Total Revenue

–0.3% (from $2.9969B to $2.9888B)

Overall net sales remained nearly flat, reflecting a balance between slight declines in Retail and International revenue and modest gains in Foodservice revenue. This stability builds on last year’s similar performance despite lingering market challenges. " "

Operating Income (EBIT)

–20% (from $284.44M to $228.33M)

Operating income fell significantly due to a combination of lower gross profit—stemming from increased input costs—and higher SG&A expenses. These factors further worsened from Q1 2024, where higher margins in some segments could not offset rising costs and operational challenges. " "

Net Income

–22% (from $218.86M to $170.58M)

Net income declined markedly as the drop in operating income and reduced interest and investment income directly impacted the bottom line. The deterioration builds on prior period challenges where similar cost pressures and disruptions affected profitability. " "

EPS (Basic/Diluted)

–22.5% (from $0.40 to $0.31)

Earnings per share fell in line with net income, with lower operating and net earnings compounded by non-core losses (e.g., a loss on sale of a non-core sow operation) leading to a roughly 22.5% drop. This reflects both underlying operational and cost challenges carried over from the previous period. " "

Retail Revenue

–1% (from $1.911B to $1.890B)

Retail revenue experienced a slight decline, driven by continued challenges such as production disruptions (notably for snack nuts) and pricing pressures that had already impacted previous periods. This modest decrease indicates ongoing issues in the market that have only marginally worsened year over year. "

Foodservice Revenue

+2% (from $913.1M to $930.2M)

Foodservice revenue grew modestly as gains in key categories like premium prepared proteins and turkey items helped offset some broader market headwinds. This growth builds on prior period trends of strong product performance in this segment, highlighting a resilient channel despite overall competitive pressures. "

International Revenue

–2.4% (from $172.6M to $168.5M)

International revenue saw a minor decline, reflecting mixed performance across regions. While some export markets showed strength, declines in commodity-driven sales and softer performance in specific markets led to an overall 2.4% decrease compared to the previous period. "

Organic Net Sales Growth

FY 2025

1% to 3% "

1% to 3% "

no change

Adjusted Diluted Net EPS

FY 2025

$1.58 to $1.72 "

$1.58 to $1.72 "

no change

Advertising & Marketing Investments

FY 2025

no prior guidance

Full year of double-digit increases "

no prior guidance

Capital Expenditures

FY 2025

no prior guidance

$275 million to $300 million "

no prior guidance

Dividend

FY 2025

no prior guidance

Annual rate of $1.16 per share, a 3% increase over the previous year "

no prior guidance

Turkey Supply Chain

FY 2025

no prior guidance

Monitoring pressures due to bird diseases, with actions to preserve profitability "

no prior guidance

Second Quarter Expectations

Q2 FY2025

no prior guidance

Retail net sales expected to be comparable to the prior year; Foodservice expected to see mid-single-digit organic net sales growth; International expected to achieve high single-digit growth; Bottom line expected to be comparable to Q1 and below the prior year "

no prior guidance

Transform and Modernize Initiative

In Q4 2024, Q3 2024, and Q2 2024 calls the initiative was repeatedly portrayed as a key growth driver focused on operational improvements, portfolio optimization and supply chain efficiency – not merely cost savings (e.g. generating $75M in operating income benefits in Q4 and expected full‐year benefits in Q2). " " " " " "

In Q1 2025, Hormel reaffirmed the initiative’s role with clarity: expecting $100M–$150M in benefits this fiscal year, highlighting enhancements like the Memphis distribution center and a “growth flywheel” effect. " " " "

Consistent emphasis with enhanced financial clarity and operational focus, indicating maturity in execution and higher confidence in growth outcomes.

Foodservice Segment Performance

Across Q4, Q3, and Q2 2024, the Foodservice segment was noted for steady volume and net sales gains with innovation across protein categories, strong direct selling team results, and channel diversification; momentum and profitability were repeatedly highlighted. " " " " "

In Q1 2025, the Foodservice segment continued to deliver strong results with continued double-digit growth in premium prepared proteins and added strategic updates (e.g. leadership transition), pointing toward expanded growth potential. " "

Steady performance with incremental leadership and innovation enhancements that reinforce the long‐term growth trajectory.

International Business Recovery

Q4, Q3, and Q2 2024 calls highlighted robust recovery across exports and China, with significant improvements noted in branded exports and investments in Asia; strong profit and volume recovery momentum was observed. " " " " "

In Q1 2025, the international segment maintained positive momentum with continued growth in China and strong exports, expecting high single-digit growth in the next quarter. " "

Sustained positive recovery with a clear upward trend, reflecting ongoing international market improvements.

Production Disruptions

In Q2 2024, Q3 2024, and Q4 2024, production disruptions (notably at the Planters Suffolk facility and Papillion storm damage) were a central concern with clear financial impacts, though corrective actions and co-packer partnerships were already being implemented. " " " " " "

In Q1 2025, there was less emphasis on current disruption issues, with indications that the Suffolk facility challenges have been resolved and any previous issues (like at Planters) are in recovery mode. "

Improvement noted – earlier disruptions are being resolved, leading to recovery in supply and reduced immediate operational disruptions compared to prior periods.

Retail Segment Performance Dynamics

Q2, Q3 and Q4 2024 showed strong underlying brand performance (e.g. Hormel Black Label, Jennie-O, SPAM) alongside challenges from pricing pressures, competitive headwinds, and noted production issues impacting segments like Planters. " " " " "

In Q1 2025, the Retail segment continued to benefit from flagship brand strength and innovation while still facing pricing pressures and headwinds (with some distribution and supply issues being addressed within the Planters recovery). " " " "

Continued strong brand momentum balanced against pricing and competition challenges, with some improvements in distribution recovery emerging in Q1 2025.

Turkey Supply Chain Challenges

Q2, Q3 and Q4 2024 earnings calls repeatedly detailed turkey challenges – from bird illnesses and impacts of avian influenza to depressed whole turkey pricing and production disruptions, with delayed pricing benefits and uncertainty in market dynamics. " " " " " "

In Q1 2025, turkey challenges remain significant due to ongoing bird illness pressures and pricing actions whose benefits are expected to materialize later (Q3/Q4), further impacting margins and supply chain management. " " " "

Persistent challenge with a slight nuance: while issues remain, the delay in pricing benefits is more clearly articulated in Q1 2025, indicating continued adaptation but ongoing margin pressures.

Rising Commodity Input Costs

In Q2, Q3, and Q4 2024, rising input costs for pork, beef, and nuts were consistently flagged as a headwind to margins, with detailed commentary on pork costs remaining above averages and beef and nut costs presenting specific challenges. " " " " "

In Q1 2025, similar issues persist with detailed mention that rising commodity costs for pork, beef, and nuts have impacted gross margins (15.9%), though some pass-through pricing mechanisms are in place to mitigate the impact. " "

Consistent negative pressure, with rising input costs remaining a persistent challenge that continues to pressure margins.

Planters Brand Recovery

Q2, Q3 and Q4 2024 extensively discussed the Planters brand recovery challenges including production disruptions at Suffolk, supply interruptions, lost distribution and subsequent remedial actions with expectations of future recovery driven by innovation and promotion. " " " " " "

In Q1 2025, recovery efforts are reported with sequential improvements in distribution and inventory replenishment, though some residual supply chain losses remain. The focus is also on marketing and accelerated innovation for younger consumers. "

Gradual recovery in motion, with improvements in supply and distribution noted in Q1 2025 though the legacy challenges remain to be fully resolved over subsequent quarters.

Execution Risks & Future Cost Savings

In Q2 and Q4 2024, executives explicitly noted dependency on achieving future cost savings targets (e.g. $250M net operating income improvement by 2026) with acknowledgment of inherent execution risks in scaling up the Transform & Modernize initiatives. " " " "

In Q1 2025, there is noticeably less explicit discussion of execution risks or dependency on future cost savings targets, with more emphasis on growth drivers and immediate operational improvements rather than long-term savings targets. " "

Reduced emphasis: while long-term savings targets remain a backdrop, Q1 2025’s discussion focuses more on growth initiatives than on detailing execution risks, suggesting increased confidence or a shift in strategic focus.

Sentiment Shift

Q2, Q3 and Q4 2024 mixed transformational growth ambitions with operational and supply chain difficulties. There were discussions about both the promise of the T&M initiative and the pressing issues such as production disruptions and pricing challenges, though not expressly labeled as a sentiment shift. " " "

In Q1 2025, despite ongoing operational challenges (e.g. turkey supply issues, commodity costs), the sentiment remains balanced – transformational growth initiatives are still front and center, with operational concerns acknowledged but not dominating the narrative. " " "

Balanced sentiment continues: the narrative in Q1 2025 maintains a dual focus on transformational growth alongside operational challenges, without a pronounced shift away from growth aspirations.