McCormick Stock Tanks After Q3 Earnings Beat, Higher Tariffs Impact Outlook

Core Viewpoint - McCormick & Company Inc reported a third-quarter earnings beat but faces increased tariff-related cost pressures impacting its 2025 outlook [1][2]. Financial Performance - The company reported adjusted earnings of 85 cents per share, surpassing the consensus estimate of 81 cents per share [1]. - The earnings beat was attributed to sales and SG&A leverage, although gross margins fell short of expectations due to higher commodity and tariff costs [2]. Tariff Exposure - McCormick's tariff exposure has increased to approximately $140 million gross annualized (around $70 million gross exposure for 2025), up from about $90 million gross annualized (approximately $50 million gross exposure for 2025) [2]. - Despite the increase in tariff exposure, it remains within investor expectations [2]. 2025 Earnings Outlook - Management has revised the adjusted earnings outlook for 2025 to a range of $3.00-$3.05 per share, down from the previous projection of $3.03-$3.08 per share, reflecting the gross impact from tariffs of around $70 million [3]. Stock Performance - At the time of publication, McCormick's shares had declined by 3.10% to $66.17 [3].