The J. M. Smucker 2026 Q2 Earnings Remarkable Turnaround as Net Income Surges 1084.9%

The J. M. Smucker (SJM) reported fiscal 2026 Q2 earnings on Nov 26, 2025, with revenue slightly beating expectations and a dramatic turnaround in profitability. The company updated its full-year guidance, narrowing sales growth forecasts to 3.5%–4.5% and tightening profit targets to $8.75–$9.25 per share, reflecting cautious optimism amid ongoing challenges.

Revenue

J. M. Smucker’s total revenue rose 2.6% year-over-year to $2.33 billion, driven by strong performance across its U.S. Retail Coffee segment, which led the charge with $848.90 million. The U.S. Retail Frozen Handheld and Spreads segment contributed $461.10 million, while the U.S. Retail Pet Foods segment added $413.20 million. Sweet Baked Snacks, though facing transition costs, generated $256.10 million in revenue. International and Away From Home operations rounded out the total with $350.80 million.

Earnings/Net Income

The company returned to profitability with EPS of $2.26, reversing a $0.23 loss in 2025 Q2. Net income surged to $241.30 million, a 1084.9% increase from a $24.50 million loss. This marked a significant turnaround, underscoring strong operational execution despite macroeconomic headwinds.

Post-Earnings Price Action Review

The strategy of buying SJM shares 30 days post-earnings underperformed significantly over three years, returning -28.52% versus the benchmark’s 66.23%. With an excess return of -94.75%, a CAGR of -11.57%, and a Sharpe ratio of -0.44, the strategy highlighted high risk and moderate returns, indicating a volatile and unprofitable approach for investors.

CEO Commentary

Mark Smucker emphasized progress in Sweet Baked Snacks, attributing growth to SKU rationalization and core brands like Hostess. He expressed confidence in pet portfolio recovery, particularly Milk-Bone, and outlined plans to address spreads’ weakness through innovation and Away From Home expansion.

Guidance

CFO Tucker Marshall outlined $0.50/share tariff headwinds in FY26, with coffee margins expected to improve from 18.2% in Q2 to over 20% by Q4. The company aims for $500 million in debt paydowns by FY27 and maintains a leverage target of ~4x net debt/EBITDA in FY26.

Additional News

Recent developments include the Trump administration’s removal of 40% tariffs on Brazilian green coffee, expected to benefit Smucker in FY27. The company announced a $1.10 per share dividend, yielding ~4.2%, and CFO Tucker Marshall sold 11,139 shares in September. Additionally, Smucker’s SKU reduction strategy and relaunched Suzy Q’s brand are driving growth in Sweet Baked Snacks, aligning with its focus on core products.