Core Insights - Hormel Foods Corporation reported second-quarter fiscal 2025 results with adjusted earnings of 35 cents per share, matching the Zacks Consensus Estimate, but down from 38 cents in the prior year [1] - Net sales increased by 0.4% year over year to $2,898.8 million, although it missed the consensus estimate of $2,905 million, with volumes declining by 5.7% [1] Financial Performance - Gross profit decreased to $484.4 million from $503.8 million in the year-ago quarter [2] - Adjusted operating income fell to $264.9 million from $275.9 million, with an adjusted operating margin of 9.1%, down from 9.6% [2] Segment Performance - Retail unit net sales decreased by 0.3% year over year to $1,783.8 million, with volumes down 6.6%, primarily due to lower commodity shipments [3] - Foodservice segment net sales increased by 0.5% to $936.4 million, with organic net sales rising by 4%, despite a volume decline of 7.3% [5] - International unit net sales grew by 7% to $178.5 million, with volumes up by 8.9%, driven by strong export performance, particularly in refrigerated products [7] Profitability by Segment - Segment profit for the Retail unit increased by 3.6% due to operational efficiencies and lower expenses [4] - Foodservice segment profit declined by 5.8% due to margin pressures, despite increased net sales [6] - International segment profit decreased by 20.7% due to an unfavorable export customer mix and softness in Brazil [8] Financial Health - Hormel Foods ended the quarter with cash and cash equivalents of $669.7 million and total long-term debt of $2,850.7 million [9] - The company returned nearly $159 million to shareholders via dividends [10] Future Outlook - Hormel Foods expects fiscal 2025 net sales to be between $12 billion and $12.2 billion, with organic net sales growth projected at 2% to 3% [12] - Operating income is anticipated to be between $1,118 million and $1,185 million, while adjusted operating income is expected to range from $1,175 million to $1,248 million [13] - Full-year diluted EPS is projected to be between $1.49 and $1.59, with adjusted EPS expected between $1.58 and $1.68 [14] Stock Performance - HRL stock has risen by 5.9% in the past three months, contrasting with a 1.8% decline in the industry [15]