Hershey(US:HSY) ZACKS·2026-02-05 15:55Core Insights - The Hershey Company reported fourth-quarter 2025 results with both revenue and earnings exceeding Zacks Consensus Estimates, although adjusted earnings per share fell 36.4% year over year [1][10] - The company provided an initial outlook for 2026, expecting sales growth of 4-5% and earnings growth of 30-35% [13][14] Financial Performance - Consolidated net sales reached $3,091 million, a 7% increase from the previous year, surpassing the Zacks Consensus Estimate of $3,002 million [2] - Adjusted earnings were $1.71 per share, exceeding the consensus estimate of $1.40 [1] - Adjusted operating income declined 24% to $529.3 million, with an adjusted operating margin of 17.1%, down 700 basis points year over year [6] Sales Breakdown - North America Confectionery segment net sales were $2.48 billion, up 5.3% year over year, driven by pricing actions despite a decline in volume [7] - The North America Salty Snacks segment saw net sales of $357 million, representing a 28% year-over-year growth, aided by the LesserEvil acquisition [9] - International segment net sales were $255.6 million, a slight increase of 0.4% year over year, but reported a loss of $31.6 million compared to a profit in the prior year [11] Margin and Cost Analysis - Adjusted gross margin was 38.3%, down 650 basis points year over year due to increased cocoa and input costs, tariff expenses of approximately $30 million, and lower volumes [4] - Selling, marketing, and administrative expenses rose 12.1% year over year, driven by higher compensation and brand investment [5] Future Outlook - For 2026, Hershey anticipates net sales growth of 4-5%, with contributions from pricing actions and innovation [13] - Expected adjusted diluted earnings per share for 2026 are projected to be between $8.20 and $8.52, indicating significant growth [14] - Capital expenditures for 2026 are estimated to be between $425 million and $475 million [14]