Hershey Earnings Beat, Company Raises 2026 Outlook

The Hershey Company said in a Feb. 5, 2026 press release that Hershey earnings topped expectations as adjusted results beat forecasts and it raised its 2026 outlook, even as tariffs and unprecedented cocoa inflation trimmed reported profits.

Q4 Results and 2026 Outlook

Hershey reported fourth-quarter consolidated net sales of $3.1 billion, up 7.0% year-over-year, with organic constant-currency growth of 5.7%. Adjusted earnings per share (EPS) were $1.71, beating the $1.40 consensus by 22.1%. Adjusted gross margin narrowed 650 basis points to 38.3%. On a reported basis, net income fell 59.9% to $320 million, and reported EPS dropped 60.3% to $0.52. Reported gross margin declined 1,700 basis points to 37.0%. Management attributed margin pressure primarily to broad commodity inflation, describing cocoa inflation as unprecedented, and noted roughly $30 million in incremental tariff expenses during the quarter.

Segment results varied. North America Salty Snacks net sales rose 28.0%, including 18.2% organic growth, driven by about 14 points of volume growth and 4 points of net price realization. The LesserEvil acquisition contributed roughly 10 points to that segment’s growth. North America Confectionery net sales increased 5.3%, with net price realization of about 10 points offsetting a volume decline near 5 points. International sales edged up 0.4% to $256 million, with organic constant-currency sales down 1.9% as a 2-point price increase was outweighed by a 4-point volume decline; the Sour Strips acquisition added about 40 basis points to confectionery growth.

For full-year 2025, consolidated net sales reached $11.7 billion, up 4.4%. Reported net income declined roughly 60% to $883 million, and reported EPS fell to $1.81. The company’s AAA transformation program delivered about $160 million in net savings. Capital expenditures totaled $455 million, and dividends distributed for the year reached $1.1 billion.

Hershey set 2026 guidance calling for net sales growth of 4.0–5.0% and adjusted EPS growth of 30.0–35.0%, implying adjusted EPS between $8.20 and $8.52. The company expects organic net sales growth of 2.5–3.5% and an adjusted gross-margin recovery of about 400 basis points, driven by a low single-digit decline in total cost of goods sold (COGS). The adjusted effective tax rate is targeted at 25.0–27.0%, with first-quarter net sales expected to increase in the high single digits. Management said acquisitions would contribute roughly 150 basis points to sales growth and that visibility into commodity and packaging costs was very good. The plan assumes demand headwinds from accelerated health-and-wellness trends and increased GLP-1 adoption. On the earnings call, management said, "We're excited about 2026."

The board declared a quarterly dividend increase of 6%, setting Common Stock payout at $1.452 per share and Class B Common payout at $1.320 per share. These dividends are payable March 16, 2026, to holders of record on Feb. 17, with an ex-dividend date of Feb. 13. This marks the 384th consecutive regular dividend on Common shares and the 165th on Class B shares. The dividend increase and long payout streak, despite last year’s steep reported profit decline, highlight near-term capital-allocation tension as Hershey pursues the recovery outlined in its guidance.