Hershey Confident in Business Momentum Entering 2026
As The Hershey Company moves into 2026, management expressed strong confidence in the company’s trajectory despite a challenging operating environment. President and Chief Executive Officer Kirk Tanner highlighted the resilience and execution strength of Hershey’s teams, noting that disciplined operations, impactful innovation, and strategic brand investments continue to drive meaningful results.
According to Tanner, the company remains focused on strengthening its foundation, improving profitability, and advancing the next phase of its long-term strategy. These efforts are aimed at delivering sustainable growth and long-term value creation for shareholders.
Fourth-Quarter 2025 Financial Performance
Hershey reported consolidated net sales of $3.09 billion for the fourth quarter of 2025, representing a 7.0% increase compared to the same period in 2024. Organic, constant currency net sales rose 5.7%, supported by strong net price realization and one additional shipping day during the quarter.
Acquisitions contributed a 1.2 percentage-point benefit to net sales growth, primarily reflecting the impact of the Sour Strips and LesserEvil acquisitions. Foreign currency exchange provided a modest 0.1 percentage-point benefit.
Reported net income for the quarter totaled $320.0 million, or $1.57 per diluted share, reflecting a 59.9% decline year over year. The decrease was largely driven by higher commodity costs, incremental tariff expenses, and the absence of significant derivative mark-to-market gains recorded in the prior-year period. Adjusted diluted earnings per share were $1.71, down 36.4% from the fourth quarter of 2024.
Full-Year 2025 Financial Results
For the full year ended December 31, 2025, Hershey generated consolidated net sales of $11.69 billion, an increase of 4.4% compared to 2024. Organic, constant currency net sales grew 4.2%, supported by pricing actions and steady demand across key categories.
Acquisitions added a 0.5 percentage-point benefit to annual sales growth, while foreign currency exchange created a 0.3 percentage-point headwind.
Reported net income for full-year 2025 was $883.3 million, or $4.34 per diluted share, representing a 60.3% decline year over year. Adjusted diluted earnings per share totaled $6.31, down 32.7%, reflecting elevated input costs, higher strategic investments, and derivative mark-to-market losses recorded during the year.
2026 Full-Year Financial Outlook
Hershey issued an optimistic outlook for 2026, forecasting continued top-line growth and a significant recovery in earnings.
The company expects full-year reported net sales growth of 4% to 5%, driven by net price realization, increased innovation, cultural and seasonal activations, and higher advertising investment to support demand. Acquisitions, primarily the 2025 acquisition of LesserEvil, are expected to contribute approximately 150 basis points to sales growth, while foreign currency exchange is anticipated to have a neutral impact.
Reported diluted earnings per share for 2026 are projected to range between $7.77 and $8.19, representing an increase of 79% to 89% versus 2025. Adjusted diluted earnings per share are expected to be $8.20 to $8.52, reflecting growth of 30% to 35% year over year.
Management noted that sales growth and gross margin recovery are expected to more than offset increased investments in brands, capabilities, and technology, as well as higher interest expense. The difference between reported and adjusted earnings growth primarily reflects a large derivative mark-to-market loss recorded in 2025.
Additional 2026 Financial Assumptions
For 2026, Hershey expects an effective tax rate in the range of 25% to 27% on both a reported and adjusted basis. Other expense, primarily related to pension and post-retirement benefit costs, is projected at approximately $15 million.
Interest expense is expected to range between $200 million and $210 million, while capital expenditures are projected to be $425 million to $475 million. The company also anticipates achieving approximately $100 million in savings from its Advancing Agility & Automation Initiative.
Segment Performance Highlights
North America Confectionery
Fourth-quarter net sales in the North America Confectionery segment increased 5.3% to $2.48 billion. Organic, constant currency growth of 5.0% was driven by strong net price realization, partially offset by volume declines related to price elasticity. Segment income declined 10.7%, reflecting higher commodity and tariff costs, lower volume, and inventory valuation timing impacts.
North America Salty Snacks
The North America Salty Snacks segment delivered strong performance, with fourth-quarter net sales rising 28.0% to $357.0 million. The LesserEvil acquisition contributed approximately 10 percentage points to growth. Segment income increased 38.1%, driven by higher volume, productivity gains, and reduced promotional spending, resulting in margin expansion.
International
International net sales increased 0.4% in the fourth quarter to $255.6 million. Organic, constant currency sales declined 1.9%, as pricing gains were offset by volume declines related to shipment timing and price elasticity. The segment reported a loss during the quarter, reflecting higher commodity costs and lower volume.
Outlook and Strategic Focus
Hershey enters 2026 with a focus on disciplined execution, brand investment, and operational efficiency. Management remains confident that its strategic initiatives, combined with improving margins and strong brand momentum, will support long-term growth and shareholder value creation despite ongoing macroeconomic challenges.
SOURCE LINK :https://www.thehersheycompany.com/
