip swap transactions to transfer U.S. dollars into Argentina primarily related to funding our capacity expansion in Argentina. The blue chip swap rate can diverge significantly from Argentina’s official exchange rate.
| For the Fiscal Year Ended May 28, 2023 (a) | ||||||||||||||||||||
| (in millions) | North America | International (a) | Total | |||||||||||||||||
| Net sales | $ | 4,249.4 | $ | 1,101.2 | $ | 5,350.6 | ||||||||||||||
| Less: Other segment items (b) | 3,087.1 | 870.2 | 3,957.3 | |||||||||||||||||
| Segment Adjusted EBITDA (c) | $ | 1,162.3 | $ | 231.0 | $ | 1,393.3 | ||||||||||||||
| Unallocated corporate costs (d) | (143.9) | |||||||||||||||||||
| Depreciation and amortization (e) | 247.4 | |||||||||||||||||||
| Unrealized derivative losses | 41.7 | |||||||||||||||||||
| Unconsolidated joint venture unrealized derivative losses | 32.7 | |||||||||||||||||||
| Foreign currency exchange losses | 5.5 | |||||||||||||||||||
| Items impacting comparability: | ||||||||||||||||||||
| Inventory step-up from acquisition | 27.0 | |||||||||||||||||||
| Integration and acquisition-related items, net | (21.8) | |||||||||||||||||||
| Gain on acquisition of interest in joint ventures (f) | (425.8) | |||||||||||||||||||
| Interest expense, net | 109.2 | |||||||||||||||||||
| Income before income taxes | 1,233.5 | |||||||||||||||||||
| Income tax expense | 224.6 | |||||||||||||||||||
| Net income | $ | 1,008.9 | ||||||||||||||||||
(a)We acquired the remaining equity interest in LW EMEA in the fourth quarter of fiscal 2023. Accordingly, LW EMEA’s net sales and adjusted EBITDA for the thirteen weeks ended May 28, 2023 are reported in the International segment, whereas in the first three quarters of fiscal 2023, our initial 50% equity interest in LW EMEA was recorded using equity method accounting. As a result, LW EMEA’s net sales are not included in the International segment’s net sales for the first three quarters of the fifty-two weeks ended May 28, 2023, and only 50% of LW EMEA’s adjusted EBITDA is reported in the International segment for those periods.
(b)Other segment items include cost of sales, selling, general, and administrative expenses, and equity method investment income or loss for each segment
(c)Segment Adjusted EBITDA for fiscal 2023 included net income associated with our equity method investments. Refer to Note 6, “Other Assets,” in these Notes to Consolidated Financial Statements of this Form 10-K.
(d)Unallocated corporate costs include costs related to corporate support staff and support services, which include, but are not limited to, our administrative, information technology, human resources, finance, and accounting functions that are not specifically allocated to the segments. In the table, unallocated costs exclude unrealized derivative gains and losses, foreign currency exchange gains and losses, blue chip swap transaction gains, and items impacting comparability. These items are added back to reconcile Segment Adjusted EBITDA to Net income. Unallocated corporate costs included only thirteen weeks associated with the acquisition of LW EMEA. For the first three quarters of fiscal 2023, our portion of LW EMEA’s unallocated corporate costs were included in “Equity method investment earnings” in the Consolidated Statements of Earnings in the International segment.
(e)Depreciation and amortization includes interest expense, income tax expense, and depreciation and amortization from equity method investments of $29.1 million for the fiscal year ended May 28, 2023.
(f)The fiscal year ended May 28, 2023 included a $425.8 million ($379.5 million after-tax) gain recognized in connection with our purchase of an additional 50% equity interest in LW EMEA, increasing our equity ownership from 50% to 100%, and our purchase of an additional 40% equity interest in LWAMSA, increasing our equity ownership from 50% to 90%. The gains related to remeasuring our initial equity interests in LW EMEA and LWAMSA to fair value.
Concentrations
Lamb Weston’s largest customer, McDonald’s Corporation, accounted for approximately 15%, 14%, and 13% of our consolidated net sales in fiscal 2025, 2024, and 2023, respectively.
Information by Geographic Area
Sales are classified as domestic or foreign based on the address to which the product is shipped. No individual foreign country is material to the consolidated results.
| For the Fiscal Years Ended May | ||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
| Net sales | ||||||||||||||||||||
| United States | $ | 4,174.5 | $ | 4,278.0 | $ | 4,125.4 | ||||||||||||||
| Other | 2,276.8 | 2,189.6 | 1,225.2 | |||||||||||||||||
| Total net sales | $ | 6,451.3 | $ | 6,467.6 | $ | 5,350.6 | ||||||||||||||
We have 26 production facilities, 14 located in the U.S. and 12 located outside of the U.S. as of May 25, 2025. Long-lived assets include property, plant, and equipment, net, operating lease assets, and capitalized software costs.
| (in millions) | May 25, 2025 | May 26, 2024 | ||||||||||||
| Long-lived assets | ||||||||||||||
| United States | $ | 2,333.0 | $ | 2,485.8 | ||||||||||
| Netherlands | 866.3 | 777.9 | ||||||||||||
| Other | 810.5 | 680.0 | ||||||||||||
| Total long-lived assets | $ | 4,009.8 | $ | 3,943.7 | ||||||||||
Labor
At May 25, 2025, we had approximately 10,100 employees, of which approximately 3,100 of these employees work outside of the U.S. Approximately 32% of our employees are parties to collective bargaining agreements with terms that we believe are typical for the industry in which we operate. Most of the union workers at our U.S. facilities are represented under contracts that expire at various times over the next several years.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jul 23, 2025 | Showing above |
| 2024 | Jul 24, 2024 | |
| 2023 | Jul 25, 2023 | |
| 2022 | Jul 27, 2022 | |
| 2021 | Jul 27, 2021 | |
| 2020 | Jul 28, 2020 | |
| 2019 | Jul 25, 2019 | |
| 2018 | Jul 26, 2018 | |
| 2017 | Jul 25, 2017 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.