Activist investor Starboard Value has publicly called on Lamb Weston Holdings to hold an investor day aimed at restoring investor confidence, resetting earnings expectations and outlining a clearer long-term growth strategy after what it described as years of operational missteps and eroded market credibility.

In a letter to Lamb Weston’s board dated April 30, Starboard said the frozen potato processor remains a fundamentally strong business operating in an attractive category, but argued that management must now more clearly articulate how it intends to restore normalized earnings and sustainable growth.

Starboard, which describes itself as a significant shareholder, said Lamb Weston should use an investor day to “reset the narrative” by reaffirming its structural strengths, including industry concentration, pricing power, barriers to entry and rational competitive dynamics, while also evaluating which business units and operational areas are most strategic for future capital allocation.

The investor outlined a five-point framework that includes portfolio optimization, clearer communication of structural advantages, explicit profitability commitments, long-term incremental margin targets and a renewed focus on earnings growth.

Central to Starboard’s thesis is a call for Lamb Weston to achieve adjusted EBITDA margins of at least 25% by fiscal 2029. According to the letter, this would be driven through a combination of profitable revenue growth, pricing discipline and broader cost reductions beyond the company’s previously announced USD 250 million savings programme.

Starboard argued that while Lamb Weston’s current cost-cutting efforts have focused largely on cost of goods sold, a larger opportunity may exist within SG&A, which it said has nearly tripled over the past decade despite relatively modest volume growth. The firm suggested a more rigorous zero-based budgeting approach and said margin targets, rather than absolute savings figures, would provide investors with a more transparent performance benchmark.

Beyond the FY2029 profitability target, Starboard said Lamb Weston should also commit to approximately 40% incremental adjusted EBITDA margins thereafter, supported by low- to mid-single-digit revenue growth, creating what it described as a path toward low-double-digit long-term earnings growth.

The intervention reflects mounting investor pressure on major food manufacturers to move beyond near-term operational fixes and provide clearer strategic frameworks that align margin recovery with capital discipline and category leadership.

For the global potato processing sector, the development is notable given Lamb Weston’s scale and influence across frozen potato supply chains. Any strategic shifts tied to cost structure, capacity prioritization or commercial execution could carry implications for suppliers, processors and retail customers across key markets.

Starboard said rebuilding credibility will depend not only on setting measurable targets but on management’s ability to consistently execute and communicate progress.