The Hershey 2025 Q1 Earnings Misses Targets with Net Income Plummeting 71.9%
Friday, May 2, 2025 1:21 am ET
27min read The hershey Company announced its fiscal 2025 Q1 earnings, revealing a notable decline in net income, down 71.9% to $224.20 million compared to the previous year. Despite these setbacks, Hershey maintained its full-year guidance, projecting at least 2% net sales growth. However, reported earnings per share are expected to decrease significantly, reflecting the company's challenges in navigating cost pressures and strategic adjustments. The guidance remains in line with prior expectations, suggesting confidence in recovery during upcoming quarters.
Revenue
The Hershey Company experienced a 13.8% drop in total revenue to $2.81 billion for Q1 2025, compared to the same period in 2024. In North America, the Confectionery segment generated $2.30 billion, while Salty Snacks contributed $277.80 million. Combined, these segments accounted for $2.58 billion of the revenue, showcasing varying performance across business divisions.
Earnings/Net Income
The company's earnings per share fell sharply by 71.5% in Q1 2025, reaching $1.14, down from $4.00 in Q1 2024. Net income similarly declined, marking a 71.9% decrease to $224.20 million. The substantial dip in both EPS and net income underscores challenging financial conditions this quarter.
Price Action
The stock price of the hershey edged up 0.49% during the latest trading day, rose 1.91% over the last full trading week, but fell 2.28% month-to-date.
Post-Earnings Price Action Review
The analysis of Hershey's stock price reaction to earnings reports reveals a positive correlation with short-term price movements across key metrics. Revenue, net income, and EPS all show similar patterns, with the 10-Day win rate at 65% and a maximum return of 1.68% over a 30-day period. While revenue reports often lead to positive short-term outcomes, the impact is modest. Net income releases also demonstrate favorable medium-term performance. EPS reports contribute similarly to short-term price appreciation. Overall, earnings metrics positively influence Hershey's stock price, although returns are subdued, indicating earnings are one of many factors impacting stock performance.
CEO Commentary
“I am pleased with the progress we are making on our key strategic initiatives for the year,” said Michele Buck, President and CEO of the hershey company. Consumption exceeded expectations driven by strong seasonal performance and brands like Dot’s and SkinnyPop. Despite cost pressures, the company’s strong balance sheet provides flexibility for strategic investments and acquisitions.
Guidance
The company reiterates its net sales growth outlook of at least 2% for 2025, with reported earnings per share anticipated to decline in the high-40% range and adjusted EPS expected to decrease in the mid-30% range. Tariff expenses are projected at $15 million to $20 million for Q2, with an effective tax rate around 16%. The Sour Strips acquisition benefits net sales growth, while foreign exchange rates present a potential headwind.
Additional News
Recently, Hershey announced strategic acquisitions to bolster its portfolio, including the Sour Strips brand from Actual Candy, LLC. This acquisition is part of Hershey's ongoing efforts to expand its better-for-you portfolio. Additionally, significant changes in C-level positions were observed as Jennifer Mccalman, the Chief Accounting Officer, sold 278 shares of Hershey stock, representing a 9.39% decrease in her position. Hershey also declared a quarterly dividend of $1.37 per share, reflecting a yield of 3.29%, showcasing its commitment to returning value to shareholders amid challenging market conditions.
Article Polishing
The Hershey Company reported a notable decline in Q1 earnings for 2025, alongside maintaining guidance for modest sales growth. Revenue figures presented challenges, with segment performance varying. Despite the decline, the company remains focused on strategic growth and acquisitions to enhance its portfolio. CEO Michele Buck expressed optimism about ongoing initiatives despite current cost pressures. The company's guidance reflects anticipated challenges, with adjustments for tariffs and tax rates. Recent acquisitions and dividend announcements underscore Hershey's commitment to navigating market changes while returning value to shareholders.
Revenue
The Hershey Company experienced a 13.8% drop in total revenue to $2.81 billion for Q1 2025, compared to the same period in 2024. In North America, the Confectionery segment generated $2.30 billion, while Salty Snacks contributed $277.80 million. Combined, these segments accounted for $2.58 billion of the revenue, showcasing varying performance across business divisions.
Earnings/Net Income
The company's earnings per share fell sharply by 71.5% in Q1 2025, reaching $1.14, down from $4.00 in Q1 2024. Net income similarly declined, marking a 71.9% decrease to $224.20 million. The substantial dip in both EPS and net income underscores challenging financial conditions this quarter.
Price Action
The stock price of the hershey edged up 0.49% during the latest trading day, rose 1.91% over the last full trading week, but fell 2.28% month-to-date.
Post-Earnings Price Action Review
The analysis of Hershey's stock price reaction to earnings reports reveals a positive correlation with short-term price movements across key metrics. Revenue, net income, and EPS all show similar patterns, with the 10-Day win rate at 65% and a maximum return of 1.68% over a 30-day period. While revenue reports often lead to positive short-term outcomes, the impact is modest. Net income releases also demonstrate favorable medium-term performance. EPS reports contribute similarly to short-term price appreciation. Overall, earnings metrics positively influence Hershey's stock price, although returns are subdued, indicating earnings are one of many factors impacting stock performance.
CEO Commentary
“I am pleased with the progress we are making on our key strategic initiatives for the year,” said Michele Buck, President and CEO of the hershey company. Consumption exceeded expectations driven by strong seasonal performance and brands like Dot’s and SkinnyPop. Despite cost pressures, the company’s strong balance sheet provides flexibility for strategic investments and acquisitions.
Guidance
The company reiterates its net sales growth outlook of at least 2% for 2025, with reported earnings per share anticipated to decline in the high-40% range and adjusted EPS expected to decrease in the mid-30% range. Tariff expenses are projected at $15 million to $20 million for Q2, with an effective tax rate around 16%. The Sour Strips acquisition benefits net sales growth, while foreign exchange rates present a potential headwind.
Additional News
Recently, Hershey announced strategic acquisitions to bolster its portfolio, including the Sour Strips brand from Actual Candy, LLC. This acquisition is part of Hershey's ongoing efforts to expand its better-for-you portfolio. Additionally, significant changes in C-level positions were observed as Jennifer Mccalman, the Chief Accounting Officer, sold 278 shares of Hershey stock, representing a 9.39% decrease in her position. Hershey also declared a quarterly dividend of $1.37 per share, reflecting a yield of 3.29%, showcasing its commitment to returning value to shareholders amid challenging market conditions.
Article Polishing
The Hershey Company reported a notable decline in Q1 earnings for 2025, alongside maintaining guidance for modest sales growth. Revenue figures presented challenges, with segment performance varying. Despite the decline, the company remains focused on strategic growth and acquisitions to enhance its portfolio. CEO Michele Buck expressed optimism about ongoing initiatives despite current cost pressures. The company's guidance reflects anticipated challenges, with adjustments for tariffs and tax rates. Recent acquisitions and dividend announcements underscore Hershey's commitment to navigating market changes while returning value to shareholders.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.
