PPC

A month has gone by since the last earnings report for Pilgrim's Pride (PPC). Shares have added about 6% in that time frame, outperforming the S&P 500. Will the recent positive trend continue leading up to its next earnings release, or is Pilgrim's Pride due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers. Pilgrim’s Pride reported second-quarter 2026 results, wherein both the top and bottom lines decreased year over year. PPC posted adjusted earnings of 64 cents per share, down 62.4% year over year from $1.70 per share. Net sales declined 2.8% year over year to $4,626.2 million from $4,757.4 million, missing the consensus estimate of $4,900 million. Lower U.S. commodity pricing weighed on results, while Just Bare retail sales growth of more than 30% offered support. Gross profit fell 52.5% year over year to $339.8 million, down from $715.3 million, as cost of sales rose from $4,042.1 million in the prior-year period to $4,286.5 million. Selling, general and administrative expenses increased 32.9% year over year to $265.1 million, from $199.5 million in the previous year period. Adjusted EBITDA declined 47.6% year over year to $360 million from $686.9 million. The adjusted EBITDA margin also contracted 660 basis points year over year to 7.8% from 14.4%. Operating income was $66 million, a year-over-year decline of 87.1% from $512.3 million. U.S. sales decreased 6.1% year over year to $2,649.2 million from $2,820.4 million. Adjusted operating income dropped year over year to $150.2 million from $413.5 million, while the adjusted operating margin narrowed to 5.7% from 14.7% in the prior-year period. Fresh volumes improved on stronger retail and foodservice demand, but commodity pricing declines hurt profitability. Jumbo cutout values declined more than 25% from the prior year. Margins improved sequentially as plant upgrades were completed and live operations improved. U.S. Prepared Foods delivered higher sales and margins from the year-ago quarter. Just Bare retail sales increased more than 30%. Just Bare expanded its market position by gaining nearly 300 basis points of market share over the past year. Meanwhile, construction of the prepared foods facility in Walker County, GA, remained on track, and continued investments in Big Bird portioning equipment enhanced the company's value-added production capabilities. Europe sales rose 1.3% year over year to $1,389.7 million from $1,371.3 million. Adjusted operating income declined year over year to $69.3 million from $73.9 million, and the adjusted operating margin slipped to 5% from 5.4% in the prior-year period. Retail volumes with key customers continued to outpace growth in the broader grocery channel. Rollover sales delivered double-digit growth, while Fridge Raiders maintained stable performance. However, margins came under pressure due to excess European pork imports into the U.K., higher costs related to the Middle East and weaker foodservice traffic. Mexico sales increased 3.8% year over year to $587.3 million from $565.7 million. Adjusted operating income fell year over year to $16.5 million from $86.9 million, with the adjusted operating margin shrinking to 2.8% from 15.4% in the previous-year period. Mexico volumes increased year over year, supported by improved growing conditions and more than 30% growth in Pilgrim's branded retail fresh volumes. However, margins in the live commodity business came under pressure from higher domestic chicken production, increased imports, greater egg availability and additional pork imports. Meanwhile, the ramp-up of live operations in the Southern Peninsula continued to progress as planned. Pilgrim’s ended the quarter with cash and cash equivalents of $388.8 million, down from $640.2 million at the end of 2025. Long-term debt, excluding current maturities, was $2,861.4 million, while total stockholders’ equity stood at $3,763.4 million. Cash provided by operating activities totaled $471.8 million for the first six months of 2026. Capital expenditures reached $465.2 million. In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -33.04% due to these changes. At this time, Pilgrim's Pride has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy. Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Pilgrim's Pride has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Pilgrim's Pride Corporation (PPC) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, July 30, 2026, at 5 p.m. ET Head of Strategy, Investor Relations and Sustainability - Andrew Rojeski President and Chief Executive Officer - Fabio Sandri Chief Financial Officer - Matthew Galvanoni Operator: Good morning, and welcome to the Second Quarter of 2026 Pilgrim's Pride Earnings Conference Call and Webcast. [Operator Instructions] At the company's request, this call is being recorded. Please note that the slides referenced during today's call are available for download from the Investors section of the company's website at [www.pilgrims.com](https://www.pilgrims.com). [Operator Instructions] I would now like to turn the conference call over to Andrew Rojeski, Head of Strategy, Investor Relations and Sustainability for Pilgrim's Pride. Andrew Rojeski: Good morning, and thank you for joining us today as we review our operating and financial results for the second quarter ended on June 28, 2026. Yesterday afternoon, we issued a press release providing an overview of our financial performance for the quarter, including a reconciliation of any non-GAAP measures we may discuss. A copy of the release is available on our website at ir.pilgrims.com, along with slides for reference. These items also have been filed as Form 8-Ks and are available online at sec.gov. Fabio Sandri, President and Chief Executive Officer; and Matt Galvanoni, Chief Financial Officer, will present on today's call. Before we begin our prepared remarks, I would like to remind everyone of our safe harbor disclaimer. Today's call may contain certain forward-looking statements that represent our outlook and current expectations as of the day of this release. Other additional factors not anticipated by management may cause actual results to differ materially from those projected in these forward-looking statements. Further information concerning these factors have been provided in yesterday's press release, our Form 10-K and our regular filings with the SEC. I would now like to turn the call over to Fabio Sandri. Fabio Sandri: Thank you, Andy. Good morning, everyone, and thank you for joining us today. For the second quarter of 2026, we reported net revenues of $4.6 billion with an adjusted EBITDA of $360 million. Our adjusted EBITDA margin was 7.8% compared to 14.4% last year. During the quarter, chicken demand remained firm across all regions, leading the growth in meat protein consumption. Equally important, we continue to drive growth projects to strengthen our portfolio, drive sales growth and enhance margins. In the U.S., demand for chicken continued to grow in both retail and foodservice. Operations improved compared to previous quarter given the completion of our plant upgrades and progress in the efficiency of our live operations. Volumes to key customers in Fresh remained steady, whereas prepared grew double digits as Just Bare continued to lead growth and velocity in the frozen fully cooked category. In Europe, poultry and ready meals drove overall sales growth as their affordability and convenience resonated with value-conscious consumers. Margins were compressed given competition from imported pork into U.K. and increased costs driven by the Middle East conflict. Mexico also increased volumes compared to last year, driven by exceptional growing environment for birds. We continue to grow our branded offerings in both fresh and prepared, and the previously announced growth and diversification projects all remain on schedule. We continue to focus all aspects in the environment, social and governance matters within sustainability. Our approach to team member development and retention were recently recognized across regions for the workplace satisfaction, including America's Greatest Workplace by Newsweek in the U.S., Employer of the Year by The Grocer in Europe and Exceptional Companies Award by the Institute for the Promotion of Quality in Mexico. Turning to supply in U.S. USDA reported ready-to-cook production increased 4.5% over same period last year from higher headcount and modestly higher live weights. Egg sets rose 2% from improved layer flock productivity, where chick placements grew 2.4% from moderate improvements in hatchability. A significant part of the growth came from much better livability than previous years. Given the size of the layer flock, recent pullet placements and production environment, the USDA anticipates chicken production growth to slow down in the second half of the year to around 2.5%, closing the year at 3.3%. As for other proteins, USDA expected limited growth in pork, along with a minor increase in beef availability as higher imports partially offset domestic production headwinds. When these factors are combined with increased chicken supply, USDA estimates overall net protein availability will increase by 2.2% compared to last year. Within the U.S., the affordability of chicken provided a great option to household budgets pressured by persistent inflation and elevated energy prices. As a result, chicken continued to be resilient as volumes increased across both retail and foodservice channels. In retail, the fresh meat department posted dollar sales growth across all major proteins. From a volume standpoint, chicken delivered the highest growth among all proteins compared to the same period last year. Boneless skinless breast volumes increased year-over-year as pricing remained steady and the spread versus ground beef remained at record levels. Boneless skinless dark meat continued to deliver strong growth as volumes rose compared to the first quarter of 2026. In deli, consumer demand for convenience, ready-to-eat options drove growth in rotisserie WOGs and cutup portions. Sales and volumes for appetizers, including popcorn chicken and wings also rose compared to the same period last year. Demand for convenience and value also permeated the frozen prepared category as chicken grew compared to last year. Within foodservice, chicken volumes remained positive despite mixed industry performance and traffic trends as operators continue to expand chicken as a value-oriented protein offering. Overall, foodservice volumes increased despite continuous concern about foot traffic with chicken gaining menu penetration. QSR and noncommercial channels presented the largest growth with chicken-focused chains lead growth in QSR. Despite continued healthy growth in chicken across all channels, demand was more than offset by the increase in supply. As a result, counter-seasonal movements emerged in the commodity chicken market, lowering cutout values compared to previous quarter. In exports, overall poultry exports remained steady compared to last year as trade flows continue to navigate through a variety of circumstances. Our volume growth was strong, and we outpaced the channel through an increased presence in several key markets. Within the Middle East, trade to GCC countries continue to flow through alternative [ ports ], giving a comprehensive inland transportation network, enabling a resilient supply chain. For Asia, recent meetings between government officials from the United States and China created a favorable outcome for the U.S. poultry exports. As such, China released 17 states from its avian influenza ban, allowing shipments of raw products to resume. Additional opportunities exist as other states that are currently free of high path avian influenza have yet to be fully recognized. Further meetings scheduled later in the year may result in the release of these states and resumption by China to follow the Phase 1 agreement. Turning to feed. Corn was volatile throughout the quarter. Early in the period, concerns about disrupted fertilizer supply and higher energy costs associated with the Middle East conflict elevated prices. Corn markets eventually fell given favorable U.S. planting weather, higher level of U.S. planting acreage relative to the forecasted expectations and better-than-expected production in South America. Looking ahead, higher risk premiums for corn may emerge pending outcomes in the Middle East and reactions by China to potential trade policy changes by the U.S. Nonetheless, yields for the U.S. crop, along with weather in the Midwest will be the key drivers for corn pricing in the short term. The soy complex shows similar volatility given the Middle East conflict, along with additional uncertainty from the pace and volume of Chinese purchases of U.S. soybeans. Another year of record soybean production in South America, along with increased soybean acreage in the U.S. versus last year, reinforced healthy stock levels. Given the potential of increment buys of U.S. soybeans by China, a risk premium will continue to exist within the soy market. Soybean oil continues to be the stronger leg of the soy complex, keeping the soybean meal price relatively lower. In wheat, global stocks remain at comfortable levels despite a decline in production from all-time high last year. Availability may be further enhanced later this year as U.K. anticipates a production increase of 25% versus prior year. However, recent concerns regarding shipments in the Black Sea given the conflict between Ukraine and Russia may trigger an increase in price. In the U.S., investment in converting our plant in Russellville to a case-ready operation to further strengthen key customer partnerships was completed as planned. We also continue to improve our sales mix given the recent installation of dark meat deboning and portioning equipment in several big bird plants. Given this work, our portfolio was more prepared to manage the counter-seasonal declines in commodity cutout values, enhancing profitability from the first quarter. In Fresh, volumes grew compared to the same period last year. Margins expanded from the previous quarter given the completion of the plant upgrades and continued improvements in live operations. Case-ready volumes rose compared to last year from incremental distribution and stable velocity throughout retail. We also secured several promotional events with several leading retailers to further drive demand during the next quarters. Small birds also grew as volumes to key customers exceeded channel averages. Our big bird plants provided additional product to support the growth of prepared foods, mitigating the impact of commodity market declines. To support the growth of our key customers, we recently announced the investments in Ellijay, Georgia to expand production and do more deboning of small birds. Based on this work, we will further align our portfolio to meet the fast growing boneless chicken categories such as chicken sandwich and tenders. Momentum to further diversify our portfolio through prepared foods continue to accelerate. Overall volumes increased nearly 14% compared to the same period last year. Retail sales of Just Bare increased over 30%, 6x the category average. We also received additional recognition for the taste and quality of Just Bare as recent survey of chefs by the Allrecipes named nugget one of the best in the category. Given its extensive growth and consumer acceptance, it has achieved nearly 15% market share, making it the second largest brand in frozen fully cooked. We continue to drive growth of our branded presence in retail through innovation. To that end, we have created expansions to expand Just Bare presence across different occasions and consumer segments. Similarly, we are securing partnership to deliver and launch new flavor offerings through the retail and club for the Pilgrim's branded in retail. We are building further awareness of our superior taste and culinary focus of the broader Just Bare fresh prepared portfolio through media partnerships. Recently, our innovation was featured on the award-winning television series, The Bear, and further supported by selected dining experience, meal kits and press coverage. Based on this work, we've generated over 950 million earned media impressions. In foodservice, we continue to increase our presence of branded offerings as market share has increased in both commercial and noncommercial channels. Moving forward, we will continue to cultivate our presence through innovation, digital engagement and new product development. Our investment in the Walker County, Georgia to further support our growth remains on track with commissions slated for the second half of 2027. In Europe, our diversified portfolio continues to adapt to meet evolving marketplace needs. The affordability of our poultry and meals resonated with inflation-strapped consumers as each were among the fastest growing categories in retail. Our volumes to key customers rose faster than both at the grocery channel averages and prior year, reinforcing our partnerships. In the branded segment, volume in the Rollover grew double digits and garnered significant retailer acceptance and consumer interest. Fridge Raiders remained relatively steady as additional distribution was secured throughout grocery, enabling further growth for the remainder of the year. While Richmond's margins remain attractive, the pace of volume growth lags our expectations as extensive promotion activity, along with significant retailer support of premium private label offerings has intensified competition pressures. Given Richmond's market presence and further profitability growth potential, we will continue to emphasize sales execution, investment in brand building and drive innovation. In foodservice, QSRs continue to experience declines in store visits, resulting in lower volumes and sales. We will continue to work closely with leading foodservice providers to expand our portfolio of value-focused offerings, generating additional traffic. Despite increasing costs from the Middle East conflict and competition from imported pork into the U.K., overall profitability was comparable with last year. Within pork, continued reductions in the existing herd along with further diversification in prepared should alleviate margin pressures. In addition, our pricing arrangements for customer-specific offerings allow for recovery from raw material escalation. Turning to Mexico. The country experienced a counter-seasonal very positive growing environment for birds. As a result, production expanded from elevated livability and higher live weight. Increased production of domestic eggs and additional pork imports further grew overall protein availability in the country. Nonetheless, demand for chicken was very strong, absorbing the additional supply. We continue to grow our differentiated branded offerings. In Fresh, volumes of retail branded products grew over 30% compared to last year. Just Bare once led the growth as volumes increased over 2.5x. Prepared Foods offerings continue to gain marketplace traction as volumes rose across retail and foodservice. Pilgrim's branded offerings led growth as volumes grew double digit across both channels. Operational excellence efforts made significant progress given improvements in productivity and live operations, further enabling our business to navigate these challenging market conditions. We continue our investments to drive sales growth and reduce the volatility of our portfolio. To that end, we completed our expansion of the prepared plant -- prepared line at Porvenir and started production as scheduled. Our investments in live in the Southern Peninsula are also on track and ramp-up continues. We continue to emphasize all aspects of sustainability throughout our operations. As part of this effort, we've made repeated investments in team member training to reinforce our values throughout our organization, build technical skills and develop management capabilities. Given our continued focus, we've been recognized as a leader in workplace satisfaction across multiple publications, including Newsweek in the U.S., The Grocer in Europe and Institute for Promotional Quality in Mexico. With that in mind, I'd like to ask our CFO, Matt Galvanoni, to discuss our financial results. Matthew Galvanoni: Thank you, Fabio. Good morning, everyone. For the second quarter of 2026, net revenues were $4.63 billion versus $4.76 billion a year ago, with adjusted EBITDA of $360.0 million and a margin of 7.8% compared to $686.9 million and a 14.4% margin in Q2 last year. Adjusted EBITDA margins in Q2 were 8.7% in the U.S. compared to 17.1% a year ago. For our Europe business, adjusted EBITDA margins came in at 7.6% for Q2 compared to 8.2% last year. In Mexico, adjusted EBITDA margins in Q2 were 3.9% versus 16.3% a year ago. U.S. net revenues were $2.65 billion versus $2.82 billion a year ago. Adjusted EBITDA in the U.S. for Q2 came in at $231.5 million compared to $482.7 million last year. U.S. margins declined year-over-year primarily due to the 27% decrease in jumbo cutout value. However, sequentially, U.S. margins improved while both lapping the impacts of significant plant downtime in the first quarter and through improved performance in our live operations. U.S. Prepared Foods continues to demonstrate robust growth with year-over-year volumes increasing nearly 14%. In our U.S. GAAP results, we incurred legal settlement expenses of $136 million in the quarter, primarily due to reaching settlements with certain parties associated with the ongoing broilers litigation. Also, we took a $26 million charge in the quarter, primarily related to an asset impairment associated with our previously announced forthcoming shutdown of the harvesting facility in Chattanooga. In Europe, adjusted EBITDA in Q2 was $105.8 million versus $111.8 million last year. The business benefited from strength in poultry and meals offerings during the quarter, along with the continued benefits of its structural reorganization. The strength in poultry and meals helped compensate for pressured pork margins due to higher European imports in the U.K., increased costs driven by the Middle East conflict and decreases in foodservice traffic. Mexico generated $22.6 million in adjusted EBITDA in Q2 compared to $92.3 million last year. As Fabio mentioned earlier, Mexico's results were impacted by year-over-year changes in bird growing conditions, increasing supply in the live markets and lower-priced competing proteins. SG&A costs in the quarter were higher year-over-year, primarily due to an increase in legal settlement and defense costs. However, these costs were partially offset by lower incentive compensation accruals and marketing expense during the quarter. Our effective tax rate for the quarter was 39.3%. However, our year-to-date effective tax rate is 25.3%. We continue to anticipate that the full year effective tax rate will approximate 25%. We have a strong balance sheet, and we continue to emphasize cash flows from operating activities, management of working capital and disciplined investment in high-return projects. During Q2, we completed a $250 million tender offer of our 2033 bonds. At the end of the quarter, our net debt totaled less than $2.5 billion with a leverage ratio of 1.43x our last 12 months adjusted EBITDA. We had nearly $1.6 billion in total cash and available credit at the end of the quarter. GAAP net interest expense for the quarter totaled $46.1 million. However, excluding the loss on the early extinguishment of debt, our net interest expense was $28.5 million. Excluding the impact of early extinguishment of debt, we anticipate our full year net interest expense to be approximately $115 million to $120 million. We spent $230 million in CapEx in the second quarter. The spending this quarter included the finalization of the Russellville conversion, continued progress in our new prepared foods plant in Georgia and the investment in Ellijay, Georgia to enhance our mix in support of key customers in the foodservice space. At this time, we maintain our full year CapEx estimate of approximately $900 million. These near-term growth projects align to our overall strategies of portfolio diversification, focus on key customers, operational excellence and our commitment to team member health and safety. Operator, this concludes our prepared remarks. Please open the call for questions. Operator: [Operator Instructions] And our first question here will come from Ben Theurer with Barclays. Benjamin Theurer: Just real quick, maybe digging into your expectations for the second half and if you could help us maybe understand a little bit what you're seeing in terms of supply as it relates to the U.S. market and how it should impact third and fourth quarter. You flagged in the presentation a little bit of an uptick, if you want to call it an uptick, at least a little bit on some of the pricing, particularly on wings from this like very low levels, slightly more improving, but tenders still being very much down on a historic basis. So as we think about the cutout value and how that flows into that business that is more commodity price exposed for you guys, what are your expectations in terms of just how it's going to flow through into profits for the third and the fourth quarter? That would be my first question. And I have a very quick follow-up. Fabio Sandri: Yes. As we mentioned, we saw a significant increase in supply during Q2, 4.5%. I think the initial expectation was a little lower than that. What we saw was we started with the egg sets and the industry set 2% more eggs in the quarter. We expected a little bit better management, and we saw that a little bit improve in the hatchability. So the chick placements were 2.4%. I think what was different this quarter is that we saw an improvement in the growing conditions of the birds, and the livability was significantly better than last year. As you remember, last year, we have a lot of issues in the industry with the respiratory diseases and low path AI. So we saw some more mortality. And this livability actually translated into more than 1% increase in total supply. So the headcount was a little higher than everybody anticipated, and that is what created a 4.5% growth in the supply in Q2. Coming to Q3 and Q4, starting with the breeding flock, I think we saw the same number as last year. So we don't expect a significant improvement in number of eggs. So I think it's all about the increase in egg sets and how that will translate into ready-to-cook pounds. We don't expect that effect of increased livability for Q3 and Q4 as those issues were more concentrated in Q2. We're also seeing a little bit of warm weather, which typically impacts the growth of the birds, especially now in July, August. So we're expecting and USDA is expecting growth in the second half to moderate. For the third and fourth quarter of 2026, the USDA is expecting 2.5% increase in the supply, which is more in line with the strong demand that we are seeing for chicken. I think when you go to the pricing, and you need to go into individual segments and into individual pieces, I think first, we'll start with overall trends that are happening in the consumer, right? I think we're seeing several trends and changes in the environment that are supporting the demand for chicken in both retail and foodservice. Starting with the foodservice, I think we are seeing the fight for traffic. Foodservice is struggling with traffic, and because of that, they are focusing on promotional activities. And we're seeing that they're using chicken for those promotional activities to generate traffic. That's why we saw an increase of 3.1% in -- 3.4% actually in the volume of chicken in the foodservice category. And then we see the retail, where consumers are strapped for money. They are looking for a control over their budgets, and they're going to the retail to buy protein. We saw a growth in retail of 2.8% on the chicken category, especially on the prepared side, where we've seen our brands really resonating with the consumer on the prepared, on the Just Bare. Consumers are looking for affordability and also for convenience. So we saw significant growth in prepared, but we saw some significant growth in fresh as well with the industry or the volume in chicken growing by 1.8%. Going more specifically into the cuts, right, we saw the wings bouncing back after getting off the menus on the foodservice, and we are seeing some increase in availability in wings in retail. So we expect wings demand to continue to increase, especially starting now the football season and the basketball season. I think on the boneless breast, we've been talking about this for more than a year right now, right? The delta between ground beef and boneless breast continues to widen, and I think it's the highest it's ever been. I think that is helping the demand for boneless breast. And more important than that, we are seeing some significant promotional activity on the retail coming into the fall and coming into the next months. That is happening because I think the retail is also looking for foot traffic. They're also increasing their promotional activity, and boneless breast has been a significant and important part for that. On the boneless dark meat, we're also seeing some great trends with changing demographics and changing culinary preferences, and boneless dark meat has been the fastest growing category in the retail. So we're seeing some very positive trends overall for protein and for chicken in special, both in foodservice and retail. And that can help for the pricing and for the demand as long as the supply is in line with what we expect. Benjamin Theurer: Okay. Perfect. And then one real quick one for Matt probably. As it relates to the CapEx cadence, I mean, I think you just said $900 million for the year. Initially, it was $900 million, I think, to $950 million. So should we assume closer to the lower end of that just given the run rate of the projects? Or is there anything that you've kind of like postponed? Or what's driving that guidance more to the lower end of the previous guidance for the CapEx versus what was $900 million. to $950 million? Matthew Galvanoni: Yes. No, sure. I think year-to-date, we're at $465 million, and kind of looking at the $900 million, we have a lot of the projects that kind of gone through already with all the Russellville conversion, some of the other plants we have. Of course, we've got continuing spend on Walker County with the new prepared foods plant and then with Ellijay, but we've got some of the bigger projects behind us and spent in the first half of the year. So at $465 million, my guide at $900 million kind of just gets you kind of almost equal first half, second half but maybe just slightly below in the second half compared to the first half of the year. Operator: And our next question will come from Peter Galbo with Bank of America. Peter Galbo: Maybe to follow up to Ben's initial question and ask it slightly differently. Fabio, I know you gave a very comprehensive answer. But just is there an expectation that as we get closer to the fall that we might see the industry kind of go through its normal seasonal cuts on production? I know that, that was obviously last year kind of something that didn't happen that typically, again, we would expect to happen seasonally. So just given where the commodity markets sit, like are we in a more normal environment this year where production cuts are kind of expected for the industry? Fabio Sandri: Yes, it's normal for the industry to do the seasonal cuts. As we all know, our industry always produced to the expected demand, and during the fall given the Thanksgiving and other events, we don't see a strong demand for chicken. So it is normal to have that seasonal cuts. Last year, I think they waited a little because of the high prices that we were seeing during the -- especially in the commodity segment in the second quarter last year. But the seasonal cuts always happen, and they start around the end of August and September. So our industry always produces to the demand. Like I mentioned, I think it was unexpected or it was welcome but an unexpected increase in livability that we had in Q2 because the exits were only increasing by 2%, which was in line with the expected demand growth that we have for chicken for the whole year. I think the livability was what increased the production a little bit over what the industry was expecting. And I cannot speak for the industry as well, again, but for Pilgrim's, we will always adjust our production to demand for our key customers. And I think you mentioned one important point, which is the portfolio, right? As we always mentioned, we have a differentiated portfolio. We have the small birds. We have the case ready, the big birds and the prepared foods, and we're seeing some strong growth in the prepared foods. So -- and with all the investments we did in the big bird plants, a big portion of our production is using on the growth of our prepared foods, especially on the portion side. So I think that's also important. But overall, long story short, our industry will always adjust the demand to the expected -- the production to the expected demand. Peter Galbo: Great. Okay. Maybe if I could ask on Mexico, obviously, a very, call it, dynamic first half with a lot of moving pieces there, and maybe things will start to normalize out in the second half. But if you could give us some perspective on, we've gone through a challenged first half, both from a top line and a profitability perspective, just kind of how that shapes up for the back half of the year. Fabio Sandri: No, sure. Thank you, Peter. Yes, Mexico, we always mention that Mexico could be very volatile quarter-over-quarter, but it's resilient in double digits year-over-year. I think we're seeing a little bit of a persistent low margins at least to our expectations in Mexico, but the reasons are a little bit different from Q1 than Q2. Typically, what we see in Q2, similar a little bit to what I mentioned in U.S., it is that the growing conditions are not favorable in Mexico. This year, very different from other years. We saw some outstanding growing conditions. So the industry normally increase the sets expecting this worsening or this bad growing conditions. And because of this year, mortality was much lower than expected or livability was much higher than expected. And we saw a significant increase in the supply of chicken in Mexico, almost double-digit increase in volume. At the same time, we are seeing in Mexico the same behavior than U.S. on the egg, on the shell egg. We saw a significant increase in the supply of shell eggs and the consequent reduction in price. And in Mexico, because it is a growing economy and chicken is the entry protein, but egg competes more with chicken than in other countries. So we saw a significant increase in chicken, a significant increase in eggs with a lower price, and we also saw some significant imports on the country of pork from the United States. With all that, we saw a very large increase in the supply of protein in the country. Nonetheless, demand continues to be excellent because we saw that it was able to absorb all this growth in protein, which signifies to us that our strategy of growing in Mexico, it is the right one. We are, as I mentioned, building 2 complexes in the Peninsula and in the South to grow our geographical diversification. And we continue to invest in our brands and in our prepared foods. So the changing in the consumer behavior in Mexico towards more convenience can also be supported with our brands. So I think Mexico, once again, it's very volatile quarter-over-quarter, but we expect very good margins year-over-year given this demand for chicken and for overall protein that continues to grow. Operator: And our next question will come from Ben Mayhew with BMO Capital Markets. Benjamin Mayhew: So my first question is around U.S. chicken demand. So you spoke about and referenced ongoing strong demand for U.S. chicken. But we've seen foodservice industry traffic trends soften in recent months, and grocery industry trends remain somewhat soft. So I was just wondering if you could frame the demand side of the equation maybe relative to like 6 to 9 months ago and just how it's evolving out there. Fabio Sandri: Sure, sure. Yes. I think, again, like I mentioned, I think we need to -- I need to get back to overall trends and changes in the environment. The consumer continues to be looking at their budgets with greater efficiency, and they are strapped in their spending. It's interesting that we look at -- in service, when consumers are asked about the first thing that they will cut from the budget, 75% of the consumer will say that they will cut dining out. So I think that's the foot traffic impact, right? When the budget is constrained, 75% of the consumers will say that they reduce dining out. That will help the demand on retail. And then what foodservice is doing about it, it is increasing the promotions to get this foot traffic that is trying to cut their budgets. And that's where chicken has been winning on the foodservice and increasing menu penetration. I think we're seeing the menu penetration for chicken increasing every single quarter and be used for attracting the consumers. And when you drill down into all the segments in the foodservice, we're seeing the QSRs growing the fastest. Menu penetration and chicken volume in QSRs increased by 4.1%. I think the noncommercial, also, we're seeing a resume of the in-person operations in companies and hospitals and hospitality. We're seeing growth in chicken of 5.9%. The only segment that was stagnant and a little -- just a little bit of growth was the foodservice restaurants, and that's the segment that is being more impacted by these consumers cutting their budgets. And then that helps the chicken on the foodservice despite the weakness in the foot traffic. And then we go to the retail. And like I mentioned, the retail volume has been growing, especially on the prepared side. And when we go for the same survey when the consumers asked what they cut from the budget, 29% saying that they cut from grocery spending, but only 3% say that they are willing to cut meat and poultry consumption. 68% of the consumers say that meat is a nonnegotiable or important item at retail. And that's what we are seeing, this resilient demand for protein and chicken on retail growing by 2.8%. So I think that is the overall consumer sentiment and the several trends that are helping with the demand for protein. Benjamin Mayhew: Okay. And my follow-up question has to do with the European U.K. business. The top line continues to actually trend constructively with volumes up almost 1% there. The margins, however, have kind of stagnated. And so I'm just wondering, I know that the pork business has been under pressure, and you're not getting out of it what you maybe have hoped for a couple of years ago when you acquired it. What -- is there any way to quantify like how big of an impact pork is? And is there a time line that you would expect that to recover? And just where do you see this margin profile going from here, from roughly like 5%? And that will be my last question. Fabio Sandri: Of course. Thank you, Ben. Well, I think, first of all, we finished all the reorganization, and we really have one integrated company in Europe, very diversified, as we mentioned. We have the fresh chicken, the fresh pork, the prepared foods. We have the branded business, the meals business and the foodservice business. So when we look at all these different segments, I think they are balancing each other really well to what's happening to the consumer in Europe, which is very similar to what's happening to the consumer in the United States. So we are seeing growth in the chicken demand in Europe. Our challenge to grow there, it is to build more housing. I think that has been the challenge, but it is in the works for us to be able to grow the supply of chicken for the increased demand there. So chicken was really growing in Europe. The meals business also is growing really fast with the convenience and pricing being a great alternative to these consumers in Europe. Then we go to the segments that are not growing as we expected. First is the QSRs or the foodservice segment that we have in Europe. That segment, it is stagnant year-over-year. And we're working with our key customers there to enable, just like in U.S., more promotional activity to increase foot traffic and increase volumes. The second is the branded business. We are seeing a lot of competition from private label; and the consumers when they are trying to save money, they tend to go to the cheaper private label. But we are also increasing our promotional activity on the branded segments and expanding innovation, especially on the Richmond brand, so we can achieve growth in that segment. And then we go to the one that is being struggling for us in Europe, which is the pork business. Because of the China increase in the pork supply, we're seeing a reduction in European exports to China. When those exports reduced, especially from countries like Spain and Denmark, we saw a significant increase in the supply of pork into the U.K. We have a differentiated operation in the U.K., which is high welfare, so it's a higher value, let's say, proposition. But we saw this increase in the supply of very competitive cheap pork into the U.K., and that impacted more on the wholesale business, less the retail, where we have a very differentiated offering, but all the wholesale prices went down. So I think that's what impacted the pork operations in there. We are seeing some herd reduction in other countries, and we expect the prices to react. I don't think that there will be some increase in the export to China in the short term. I think it will be more on the reduction of herd in Europe, and then we'll see less imports of pork cuts into the U.K., especially in the wholesale market. So overall, again, a portfolio that is highly diversified and we are investing in innovation and brand growth and in chicken growth to be able to increase our volumes in Europe. Operator: And our next question will come from Pooran Sharma with Stephens. Pooran Sharma: Fabio, you kind of alluded to this in the prepared comments, and you've said this in the past, but wanted to talk about the benefit of lower raw material costs for your Prepared Foods business, which sounds like it has strong momentum. You said Just Bare up 30% in retail. Given kind of just the downturn in pricing, can you remind us how long of a lag it takes for you to see benefits from your Prepared Foods business? Fabio Sandri: Super. Yes. Like I said, I think looking at the overall portfolio, what we want is to grow our branded business in the United States. That will compensate the volatility in the big bird commodity market. Once again, we don't want to reduce our commodity operation. We want to reduce the volatility of the overall portfolio with the growth of prepared foods. We invested in our big bird plants in more portioning, so we can have internal supply. We used to have more than half of our supply from outside, and we are increasing that to much less than half of our needs in terms of raw meat for our prepared foods from external. And that's what we want, quality and assurance of supply of the no antibiotics ever material that is important for our Just Bare brand. There is no lag because all of our internal transferring are always based on market pricing. So we run our Prepared Foods operation just like a stand-alone and the overall portfolio will benefit from that exposure. So we price our products in the prepared foods based on competition from the market and based on the value that they generate. As I mentioned, the Just Bare brand adds a lot of velocity to the retailers when they are on the shelves, both on the prepared and on the fresh side. So I think it is more about improving our operations in the big bird category, achieving all the efficiencies that we want so we can improve the profitability in that category. The Prepared Foods profitability has been strong since the raw materials are very competitive, as you mentioned. Pooran Sharma: Great. Appreciate the color there. And just on the follow-up here, I think recently, on the July WASDE, we saw quarterly production estimates raised. But on the table egg layer front, we've been hearing of heat stress impacting birds, and so you can't get an optimal sized egg there. And I know it's different genetics when you go over to broilers. But just being in the same geographic location, will we see maybe the opposite of last year where you saw better growing conditions in 3Q? Will we see maybe worse growing conditions in 3Q this year, just given implications for heat stress thus far? And then do you think that is reflected in USDA estimates at all? Fabio Sandri: Yes. I think that is a great point, Pooran. And as I mentioned, I think in Q2, out of a 2% increase in egg sets, which is what the industry believe is going to be the increase in supply, we saw 4.5% increase in ready-to-cook pounds. And as I mentioned, I think livability was the biggest unknown or different factor during Q2. I think to your exact point, given the heat wave, that increase in livability should not be a bigger factor in Q3. And that's why I think the increase in egg sets and chicks placed, it's more in line with the end -- with the increase in ready-to-cook. And we normally see that. I think last year, you have a great point. During the fall, we saw some great growing conditions. The weather was mild. We didn't see big stretches of hot weather, and that helped in Q3 2025 an increase in production, especially in September. So I think you're right. If the weather continues to be what it is with some hot weather in the South and other regions where there is a big production of chicken and table eggs, I think the egg set increase will be more in line with the RTC increase. And then that is incorporated into the WASDE. I think WASDE is expecting the same conditions as last year. And if livability is not as good as last year, we can see actually reduction in the production compared to the increase in egg sets. Operator: [Operator Instructions] Our next question will come from Leah Jordan with Goldman Sachs. Leah Jordan: I wanted to go back to the response in the question before last. You talked about some of these actions reducing the volatility of your business longer term. So after you've completed these plant upgrades, we've got a few more value-added projects that are still on the come. I was just seeing if you could walk through how you're thinking about mix and operational efficiency as margin tailwinds into the back half and into next year, just to kind of support that reducing volatility outlook. Fabio Sandri: I think it's a great point. Again, operational efficiency is at the core of our beliefs and our values, right? We always need to be the best at everything that we do regardless of the segment we are in. Then we try to reduce the volatility through our portfolio. And I say reduce the volatility. I don't think that we want to or can create a portfolio that is going to be total immune to volatility because we want to capture the upsides in the commodity segment when they happen. What we want is to really create a protection from the downsides where because of our portfolio, the company will be not stressed in the results. So what we want is to always keep a great base of profitability, giving geographical diversification and giving the business diversification in U.S. with the small birds that are more stable with the case ready that is also more stable. But we want -- and the prepared foods that encounter, as I mentioned, a little bit of volatility in the big bird segment, which we are -- again, is the segment we are seeing the highest volatility. So long term, what we want is to continue to grow our Prepared Foods operation and growth in line with our key customers. I think this is the other point, and that's important. We're always looking into our portfolio and seeing if there is opportunities for the long term. And the Ellijay conversion is a great example. We've been seeing the reduction in the demand for bone-in category, especially on the 8 piece, and we're seeing the increase in the demand for the chicken sandwich segment. And that's why we're doing the change in the Ellijay operation to increase the deboning and support our key customers on -- for their growth. Matthew Galvanoni: And Leah, I'll just chime. In relative to next year as we wind down the completion of our Walker County facility for the prepared food, that will -- that's going to benefit us to be -- have less exposure to co-packers and some potentially better margins for us as we go forward to help that higher offtake of our own internal meat also with all the work that we've done on the portioning side in the big bird plant. Operator: And our next question will come from Heather Jones with Heather Jones Research. Heather Jones: Just first question that is really quick clarification. Fabio, you mentioned something about strong margins year-over-year, and it was in relation to a Mexico question. Is that just the long term that you expect the margins to be strong over the long term? Are you talking about you expect margins to be up strongly year-on-year for Q3? Fabio Sandri: Yes. Compared to Q3 last year, I think we saw some weakness in the second semester in Mexico. So I think we can have some growth in the margins in Mexico in the second semester. But I think it's more about the growth in the demand of a growing economy like Mexico, where their imports are a significant part of their protein consumption and our operation in the country continues to grow. So long term, we expect double-digit margins. Again, quarter-over-quarter could be very volatile. Heather Jones: Right. Okay. And then a bigger picture question is just I know that supply has surprised to the upside in the first half and thus far in Q3 in the U.S. But it also seems to be that there's been some incremental softening in demand and even more so over the last couple of weeks, which I guess is related to the cyclospora that's affecting foodservice traffic. So just wondering if you could give us your big picture view as to when we look at pricing and margins, have you tried to pinpoint what you think is attributable to supply? And what do you think is attributable to demand and just how you're thinking about that going forward? Fabio Sandri: That's a great question, Heather. I think on the foodservice, we've had these issues before in the industry, and we always bounce back. I think it's always a small or short time. We saw that in Panera, in Chipotle and others in the past, right? I think from time to time, we have -- but I think we have a great food supply, and we have great resilience, and we have good health conditions overall in the restaurants in the United States. So I expect that only to be a small reduction in any specific week. Again, the consumers continue to go to foodservice. Foodservice, it is a great option for the consumers. But the foot traffic continues to be an issue, like I said. And again, chicken is a great opportunity for generating foot traffic through promotional activity. And then we're seeing that already happening. I think during Q2, to be honest, I think we saw less promotional activity in the foodservice, but yet we saw the growth of 3.4% in the segment and like I mentioned, especially on the QSR. I think what can change in -- to be honest, on the demand is in retail in terms of promotional activity. We have not seen great promotional activity in boneless breast during the first semester. And we're seeing some strong indication, and we saw some price decreases, some significant price decreases in boneless breast in retail during Q3. And I think that can lead to a bigger or stronger demand, especially for that cut because boneless dark meat has been growing a lot, like I mentioned. But especially for the breast meat, I think the promotional activity, the reduction in pricing in the retail is going to be a significant improvement into the demand going into Q3 and Q4. Operator: And this will conclude our question-and-answer session. I'd like to turn the conference back over to Fabio Sandri for any closing remarks. Fabio Sandri: Thank you, everyone, for attending today's call. During the quarter, chicken demand remained firm across all regions as affordability continued to resonate among consumers. We made significant progress in our investments to drive growth and mitigate downside risks as volumes and margins improved from previous quarter in the volatile commodity markets. Our investments in prepared foods at Walker County and small birds in Ellijay will further strengthen our portfolio. We will continue to work with our commitment to have the best team and our relentless pursuit of operational excellence. When these efforts are combined with our commitment to quality, service and sustainability, we can further build our legacy and achieve our vision to be the best and most respected company in our industry, creating the opportunity of a better future for our team members. Thank you, everyone. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines. Before you buy stock in Pilgrim's Pride, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Pilgrim's Pride wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* Now, it’s worth noting Stock Advisor’s total average return is 953% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Pilgrim's Pride (PPC) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Net Revenues: $4.63 billion in Q2 2026, down from $4.76 billion in the prior-year quarter. Adjusted EBITDA: $360.0 million, compared to $686.9 million in Q2 2025. Adjusted EBITDA Margin: 7.8%, down from 14.4% in the same period last year. US Adjusted EBITDA Margin: 8.7% in Q2, versus 17.1% a year ago. Europe Adjusted EBITDA Margin: 7.6% in Q2, compared to 8.2% last year. Mexico Adjusted EBITDA Margin: 3.9% in Q2, versus 16.3% a year ago. US Net Revenues: $2.65 billion, down from $2.82 billion in the prior-year quarter. US Adjusted EBITDA: $231.5 million, compared to $482.7 million last year. Europe Adjusted EBITDA: $105.8 million, versus $111.8 million in Q2 2025. Mexico Adjusted EBITDA: $22.6 million, compared to $92.3 million last year. US Prepared Foods Volumes: Increased nearly 14% year over year. Legal-Settlement Expenses: $136 million in the quarter, primarily related to broilers litigation settlements. Asset Impairment Charge: $26 million, mainly tied to the forthcoming shutdown of the Chattanooga harvesting facility. Effective Tax Rate: 39.3% for the quarter; year-to-date rate of 25.3%, with full-year expectation of approximately 25%. Net Debt: Less than $2.5 billion at quarter-end, with a leverage ratio of 1.43 times last 12 months adjusted EBITDA. Cash and Available Credit: Nearly $1.6 billion at the end of the quarter. Net Interest Expense: $46.1 million on a GAAP basis; $28.5 million excluding loss on early extinguishment of debt. Capital Expenditures: $230 million in Q2; full-year estimate maintained at approximately $900 million. Warning! GuruFocus has detected 4 Warning Sign with PHIN. Is PPC fairly valued? Test your thesis with our free DCF calculator. Release Date: July 30, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Chicken demand remained firm across all regions, with volumes increasing in both retail and foodservice channels. US Prepared Foods volumes grew nearly 14% year-over-year, with Just Bare retail sales up over 30% and achieving nearly 15% market share. Operational improvements in the US, including completed plant upgrades and better live operations, led to sequential margin expansion. The company completed the Russellville conversion to case-ready operations and is investing in Ellijay to support growing boneless chicken demand. China released 17 states from its avian influenza ban, resuming raw poultry shipments and creating export opportunities. Adjusted EBITDA margin fell to 7.8% from 14.4% a year ago, driven by a 27% decrease in US jumbo cut-out values. Mexico's adjusted EBITDA margin dropped sharply to 3.9% from 16.3% due to increased supply and lower-priced competing proteins. Europe faced margin compression from competition with imported pork into the UK and increased costs due to the Middle East conflict. The company incurred $136 million in legal-settlement expenses and a $26 million asset impairment charge in the quarter. Foodservice traffic declines in Europe led to lower volumes and sales, while Richmond brand growth lagged expectations due to intense competition. Q: What are your expectations for US chicken supply and pricing in the second half of 2026, and how will it impact profitability? A: Fabio Sandri, CEO, explained that Q2 supply growth of 4.5% was higher than expected, driven by a 2% increase in egg sets and significantly improved livability. He expects supply growth to moderate to around 2.5% in Q3 and Q4, aligning with strong demand. He noted that seasonal production cuts are normal in the fall and that the industry will adjust production to demand. He also highlighted that the spread between boneless breast and ground beef is at record levels, supporting demand, and that promotional activity in retail is expected to increase, particularly for boneless breast. Q: Can you provide more detail on the performance of the Mexico business and its outlook for the second half? A: Fabio Sandri, CEO, stated that Mexico's Q2 results were impacted by exceptional bird-growing conditions, which led to a near double-digit increase in supply, along with increased egg supply and pork imports. Despite this, demand was strong enough to absorb the additional protein. He acknowledged that Mexico is volatile quarter-over-quarter but expects double-digit margins over the long term, driven by a growing economy and continued investment in brands and Prepared Foods. He also noted that margins could improve in the second half compared to last year. Q: How is the demand for US chicken evolving, and what is driving it? A: Fabio Sandri, CEO, said that consumer budgets remain constrained, with 75% of consumers cutting dining out first. This is driving foodservice operators to use chicken in promotional activities to generate traffic, leading to a 3.4% increase in chicken volume in foodservice. In retail, 68% of consumers consider meat a non-negotiable item, supporting a 2.8% growth in chicken volume. He highlighted that chicken is gaining menu penetration in QSRs and non-commercial channels, while the full-service restaurant segment is most impacted by budget cuts. Q: What is the outlook for the European business, particularly the pork segment, and its margin profile? A: Fabio Sandri, CEO, explained that Europe's diversified portfolio is balancing well, with growth in chicken and meals, but the pork business is under pressure due to increased imports into the UK from Europe, driven by reduced exports to China. He expects herd reductions in Europe to eventually alleviate this pressure. The branded business is facing competition from private label, but the company is increasing promotional activity and innovation, especially for the Richmond brand. He noted that the foodservice segment is stagnant, and the company is working with key customers to drive traffic. Q: How will lower raw-material costs benefit the Prepared Foods business, and is there a lag in realizing these benefits? A: Fabio Sandri, CEO, stated that there is no lag, as internal transfers are based on market pricing, and the Prepared Foods operation runs as a standalone business. The profitability of Prepared Foods has been strong due to competitive raw-material costs. He emphasized that the company's strategy is to grow its branded business, like Just Bare, to reduce the volatility of the overall portfolio, while continuing to invest in internal supply for quality and assurance, particularly for no-antibiotics-ever products. Q: Can you walk through how mix and operational efficiency will act as margin tailwinds into the back half and next year? A: Fabio Sandri, CEO, said that operational efficiency is core to the company's values, and the goal is to reduce volatility through portfolio diversification, not to be immune to it. He highlighted the Ellijay conversion to increase deboning for the growing chicken-sandwich segment. Matt Galvanoni, CFO, added that the completion of the Walker County Prepared Foods facility will reduce exposure to co-packers and improve margins, along with the portioning work in big-bird plants. Q: Given the supply surprise in the first half, how are you thinking about the balance of supply and demand, and what is the impact of the recent Cyclospora issue? A: Fabio Sandri, CEO, said that the industry has dealt with similar foodservice issues before and expects a short-term impact. He noted that foodservice traffic remains a challenge, but chicken is a great tool for generating traffic through promotions. He also mentioned that retail promotional activity for boneless breast has been limited in the first half, but significant price decreases in Q3 could lead to stronger demand. He expects the supply-demand balance to improve as production growth moderates. Q: What is the CapEx cadence for the rest of the year, and is guidance trending to the lower end? A: Matt Galvanoni, CFO, confirmed that year-to-date CapEx is $465 million, and the full-year guidance remains at $900 million. He noted that many of the larger projects, such as the Russellville conversion, are behind them, and spending in the second half will be slightly lower than the first half, with continued investment in Walker County and Ellijay. Q: Will the industry make normal seasonal production cuts this fall, given the current commodity market conditions? A: Fabio Sandri, CEO, said that seasonal cuts are normal and typically begin around the end of August and September. He noted that last year's cuts were delayed due to high prices, but the industry always produces to expected demand. He reiterated that the unexpected increase in livability in Q2 was the main factor behind the supply surprise, and with more normal growing conditions expected, production should align more closely with demand. Q: Can you provide more color on the impact of heat stress on bird growing conditions in Q3 and whether it is reflected in USDA estimates? A: Fabio Sandri, CEO, said that the heat wave should prevent a repeat of the improved livability seen in Q2, making egg set increases more in line with ready-to-cook production. He noted that if livability is not as good as last year, production could actually be lower than the increase in egg sets. He believes the USDA estimates already incorporate these expectations. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Pilgrim's Pride Corporation? Here are five stocks we like better. Second-quarter results weakened significantly: Net revenue fell to $4.63 billion from $4.76 billion, while adjusted EBITDA dropped to $360 million from $686.9 million as higher U.S. chicken supply and lower commodity pricing compressed margins. U.S. demand and branded products remained strong: Retail and foodservice chicken volumes grew, prepared-foods volumes rose nearly 14%, and Just Bare sales increased more than 30% to nearly 15% share of frozen fully cooked chicken. Regional and financial pressures persisted: Mexico EBITDA declined sharply amid excess protein supply, while the company recorded $136 million in legal settlement expenses; Pilgrim’s Pride nevertheless reduced debt through a $250 million bond tender offer and maintained its roughly $900 million full-year capital-spending plan. Seize the Opportunity: Beyond Meat’s New Steak Could Spark Growth Pilgrim's Pride (NASDAQ:PPC) reported second-quarter 2026 net revenue of $4.63 billion and adjusted EBITDA of $360 million, as higher chicken supply and lower commodity pricing weighed on results despite continued demand growth in retail and foodservice channels. Adjusted EBITDA margin was 7.8%, down from 14.4% a year earlier. Revenue declined from $4.76 billion in the prior-year quarter, while adjusted EBITDA fell from $686.9 million. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now Beyond Meat Forecast: Is There Any Hope Left for This Stock? President and CEO Fabio Sandri said chicken remained an affordable protein option for consumers facing inflation and elevated energy prices. However, a 4.5% year-over-year increase in U.S. ready-to-cook chicken production during the quarter exceeded demand growth and led to counterseasonal declines in commodity chicken cutout values. Pilgrim's Pride's U.S. business generated $2.65 billion in revenue, compared with $2.82 billion a year earlier. Adjusted EBITDA in the segment totaled $231.5 million, down from $482.7 million, and the adjusted EBITDA margin declined to 8.7% from 17.1%. → 3 Value ETFs to Consider as Growth Stocks Lag Behind Analysts Agree, This Could Be Tyson Stock’s Comeback Year Chief Financial Officer Matt Galvanoni said the U.S. margin decline was primarily driven by a 27% decrease in the jumbo cutout value. Still, U.S. margins improved sequentially as plant upgrades were completed and live operations improved following significant downtime in the first quarter. Sandri said the U.S. industry benefited from improved bird livability during the second quarter, contributing more than one percentage point of the increase in supply. The company expects production growth to moderate in the second half as the impact from improved livability fades and warmer weather affects bird growth. The USDA expects supply to increase about 2.5% in the third and fourth quarters, according to Sandri. → 5 AI Stocks Are Pulling Back—Which Growth Catalysts Still Look Strongest? He also said seasonal production cuts are typical during the late summer and fall, when chicken demand is generally softer around Thanksgiving and other seasonal events. Pilgrim's Pride said it will continue to align production with demand from key customers. Demand trends remained favorable, according to management. The company cited growth in chicken volumes in both retail and foodservice, with quick-service restaurants and non-commercial foodservice channels showing particular strength. Sandri said chicken menu penetration continued to rise as restaurants used the protein in promotional offerings designed to attract traffic. Pilgrim's Pride said its U.S. prepared-foods volumes increased nearly 14% from a year earlier. Retail sales of its Just Bare brand rose more than 30%, or roughly six times the frozen fully cooked category average, management said. Just Bare reached nearly 15% market share and became the second-largest brand in frozen fully cooked chicken, according to the company. The company has been investing to supply more prepared-foods production internally, including adding dark-meat deboning and portioning equipment at big-bird plants. Sandri said internal transfers to prepared foods are based on market prices, while the broader portfolio benefits from growing branded and value-added products that can help offset volatility in commodity markets. Pilgrim's Pride completed its conversion of the Russellville plant to a case-ready operation during the quarter. It also announced investments in Ellijay, Georgia, to expand small-bird production and deboning capacity to support demand for boneless chicken, sandwiches and tenders. The company's Walker County, Georgia, prepared-foods facility remains on track for commissioning in the second half of 2027. In Europe, adjusted EBITDA was $105.8 million, compared with $111.8 million a year ago, while the adjusted EBITDA margin was 7.6%, down from 8.2%. Management said poultry and meal offerings performed well as consumers sought affordable and convenient food options. European pork margins were pressured by increased pork imports into the U.K., higher costs associated with the Middle East conflict and weaker foodservice traffic. Sandri said lower European exports to China had contributed to additional pork supply from countries including Spain and Denmark entering the U.K. market. He said herd reductions elsewhere in Europe could eventually support pricing. Mexico generated adjusted EBITDA of $22.6 million, down from $92.3 million in the prior-year period, with margin declining to 3.9% from 16.3%. The company said unusually favorable growing conditions increased chicken supply, while expanded domestic egg production and pork imports added to overall protein availability. Despite those pressures, Sandri said Mexican demand remained strong enough to absorb the added supply. Pilgrim's Pride reported that retail-branded fresh-product volumes in Mexico increased more than 30%, while Just Bare volumes rose more than two-and-a-half times from a year earlier. On a GAAP basis, Pilgrim's Pride recorded $136 million in legal settlement expenses, mainly related to settlements with certain parties in ongoing broiler litigation. The company also recorded a $26 million charge primarily associated with an asset impairment tied to the planned shutdown of its Chattanooga harvesting facility. During the quarter, Pilgrim's Pride completed a $250 million tender offer for its 2033 bonds. Net debt was below $2.5 billion at quarter-end, with leverage at 1.43 times last-12-month adjusted EBITDA. The company reported nearly $1.6 billion of cash and available credit. Capital expenditures totaled $230 million in the second quarter, bringing year-to-date spending to $465 million. Galvanoni reaffirmed full-year capital expenditure expectations of about $900 million and said the company expects full-year net interest expense, excluding the impact of early debt extinguishment, to be approximately $115 million to $120 million. Pilgrim's Pride Corporation is a leading poultry producer in the United States and Mexico and a wholly owned subsidiary of JBS SA Headquartered in Greeley, Colorado, and Pittsburg, Texas, the company specializes in the production, processing and distribution of fresh, frozen and value-added chicken products. Pilgrim's Pride serves a diverse customer base that includes retail grocery chains, foodservice distributors and restaurant operators across North America and in select international markets. The company's vertically integrated operations encompass breeding, hatching, feed milling, processing plants and cold storage facilities. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Pilgrim's Pride Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Pilgrim’s Pride Corporation PPC reported second-quarter 2026 results, wherein both the top and bottom lines decreased year over year. Both metrics fell short of the Zacks Consensus Estimate. PPC posted adjusted earnings of 64 cents per share, down 62.4% year over year from $1.70 per share. The metric came below the Zacks Consensus Estimate of 75 cents. Pilgrim's Pride Corporation price-consensus-eps-surprise-chart | Pilgrim's Pride Corporation Quote Net sales declined 2.8% year over year to $4,626.2 million from $4,757.4 million, missing the consensus estimate of $4,900 million. Declining U.S. commodity pricing weighed on results, while Just Bare retail sales growth of more than 30% offered support. Gross profit fell 52.5% year over year to $339.8 million, down from $715.3 million, as cost of sales rose from $4,042.1 million in the prior-year period to $4,286.5 million. Selling, general and administrative expenses increased 32.9% year over year to $265.1 million, from $199.5 million in the previous year period. Adjusted EBITDA declined 47.6% year over year to $360 million from $686.9 million. The adjusted EBITDA margin also contracted 660 basis points year over year to 7.8% from 14.4%. The operating income was $66 million, a year-over-year decline of 87.1% from $512.3 million. U.S. sales decreased 6.1% year over year to $2,649.2 million from $2,820.4 million. Adjusted operating income dropped year over year to $150.2 million from $413.5 million, while the adjusted operating margin narrowed to 5.7% from 14.7% in the prior-year period. Higher retail and foodservice demand drove growth in fresh volumes, although weaker commodity chicken prices continued to weigh on profitability. Profitability improved sequentially as completed plant enhancement projects and stronger performance across live operations supported margins.The U.S. Prepared Foods segment recorded year-over-year improvements in both sales and margins. Just Bare retail sales increased more than 30%. Over the past year, the brand strengthened its competitive position by adding nearly 300 basis points to its market share. Construction of the Walker County, GA, prepared foods facility continued as scheduled, while ongoing investments in Big Bird portioning equipment further expanded the company's value-added production capabilities. Europe sales rose 1.3% year over year to $1,389.7 million from $1,371.3 million. Adjusted operating income declined year over year to $69.3 million from $73.9 million, and the adjusted operating margin slipped to 5% from 5.4% in the prior-year period. Retail volumes with key customers continued to grow at a faster pace than the overall grocery market. The Rollover brand posted double-digit sales growth, while Fridge Raiders continued to deliver stable performance. Even so, profitability was affected by elevated pork imports into the U.K., increased costs associated with the Middle East and softer demand from foodservice customers. Mexico sales increased 3.8% year over year to $587.3 million from $565.7 million. Adjusted operating income fell year over year to $16.5 million from $86.9 million, with the adjusted operating margin shrinking to 2.8% from 15.4% in the previous-year period. Mexico volumes increased from the prior-year period, benefiting from improved growing conditions and a more than 30% increase in Pilgrim's branded retail fresh volumes. However, profitability in the live commodity business remained under pressure due to higher domestic chicken production, increased import volumes, greater egg availability and additional pork imports. At the same time, the expansion of live operations in the Southern Peninsula remained on schedule. Pilgrim’s ended the quarter with cash and cash equivalents of $388.8 million, down from $640.2 million at the end of 2025. Long-term debt, excluding current maturities, was $2,861.4 million, while total stockholders’ equity stood at $3,763.4 million. Cash provided by operating activities totaled $471.8 million for the first six months of 2026. Capital expenditures reached $465.2 million. This Zacks Rank #5 (Strong Sell) stock has plunged 30.9% in the past six months compared with the industry’s 7.7% decline. Image Source: Zacks Investment Research Some better-ranked stocks have been discussed below: United Natural Foods Inc. UNFI distributes natural, organic, specialty, produce, and conventional grocery and non-food products in the United States and Canada. It presently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. The Zacks Consensus Estimate for UNFI’s 2026 sales indicates a decline of 2.1%, and the same for earnings indicates growth of 254.9% from the prior-year reported levels. UNFI delivered a trailing four-quarter earnings surprise of nearly 30%, on average. US Foods Holding Corporation USFD, together with its subsidiaries, markets, sells and distributes fresh, frozen, and dry food and non-food products to foodservice customers in the United States. USFD currently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for US Foods’ current fiscal-year sales and earnings implies growth of 5.1% and 16.3%, respectively, from the year-ago actuals. USFD delivered a trailing four-quarter earnings surprise of 3.9%, on average. Darling Ingredients Inc. DAR develops, produces, and sells sustainable natural ingredients from edible and inedible bio-nutrients in North America, Europe, China, South America, and internationally. DAR currently carries a Zacks Rank #2. The Zacks Consensus Estimate for DAR’s current fiscal-year sales and earnings implies growth of 13.2% and 642.7%, respectively, from the year-ago actuals. DAR delivered a trailing four-quarter negative earnings surprise of 16.1%, on average. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Pilgrim's Pride Corporation (PPC) : Free Stock Analysis Report Darling Ingredients Inc. (DAR) : Free Stock Analysis Report United Natural Foods, Inc. (UNFI) : Free Stock Analysis Report US Foods Holding Corp. (USFD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

GREELEY, Colo., July 29, 2026 (GLOBE NEWSWIRE) -- Pilgrim’s Pride Corporation (NASDAQ: PPC), one of the world's leading food companies, reports its second quarter 2026 financial results. Second Quarter Highlights Net Sales of $4.6 billion. Consolidated GAAP Operating Income margin of 1.4%. GAAP Net Income of $13.2 million and GAAP EPS of $0.06. Adjusted Net Income of $153.9 million, and Adjusted EPS of $0.64. Adjusted EBITDA of $360.0 million, or a 7.8% margin, with Adjusted EBITDA margins of 8.7% in the U.S., 7.6% in Europe, and 3.9% in Mexico. U.S. Fresh volumes rose from increased demand across both retail and foodservice. Profitability declined from previous year due to commodity market pricing reductions, while margins increased sequentially from last quarter with improvements in our productivity, completion of plant upgrades and gains in live operations. Pilgrim’s continues to improve its portfolio and support key customer growth with the investment in Ellijay, Ga., to increase deboning in the small bird category. U.S. Prepared Foods drove profitable growth as sales and margins both rose from last year. Just Bare® retail sales increased over 30% versus prior year, making it the second largest brand in the fully cooked category. Construction of the new prepared foods facility in Walker County, Ga., remains on schedule. Europe sales and volumes rose from continued marketplace momentum for poultry and meals offerings.  Sales of Rollover® grew double digits whereas Fridge Raiders® remained steady. Margins in the UK pork segment continue to be impacted by excess imports from European countries. Mexico volumes grew from last year with improved growing conditions and as retail fresh volumes of Pilgrim’s® rose over 30%. Margins in the live commodity markets were impacted by increased domestic production and imports in chicken, greater egg availability, and additional pork imports. Ramp up of live operations in the Southern Peninsula continues to be on track. Pilgrim’s approach to engaging its team members and supporting its communities garnered multiple awards across regions for workplace satisfaction, including “America’s Greatest Workplaces” by Newsweek in the U.S., “Employer of the Year” by The Grocer in Europe, and the “Exceptional Companies Award” by the Institute for the Promotion of Quality in Mexico. Maintained strong liquidity position to support future growth opportunities as the company’s net leverage ratio is currently 1.43x Adjusted EBITDA, below the target of 2x to 3x. (1)  Reconciliations for non-U.S. GAAP measures are provided in subsequent sections within this release. “Throughout the quarter, chicken demand remained firm in all regions as affordability continued to resonate with consumers across retail and foodservice,” said Fabio Sandri, Pilgrim’s President and CEO.  “We continued our investments to drive sales growth and reduce volatility, mitigating downsides in the chicken commodity markets.” In the second quarter, counter-seasonal movements in the jumbo commodity cutout market emerged as values fell more than 25% from the prior year. While profitability declined compared to last year, margins improved sequentially with the completion of plant upgrades and improvements in live operations. Case Ready and Small Bird volumes grew from incremental distribution with Key Customers. Investments in Big Bird for portioning equipment continue to support the growth of Prepared Foods, moderating the impact of commodity market declines. Additional investments were announced in Ellijay, Ga., to support the long-term growth of Key Customers in the boneless category. “While consumer interest in chicken continued to be healthy across all channels, supply growth rose faster than demand.” said Sandri. “Our relentless focus on closing operational gaps and further investments in plant upgrades to increase our internal supply capabilities and support Key Customer growth will further improve our ability to mitigate the impact of volatile commodity fundamentals, creating a more resilient earnings profile.” U.S. Prepared Foods continues to drive profitable growth as sales and margins expanded compared to prior year.  Just Bare® continues to lead growth within the frozen fully cooked category, growing market share by nearly 300 basis points over the past year. “The growth of Just Bare® continues to demonstrate our ability to diversify our portfolio through brands,” Sandri said. “Our investment in Walker County, Ga., will further enhance our operational capabilities, accelerating momentum of our value-added line up.” In Europe, volumes to Key Customers in retail rose faster than the overall grocery channel, as poultry and meal offerings continued to resonate throughout the market. These growth areas helped compensate for pressured pork margins due to increased European imports to the UK, additional costs driven by the Middle East conflict, and decreases in foodservice traffic. “Our diversified portfolio continues to demonstrate adaptability needed to meet consumer needs and drive volume growth through Key Customer partnerships,” commented Sandri. “Equally important, we’ve secured additional distribution through our innovation and branded offerings that will further expand our presence.” Mexico increased volumes through growth in both fresh and prepared. In Fresh, branded offerings in retail rose nearly 30% compared to last year. Prepared experienced similar success as Pilgrims® value-added products grew over double digits in both retail and foodservice. Margins were compressed versus last year as counter-seasonal growing conditions for chickens, supporting a significant increase in production. Total protein supply also expanded further given additional egg availability and pork imports. Projects to drive sales and mitigate the impact of commodity volatility remain on schedule. The new prepared foods line in Porvenir started production on schedule, and expansion in the Southern Peninsula proceeds as planned. “Demand for chicken continues to be robust throughout Mexico despite a significant increase in overall protein supply,” remarked Sandri. “The growth of our branded offerings and prepared foods along with our investments will further mitigate challenges from live commodity markets, improving our margin profile while reducing risk.” Pilgrim’s was also recognized as a top employer of choice by multiple entities across all regions, resulting from the company’s partnerships with its team members and communities, its training and development programs, and overall workplace satisfaction. “Culture is paramount to our success,” concluded Sandri. “It attracts talent, retains team members and ultimately drives the success of our business. We will continue to be vigilant in embedding our unique values, strategies, and methods throughout all aspects of our organization.” Conference Call Information A conference call to discuss Pilgrim’s quarterly results will be held tomorrow, July 30, at 7 a.m. MT (9 a.m. ET). Participants are encouraged to pre-register for the conference call using the link below. Callers who pre-register will be given a unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time. To pre-register, go to: https://dpregister.com/sreg/10210422/1046c71b5dc You may also reach the pre-registration link by logging in through the investor section of our website at https://ir.pilgrims.com in the “Events & Presentations” section. For those who would like to join the call but have not pre-registered, access is available by dialing +1 (844) 883-3889 within the US, or +1 (412) 317-9245 internationally, and requesting the “Pilgrim’s Pride Conference.” Replays of the conference call will be available on Pilgrim’s website approximately two hours after the call concludes and can be accessed through the “Investor” section of www.pilgrims.com. About Pilgrim’s Pride Pilgrim’s employs approximately 63,000 people and operates protein processing plants and prepared-foods facilities in 14 states, Puerto Rico, Mexico, the U.K, the Republic of Ireland and continental Europe. The Company’s primary distribution is through retailers and foodservice distributors. For more information, please visit www.pilgrims.com. Forward-Looking Statements Statements contained in this press release that state the intentions, plans, hopes, beliefs, anticipations, expectations or predictions of the future of Pilgrim’s Pride Corporation and its management are considered forward-looking statements. Without limiting the foregoing, words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “should,” “targets,” “will” and the negative thereof and similar words and expressions are intended to identify forward-looking statements. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those projected in such forward-looking statements include: matters affecting the poultry industry generally; the ability to execute the Company’s business plan to achieve desired cost savings and profitability; future pricing for feed ingredients and the Company’s products; outbreaks of avian influenza or other diseases, either in Pilgrim’s Pride’s flocks or elsewhere, affecting its ability to conduct its operations and/or demand for its poultry products; contamination of Pilgrim’s Pride’s products, which has previously and can in the future lead to product liability claims and product recalls; exposure to risks related to product liability, product recalls, property damage and injuries to persons, for which insurance coverage is expensive, limited and potentially inadequate; management of cash resources; restrictions imposed by, and as a result of, Pilgrim’s Pride’s leverage; changes in laws or regulations affecting Pilgrim’s Pride’s operations or the application thereof; new immigration legislation or increased enforcement efforts in connection with existing immigration legislation that cause the costs of doing business to increase, cause Pilgrim’s Pride to change the way in which it does business, or otherwise disrupt its operations; competitive factors and pricing pressures or the loss of one or more of Pilgrim’s Pride’s largest customers; currency exchange rate fluctuations, trade barriers, exchange controls, expropriation and other risks associated with foreign operations; disruptions in international markets and distribution channels, including, but not limited to, the impacts of the Russia-Ukraine conflict; the risk of cyber-attacks, natural disasters, power losses, unauthorized access, telecommunication failures, and other problems on our information systems; and the impact of uncertainties of litigation and other legal matters described in our most recent Form 10-K and Form 10-Q, including the In re Broiler Chicken Antitrust Litigation, as well as other risks described under “Risk Factors” in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and subsequent filings with the Securities and Exchange Commission. The forward-looking statements in this release speak only as of the date of this release, whether as a result of new information, future developments or otherwise, except as may be required by applicable law. PILGRIM’S PRIDE CORPORATIONSelected Financial Information(Unaudited) “EBITDA” is defined as the sum of net income plus interest, taxes, depreciation and amortization. “Adjusted EBITDA” is calculated by adding to EBITDA certain items of expense and deducting from EBITDA certain items of income that we believe are not indicative of our ongoing operating performance consisting of: (1) foreign currency transaction losses (gains), (2) costs related to litigation settlements, (3) restructuring activities losses, (4) asset impairment, and (5) net income (loss) attributable to noncontrolling interest. EBITDA is presented because it is used by management and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of results prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”), to compare the performance of companies. We believe investors would be interested in our Adjusted EBITDA because this is how our management analyzes EBITDA applicable to continuing operations. The Company also believes that Adjusted EBITDA, in combination with the Company’s financial results calculated in accordance with U.S. GAAP, provides investors with additional perspective regarding the impact of certain significant items on EBITDA and facilitates a more direct comparison of its performance with its competitors. EBITDA and Adjusted EBITDA are not measurements of financial performance under U.S. GAAP. EBITDA and Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as substitutes for an analysis of our results as reported under U.S. GAAP. In addition, other companies in our industry may calculate these measures differently limiting their usefulness as a comparative measure. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as an alternative to net income as indicators of our operating performance or any other measures of performance derived in accordance with U.S. GAAP. These limitations should be compensated for by relying primarily on our U.S. GAAP results and using EBITDA and Adjusted EBITDA only on a supplemental basis. (a)  Interest expense, net, consists of interest expense less interest income.(b)  Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.(c)  This represents expenses recognized in anticipation of probable settlements in ongoing litigation.(d)  Restructuring activities losses are related to costs incurred, such as severance.(e)  Primarily due to the closure announcement of the Chattanooga, TN harvest plant. The summary unaudited consolidated income statement data for the 12 months ended June 28, 2026 (the LTM Period) have been calculated by subtracting the applicable unaudited consolidated income statement data for the  six months ended June 28, 2026 from the sum of (1) the applicable audited consolidated income statement data for the year ended December 28, 2025 and (2) the applicable unaudited consolidated income statement data for the six months ended June 28, 2026. EBITDA margins have been calculated by taking the relevant unaudited EBITDA figures, then dividing by net sales for the applicable period. EBITDA margins are presented because they are used by management and we believe they are frequently used by securities analysts, investors and other interested parties, as a supplement to our results prepared in accordance with U.S. GAAP, to compare the performance of companies. Adjusted EBITDA by segment figures are presented because they are used by management and we believe they are frequently used by securities analysts, investors and other interested parties, as a supplement to our results prepared in accordance with U.S. GAAP, to compare the performance of companies. (a)  Interest expense, net, consists of interest expense less interest income.(b)  Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.(c)  This represents expenses recognized in anticipation of probable settlements in ongoing litigation.(d)  Restructuring activities losses are related to costs incurred, such as severance.(e)  Primarily due to the closure announcement of the Chattanooga, TN harvest plant. Adjusted EBITDA by segment figures are presented because they are used by management and we believe they are frequently used by securities analysts, investors and other interested parties, as a supplement to our results prepared in accordance with U.S. GAAP, to compare the performance of companies. (a)  Interest expense, net, consists of interest expense less interest income.(b)  Transactional functional currency gains/losses are included in the line item Foreign currency transaction losses (gains) in the Condensed Consolidated Statements of Income.(c)  This represents expenses recognized in anticipation of probable settlements in ongoing litigation.(d)  Restructuring activities losses are related to costs incurred, such as severance.(e)  Primarily due to the closure announcement of the Chattanooga, TN harvest plant. Adjusted Operating Income is calculated by adding to Operating Income certain items of expense and deducting from Operating Income certain items of income. Management believes that presentation of Adjusted Operating Income provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of GAAP operating income to adjusted operating income as follows: Adjusted Operating Income Margin for each of our reportable segments is calculated by dividing Adjusted operating income by Net Sales. Management believes that presentation of Adjusted Operating Income Margin provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of GAAP operating income margin for each of our reportable segments to adjusted operating income margin for each of our reportable segments is as follows: Adjusted net income attributable to Pilgrim's Pride Corporation ("Pilgrim's") is calculated by adding to net income attributable to Pilgrim's certain items of expense and deducting from net income attributable to Pilgrim's certain items of income, as shown below in the table. Adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is presented because it is used by management, and we believe it is frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of results prepared in conformity with U.S. GAAP, to compare the performance of companies. Management also believe that this non-U.S. GAAP financial measure, in combination with our financial results calculated in accordance with U.S. GAAP, provides investors with additional perspective regarding the impact of such charges on net income attributable to Pilgrim’s Pride Corporation per common diluted share. Adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is not a measurement of financial performance under U.S. GAAP, has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results as reported under U.S. GAAP. Management believes that presentation of adjusted net income attributable to Pilgrim’s provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of net income attributable to Pilgrim’s Pride Corporation per common diluted share to adjusted net income attributable to Pilgrim’s Pride Corporation per common diluted share is as follows: (a)  The loss on early extinguishment of debt recognized as a component of interest expense was due to the repurchase of the Senior Notes due 2032 in the second quarter of 2026.(b)  Net tax impact of adjustments represents the tax impact of all adjustments shown above. Adjusted EPS is calculated by dividing the adjusted net income attributable to Pilgrim's stockholders by the weighted average number of diluted shares. Management believes that Adjusted EPS provides useful supplemental information about our operating performance and enables comparison of our performance between periods because certain costs shown below are not indicative of our current operating performance. A reconciliation of U.S. GAAP to non-U.S. GAAP financial measures is as follows: (a)  The loss on early extinguishment of debt recognized as a component of interest expense was due to the repurchase of the Senior Notes due 2032 in the second quarter of 2026.(b)  Net tax impact of adjustments represents the tax impact of all adjustments shown above.

Pilgrim's Pride (PPC) came out with quarterly earnings of $0.64 per share, missing the Zacks Consensus Estimate of $0.75 per share. This compares to earnings of $1.7 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -14.67%. A quarter ago, it was expected that this poultry producer would post earnings of $0.69 per share when it actually produced earnings of $0.51, delivering a surprise of -26.09%. Over the last four quarters, the company has surpassed consensus EPS estimates just once. Pilgrim's Pride, which belongs to the Zacks Food - Meat Products industry, posted revenues of $4.63 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 5.59%. This compares to year-ago revenues of $4.76 billion. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Pilgrim's Pride shares have lost about 23.6% since the beginning of the year versus the S&P 500's gain of 8.5%. While Pilgrim's Pride has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Pilgrim's Pride was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #5 (Strong Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.12 on $4.6 billion in revenues for the coming quarter and $3.01 on $18.7 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Meat Products is currently in the bottom 10% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Beyond Meat (BYND), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 5. This plant-based meat company is expected to post quarterly loss of $0.08 per share in its upcoming report, which represents a year-over-year change of +81.4%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Beyond Meat's revenues are expected to be $62.5 million, down 16.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Pilgrim's Pride Corporation (PPC) : Free Stock Analysis Report Beyond Meat, Inc. (BYND) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Chicken producer Pilgrim’s Pride (NASDAQ:PPC) missed Wall Street’s revenue expectations in Q2 CY2026, with sales falling 2.8% year on year to $4.63 billion. Its non-GAAP profit of $0.64 per share was 3.4% below analysts’ consensus estimates. Is now the time to buy Pilgrim's Pride? Find out in our full research report. Revenue: $4.63 billion vs analyst estimates of $4.70 billion (2.8% year-on-year decline, 1.6% miss) Adjusted EPS: $0.64 vs analyst expectations of $0.66 (3.4% miss) Adjusted EBITDA: $360 million vs analyst estimates of $367.4 million (7.8% margin, 2% miss) Operating Margin: 1.4%, down from 10.8% in the same quarter last year Free Cash Flow Margin: 2.2%, down from 7% in the same quarter last year Market Capitalization: $7.09 billion “Throughout the quarter, chicken demand remained firm in all regions as affordability continued to resonate with consumers across retail and foodservice,” said Fabio Sandri, Pilgrim’s President and CEO. Offering everything from pre-marinated to frozen chicken, Pilgrim’s Pride (NASDAQ:PPC) produces, processes, and distributes chicken products to retailers and food service customers. A company’s long-term sales performance is one signal of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. With $18.44 billion in revenue over the past 12 months, Pilgrim's Pride is larger than most consumer staples companies and benefits from economies of scale, enabling it to gain more leverage on its fixed costs than smaller competitors. Its size also gives it negotiating leverage with distributors, allowing its products to reach more shelves. However, its scale is a double-edged sword because there are only a finite number of major retail partners, placing a ceiling on its growth. To expand meaningfully, Pilgrim's Pride likely needs to tweak its prices, innovate with new products, or enter new markets. As you can see below, Pilgrim's Pride grew its sales at a sluggish 2.6% compounded annual growth rate over the last three years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis. This quarter, Pilgrim's Pride missed Wall Street’s estimates and reported a rather uninspiring 2.8% year-on-year revenue decline, generating $4.63 billion of revenue. Looking ahead, sell-side analysts expect revenue to grow 1.2% over the next 12 months, similar to its three-year rate. This projection doesn’t excite us and suggests its products will see some demand headwinds. WHILE YOU’RE HERE: The Next Palantir? One satellite company captures images of every point on Earth. Every single day. The Pentagon wants it. Hedge funds are using it to beat earnings. You’ve probably never heard of it. This is what the early days of Palantir looked like before it became a giant. Same playbook. Different technology. If you missed Palantir, you need to see this. Claim The Stock Ticker for Free HERE. If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills. Pilgrim's Pride has shown mediocre cash profitability relative to peers over the last two years, giving the company fewer opportunities to return capital to shareholders. Its free cash flow margin averaged 3.8%, below what we’d expect for a consumer staples business. Taking a step back, we can see that Pilgrim's Pride’s margin dropped by 4.4 percentage points over the last year. This along with its unexciting margin puts the company in a tough spot, and shareholders are likely hoping it can reverse course. If the trend continues, it could signal it’s in the middle of an investment cycle. Pilgrim's Pride’s free cash flow clocked in at $100.6 million in Q2, equivalent to a 2.2% margin. The company’s cash profitability regressed as it was 4.8 percentage points lower than in the same quarter last year, suggesting its historical struggles have dragged on. We struggled to find many positives in these results. Its gross margin missed and its EBITDA fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 2.1% to $29.33 immediately following the results. Pilgrim's Pride’s latest earnings report disappointed. One quarter doesn’t define a company’s quality, so let’s explore whether the stock is a buy at the current price. When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.