McCormick & Company (MKC) Q3 2026 earnings summary

Executive summary

• Net sales grew 17.4% year-over-year in Q3 2026, with 1.9–2% organic growth and the remainder from the McCormick de Mexico acquisition; strong momentum in EMEA and Asia Pacific, and improving trends in Americas.

• Margin expansion and increased earnings were driven by productivity initiatives, operational discipline, and acquisition accretion, despite inflationary pressures.

• Integration planning for the Unilever Foods combination is on track, with regulatory filings progressing, leadership and operating model established, and synergy opportunities identified.

• Global Flavor Solutions delivered solid organic growth, though volumes were slightly below expectations due to cyclical demand and a muted food industry environment.

• The company completed the acquisition of a controlling interest in McCormick de Mexico and announced a pending merger with Unilever Foods.

Financial highlights

• Q3 2026 net sales reached $2,024.8 million, up 17.4% year-over-year; constant currency sales growth was 16.5%.

• Adjusted gross profit margin expanded by 180–190 basis points to 39.3%, driven by acquisition accretion and productivity improvements.

• Adjusted operating income increased by 22% (21% in constant currency) to $359 million, while reported operating income declined due to special charges.

• Adjusted EPS for Q3 was $0.86, up from $0.85 last year; reported EPS was $0.36, impacted by $0.50 in special charges.

• Cash flow from operations year-to-date reached $600 million, up from $420 million last year, enabling $387 million in dividends and $131 million in capex.

Outlook and guidance

• Full-year net sales growth expected at 13–17%, with 12–16% from McCormick de Mexico and 1–3% organic; gross margin expansion for the year expected at the high end of 100–120 bps versus 2025, despite 6–7% cost inflation.

• Adjusted operating income projected to increase 16–20%; adjusted EPS guidance of $3.05–$3.13, up 2–5%.

• Operating income and EPS expected at the midpoint of guidance, with Q4 impacted by higher costs and less favorable tax rate.

• Margin expansion and reinvestment anticipated post-Unilever Foods combination.

• Strong cash flow anticipated, with significant returns to shareholders via dividends.