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- **$709M Impairment Charge**: Residential kitchen segment write-down reflects strategic review, but underlying business strength remains intact.
- **Q3 Financial Beat**: Revenue ($980M), EBITDA ($196M), and EPS ($2.37) all exceeded guidance, driven by cross-segment execution.
- **Tariff Mitigation Plan**: $12M Q3 impact expected to decline to $5-$10M in Q4; pricing and operational changes to offset costs by 2026.
- **Spin-Off Progress**: Food processing spin targeted for mid-2026, with SEC filings and separation activities on track.
- **Ice & Beverage Growth**: New products and automation solutions position Middleby for outsized growth in this high-margin segment.

**【CEO Summary Section】**
- Announced strategic review of the residential kitchen business, including a $709 million non-cash impairment charge. Despite the charge, the segment is positioned for recovery with new manufacturing facilities and product innovations.
- Q3 total revenue of $980 million exceeded guidance, driven by strong performance across all three segments. Adjusted EBITDA was $196 million, and adjusted EPS was $2.37, both above expectations.
- Emphasized long-term growth opportunities in ice and beverage solutions, with a focus on automation and IoT capabilities. New manufacturing facilities and innovation centers were highlighted as key investments.
- Share repurchases continued, with $500 million deployed year-to-date, reflecting confidence in the company’s undervalued shares.

**【CFO Financial Commentary】**
- Q3 GAAP net income was $420 million, with adjusted EBITDA of $196 million and adjusted EPS of $2.37, both exceeding guidance.
- Tariffs impacted EBITDA by $12 million in Q3, with an estimated $5-$10 million impact in Q4. Management expects to offset tariff costs through pricing and operational improvements by 2026.
- Food processing segment order rates improved, with Q4 expected to be the strongest quarter of the year. Spin-off of the food processing business remains on track for mid-2026.
- Capital allocation prioritizes share repurchases, with $365 million in free cash flow year-to-date and $500 million in share buybacks.

**【Q&A Key Highlights】**
- **Residential Business Strategy**: Management reaffirmed confidence in the segment’s long-term potential despite the impairment charge, citing strategic investments in innovation and manufacturing efficiency.
- **Tariff Mitigation**: Plans include production shifts to other regions (e.g., Asia) and U.S.-based manufacturing for premium products. Pricing adjustments and operational efficiencies are expected to offset remaining tariff impacts.
- **Commercial Food Service Outlook**: QSR segment challenges persist due to traffic declines, but emerging chains and general market customers show growth. Beverage and automation solutions are key growth drivers.
- **Food Processing Spin-Off**: Progress on separating the business is on track, with SEC filings and spin timing expected in early 2026. Management highlighted the segment’s strong order pipeline and margin potential.
- **Ice and Beverage Growth**: The segment is a core focus, with new product launches and partnerships driving outsized growth expectations.


The Middleby Corporation (MIDD) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

MIDD

MIDD fundamentals

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