In a rare instance, this week’s markets will be looking at three non-tech giants to understand where the broader economy is headed.
General Mills (GIS) , Darden Restaurants (DRI) , and FedEx (FDX) are all set to report earnings in the looming shadow of the latest potential rate cut from the Fed.
Usually, the talk on Wall Street focuses on tech or tariffs. However, these three companies are food, dining, and global logistics mainstays and often provide a snapshot of the next trends emerging in inflation, consumer strength, and trade flow.
Speaking of inflation, it’s back, despite the Fed’s best efforts.
In August, consumer prices jumped 0.4%, with grocery expenses up 0.6% — the most significant increase over two years. Meanwhile, retail sales rose by 0.6%, indicating that spending power is still left in the tank.
Amid this backdrop, Federal Reserve Chair Jerome Powell will decide whether he will back market expectations and issue a 0.25% or 0.5% rate cut or hold the line to tame inflation.
U.S. President Donald Trump is the biggest champion of lowering the benchmark interest rate, arguing the Fed should cut rates by at least three percentage points.
Ultimately, the concept is simple. When you cut rates, it’s supposed to, in theory, increase economic activity, since it allows businesses to borrow and spend more.
But it also leads to more inflation, something the Fed wants to avoid. So a decision to cut the rate means the Fed believes inflation is not as bad as some of the headlines suggest.
Adding more color to the inflation debate, when earnings release, General Mills will demonstrate whether customers are finally rejecting rising supermarket prices.
Darden’s results will disclose whether Americans are still eating out or reducing their consumption. FedEx, which is suffering from worldwide demand uncertainties, could reveal if trade and e-commerce are slowing. These are all valuable nuggets in their own right.
These three corporations may have something to say to investors expecting the Fed to lower interest rates and lead to a gentle landing. The only issue is: Will it be what Wall Street wants to hear?
General Mills earnings test consumer tolerance for higher prices
General Mills is feeling the heat; the packaged-food giant faces a stern test this earnings season. Expected to report an EPS of $0.81 to $0.82 per share on roughly $4.52 billion in revenue, General Mills is expecting a drop from $1.00 EPS and $4.85 billion a year earlier.
This is not a great position; it already starts the earnings season with pressure on its back.
Thanks to increased costs for grains, shipping, and labor, as well as the sale of its U.S. yogurt company in June, which cut top-line revenues by 4%, General Mills already slashed its full-year forecast, guiding fiscal 2026 earnings to $3.58 to $3.79 per share — well below last year’s $4.21.
Again, these numbers are not new; the markets will not react. Instead, what these numbers from one of the oldest food companies in America illustrate is that rising supermarket prices are weighing down the bottom line.
We do not know how much it is happening; it’s best to look into the latest results.
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Margins are narrowing. Gross margins are at 34.6%, with net margins approaching 11.7%. Organic net sales are expected to vary between -1% and +1%.
The true concern is whether customers are still prepared to accept increased pricing for pantry staples — or whether they are now pushing back, spelling trouble for the packaged food sector, apart from the specific concern haunting General Mills’ stockholders.
General Mills will report the latest results before the opening bell on Wednesday.
Darden Restaurants may show cracks in discretionary dining
While General Mills enters the earnings season with a point to prove, the same cannot be said for Darden Restaurants, which has a spring in its step, despite the overall concerns surrounding inflationary pressures.
Still, all eyes will be on Darden when it reports Q1 earnings, before the opening bell on Sept. 18.
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Just as General Mills will give the markets a fair idea of where the American consumer is with respect to grocery, Darden’s results will help us understand American discretionary dining.
Same-store sales growth has been strong, particularly at Olive Garden, which increased almost 7% last quarter. Overall, Darden generated $12.08 billion in fiscal 2025 sales, with Q4 alone up 10% year on year.
Margins remain robust, with a net profit of around 8.7% and an operating margin of 11%.
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But cost constraints remain. Food and labor costs are rising, and although Darden has handled these costs via pricing and promotions, any evidence of traffic decreasing might imply that inflation is eventually limiting consumer spending in the dining industry.
Investors will also look for feedback on capital returns. Darden just authorized a $1 billion buyback and increased the dividend. That is confidence; yet, if profits or forecast fail, it might indicate that even casual dining is no longer exempt.
FedEx may reveal if global trade is bouncing back — or breaking down
FedEx often serves as an economic barometer, and this quarter is no exception, with the shipping company forecast to announce profits of $3.64 per share, with sales likely to be flat or up just 1-2% year on year.
FedEx reported adjusted earnings of $6.07 per share on $22.2 billion in sales last quarter, but it paused some of its full-year forecasts owing to “global demand uncertainty.” This caution and a recent downgrade by Bank of America have investors on edge.
FedEx has reduced expenses with its DRIVE effort and the Network 2.0 revamp, but increased fuel and labor costs remain a drag.
Whether such savings are sufficient to maintain margins will be a major emphasis. The larger question: Are volumes stabilizing?
If FedEx reports lower-than-expected earnings or cuts outlook again, it may corroborate wider difficulties in trade and e-commerce. But if it surprises to the upside, it may indicate that company investment and shipping demand are beginning to improve.
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