Overview
- Adjusted EPS came in at $0.45 vs. $0.44 expected, while net sales of $2.979 billion missed estimates and fell 6.8% year over year.
- Management cited roughly a 100-basis-point sales headwind from retailer purchasing shifts around quarter-end, and all four segments declined.
- Profitability deteriorated, with adjusted operating margin down to 11.3% from 15.3%, adjusted gross profit off 17.1% to $698 million, and adjusted EBITDA down 25.2% to $478 million; first-half operating cash flow fell to $331 million from $754 million.
- Full-year guidance was reaffirmed, including adjusted EPS of $1.70–$1.85, organic net sales change of down 1% to flat, and adjusted operating margin of about 11.0%–11.5%.
- The company warned previously announced U.S. tariffs could add roughly 3% to fiscal 2026 COGS, expects core inflation slightly above 4%, and guided to about 7% total COGS inflation as shares traded down roughly 3.5% to $17.18.