Activist Starboard Value LP is pressing Lamb Weston Holdings to accelerate cost reductions and review its Asian operations amid stagnant growth, recommending that the company increase its cost-saving target to $500m from the $250m planned by fiscal 2028, according to a report by Bloomberg.

In a letter sent to CEO Mike Smith on Sunday, Starboard Value highlights that while Lamb Weston, the primary French fry supplier to McDonald's Corp, has relied on price-driven growth since its 2016 IPO, profitability has lagged peers due to high operating costs. Starboard describes itself as a significant shareholder and supportive of volume-focused strategies but is urging further efficiency gains.

In a statement in response to the letter, a Lamb Weston spokesperson highlighted the company's ongoing management changes and cost-cutting initiatives.

Lamb Werston's shares dropped as much as 2.3% on Monday, continuing a decline of roughly 30% since early 2025.

Analysts expect the firm to report a 2% sales decline and 44% fall in adjusted earnings for the quarter ending February 22, with results due 1 April.