Hershey Announces Second-Quarter 2026 Financial Performance Results
The Hershey Company (NYSE: HSY) has announced its financial results for the second quarter ended June 28, 2026, reporting strong sales growth, significant earnings improvement, and continued progress in its strategic transformation initiatives. The company also updated its full-year 2026 financial outlook, narrowing its expectations for sales growth, organic sales growth, and earnings performance.
Hershey delivered a solid first half of 2026, with reported net sales increasing 8.7% and organic net sales growing 5.8%. The company said improved profitability, continued investment behind its iconic brands, merchandising capabilities, and innovation pipeline have positioned it for continued momentum through the remainder of the year.
“We delivered a strong first half, with reported net sales up 8.7%, organic net sales up 5.8% and meaningful earnings recovery,” said Kirk Tanner, President and Chief Executive Officer of The Hershey Company. “We enter the second half with momentum, compelling growth plans, and increased investment behind our brands, merchandising, and innovation. With cost visibility and operating flexibility, we are well positioned to navigate dynamic markets and deliver on our full-year financial commitments.”
Second Quarter 2026 Financial Highlights
For the second quarter of 2026, Hershey reported consolidated net sales of $2.79 billion, representing an increase of 6.6% compared with the same period last year. Organic, constant currency net sales increased 3.6%, supported primarily by pricing actions across the company’s portfolio.
The company reported net income of $457.7 million, or $2.26 per diluted share, representing a 629% increase compared with the prior-year period. Adjusted earnings per diluted share reached $1.90, an increase of 57%.
For the first six months of 2026, Hershey generated consolidated net sales of $5.89 billion, up 8.7% year over year. Organic, constant currency net sales increased 5.8%. Reported net income reached $892.8 million, or $4.39 per diluted share, an increase of 211.3%. Adjusted earnings per diluted share increased 28.4% to $4.25.
Updated 2026 Financial Outlook
Hershey narrowed its full-year 2026 outlook for net sales growth, organic net sales growth, reported earnings per share, and adjusted earnings per share. The company noted that the updated outlook does not include potential future tariff rebates.
The company expects several key financial metrics for the year, including:
- Reported and adjusted effective tax rate between approximately 25% and 27%.
- Other expense of approximately $10 million, primarily related to pension and post-retirement benefit costs.
- Interest expense between approximately $200 million and $210 million.
- Capital expenditures ranging from approximately $425 million to $475 million.
- Approximately $100 million in savings from the company’s Agility & Automation Initiative.
Hershey also highlighted that its adjusted earnings outlook excludes the impact of mark-to-market gains and losses from commodity derivative contracts, which are recorded in corporate unallocated expenses until related inventory is sold.
Strong Improvement in Profitability
Hershey’s consolidated gross margin improved significantly during the second quarter. Reported gross margin reached 45.3%, compared with 30.5% in the second quarter of 2025, representing a 1,480-basis-point improvement.
The increase was driven by stronger pricing realization, favorable commodity derivative impacts, lower net commodity costs, and productivity savings. These benefits more than offset higher logistics expenses and unfavorable product mix.
Adjusted gross margin increased to 41.6%, improving by 350 basis points compared with the prior-year period. The improvement reflected pricing actions, lower commodity costs, and productivity initiatives.
Selling, marketing, and administrative expenses increased 2.9% during the quarter. Excluding advertising and consumer marketing expenses, these costs increased 6%, primarily due to investments in technology, capabilities, and business transformation initiatives.
Advertising and consumer marketing expenses declined 3.3% year over year, mainly due to improved efficiencies and timing of media investments.
Operating Profit Growth
Hershey reported second-quarter operating profit of $642.6 million, an increase of 233.3% compared with the prior-year period. Operating profit margin improved to 23.1%, up 1,570 basis points.
Adjusted operating profit increased 37.3% to $563.5 million, while adjusted operating margin improved 450 basis points to 20.2%.
The company attributed operating profit growth to stronger pricing, reduced commodity costs, and productivity savings, which offset higher logistics expenses and investments in technology and capabilities.
Segment Performance Highlights
North America Confectionery
Hershey’s largest segment, North America Confectionery, reported second-quarter net sales of $2.17 billion, up 4.2% year over year. Organic, constant currency sales also increased 4.2%, supported by approximately 14 percentage points of net price realization.
Volume declined approximately 10 points due to consumer response to higher prices and normal shipment fluctuations. However, retailer inventory replenishment provided some offset.
The company’s U.S. candy, mint, and gum retail takeaway increased 3.7% during the 12-week period ended July 19, 2026, although market share declined slightly due to increased competitive innovation.
Segment income increased 40.1% to $705.8 million, with segment margin improving to 32.5%. Growth was driven by pricing, lower commodity costs, and supply chain productivity improvements.
North America Salty Snacks
North America Salty Snacks delivered strong sales growth, with second-quarter net sales rising 22.9% to $387.8 million. The acquisition of LesserEvil contributed approximately 22 percentage points of growth.
Organic, constant currency sales increased 0.6%, while volume increased approximately 4 points. Growth was supported by innovation and improved consumer demand but was impacted by execution challenges in multipacks and Dot’s pretzels.
Segment income declined 5.9% to $62.6 million due to higher logistics costs, increased marketing investments, lower pricing benefits, and unfavorable product mix.
International Segment
Hershey’s International segment generated second-quarter sales of $225.9 million, up 5.7% from the previous year. Organic, constant currency sales increased 2.1%.
Pricing actions contributed approximately 10 points of growth, while volume declined due to price elasticity and inventory timing related to geopolitical risk management.
The segment reported a loss of $5.1 million, impacted by higher raw material costs, manufacturing expenses, and increased advertising investment.
Continued Investment for Future Growth
Hershey said it remains focused on strengthening its brands, expanding innovation, improving operational agility, and investing in automation and technology. The company believes its strategic initiatives will support long-term growth while helping manage evolving consumer, commodity, and market conditions.
With strong first-half performance, improved profitability, and continued investment behind key growth areas, Hershey enters the second half of 2026 focused on delivering sustainable value for consumers, customers, and shareholders.
Source Link:https://www.thehersheycompany.com/
