TLDR
- Q4 adjusted EPS of $2.31 misses analyst estimate of $2.24
- Net sales down 3% to $2.1 billion, below expectations
- FY 2026 EPS guidance lowered to $8.50–$9.50 from $10.12
- Stock sinks 10.42% to $100.17 after results
- Hostess acquisition, divestitures impact results
The J.M. Smucker Company (NYSE: SJM) stock dropped over 12% to below $100 on Tuesday morning after reporting disappointing fourth-quarter fiscal 2025 results and offering a weaker-than-expected fiscal 2026 profit outlook.
The J. M. Smucker Company (SJM)
The earnings date was April 30, 2025. The snack and spread maker missed analyst forecasts on both revenue and profit.
Smucker’s adjusted earnings per share came in at $2.31 for the quarter, down 13% year-over-year and below Wall Street’s estimate of $2.24. Quarterly net sales dropped 3% to $2.1 billion, also falling short of the expected $2.19 billion.
The J.M. Smucker Co., $SJM, Q4-25. Results:
🔴 -9.2% Pre-Market 🚨📊 Adj. EPS: $2.31 🟢
💰 Revenue: $2.14B 🔴
🔎 Heavy goodwill impairment tied to the Hostess and Sweet Baked Snacks brands drove a GAAP loss, despite solid cash flow and $2.31 in adjusted EPS. pic.twitter.com/VWoPgE8PpS— EarningsTime (@Earnings_Time) June 10, 2025
Impact of Divestitures and Acquisitions
Smucker’s financial results reflected several portfolio changes, including the divestiture of its Sweet Baked Snacks value brands, Voortman® business, Canada condiment operations, and Sahale Snacks®, along with the November 2023 acquisition of Hostess Brands.
Excluding these divestitures and currency fluctuations, net sales declined 1%, mainly from a 3% drop in volume/mix, especially in dog snacks, baked goods, and fruit spreads. Uncrustables® sandwiches were a bright spot with higher sales. A 3% boost in net pricing, mainly for coffee, partially offset these declines.
Segment Performance Mixed
The U.S. Retail Coffee segment grew 11% to $738.6 million, while the International and Away From Home division rose 3% to $308.9 million. Sales for U.S. Retail Frozen Handheld and Spreads were flat at $449.8 million. However, Sweet Baked Snacks plummeted 26% to $251 million, and U.S. Retail Pet Food dropped 13% to $395.5 million—both worse than analyst expectations.
Gross profit fell 10% to $90 million due to higher costs and volume mix. Operating income was hit by $980 million in noncash impairment charges tied to the Sweet Baked Snacks and Hostess trademarks.
Weak 2026 Guidance Raises Concerns
For fiscal 2026, Smucker projects adjusted EPS of $8.50 to $9.50, a decline from $10.12 in fiscal 2025 and below analyst expectations of $10.28. Revenue is expected to grow 2% to 4% from $8.73 billion last year.
Smucker highlighted challenges from tariffs, inflation, and changing consumer behavior as risks to its outlook. Free cash flow is estimated at $875 million, with $325 million in planned capital expenditures.
Cash Flow and Debt Position
Operating cash flow was $393.9 million for the quarter, down from $428.1 million a year earlier, mainly due to higher tax payments. Free cash flow totaled $298.9 million, up slightly from $297.5 million. The company repaid $177.6 million in debt during the period.
CEO Mark Smucker emphasized confidence in long-term growth despite near-term hurdles. However, investors reacted sharply to the earnings miss and muted guidance.
