HORMEL FOODS REPORTS STRONG SECOND QUARTER FISCAL 2026 RESULTS
Rhea-AI Summary
Hormel Foods (NYSE: HRL) reported second-quarter fiscal 2026 net sales of $2.97 billion, with organic net sales up 3%. GAAP EPS was $0.29 and adjusted EPS $0.40, reflecting double-digit growth.
The company completed the sale of its whole-bird turkey business, recording a $61 million loss and expecting about a $50 million fiscal 2026 net sales reduction with minimal adjusted EPS impact. Full-year 2026 guidance largely reaffirmed, though diluted EPS guidance was reduced to $1.28–$1.37.
AI-generated analysis. Not financial advice.
Positive
- Q2 2026 organic net sales up 3% on $2.97 billion revenue
- Adjusted diluted EPS of $0.40 with double-digit year-over-year growth
- Foodservice segment net sales up 6% and segment profit up 11%
- International segment net sales up 4% and segment profit up 20%
- Retail segment profit up 13% on flat net sales and 1% organic growth
- Returned $161 million in dividends; quarter-end cash balance $827 million, up $156 million since fiscal 2025 year-end
Negative
- Operating margin declined to 7.3% from 8.6% year-over-year
- Recorded a $61 million loss on the sale of the whole-bird turkey business
- Retail segment volume down 2%; organic volume down 2%
- Selling, general and administrative expenses rose to 10.7% of net sales from 8.7%
- Diluted EPS guidance cut to $1.28–$1.37 from $1.37–$1.46
- Turkey divestiture expected to reduce fiscal 2026 reported net sales by about $50 million
News Market Reaction – HRL
On the day this news was published, HRL gained 12.55%, reflecting a significant positive market reaction. Argus tracked a peak move of +9.3% during that session. Our momentum scanner triggered 59 alerts that day, indicating high trading interest and price volatility. This price movement added approximately $1.47B to the company's valuation, bringing the market cap to $13.14B at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
HRL gained 0.34% while key packaged food peers were mixed: MKC +0.61%, GIS +1.32%, PPC +2.51%, SJM +0.01%, K -0.02%. The pattern supports a stock-specific reaction to the earnings and guidance update rather than a broad sector move.
Historical Context
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| May 18 | Dividend declaration | Positive | +0.1% | Quarterly dividend of $0.2925 per share, continuing long payout streak. |
| May 14 | Product launch | Positive | +0.5% | Launch of SPAM® Dog for foodservice, expanding branded product offerings. |
| May 04 | Earnings call notice | Neutral | +1.3% | Announcement of timing and participants for Q2 fiscal 2026 earnings call. |
| Apr 28 | CSR initiative | Neutral | -0.8% | Call for 10 Under 20 Food Heroes nominations focused on food security efforts. |
| Apr 28 | Product launch | Positive | -0.8% | Launch of HERDEZ® Asada marinades and sauces in a Walmart-exclusive line. |
Recent company news, including dividends and product launches, has generally coincided with modest positive price moves, though some brand and CSR announcements saw small divergences.
Over the last few months, Hormel’s news flow has focused on steady shareholder returns, brand innovation, and corporate initiatives. A May 18 dividend declaration maintained a long dividend streak with a small positive reaction. Product launches like the SPAM® Dog and HERDEZ® Asada line highlighted branded growth, while community-oriented programs such as the 10 Under 20 Food Heroes drew mixed market responses. Against this backdrop, the second-quarter fiscal 2026 results and updated guidance add a more comprehensive view of operational performance and portfolio reshaping, including the turkey divestiture.
Regulatory & Risk Context
Hormel has an effective universal shelf registration on Form S-3ASR dated 2025-12-05, allowing issuance of senior unsecured debt securities over time. Terms such as maturity and interest rate would be set in future prospectus supplements. The shelf focuses on debt, with no usage to date and potential proceeds earmarked for general corporate purposes including working capital, acquisitions, capital spending, refinancing, or shareholder returns.
Market Pulse Summary
The stock surged +12.6% in the session following this news. A strong positive reaction aligns with the company’s report of organic net sales growth, higher adjusted EPS at $0.40, and broad-based segment profit gains. The divestiture of the whole-bird turkey business, despite a $61 million loss, fits the shift toward value-added proteins. Investors have also seen an effective S-3ASR debt shelf in place, but with no usage yet, balance-sheet flexibility remained intact before this news.
Key Terms
organic net sales financial
adjusted operating income financial
operating margin financial
cash flow from operations financial
capital expenditures financial
depreciation and amortization financial
effective tax rate financial
AI-generated analysis. Not financial advice.
Company Delivers Sixth Consecutive Quarter of Organic Top-Line Growth, GAAP EPS of
EXECUTIVE SUMMARY — SECOND QUARTER
- Net sales of
$2.97 billion 3% - Operating income of
$217 million $294 million - Operating margin of
7.3% ; adjusted operating margin1 of9.9% - Earnings before income taxes of
$206 million $283 million - Diluted earnings per share of
$0.29 $0.40 - Cash flow from operations of
$179 million
EXECUTIVE COMMENTARY
"We delivered strong second quarter results marked by profitable growth and improved performance," said Jeff Ettinger, interim chief executive officer. "We achieved our sixth consecutive quarter of organic top-line growth, expanded gross margins, and attained double-digit growth in adjusted earnings.1 This was an excellent quarter and gives us even greater confidence in our ability to deliver our full-year outlook."
"Our teams are executing at a high level across the organization, driving impressive performance from our protein-centric portfolio," said John Ghingo, president. "Each segment delivered both net sales and segment profit growth in the second quarter, reflecting broad-based strength across the business and the impact of our strategy. We are encouraged by our results and confident in how the business is performing."
FULL YEAR FISCAL 2026 GUIDANCE
For fiscal 2026, the Company:
- Reaffirms net sales in the range of
$12.2 billion $12.5 billion 1% to4% - Updates operating income guidance to be in the range of
$0.96 billion $1.02 billion - Reaffirms adjusted operating income1 to be in the range of
$1.06 billion $1.12 billion 4% to10% - Updates diluted earnings per share guidance to be in the range of
$1.28 $1.37 - Reaffirms adjusted diluted earnings per share1 to be in the range of
$1.43 $1.51 4% to10%
Updated | Previous | |
Net Sales | ||
Organic Net Sales1 Growth Rate | ||
Diluted Earnings per Share | ||
Adj. Diluted Earnings per Share1 |
PORTFOLIO SHAPING
During the second quarter of fiscal 2026, the Company completed the previously announced sale of its whole-bird turkey business. This divestiture underscores the Company's ongoing strategic shift toward expanding its value-added protein portfolio and reducing exposure to more volatile, commodity-driven businesses.
The expected impacts of the transaction are reflected in the Company's updated fiscal 2026 guidance ranges. The Company continues to expect the transaction to result in an approximate
SEGMENT HIGHLIGHTS – SECOND QUARTER
Retail
- Volume down
2% ; organic volume1 down2% - Net sales flat; organic net sales1 up
1% - Segment profit up
13%
Organic net sales1 grew in the second quarter of fiscal 2026, as strong performance in Jennie-O® ground turkey was partially offset by the strategic exit from select non-core private label snack nut items. Other priority brands such as Applegate® natural and organic meats, Hormel® Black Label® bacon, the Herdez® portfolio, and Hormel Gatherings® party trays contributed to organic net sales1 growth in the quarter. Segment profit increased as higher organic net sales,1 improved performance across the turkey manufacturing network, and lower selling, general and administrative expenses were partially offset by inflationary pressures in the logistics network.
Foodservice
- Volume up
1% ; organic volume1 up1% - Net sales up
6% ; organic net sales1 up7% - Segment profit up
11%
Second quarter organic net sales1 for the Foodservice segment was up
International
- Volume up
1% ; organic volume1 up1% - Net sales up
4% ; organic net sales1 up5% - Segment profit up
20%
For the International segment, organic volume1 and organic net sales1 grew in the second quarter of fiscal 2026. Organic net sales1 growth was driven by strong results from SPAM® luncheon meat exports and our in-country
ADDITIONAL FINANCIAL DETAILS – SECOND QUARTER FISCAL 2026
Income Statement
- Operating margin and adjusted operating margin1 were
7.3% and9.9% , respectively, compared to8.6% and9.1% , respectively, in the prior year. - Selling, general and administrative expenses as a percent of net sales and adjusted selling, general and administrative expenses as a percent of net sales1 were
10.7% and8.2% , respectively, compared to8.7% and8.2% , respectively, in the prior year. - The loss on the sale of the whole-bird turkey business, including transaction costs, was
$61 million . - Advertising investments were
$34 million $36 million - The effective tax rate was
23.6% , compared to22.0% last year.
Cash Flow Statement
- Cash flow from operations was
$179 million . - Capital expenditures were
$82 million , compared to$75 million last year. The largest projects in the second quarter of fiscal 2026 were related to investments in data and technology, and infrastructure enhancements. - Depreciation and amortization expense was
$69 million $64 million - The Company returned
$161 million to stockholders during the quarter through dividends.
Balance Sheet
- The Company remained in a strong financial position at quarter end, with ample liquidity and a conservative level of debt.
- Cash on hand was
$827 million at quarter end, an increase of$156 million from the end of fiscal 2025. - Inventories at quarter end were
$1
PRESENTATION
A conference call will be webcast at 8 a.m. CT on May 28, 2026. Access is available at hormelfoods.com by clicking on "Investors." The call will also be available via telephone by dialing 800-549-8228 (toll free) or 646-564-2877 (international) and providing the conference ID 46321. An audio replay is available at hormelfoods.com. The webcast replay will be available at noon CT, May 28, 2026, and will remain on the website for one year.
ABOUT HORMEL FOODS
Hormel Foods Corporation, based in
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements, which are based on the Company's current assumptions and expectations. These statements are typically accompanied by the words "aim," "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "might," "plan," "project," "seek," "target," "will," "would," or similar words or expressions. The principal forward-looking statements in this news release include statements regarding the Company's fiscal 2026 guidance and future financial and operational performance.
All such forward-looking statements are intended to enjoy the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, as amended. Although the Company believes there is a reasonable basis for the forward-looking statements, its actual results could be materially different. The most important factors that could cause the Company's actual results to differ from its forward-looking statements include, but are not limited to, risks related to the deterioration of economic conditions; risks and uncertainties associated with intangible assets, including any future goodwill or intangible assets impairment charges; the risk of disruption of operations; the risk that the Company may fail to realize anticipated cost savings or operating profit improvements associated with strategic initiatives, including the Transform and Modernize initiative and the Company's recent corporate restructuring plan; risk of the Company's inability to protect information technology (IT) systems against, or effectively respond to, cyberattacks, security breaches or other IT interruptions; food safety risks; fluctuations in commodity prices and availability of raw materials and other inputs; fluctuations in market demand for the Company's products; risks related to the Company's ability to respond to changing consumer preferences; damage to the Company's reputation or brand image; risks of litigation; risks associated with trade policies, export and import controls, and tariffs; and the other risks and uncertainties described in Item 1A – Risk Factors of the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which can be accessed at hormelfoods.com in the "Investors" section. Though the Company has attempted to list comprehensively these important cautionary risk factors, the Company cautions that other factors may in the future prove to be important in affecting the Company's business or results of operations. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update any forward-looking statement except as otherwise required by law.
Note: Due to rounding, numbers presented throughout this press release may not sum precisely to the totals provided, and percentages may not precisely reflect the absolute figures.
Reclassifications: Certain prior year amounts have been reclassified to conform to the current year presentation.
END NOTES
1 | Non-GAAP measure. See Appendix: Non-GAAP Measures to this news release for more information. |
INVESTOR CONTACT
Jess Blomberg
ir@hormel.com
MEDIA CONTACT
Laura Cederberg
media@hormel.com
HORMEL FOODS CORPORATION | ||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
In thousands, except per share amounts | ||||||||
Unaudited | ||||||||
Quarter Ended | Six Months Ended | |||||||
April 26, | April 27, | April 26, | April 27, | |||||
Net Sales | ||||||||
Cost of Products Sold | 2,454,093 | 2,414,377 | 5,011,835 | 4,927,957 | ||||
Gross Profit | 518,507 | 484,433 | 988,082 | 959,666 | ||||
Selling, General, and Administrative | 318,624 | 251,432 | 560,322 | 514,445 | ||||
Equity in Earnings of Affiliates | 17,229 | 15,350 | 33,049 | 31,461 | ||||
Operating Income | 217,112 | 248,352 | 460,809 | 476,682 | ||||
Interest Income | 6,479 | 6,176 | 13,007 | 13,719 | ||||
Interest Expense | 19,822 | 19,516 | 39,550 | 38,977 | ||||
Other Income (Expense), Net | 2,294 | (4,523) | 6,109 | (2,862) | ||||
Earnings Before Income Taxes | 206,063 | 230,489 | 440,375 | 448,561 | ||||
Provision for Income Taxes | 48,685 | 50,747 | 101,227 | 98,289 | ||||
Effective Tax Rate | 23.6 % | 22.0 % | 23.0 % | 21.9 % | ||||
Net Earnings | 157,378 | 179,742 | 339,147 | 350,272 | ||||
Less: Net Earnings (Loss) Attributable | (96) | (275) | (127) | (320) | ||||
Net Earnings Attributable to Hormel | $ 157,474 | $ 180,017 | $ 339,274 | $ 350,592 | ||||
Net Earnings Per Share: | ||||||||
Basic | $ 0.29 | $ 0.33 | $ 0.62 | $ 0.64 | ||||
Diluted | $ 0.29 | $ 0.33 | $ 0.62 | $ 0.64 | ||||
Weighted-average Shares | ||||||||
Basic | 550,562 | 550,277 | 550,520 | 549,868 | ||||
Diluted | 550,915 | 550,611 | 550,810 | 550,233 | ||||
Dividends Declared Per Share | $ 0.2925 | $ 0.2900 | $ 0.5850 | $ 0.5800 | ||||
HORMEL FOODS CORPORATION | ||||
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION | ||||
In thousands | ||||
Unaudited | ||||
April 26, 2026 | October 26, 2025 | |||
Assets | ||||
Cash and Cash Equivalents | $ 826,750 | $ 670,679 | ||
Short-term Marketable Securities | 33,107 | 32,909 | ||
Accounts and Other Receivables, Net | 760,073 | 813,989 | ||
Inventories | 1,750,914 | 1,747,279 | ||
Taxes Receivable | 58,760 | 96,791 | ||
Prepaid Expenses and Other Current Assets | 64,006 | 44,010 | ||
Total Current Assets | 3,493,610 | 3,405,656 | ||
Goodwill | 4,871,935 | 4,924,087 | ||
Intangible Assets | 1,585,631 | 1,647,297 | ||
Pension Assets | 206,699 | 211,826 | ||
Investments in Affiliates | 568,549 | 533,984 | ||
Other Assets | 451,769 | 431,500 | ||
Property, Plant, and Equipment, Net | 2,166,093 | 2,238,770 | ||
Total Assets | $ 13,344,286 | $ 13,393,119 | ||
Liabilities and Shareholders' Investment | ||||
Accounts Payable & Accrued Expenses | $ 748,107 | $ 787,350 | ||
Accrued Marketing Expenses | 122,512 | 113,947 | ||
Employee-related Expenses | 241,533 | 273,402 | ||
Interest and Dividends Payable | 182,246 | 180,700 | ||
Taxes Payable | 3,059 | 18,752 | ||
Current Maturities of Long-term Debt | 505,335 | 6,646 | ||
Total Current Liabilities | 1,802,791 | 1,380,796 | ||
Long-term Debt Less Current Maturities | 2,351,004 | 2,850,778 | ||
Pension and Postretirement Benefits | 353,569 | 358,984 | ||
Deferred Income Taxes | 657,431 | 661,349 | ||
Other Long-term Liabilities | 215,615 | 225,397 | ||
Accumulated Other Comprehensive Loss | (227,991) | (243,646) | ||
Other Shareholders' Investment | 8,191,867 | 8,159,461 | ||
Total Liabilities and Shareholders' Investment | $ 13,344,286 | $ 13,393,119 | ||
HORMEL FOODS CORPORATION | ||||||||
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | ||||||||
In thousands | ||||||||
Unaudited | ||||||||
Quarter Ended | Six Months Ended | |||||||
April 26, | April 27, | April 26, | April 27, | |||||
Operating Activities | ||||||||
Net Earnings | $ 157,378 | $ 179,742 | $ 339,147 | $ 350,272 | ||||
Depreciation and Amortization | 68,826 | 63,963 | 135,921 | 129,835 | ||||
Decrease (Increase) in Working Capital, | (108,234) | (203,831) | 2,285 | (159,167) | ||||
Loss (Gain) on Sale of Business | 60,214 | — | 36,706 | 10,800 | ||||
Other | 755 | 16,567 | 14,093 | 33,906 | ||||
Net Cash Provided by (Used in) | 178,939 | 56,441 | 528,153 | 365,646 | ||||
Investing Activities | ||||||||
Net Sale (Purchase) of Securities | 197 | (3,349) | (126) | (4,735) | ||||
Proceeds from Sale of Business | 21,182 | (504) | 100,035 | 13,139 | ||||
Purchases of Property, Plant, and | (82,174) | (75,083) | (151,167) | (147,250) | ||||
Proceeds from (Purchases of) Affiliates | (3,724) | (1,305) | (5,316) | (2,699) | ||||
Other | 5,828 | 1,905 | 5,833 | 2,877 | ||||
Net Cash Provided by (Used in) | (58,690) | (78,336) | (50,742) | (138,668) | ||||
Financing Activities | ||||||||
Repayments of Long-term Debt and | (1,827) | (2,043) | (3,652) | (4,245) | ||||
Dividends Paid on Common Stock | (160,936) | (159,244) | (320,437) | (314,225) | ||||
Other | (220) | 11,721 | (1,326) | 25,841 | ||||
Net Cash Provided by (Used in) | (162,983) | (149,566) | (325,416) | (292,629) | ||||
Effect of Exchange Rate Changes on | 1,578 | 752 | 4,076 | (6,542) | ||||
Increase (Decrease) in Cash and Cash | (41,156) | (170,710) | 156,072 | (72,193) | ||||
Cash and Cash Equivalents at Beginning | 867,906 | 840,398 | 670,679 | 741,881 | ||||
Cash and Cash Equivalents at End of | $ 826,750 | $ 669,688 | $ 826,750 | $ 669,688 | ||||
HORMEL FOODS CORPORATION | ||||||||||||
SEGMENT DATA | ||||||||||||
In thousands | ||||||||||||
Unaudited | ||||||||||||
Quarter Ended | Six Months Ended | |||||||||||
April 26, | April 27, | % | April 26, | April 27, | % | |||||||
Volume (lbs.) | ||||||||||||
Retail | 663,009 | 677,277 | (2.1) | 1,356,893 | 1,414,162 | (4.0) | ||||||
Foodservice | 244,307 | 242,595 | 0.7 | 488,726 | 486,449 | 0.5 | ||||||
International | 80,536 | 79,518 | 1.3 | 155,997 | 154,087 | 1.2 | ||||||
Total Volume (lbs.) | 987,852 | 999,390 | (1.2) | 2,001,616 | 2,054,698 | (2.6) | ||||||
Net Sales | ||||||||||||
Retail | 0.3 | (1.0) | ||||||||||
Foodservice | 996,711 | 936,442 | 6.4 | 1,994,937 | 1,866,627 | 6.9 | ||||||
International | 186,225 | 178,533 | 4.3 | 367,509 | 347,028 | 5.9 | ||||||
Total Net Sales | 2.5 | 1.9 | ||||||||||
Segment Profit | ||||||||||||
Retail | $ 155,640 | $ 137,135 | 13.5 | $ 251,829 | $ 256,281 | (1.7) | ||||||
Foodservice | 155,784 | 140,633 | 10.8 | 312,325 | 279,459 | 11.8 | ||||||
International | 22,135 | 18,407 | 20.3 | 45,046 | 39,252 | 14.8 | ||||||
Total Segment Profit | 333,559 | 296,175 | 12.6 | 609,200 | 574,992 | 5.9 | ||||||
Net Unallocated | 127,400 | 65,411 | 94.8 | 168,698 | 126,111 | 33.8 | ||||||
Noncontrolling Interest | (96) | (275) | 65.2 | (127) | (320) | 60.3 | ||||||
Earnings Before | $ 206,063 | $ 230,489 | (10.6) | $ 440,375 | $ 448,561 | (1.8) | ||||||
APPENDIX: NON-GAAP MEASURES
This press release includes measures of financial performance that are not defined by
Transform and Modernize (T&M) Initiative
In the fourth quarter of fiscal 2023, the Company announced a multi-year T&M initiative. In presenting non-GAAP measures, the Company adjusts for (i.e., excludes) expenses for this initiative that are non-recurring, which are primarily project-based external consulting fees and expenses related to supply chain and portfolio optimization (e.g., asset write-offs, severance, or relocation-related costs). The Company believes that non-recurring costs associated with the T&M initiative are not reflective of the Company's ongoing operating cost structure; therefore, the Company is excluding these discrete costs. The Company does not adjust for (i.e., does not exclude) certain costs related to the T&M initiative that are expected to continue after the project ends, such as software license fees and internal employee expenses, because those costs are considered ongoing in nature as a component of normal operating costs. The Company also does not adjust for savings realized through the T&M initiative as these are considered ongoing in nature and reflective of expected future operating performance.
Gain or Loss on Sale of Business
In the second quarter of fiscal 2026, the Company completed the sale of its whole-bird turkey business, resulting in a loss on the sale. In the first quarter of fiscal 2026, the Company sold
Legal Matters
From time to time, the Company receives proceeds or incurs expenses related to discrete legal matters that the Company believes are not indicative of the Company's core operating performance, do not reflect expected future operating income or costs, and are not meaningful when comparing the Company's operating performance against that of prior periods. The Company adjusts for (i.e., excludes) these impacts.
Litigation Settlements
In fiscal 2025, the Company entered into a settlement agreement with certain plaintiffs in an antitrust lawsuit.
Corporate Restructuring Plan
In the fourth quarter of fiscal 2025, the Company commenced a corporate restructuring plan, the focus of which is to reduce administrative expenses, improve efficiencies, and align the workforce to the Company's future needs, while enabling continued investment in the Company's growth. The costs incurred to execute the corporate restructuring plan and the charges incurred under the program are primarily related to severance and employee benefit costs. Because the Company believes the charges incurred under the corporate restructuring plan do not reflect future operating costs and are not meaningful when comparing the Company's operating performance against that of prior periods, the Company adjusts for (i.e., excludes) these impacts.
Consulting Agreement
On October 27, 2025, the Company entered into an agreement with its former Chief Executive Officer (CEO), pursuant to which the former CEO is expected to provide consulting services to the Company until April 2027. Consulting costs related to the agreement include cash and share-based compensation, which were primarily recognized in the first quarter of fiscal 2026. The Company believes non-recurring costs associated with the consulting agreement are not reflective of the Company's ongoing operating cost structure, are not indicative of the Company's core operating performance, and are not meaningful when comparing the Company's operating performance against that of prior periods; therefore, the Company is excluding these discrete costs.
The tables below show the calculations to reconcile from the GAAP measures to the non-GAAP measures presented in this press release. The tax provision expense or benefit of each of the pre-tax items excluded from the Company's GAAP results was computed based on the facts and tax implications associated with each item.
HORMEL FOODS CORPORATION | |||||||
RECONCILIATION OF NON-GAAP MEASURES | |||||||
Unaudited | |||||||
Quarter Ended | Six Months Ended | ||||||
In thousands, except per share amounts | April 26, | April 27, | April 26, | April 27, | |||
Cost of Products Sold (GAAP) | |||||||
Transform and Modernize Initiative(1) | (1,393) | (2,777) | (1,774) | (2,963) | |||
Adjusted Cost of Products Sold (Non-GAAP) | |||||||
SG&A (GAAP) | $ 318,624 | $ 251,432 | $ 560,322 | $ 514,445 | |||
Transform and Modernize Initiative(2) | (14,113) | (13,775) | (24,656) | (27,743) | |||
Gain (Loss) on Sale of Business | (61,040) | — | (37,532) | (11,324) | |||
Corporate Restructuring Plan | (55) | — | (8,531) | — | |||
Consulting Agreement | — | — | (7,775) | — | |||
Litigation Settlements | — | — | — | (240) | |||
Adjusted SG&A (Non-GAAP) | $ 243,416 | $ 237,657 | $ 481,828 | $ 475,138 | |||
Operating Income (GAAP) | $ 217,112 | $ 248,352 | $ 460,809 | $ 476,682 | |||
Transform and Modernize Initiative(1)(2) | 15,506 | 16,552 | 26,430 | 30,706 | |||
(Gain) Loss on Sale of Business | 61,040 | — | 37,532 | 11,324 | |||
Corporate Restructuring Plan | 55 | — | 8,531 | — | |||
Consulting Agreement | — | — | 7,775 | — | |||
Litigation Settlements | — | — | — | 240 | |||
Adjusted Operating Income (Non-GAAP) | $ 293,713 | $ 264,903 | $ 541,077 | $ 518,952 | |||
Earnings Before Income Taxes (GAAP) | $ 206,063 | $ 230,489 | $ 440,375 | $ 448,561 | |||
Transform and Modernize Initiative(1)(2) | 15,506 | 16,552 | 26,430 | 30,706 | |||
(Gain) Loss on Sale of Business | 61,040 | — | 37,532 | 11,324 | |||
Corporate Restructuring Plan | 55 | — | 8,531 | — | |||
Consulting Agreement | — | — | 7,775 | — | |||
Litigation Settlements | — | — | — | 240 | |||
Adjusted Earnings Before Income Taxes (Non- | $ 282,664 | $ 247,040 | $ 520,643 | $ 490,831 | |||
Provision for Income Taxes (GAAP) | $ 48,685 | $ 50,747 | $ 101,227 | $ 98,289 | |||
Transform and Modernize Initiative(1)(2) | 3,799 | 3,641 | 6,475 | 6,727 | |||
(Gain) Loss on Sale of Business | 9,982 | — | 4,223 | 2,469 | |||
Corporate Restructuring Plan | 13 | — | 2,090 | — | |||
Consulting Agreement | — | — | — | — | |||
Litigation Settlements | — | — | — | 52 | |||
Adjusted Provision for Income Taxes (Non-GAAP) | $ 62,480 | $ 54,388 | $ 114,016 | $ 107,537 | |||
Net Earnings Attributable to Hormel Foods | $ 157,474 | $ 180,017 | $ 339,274 | $ 350,592 | |||
Transform and Modernize Initiative(1)(2) | 11,707 | 12,910 | 19,955 | 23,979 | |||
(Gain) Loss on Sale of Business | 51,058 | — | 33,309 | 8,855 | |||
Corporate Restructuring Plan | 41 | — | 6,441 | — | |||
Consulting Agreement | — | — | 7,775 | — | |||
Litigation Settlements | — | — | — | 188 | |||
Adjusted Net Earnings Attributable to Hormel | $ 220,280 | $ 192,928 | $ 406,754 | $ 383,615 | |||
Diluted Earnings Per Share (GAAP) | $ 0.29 | $ 0.33 | $ 0.62 | $ 0.64 | |||
Transform and Modernize Initiative(1)(2) | 0.02 | 0.02 | 0.04 | 0.04 | |||
(Gain) Loss on Sale of Business | 0.09 | — | 0.06 | 0.02 | |||
Corporate Restructuring Plan | — | — | 0.01 | — | |||
Consulting Agreement | — | — | 0.01 | — | |||
Litigation Settlements | — | — | — | — | |||
Adjusted Diluted Earnings Per Share (Non-GAAP) | $ 0.40 | $ 0.35 | $ 0.74 | $ 0.70 | |||
SG&A as a Percent of Net Sales (GAAP) | 10.7 % | 8.7 % | 9.3 % | 8.7 % | |||
Transform and Modernize Initiative(2) | (0.5) | (0.5) | (0.4) | (0.5) | |||
Gain (Loss) on Sale of Business | (2.1) | — | (0.6) | (0.2) | |||
Corporate Restructuring Plan | — | — | (0.1) | — | |||
Consulting Agreement | — | — | (0.1) | — | |||
Litigation Settlements | — | — | — | — | |||
Adjusted SG&A as a Percent of Net Sales (Non- | 8.2 % | 8.2 % | 8.0 % | 8.1 % | |||
HORMEL FOODS CORPORATION | |||||||
RECONCILIATION OF NON-GAAP MEASURES | |||||||
Unaudited | |||||||
Quarter Ended | Six Months Ended | ||||||
April 26, | April 27, | April 26, | April 27, | ||||
Operating Margin (GAAP) | 7.3 % | 8.6 % | 7.7 % | 8.1 % | |||
Transform and Modernize Initiative(1)(2) | 0.5 | 0.6 | 0.4 | 0.5 | |||
(Gain) Loss on Sale of Business | 2.1 | — | 0.6 | 0.2 | |||
Corporate Restructuring Plan | — | — | 0.1 | — | |||
Consulting Agreement | — | — | 0.1 | — | |||
Litigation Settlements | — | — | — | — | |||
Adjusted Operating Margin (Non-GAAP) | 9.9 % | 9.1 % | 9.0 % | 8.8 % | |||
(1) | Comprised primarily of asset write-offs and severance related to supply chain and portfolio optimization. |
(2) | Comprised primarily of project-based external consulting fees. |
ORGANIC VOLUME AND ORGANIC NET SALES (NON-GAAP)
The non-GAAP measures of organic volume and organic net sales are presented to provide investors with additional information to facilitate the comparison of past and present operations. Organic volume and organic net sales exclude the impact of the sale of the Company's controlling equity interest in Justin's, LLC in the first quarter of fiscal 2026.
Quarter Ended | |||||||
April 26, 2026 | April 27, 2025 | ||||||
In thousands | GAAP | GAAP | Divestiture | Non-GAAP | Non-GAAP % Change | ||
Volume (lbs.) | |||||||
Retail | 663,009 | 677,277 | (3,652) | 673,625 | (1.6) | ||
Foodservice | 244,307 | 242,595 | (302) | 242,293 | 0.8 | ||
International | 80,536 | 79,518 | (36) | 79,482 | 1.3 | ||
Total Volume (lbs.) | 987,852 | 999,390 | (3,990) | 995,400 | (0.8) | ||
Net Sales | |||||||
Retail | $ 1,789,665 | $ (18,554) | 1.4 | ||||
Foodservice | 996,711 | 936,442 | (1,738) | 934,704 | 6.6 | ||
International | 186,225 | 178,533 | (561) | 177,972 | 4.6 | ||
Total Net Sales | $ 2,972,600 | $ (20,853) | 3.3 | ||||
Six Months Ended | |||||||
April 26, 2026 | April 27, 2025 | ||||||
In thousands | GAAP | GAAP | Divestiture | Non-GAAP | Non-GAAP % Change | ||
Volume (lbs.) | |||||||
Retail | 1,356,893 | 1,414,162 | (5,065) | 1,409,097 | (3.7) | ||
Foodservice | 488,726 | 486,449 | (379) | 486,070 | 0.5 | ||
International | 155,997 | 154,087 | (49) | 154,038 | 1.3 | ||
Total Volume (lbs.) | 2,001,616 | 2,054,698 | (5,493) | 2,049,205 | (2.3) | ||
Net Sales | |||||||
Retail | $ 3,637,471 | $ (26,474) | (0.3) | ||||
Foodservice | 1,994,937 | 1,866,627 | (2,244) | 1,864,383 | 7.0 | ||
International | 367,509 | 347,028 | (670) | 346,358 | 6.1 | ||
Total Net Sales | $ 5,999,917 | $ (29,389) | 2.4 | ||||
FORWARD-LOOKING GAAP TO NON-GAAP MEASURES
The information below reconciles the estimated fiscal 2026 GAAP measures to the corresponding estimated adjusted non-GAAP measures.
Fiscal 2026 Outlook – Organic Net Sales (Non-GAAP)
To provide a clearer comparison of past and present net sales performance, the Company has adjusted its fiscal 2025 net sales to exclude the impact of the sale of the Justin's® branded business in the first quarter of fiscal 2026.
In billions | Fiscal 2026 Outlook | 2025 Results | Change | ||||||
Net Sales (GAAP) | $ 12.2 | - | $ 12.5 | $ 12.1 | 1 % | - | 3 % | ||
Divestitures | — | - | — | (0.1) | |||||
Organic Net Sales (Non-GAAP) | $ 12.2 | - | $ 12.5 | $ 12.0 | 1 % | - | 4 % | ||
Fiscal 2026 Outlook – Adjusted Operating Income (Non-GAAP)
The Company's fiscal 2026 outlook for adjusted operating income is a non-GAAP measure that excludes items impacting comparability.
In fiscal 2026, the Company expects:
- Operating income (GAAP) in the range of
$956 million $1,021 million - Adjustments for the T&M initiative of
$43.0 million $49.0 million - Adjustments for corporate restructuring plan-related charges of
$8.5 million - Adjustment for the Consulting Agreement of
$7.8 million - Adjustment for a gain related to the sale of the Justin's® branded business of
$(23.5) million - Adjustment for a loss related to the sale of the whole-bird turkey business of
$61.0 million
Resulting in an adjusted operating income range (non-GAAP) of
Fiscal 2026 Outlook – Adjusted Diluted Earnings per Share (Non-GAAP)
The Company's fiscal 2026 outlook for adjusted diluted earnings per share is a non-GAAP measure that excludes items impacting comparability.
In fiscal 2026, the Company expects:
- Diluted earnings per share (GAAP) in the range of
$1.28 $1.37 - Adjustments for the T&M initiative of
$0.06 $0.07 - Adjustments for corporate restructuring plan-related charges of
$0.01 - Adjustment for the Consulting Agreement of
$0.01 - Adjustment for a gain related to the sale of the Justin's® branded business of
$(0.03) - Adjustment for a loss related to the sale of the whole-bird turkey business of
$0.09
Resulting in an adjusted diluted earnings per share range (non-GAAP) of
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SOURCE Hormel Foods Corporation