10:31 AM EDT, 08/28/2025 (MT Newswires) -- Hormel Foods ( HRL ) lowered its full-year earnings outlook on Thursday as the food maker's fiscal third-quarter bottom line unexpectedly declined year over year amid rising commodity input costs.

The owner of the Planters snack nuts brand now anticipates adjusted earnings to come in between $1.43 and $1.45 per share for fiscal 2025, down from its previous guidance of $1.58 to $1.68. The current consensus on FactSet is for non-GAAP EPS of $1.60. The stock dropped 16% in Thursday trade.

Sales are pegged at $12.1 billion to $12.2 billion for the ongoing fiscal year, reflecting a higher bottom end versus the prior forecast of $12 billion. The Street is looking for sales of $12.12 billion.

For the three-month period ended July 27, adjusted EPS decreased to $0.35 from $0.37 a year earlier, compared with the average analyst estimate on FactSet for an increase to $0.40. The "steep rise" in commodity costs impacting the industry was the "largest contributor" to the company's shortfall, interim Chief Executive Jeff Ettinger said in a statement.

In June, the company appointed Ettinger as interim CEO for a period of 15 months, effective July 14.

Sales improved to $3.03 billion from nearly $2.9 billion, topping the market view for $2.98 billion. "The third quarter demonstrated the relevance of our portfolio, evidenced by our strong organic volume and net sales performance across each of our segments," according to Ettinger.

Revenue for retail products inclined 5.2% to $1.86 billion, buoyed by "meaningful" volume and revenue contributions from the company's turkey portfolio, Planters and the Spam portfolio, it said. Foodservice sales increased 3.5% to about $987 million, despite a 4.4% decrease in volume. International sales advanced 5.8% to $187.5 million, boosted by growth across China and robust exports of Spam luncheon meat.

For the ongoing quarter, Hormel Foods ( HRL ) expects adjusted EPS to be in a range of $0.38 to $0.40 and sales to be at $3.15 billion to $3.25 billion. The Street is looking for non-GAAP EPS of $0.47 and sales of $3.25 billion.

The company is taking "targeted pricing actions" to tackle commodity inflation and projects profit recovery to lag into the next year, "with the near-term pressures we experienced in the third quarter persisting through the fourth quarter," Ettinger said.

"We are confident in our portfolio's ability to continue delivering impressive top-line results, despite today's dynamic consumer environment, and we are committed to translating that performance into improved earnings," the interim CEO added.

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