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FLOWERS FOODS INC (FLO)·Q3 2026 Earnings Summary

Executive Summary

  • Q3 2026 earnings materials are not yet available. The latest published quarter is Q3 2025; this recap synthesizes Flowers Foods’ Q3 2025 8-K press release and call materials for investor decision-making .
  • Q3 2025 net sales grew 3.0% to $1.227B, while diluted EPS fell to $0.19 and adjusted EPS to $0.23 amid negative price/mix, modest volume declines, and higher interest expense tied to the Simple Mills acquisition; adjusted EBITDA declined 11.4% to $118.1M with margin at 9.6% .
  • Against Wall Street consensus, EPS matched ($0.23), revenue missed slightly (~$1.227B vs $1.2296B), and EBITDA came in modestly below ($118.2M vs ~$120.4M); these may temper near-term sentiment while reinforcing the margin-recovery imperative for 2026*.
  • FY25 guidance was narrowed: net sales $5.254–$5.306B (2.9–4.0% YoY), adjusted EBITDA $515–$532M, and adjusted EPS $1.02–$1.08; effective tax rate trimmed to 24.5% and CapEx lowered to $120–$130M .
  • Management highlighted continued bread category headwinds but pointed to stabilization signs and portfolio transformation (value and better-for-you), while acknowledging potential early-2026 margin pressure due to negative price/mix, promotional intensity, and volatile input costs .

What Went Well and What Went Wrong

What Went Well

  • Simple Mills integration supported growth: +$70.7M net sales contribution and +$11.1M to adjusted EBITDA, helping offset category softness .
  • Branded Retail net sales rose 6.9% to $812.8M, with acquisition-driven gains partially offsetting unfavorable price/mix and lower volumes .
  • CEO emphasized portfolio alignment with consumer demand and differentiated offerings (better-for-you, value) as a foundation for future growth: “Our proactive efforts to strategically align our portfolio with consumer demand are yielding positive results” .

What Went Wrong

  • Gross cost pressure: Materials, supplies, labor and other production costs rose to 52.1% of sales (+190 bps), driven by increased outside purchases, lower price/mix, and lower production volumes .
  • Negative price/mix and modest volume declines weighed on margins; adjusted EBITDA fell 11.4% with margin down 160 bps to 9.6% .
  • Higher net interest expense (+$9.7M YoY) from acquisition financing reduced earnings power; diluted EPS dropped to $0.19 (vs $0.31 LY) .

Financial Results

MetricQ3 2024 (oldest)Q2 2025Q3 2025 (newest)
Net Sales ($USD Billions)$1.191 $1.243 $1.227
Diluted EPS ($)$0.31 $0.28 $0.19
Adjusted Diluted EPS ($)$0.33 $0.30 $0.23
Adjusted EBITDA ($USD Millions)$133.3 $137.7 $118.1
Adjusted EBITDA Margin (%)11.2% 11.1% 9.6%
SD&A (% of Net Sales)38.7% (460.359/1,190.561) —38.8%
Adjusted SD&A (% of Net Sales)——38.3%
Materials, Supplies, Labor, Other (% of Net Sales)——52.1%

Segment breakdown:

Segment Net Sales ($USD Millions)Q3 2024 (oldest)Q3 2025 (newest)
Branded Retail$760.379 $812.760
Other$430.182 $413.794
Total$1,190.561 $1,226.554

KPIs (Q3 2025 sales bridge):

KPI (% points)Branded RetailOtherTotal
Price/Mix-1.1% -4.1% -2.3%
Volume-1.3% +0.3% -0.6%
Acquisition+9.3% 0.0% +5.9%
Total Δ Net Sales+6.9% -3.8% +3.0%

Estimate comparison (Q3 2025):

MetricConsensusActualBeat/Miss
EPS ($)0.2333*0.23*Inline*
Revenue ($USD Billions)1.2296*1.2266*Miss (-$0.0030B)*
EBITDA ($USD Millions)120.4*118.2*Miss (-$2.2M)*
# EPS Estimates7*——
# Revenue Estimates7*——

Values retrieved from S&P Global*.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales ($B)FY 2025$5.239–$5.308 (2.7–4.0% YoY) $5.254–$5.306 (2.9–4.0% YoY) Narrowed/raised low end
Net Sales ex-Simple Mills ($B)FY 2025$5.021–$5.083 (-1.6% to -0.4%) $5.033–$5.083 (-1.4% to -0.4%) Slight raise low end
Simple Mills contribution ($M)FY 2025$218–$225 $221–$223 Narrowed
53rd week ($M)FY 2025—$70–$80 Introduced
Adjusted EBITDA ($M)FY 2025$512–$538 $515–$532 Narrowed; mid maintained
Adjusted Diluted EPS ($)FY 2025$1.00–$1.10 $1.02–$1.08 Narrowed; mid ↑
Depreciation & Amortization ($M)FY 2025—$168–$172 Maintained
Net Interest Expense ($M)FY 2025—$58–$62 Maintained
Effective Tax Rate (%)FY 202525.0% 24.5% Lowered
Capital Expenditures ($M)FY 2025$135–$145 (ERP $4–$6) $120–$130 (ERP $3–$5) Lowered

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Bread category demandQ1: Category under pressure; portfolio transformation underway . Q2: Lower-than-expected revenues due to traditional loaf softness and intense competition .Units down; negative price/mix weighing margins; stabilization signs emerging .Stabilizing but still soft
Portfolio strategy (value, better-for-you)Q1/Q2: Emphasis on innovation and M&A; aligning with consumer demand .CEO reiterates differentiated offerings driving growth despite pressure .Continuing execution
Supply chain/California conversionQ2: Higher workforce-related costs tied to California conversion .Slight SD&A increase; workforce-related and restructuring implementation costs noted .Transition costs persist
Tariffs/macro/inflationQ2: Macro uncertainty flagged; FY outlook revised .Expect inflationary pressure and tariff impact into 2026; input cost volatility .Ongoing headwind
Simple Mills integrationQ1: Acquisition completed; contribution tempered by amortization/interest .In-line performance; $70.7M sales, $11.1M adj. EBITDA .Executing to plan
Private label/foodserviceQ2: Non-retail margin optimization; softer store-branded retail .Private label weaker due to narrowed price gaps; foodservice profitability improved vs prior years .Mixed performance

Management Commentary

  • “Flowers’ leading brands continue to demonstrate strong relative performance amid ongoing challenges in the bread category… differentiated offerings of better-for-you and value-oriented products” .
  • On outlook and category stabilization: management saw stabilization in periods 8–9, tougher comp in period 10 (storms last year vs none this year), and expects status quo with opportunity for improvement into 2026 .
  • On margin pressures: “More promotional activity is causing some of the gross margin pressure… negative price mix and lower volumes… not clear these pressures will dissipate early in 2026” .

Q&A Highlights

  • Analysts probed 2026 margin trajectories; CFO cited promotional activity and top-line pressure as near-term challenges, with ongoing input cost volatility .
  • Discussion on category stabilization and weather comps; management expects trends to revert to stabilized levels observed earlier in Q3 .
  • Simple Mills integration and innovation pipeline seen as supporting better-for-you growth avenues; collaboration on 2026 initiatives underway .

Estimates Context

  • Q3 2025 EPS matched consensus; revenue and EBITDA were slight misses, reflecting the negative price/mix and promotional headwinds. Estimates for FY25 imply modest tightening of expectations; near-term revisions likely reflect margin pressure and higher interest expenses tied to acquisition financing*.
  • For the next quarter and FY, Street likely adjusts margin trajectories downward pending stabilization confirmation and promotional normalization*.

Values retrieved from S&P Global*.

Key Takeaways for Investors

  • Margin recovery is the core 2026 narrative; watch promotional intensity, price/mix, and input cost volatility (wheat, tariffs) as near-term stock drivers .
  • Acquisition-driven top-line support (Simple Mills) is real but near-term EPS impact is negative due to financing and amortization; integration execution and innovation cadence are critical .
  • FY25 guidance narrowed with slightly improved EPS midpoint and lower tax/CapEx—signals disciplined cash deployment and realistic margin expectations .
  • Segment mix matters: Branded Retail gains vs Other declines highlight pricing/mix sensitivities and the importance of portfolio premiumization/value strategies .
  • Near-term trading: modest misses vs revenue/EBITDA consensus and margin commentary may cap upside until stabilization evidence strengthens; risks skew to margin pressure if promotional landscape persists*.
  • Medium-term thesis: brand strength, better-for-you/value focus, and operational investments (ERP/supply chain) can rebuild margins; execution quality and category normalization will dictate trajectory .

Notes:

  • Q3 2026 earnings materials were not found; this recap covers Q3 2025, the latest available quarter .
  • All quantitative figures are sourced from the company’s Q3 2025 8-K press release and reconciliations unless otherwise noted .
  • Earnings call insights are sourced from publicly available transcripts and summaries .