Smithfield Foods misses third-quarter forecasts on profit and sales

The company expects fiscal 2026 sales to fall by a low single-digit percentage from fiscal 2025.

Smithfield Foods reported third-quarter earnings of $0.26 per share, below expectations by $0.08. Revenue came in at $3.44 billion, against $3.73 billion expected.

Chief executive Shane Smith said the Packaged Meats business delivered strong results. The upstream segments, which are hog production and fresh pork, were held back by lower pork prices. He expects that pressure to continue into the fourth quarter.

For fiscal 2026, Smithfield expects total company sales to decline in the low single digits, compared with fiscal 2025. It guides adjusted operating profit, the company's own measure of operating profit, of $900 million to $1,000 million for the company as a whole. Packaged Meats is guided to $1,090 million to $1,140 million. Fresh Pork is guided to a loss of $50 million to breakeven. Hog Production is guided to a loss of $25 million to a profit of $25 million. Capital spending is expected to be $350 million to $375 million, not counting the proposed Sioux Falls processing plant. The effective tax rate is expected to be 22.5 per cent to 24.5 per cent. The company expects one more quarterly dividend of $0.3125 per share this year, which makes an annual rate of $1.25 per share.

The miss fits a move to Smithfield's credit facility, a bank borrowing line, made on October 16. That move came ahead of refinancing the company's 2027 notes, which are debt due that year. Smithfield is managing its balance sheet and cash flow under pressure from weak hog and fresh pork economics. Because management says commodity pressure lasts into the fourth quarter, the Fresh Pork and Hog Production losses in the fiscal 2026 outlook look like more than a one-quarter event. That leaves more of the profit resting on Packaged Meats. Any slip there would leave little cushion against continued upstream losses.