Smithfield Foods (SFD) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 adjusted operating profit of $300 million and margin expansion to 8.1% from 7.9% year-over-year, with net income rising 26.6% to $238 million, driven by disciplined execution and cost control.

• First half adjusted operating profit reached $638 million, up 2% year-over-year, and net income was $484 million, up 17.6%.

• Vertically integrated model, experienced team, and strong balance sheet supported resilience and financial flexibility.

• Maintained robust liquidity and continued market share gains in key branded categories despite a challenging macroeconomic and consumer environment.

• Announced pending acquisition of Nathan's Famous, expected to close in H2 2026 and strengthen the brand portfolio.

Financial highlights

• Q2 sales were $3.7 billion, down 2.3% year-over-year; adjusted net income was $245 million, up 13.2%; adjusted diluted EPS rose to $0.62.

• Adjusted EBITDA margin for Q2 was 10.9%, up from 10.1% year-over-year.

• Net debt to adjusted EBITDA ratio at 0.4x, with liquidity of $3.65 billion, including $1.35 billion in cash.

• Operating cash flow for the first half was $204 million, nearly double the prior year.

• Capital expenditures for the first half were $165 million, up from $158 million last year.

Outlook and guidance

• FY2026 sales expected to be roughly flat versus 2025; adjusted operating profit guidance lowered to $1.225–$1.375 billion.

• Segment profit guidance: Packaged Meats $1.075–$1.15 billion, Fresh Pork $180–$240 million, Hog Production $75–$125 million.

• Capital expenditures projected at $350–$450 million; effective tax rate guidance of 22.5%–24.5%.

• Guidance excludes impact of Nathan's Famous acquisition and new Sioux Falls facility investment.

• Dividend policy maintained, with annualized rate of $1.25 per share for 2026.