Hormel Foods tops earnings expectations and raises profit outlook

Hormel Foods Corporation (NYSE:HRL) delivered better-than-expected third-quarter earnings on Thursday and raised its full-year adjusted profit guidance, although revenue came in below Wall Street forecasts.

Shares of the global branded food company slipped 1.98% in pre-market trading following the release. Hormel reported adjusted earnings per share of $0.37, exceeding the analyst consensus of $0.35 by $0.02.

Net sales totalled $2.96 billion, compared with expectations of $3.05 billion. Revenue declined 2.4% from $3.03 billion in the same period last year, while organic net sales recorded a more modest decrease of 1.7%.

Hormel raises fiscal 2026 earnings guidance

Hormel attributed the softer revenue performance to portfolio-shaping initiatives, lower commodity-related pricing and continued pressure on consumers.

Despite those headwinds, the company increased and narrowed its adjusted earnings outlook for fiscal 2026. Hormel now expects adjusted EPS of between $1.45 and $1.51, giving a midpoint of $1.48 compared with the analyst consensus of $1.50.

The company revised its full-year revenue forecast to between $12.1 billion and $12.2 billion, down from its previous range of $12.2 billion to $12.5 billion. The midpoint of $12.15 billion compares with the $12.24 billion consensus estimate.

“We delivered solid third quarter results, growing our adjusted earnings and continuing to advance our fiscal 2026 objectives,” said Jeff Ettinger, interim chief executive officer. “With our strong year-to-date performance and continued opportunities ahead, we are raising and narrowing our adjusted earnings outlook for fiscal 2026.”

Foodservice delivers continued organic growth

Performance varied across Hormel’s operating divisions during the quarter. Retail net sales decreased 4.3% to $1.78 billion, while International sales declined 4.7% to $178.7 million.

Foodservice remained a source of growth, recording its 12th consecutive quarter of higher organic net sales. Revenue in the segment increased 1.6% to $1.00 billion.

Hormel also improved its profitability, with adjusted operating margin expanding to 9.0% from 8.4% in the corresponding period last year.

Cash generation strengthens

Cash flow was another positive feature of the quarter. Hormel generated $241 million of operating cash flow, representing a 54% increase year over year.

The company also continued returning capital to investors, distributing $161 million through dividends during the period.

While revenue remained under pressure, Hormel’s earnings beat, improved operating margin, stronger cash generation and higher fiscal 2026 adjusted EPS guidance highlighted continued progress on profitability and the company’s broader financial objectives.

Hormel Foods stock price