Hormel Foods (HRL) Q3 2026 earnings summary

Executive summary

• Adjusted earnings per share grew 6% year-over-year to $0.37, despite a 2% decline in organic net sales, driven by Foodservice strength and key retail brand growth, while significant nonrecurring charges impacted GAAP results.

• Foodservice delivered its 12th consecutive quarter of organic net sales growth, outperforming industry trends, with premium prepared proteins and branded pepperoni as strong contributors.

• Retail faced volume and net sales declines due to divestitures, pricing elasticity, and commodity-based pricing, but brands like JENNIE-O, Applegate, Planters, and Hormel Chili showed growth.

• International segment was impacted by the Brazil divestiture, a $48 million impairment in Indonesia, and a legal entity transition affecting SPAM export sales.

• Leadership transition announced: John Ghingo appointed CEO, Ash Bhumbla named incoming CFO.

Financial highlights

• Q3 2026 net sales were $2.96 billion, down 2.4% year-over-year; adjusted operating income was $266 million, and adjusted operating margin was 9%.

• Adjusted EPS was $0.37, up 6% year-over-year; diluted EPS was $0.11, down 67% due to nonrecurring charges.

• Operating cash flow reached $241 million for the quarter, up 54% year-over-year; $769 million for the first nine months, up 47%.

• Capital expenditures were $68 million for the quarter and $219 million year-to-date; full-year guidance is $260–$290 million.

• Cash on hand was $840 million, up $169 million since fiscal 2025.

Outlook and guidance

• Fiscal 2026 adjusted EPS guidance raised and narrowed to $1.45–$1.51 (prior: $1.43–$1.51); GAAP EPS guidance updated to $1.06–$1.12.

• Full-year organic net sales growth expectation tightened to 1%–2% (prior: 1%–4%), with net sales expected at $12.1–$12.2 billion.

• Adjusted operating income guidance raised to $1.08–$1.12 billion, up 6%–10% year-over-year.

• Segment profit growth anticipated across all three segments.

• Fiscal 2027 will include a 53rd week; continued focus on Foodservice momentum, retail brand growth, and favorable pork input costs.