March 24 - Smithfield Foods reported fourth-quarter results that exceeded analysts' expectations, a performance the company attributed to resilient consumer demand for packaged meats and ongoing cost-reduction efforts. The combination of stronger volumes during the holiday season and tighter household budgets, which have led more U.S. consumers to cook at home rather than dine out, helped push the company's shares up by nearly 4% in premarket trading.
For the quarter, Smithfield's sales climbed 7% to $4.23 billion, topping analyst forecasts of $4.14 billion, according to data compiled by LSEG. The company said packaged meat sales - a key revenue driver for the business - increased 4.3% in the period ended December 28 compared with a year earlier, while fresh pork sales rose 2.1% year over year.
Demand strength was particularly evident around the holidays, when shoppers favored protein-rich staples such as pork and processed meats for festive meals. That holiday surge helped the company lift volumes despite broader pressure on household spending caused by a persistently high cost of living.
Smithfield also expanded its branded portfolio in January with the acquisition of hot dog brand Nathan's Famous for $450 million. The company said it sees its flagship Packaged Meats segment and its iconic brand portfolio as central to future growth.
CEO Shane Smith commented on the company's outlook, saying, "Looking ahead to 2026, our objective is to again grow sales and profitability and we see a long runway ahead for future growth led by our flagship Packaged Meats segment and iconic brand portfolio."
The company posted adjusted earnings from continuing operations of $0.83 per share, above analysts' expectations of $0.68 per share.
Looking forward, Smithfield expects total annual sales to increase in the low-single-digits, a forecast that compares with analysts' estimates of 1.26% growth.
The quarterly results come in a broader industry context where other large processors have reported mixed outcomes. In February, Tyson Foods raised its annual revenue forecast and beat quarterly profit and sales estimates on strong demand for chicken, which helped offset weakness in its beef business.
- Sales and earnings: Q4 sales rose 7% to $4.23 billion; adjusted profit from continuing operations was $0.83 per share versus analyst expectations of $0.68.
- Volume trends: Packaged meat sales grew 4.3% and fresh pork sales grew 2.1% year over year for the quarter ended December 28.
- Acquisition: Nathan's Famous was acquired in January for $450 million to bolster the branded portfolio.