ADM(ADM) - 2025 Q2 - Quarterly Results

Executive Summary & Outlook This section provides key financial highlights, the CEO's strategic outlook, and important notes on non-GAAP financial measures Highlights ADM reported second-quarter net earnings of $219 million and adjusted net earnings of $452 million, with adjusted EPS of $0.93, both down year-over-year. Year-to-date cash flows from operations were strong at $4.0 billion. The company also remediated a material weakness in internal controls related to segment disclosures and tightened its full-year 2025 adjusted EPS guidance to approximately $4.00/share, anticipating improved margins to benefit the fourth quarter and beyond | Metric | 2Q 2025 | Change vs. 2Q 2024 | | :-------------------------------- | :------ | :------------------- | | Net Earnings | $219 million | - | | Adjusted Net Earnings | $452 million | Down | | EPS (as reported) | $0.45 | Down | | Adjusted EPS | $0.93 | Down | | YTD Cash Flows from Operating Activities | $4.0 billion | - | - Remediated previously identified material weakness in internal controls regarding segment disclosures related to reporting, pricing, and measurement[8] - Tightened full-year 2025 adjusted EPS guidance to approximately $4.00/share, with improved margins expected to benefit Q4 2025 and beyond[8] CEO Outlook CEO Juan Luciano highlighted progress on operational improvements and portfolio simplification, driving cost savings. Despite a challenging environment in Ag Services & Oilseeds (AS&O) and pockets of demand softness in Carb Solutions, Nutrition showed sequential improvement. The company expects the challenging environment to ease in Q4 due to clarity on Renewable Volume Obligations and is well-positioned to exit 2025 with strong momentum, confident in executing future opportunities - ADM continued operational improvements, driving cost savings through targeted realignments and advancing portfolio simplification opportunities[4] - AS&O focused on operational resilience and network consolidations, expecting the challenging environment to ease in Q4 with biofuel policy clarity[5][6] - Nutrition delivered sequential improvement in operating profit, with restored Decatur East Plant operations expected to support improved performance in the second half of the year[5] Non-GAAP Financial Measures Note The report includes non-GAAP financial measures, such as adjusted EPS and cash flows from operations before working capital, which are explained and reconciled on later pages (7-8 and 14-17). The company is not providing a forecasted GAAP EPS reconciliation due to the unreasonable effort required to predict certain variable items - Non-GAAP financial measures are used and reconciled on pages 7-8 and 14-17[6] - Forecasted GAAP EPS reconciliation is not provided due to the unreasonable effort exemption, as the impact of certain items (impairment, restructuring, legal, tax matters) is uncertain and material[7] Consolidated Financial Results Overview This section provides a summary of ADM's overall financial performance for the second quarter and year-to-date, highlighting key earnings and profit metrics Summary of Second Quarter & Year-to-Date Performance For Q2 2025, ADM's earnings before income taxes decreased by 53% to $279 million, with GAAP EPS down 54% to $0.45. Adjusted EPS also declined by 10% to $0.93. Total segment operating profit fell 10% to $830 million, impacted by $147 million in specified items. Year-to-date, earnings before income taxes were $632 million (down 57%), total segment operating profit was $1,577 million (down 26%), GAAP EPS was $1.06 (down 56%), and adjusted EPS was $1.63 (down 35%) 2Q 2025 Consolidated Financial Performance | Metric | 2Q 2025 | % Change vs. 2Q 2024 | | :-------------------------- | :------ | :------------------- | | Earnings Before Income Taxes | $279 million | (53)% | | EPS (as reported) | $0.45 | (54)% | | Total Segment Operating Profit | $830 million | (10)% | | Adjusted EPS | $0.93 | (10)% | YTD 2025 Consolidated Financial Performance | Metric | YTD 2025 | % Change vs. YTD 2024 | | :-------------------------- | :------- | :-------------------- | | Earnings Before Income Taxes | $632 million | (57)% | | EPS (as reported) | $1.06 | (56)% | | Total Segment Operating Profit | $1,577 million | (26)% | | Adjusted EPS | $1.63 | (35)% | - Total segment operating profit for Q2 2025 excluded $147 million in specified items, primarily portfolio optimization and impairment charges[11] Segment Performance Analysis This section details the financial performance of ADM's key business segments: Ag Services & Oilseeds, Carbohydrate Solutions, and Nutrition, along with Corporate and Other Business Ag Services & Oilseeds (AS&O) The Ag Services & Oilseeds segment reported a 17% decrease in operating profit for Q2 2025, totaling $379 million, and a 40% decrease year-to-date to $791 million. This decline was primarily driven by lower volumes and margins in Ag Services due to trade policy uncertainty and commodity prices, and significantly lower crushing margins impacted by reduced vegetable oil demand and biofuel policy uncertainty. Refined Products and Other saw a 14% increase in Q2 operating profit, while equity earnings from Wilmar also increased by 13% in Q2 AS&O Segment Operating Profit (Q2 2025 vs. Q2 2024) | Subsegment | 2Q 2025 (millions) | 2Q 2024 (millions) | % Change | | :------------------------ | :----------------- | :----------------- | :------- | | Total AS&O | $379 | $459 | (17)% | | Ag Services | $113 | $122 | (7)% | | Crushing | $33 | $132 | (75)% | | Refined Products and Other | $156 | $137 | 14% | | Wilmar | $77 | $68 | 13% | - Ag Services operating profit decreased due to lower volumes and margins from trade policy uncertainty, lower commodity prices, and slower farmer selling, with negative mark-to-market timing impacts[15] - Crushing operating profit significantly declined by 75% due to lower margins, primarily from reduced vegetable oil demand impacted by biofuel and trade policy uncertainty[16] AS&O Segment Operating Profit (YTD 2025 vs. YTD 2024) | Subsegment | YTD 2025 (millions) | YTD 2024 (millions) | % Change | | :------------------------ | :------------------ | :------------------ | :------- | | Total AS&O | $791 | $1,323 | (40)% | | Ag Services | $272 | $354 | (23)% | | Crushing | $79 | $445 | (82)% | | Refined Products and Other | $291 | $307 | (5)% | | Wilmar | $149 | $217 | (31)% | Carbohydrate Solutions The Carbohydrate Solutions segment's operating profit decreased by 6% to $337 million in Q2 2025 and by 5% to $576 million year-to-date. The Starches & Sweeteners subsegment saw a 6% decline in Q2, mainly due to lower international volumes and margins, partially offset by improved global wheat milling and North America corn wet milling performance. Vantage Corn Processors' operating profit remained relatively flat in Q2 Carbohydrate Solutions Segment Operating Profit (Q2 2025 vs. Q2 2024) | Subsegment | 2Q 2025 (millions) | 2Q 2024 (millions) | % Change | | :------------------------ | :----------------- | :----------------- | :------- | | Total Carb Solutions | $337 | $357 | (6)% | | Starches and Sweeteners | $304 | $323 | (6)% | | Vantage Corn Processors | $33 | $34 | (3)% | - Starches & Sweeteners operating profit decreased due to lower international volumes and margins, impacted by higher corn costs in EMEA, despite improved global wheat milling and North America corn wet milling[23] Carbohydrate Solutions Segment Operating Profit (YTD 2025 vs. YTD 2024) | Subsegment | YTD 2025 (millions) | YTD 2024 (millions) | % Change | | :------------------------ | :------------------ | :------------------ | :------- | | Total Carb Solutions | $576 | $605 | (5)% | | Starches and Sweeteners | $511 | $584 | (13)% | | Vantage Corn Processors | $65 | $21 | NM (Not Meaningful) | Nutrition The Nutrition segment's operating profit increased by 5% to $114 million in Q2 2025 and by 9% to $210 million year-to-date. Human Nutrition operating profit declined by 11% in Q2, with Flavors showing growth from higher margins and volumes, but Specialty Ingredients and Health & Wellness experiencing declines. Animal Nutrition operating profit was up significantly due to improved margins and cost optimization efforts Nutrition Segment Operating Profit (Q2 2025 vs. Q2 2024) | Subsegment | 2Q 2025 (millions) | 2Q 2024 (millions) | % Change | | :---------------- | :----------------- | :----------------- | :------- | | Total Nutrition | $114 | $109 | 5% | | Human Nutrition | $92 | $103 | (11)% | | Animal Nutrition | $22 | $6 | NM (Not Meaningful) | - Human Nutrition operating profit declined, with Flavors increasing due to higher margins and volumes, but Specialty Ingredients and Health & Wellness declining[28] - Animal Nutrition operating profit increased significantly, driven by improved margins and ongoing cost optimization efforts[29] Nutrition Segment Operating Profit (YTD 2025 vs. YTD 2024) | Subsegment | YTD 2025 (millions) | YTD 2024 (millions) | % Change | | :---------------- | :------------------ | :------------------ | :------- | | Total Nutrition | $210 | $193 | 9% | | Human Nutrition | $168 | $179 | (6)% | | Animal Nutrition | $42 | $14 | NM (Not Meaningful) | Corporate and Other Business Summary For the second quarter of 2025, Corporate and Other Business experienced lower costs compared to the prior year quarter, primarily due to a decrease in net interest expense, excluding revaluation losses - Corporate and Other Business achieved lower costs in Q2 2025 versus prior year, driven by lower net interest expense, excluding revaluation losses[31] Company Information This section provides details on the conference call, an overview of ADM's business, and a cautionary note on forward-looking statements Conference Call Details ADM hosted a webcast on August 5, 2025, at 9 a.m. Central Time to discuss financial results and outlook, with a replay available on their website - Webcast held on August 5, 2025, at 9 a.m. Central Time to discuss financial results and outlook, with replay available at www.adm.com/webcast[32](index=32&type=chunk) About ADM ADM is a global leader in agricultural supply chain management and processing, providing food security, human and animal nutrition solutions, and pioneering bio-based consumer and industrial solutions. The company is committed to business-driven sustainability efforts across the agricultural sector and bioeconomy - ADM is an essential global agricultural supply chain manager and processor, providing food security[33] - ADM is a premier human and animal nutrition provider, offering a broad portfolio of ingredients and solutions[33] - ADM is an innovator in new bio-based consumer and industrial solutions and leads in business-driven sustainability efforts[33] Cautionary Note Regarding Forward-Looking Statements This press release contains forward-looking statements subject to substantial risks and uncertainties that could cause actual results to differ materially. These risks include operational issues, commodity price volatility, changes in government policies (trade, biofuels), international conflicts, legal proceedings, and transaction-related uncertainties. Readers are cautioned not to place undue reliance on these statements, and ADM disclaims any duty to update them - Forward-looking statements are subject to significant risks and uncertainties, including operational risks, commodity price volatility, and changes in government policies[34] - Other risks include international conflicts, legal proceedings (including ongoing government investigations), and uncertainties related to acquisitions and divestitures[34] - ADM claims the protection of the safe harbor for forward-looking statements and disclaims any duty to update them after the announcement date[34][35] Non-GAAP Financial Measures Definitions This section defines and explains various non-GAAP financial measures used in the report, such as adjusted net earnings, total segment operating profit, and adjusted ROIC Adjusted Net Earnings and Adjusted EPS Adjusted net earnings and adjusted EPS are non-GAAP measures that remove the effect of specified items from reported net earnings and diluted EPS, respectively. Management uses these to provide investors with additional information on underlying business performance and period-to-period comparability, but they are not intended to replace GAAP measures - Adjusted net earnings and Adjusted EPS exclude the effect of specified items from reported net earnings and diluted EPS[37] - These measures provide additional information for evaluating underlying business performance and period-to-period comparability[37] Total Segment Operating Profit Total segment operating profit is a non-GAAP measure representing consolidated earnings before income taxes, adjusted for Other Business, Corporate costs, and specified items. It helps investors understand reportable segment performance by excluding overhead and specific non-recurring items, but it is not a GAAP measure of consolidated operating results - Total segment operating profit adjusts consolidated earnings before income taxes for Other Business, Corporate, and specified items[38] - It provides information on reportable segment performance by excluding overhead costs and specified items[38] Adjusted Return on Invested Capital (ROIC) Adjusted ROIC is a non-GAAP measure calculated by dividing Adjusted ROIC earnings (net earnings adjusted for after-tax interest expense and specified items) by adjusted invested capital (equity plus interest-bearing liabilities, adjusted for specified items). Management uses it to assess returns, excluding specified items, and to compare against its weighted average cost of capital (WACC) - Adjusted ROIC is calculated using Adjusted ROIC earnings (net earnings adjusted for after-tax interest and specified items) and adjusted invested capital[39] - It provides information about ADM's returns, excluding specified items, and enhances period-to-period comparability[39] EBITDA and Adjusted EBITDA EBITDA is defined as earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA further adjusts EBITDA by removing the impact of specified items. These non-GAAP measures offer investors additional insight into the company's operations, allowing for better evaluation of underlying business performance and period-to-period comparability, but are not alternatives to GAAP net earnings - EBITDA is earnings before interest, taxes, depreciation, and amortization[40] - Adjusted EBITDA removes the impact of specified items from EBITDA[40] - These measures provide additional information for evaluating underlying business performance and period-to-period comparability[41] Cash Flows from Operations Before Working Capital Cash flows from operations before working capital is a non-GAAP measure that adjusts cash flows from operating activities for changes in operating assets and liabilities. Management considers it a useful indicator of the company's cash generation, though it is not an alternative to GAAP cash from operating activities - Cash flows from operations before working capital adjusts cash flows from operating activities for changes in operating assets and liabilities[42] - This non-GAAP measure is considered useful for understanding the company's cash generation[42] Financial Tables This section presents detailed financial tables including segment operating profit, consolidated statements of earnings, balance sheet, cash flows, and non-GAAP reconciliations Segment Operating Profit and Corporate Results This table provides a detailed breakdown of segment operating profit for Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition, along with Corporate Results, for both the second quarter and six months ended June 30, 2025, compared to the prior year. It highlights changes in profit contributions from each segment and corporate expenses Segment Operating Profit and Corporate Results (Q2 & YTD 2025 vs. 2024) | (In millions) | Q2 2025 | Q2 2024 | Q2 Change | YTD 2025 | YTD 2024 | YTD Change | | :-------------------------- | :------ | :------ | :-------- | :------- | :------- | :--------- | | Ag Services and Oilseeds | $379 | $459 | $(80) | $791 | $1,323 | $(532) | | Carbohydrate Solutions | $337 | $357 | $(20) | $576 | $605 | $(29) | | Nutrition | $114 | $109 | $5 | $210 | $193 | $17 | | Corporate Results | $(498) | $(418) | $(80) | $(939) | $(844) | $(95) | | Interest expense - net | $(112) | $(128) | $16 | $(212) | $(238) | $26 | | Unallocated corporate function costs | $(294) | $(292) | $(2) | $(647) | $(596) | $(51) | | Revaluation losses, impairment, restructuring | $(99) | — | $(99) | $(104) | $(12) | $(92) | Consolidated Statements of Earnings This table presents the consolidated statements of earnings for the second quarter and six months ended June 30, 2025, and 2024. It details revenues, cost of products sold, gross profit, various expenses, and ultimately net earnings attributable to ADM, along with diluted earnings per common share Consolidated Statements of Earnings (Q2 & YTD 2025 vs. 2024) | (in millions, except per share amounts) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------------- | :------ | :------ | :------- | :------- | | Revenues | $21,166 | $22,248 | $41,341 | $44,095 | | Gross Profit | $1,370 | $1,396 | $2,550 | $3,055 | | Earnings Before Income Taxes | $279 | $596 | $632 | $1,481 | | Net Earnings Attributable to ADM | $219 | $486 | $514 | $1,215 | | Diluted earnings per common share | $0.45 | $0.98 | $1.06 | $2.41 | Summary of Financial Condition (Balance Sheet) This table provides a summary of ADM's financial condition (balance sheet) as of June 30, 2025, and June 30, 2024. It outlines key assets such as cash, operating working capital, property, plant, and equipment, and liabilities including short-term and long-term debt, as well as shareholders' equity Summary of Financial Condition (June 30, 2025 vs. 2024) | (in millions) | June 30, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------ | | Cash and cash equivalents | $1,057 | $764 | | Operating working capital | $8,377 | $9,827 | | Property, plant, and equipment | $11,142 | $10,628 | | Investments in affiliates | $5,175 | $5,557 | | Short-term debt | $856 | $2,312 | | Long-term debt, including current maturities | $8,372 | $8,248 | | Shareholders' equity | $22,438 | $22,159 | | Total Net Investment / Financed By | $35,147 | $36,327 | Summary of Cash Flows This table presents the summary of cash flows for the six months ended June 30, 2025, and 2024. It details cash flows from operating, investing, and financing activities, showing a significant increase in net cash provided by operating activities in 2025 and a net increase in cash and cash equivalents Summary of Cash Flows (YTD 2025 vs. 2024) | (in millions) | YTD 2025 | YTD 2024 | | :-------------------------------------- | :------- | :------- | | Net cash provided by operating activities | $3,956 | $1,168 | | Net cash used in investing activities | $(391) | $(1,612) | | Net cash used in financing activities | $(1,579) | $(661) | | Net increase (decrease) in cash, cash equivalents | $2,020 | $(1,119) | | Cash, cash equivalents - end of period | $5,944 | $4,271 | Segment Operating Analysis (Volumes & Revenues) This table provides an analysis of certain processed volumes by commodity (Oilseeds and Corn) and total segment revenues for Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition for the second quarter and six months ended June 30, 2025, compared to the prior year Certain Processed Volumes (Q2 & YTD 2025 vs. 2024) | (in '000s metric tons) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :---------------------- | :------ | :------ | :------- | :------- | | Oilseeds | 9,051 | 8,872 | 18,142 | 18,259 | | Corn | 4,614 | 4,482 | 9,195 | 8,890 | Segment Revenues (Q2 & YTD 2025 vs. 2024) | (in millions) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :---------------------- | :------ | :------ | :------- | :------- | | Ag Services and Oilseeds | $16,269 | $17,333 | $31,944 | $34,552 | | Carbohydrate Solutions | $2,792 | $2,894 | $5,362 | $5,577 | | Nutrition | $1,993 | $1,908 | $3,810 | $3,744 | | Total Segment Revenues | $21,054 | $22,135 | $41,116 | $43,873 | | Total Revenues | $21,166 | $22,248 | $41,341 | $44,095 | Total Segment Operating Profit Reconciliation (Non-GAAP) This table provides a reconciliation of earnings before income taxes (GAAP) to total segment operating profit (Non-GAAP) for the second quarter and six months ended June 30, 2025, and 2024. It details adjustments for Other Business, Corporate, and specified items like impairment and restructuring charges Total Segment Operating Profit Reconciliation (Q2 & YTD 2025 vs. 2024) | (In millions) | Q2 2025 | Q2 2024 | Q2 Change | YTD 2025 | YTD 2024 | YTD Change | | :-------------------------------- | :------ | :------ | :-------- | :------- | :------- | :--------- | | Earnings before income taxes | $279 | $596 | $(317) | $632 | $1,481 | $(849) | | Other Business (earnings) | $(94) | $(96) | $2 | $(190) | $(217) | $27 | | Corporate | $498 | $418 | $80 | $939 | $844 | $95 | | Specified items (net) | $147 | $7 | $140 | $196 | $13 | $183 | | Total Segment Operating Profit | $830 | $925 | $(95) | $1,577 | $2,121 | $(544) | Adjusted Net Earnings and Adjusted EPS Reconciliation (Non-GAAP) This table reconciles GAAP net earnings and EPS to adjusted net earnings and adjusted EPS for the second quarter and six months ended June 30, 2025, and 2024. It itemizes specific adjustments, including gains on asset sales, impairment and restructuring charges, acquisition expenses, and contract termination gains, along with their per-share impact Adjusted Net Earnings and Adjusted EPS Reconciliation (Q2 & YTD 2025 vs. 2024) | (in millions, except per share amounts) | Q2 2025 (millions) | Q2 2025 (per share) | Q2 2024 (millions) | Q2 2024 (per share) | YTD 2025 (millions) | YTD 2025 (per share) | YTD 2024 (millions) | YTD 2024 (per share) | | :-------------------------------------- | :----------------- | :------------------ | :----------------- | :------------------ | :------------------ | :------------------- | :------------------ | :------------------- | | Net earnings and reported EPS (diluted) | $219 | $0.45 | $486 | $0.98 | $514 | $1.06 | $1,215 | $2.41 | | Total adjustments | $233 | $0.48 | $22 | $0.05 | $276 | $0.57 | $43 | $0.08 | | Adjusted net earnings and adjusted diluted EPS | $452 | $0.93 | $508 | $1.03 | $790 | $1.63 | $1,258 | $2.49 | - Adjustments for Q2 2025 included $291 million ($0.60/share) for impairment, exit, restructuring charges, and settlement contingencies, and a $52 million ($0.11/share) gain on contract termination[51] Return on Invested Capital (ROIC) and Adjusted ROIC Reconciliation (Non-GAAP) This table provides a reconciliation of ROIC and Adjusted ROIC, non-GAAP financial measures, for the four quarters ended June 30, 2025. It details the calculation of Adjusted ROIC Earnings and Adjusted Invested Capital, showing the company's Return on Invested Capital at 4.5% and Adjusted Return on Invested Capital at 6.9% Adjusted ROIC Earnings (Four Quarters Ended June 30, 2025) | (in millions) | Sep. 30, 2024 | Dec. 31, 2024 | Mar. 31, 2025 | June 30, 2025 | Four Quarters Ended June 30, 2025 | | :-------------------------- | :------------ | :------------ | :------------ | :------------ | :-------------------------------- | | Net earnings attributable to ADM | $18 | $567 | $295 | $219 | $1,099 | | Total ROIC Earnings | $112 | $663 | $383 | $307 | $1,465 | | Total Adjusted ROIC Earnings | $624 | $641 | $426 | $540 | $2,231 | Adjusted Invested Capital (Trailing Four Quarter Average) | (in millions) | Sep. 30, 2024 | Dec. 31, 2024 | Mar. 31, 2025 | June 30, 2025 | Trailing Four Quarter Average | | :-------------------------- | :------------ | :------------ | :------------ | :------------ | :---------------------------- | | Equity | $21,974 | $22,168 | $22,119 | $22,430 | $22,173 | | Interest-bearing liabilities | $10,051 | $10,180 | $11,088 | $9,252 | $10,143 | | Total Invested Capital | $32,025 | $32,348 | $33,207 | $31,682 | $32,316 | | Total Adjusted Invested Capital | $32,537 | $32,326 | $33,250 | $31,915 | $32,507 | - Return on Invested Capital was 4.5%, and Adjusted Return on Invested Capital was 6.9% for the four quarters ended June 30, 2025[55] EBITDA and Adjusted EBITDA Reconciliation (Non-GAAP) This table reconciles net earnings to EBITDA and Adjusted EBITDA for the four quarters ended June 30, 2025, and June 30, 2024. It details the adjustments made for income tax expense, interest expense, depreciation and amortization, and various specified items to arrive at the non-GAAP EBITDA figures EBITDA and Adjusted EBITDA Reconciliation (Four Quarters Ended June 30, 2025 vs. 2024) | (in millions) | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Four Quarters Ended June 30, 2025 | Four Quarters Ended June 30, 2024 | | :-------------------------------------- | :------ | :------ | :------ | :------ | :-------------------------------- | :-------------------------------- | | Net earnings | $18 | $567 | $295 | $219 | $1,099 | $2,601 | | Income tax expense | $90 | $106 | $61 | $62 | $319 | $680 | | Interest expense | $124 | $132 | $116 | $116 | $488 | $456 | | Depreciation and amortization | $288 | $287 | $284 | $286 | $1,145 | $1,104 | | EBITDA | $520 | $1,086 | $753 | $681 | $3,040 | $4,806 | | Total adjustments | $531 | $51 | $54 | $250 | $894 | $340 | | Adjusted EBITDA | $1,051 | $1,095 | $807 | $931 | $3,884 | $5,146 |