Hormel (HRL) Q1 2026 Earnings Call Transcript

The Motley Fool

by newsfeedback@fool.com (Motley Fool Transcribing)

February 26, 2026

AI-Generated Deep Dive Summary

Hormel Foods (HRL) reported steady growth in its Q1 2026 earnings call, driven by strong performance across key segments. Organic net sales increased by 2%, marking the fifth consecutive quarter of growth. The company highlighted robust demand from its protein-centric portfolio, particularly in foodservice and international markets, which saw high-single-digit growth rates. However, retail segment sales dipped by 2% due to a strategic exit from non-core private label snack nuts. Adjusted diluted EPS reached $0.34 for the quarter, while reported EPS was $0.33. Despite the growth, Hormel faced challenges such as elevated commodity costs, particularly in beef and pork trim, which rose significantly compared to last year. Pork trim costs alone jumped by 12%, impacting margins despite strong sales. Logistics expenses also climbed due to freight capacity constraints from severe winter weather and industry dynamics, further pressuring profitability. The company’s adjusted operating income came in at $247 million with an operating margin of 8.2%. Cash flow from operations totaled $349 million, up $26 million year-over-year, reflecting strong liquidity. Hormel reaffirmed its full-year guidance, expecting organic net sales growth between 1% to 4%, adjusted operating income growth in the range of 4%-10%, and adjusted diluted EPS guidance of $1.43 to $1.51. Hormel’s progress on its "Transform and Modernize" initiative has positioned it for long-term gains, with increased manufacturing capacity and ongoing cost management efforts. The company also announced a second wave of retail pricing adjustments at the start of Q2 to offset elevated input costs. Additionally, Hormel inked a deal to sell its whole-bird turkey business to Life-Science Innovations, which is expected to reduce net sales by approximately $50 million in fiscal 2026 but

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Originally published on The Motley Fool on 2/26/2026