J. M. Smucker’s third quarter results met Wall Street’s revenue and profit expectations, but the market responded negatively, reflecting investor concerns about ongoing cost pressures and segment-level volatility. Management attributed the quarter’s stable performance to improved volumes across key categories, especially Sweet Baked Snacks and coffee, as well as successful SKU rationalization efforts. CEO Mark Smucker highlighted the company’s progress in streamlining its baked goods portfolio and the relaunch of SuzyQs, while CFO Tucker Marshall pointed to higher marketing investment and operational transition costs, particularly in the bakery network, as factors impacting margins in the quarter.
Is now the time to buy SJM? Find out in our full research report (it’s free for active Edge members).
J. M. Smucker (SJM) Q3 CY2025 Highlights:
- Revenue: $2.33 billion vs analyst estimates of $2.32 billion (2.6% year-on-year growth, in line)
- Adjusted EPS: $2.10 vs analyst estimates of $2.10 (in line)
- Adjusted EBITDA: $487.4 million vs analyst estimates of $478.9 million (20.9% margin, 1.8% beat)
- Management reiterated its full-year Adjusted EPS guidance of $9 at the midpoint
- Operating Margin: 18%, up from 7.5% in the same quarter last year
- Organic Revenue rose 5% year on year vs analyst estimates of 4.5% growth (51.2 basis point beat)
- Sales Volumes rose 6% year on year (2% in the same quarter last year)
- Market Capitalization: $11 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From J. M. Smucker’s Q3 Earnings Call
- Andrew Lazar (Barclays) asked whether volume gains in Sweet Baked Snacks are sustainable or temporary, to which CEO Mark Smucker responded that SKU rationalization and focused execution are driving lasting improvement, with further acceleration expected.
- Tom Palmer (JPMorgan) questioned the impact of not taking additional coffee price increases. CFO Tucker Marshall clarified that $75 million in tariff costs would be absorbed this year, but tariff relief should provide a margin tailwind next year.
- Robert Moskow (TD Cowen) inquired about the shortfall in Sweet Baked Snacks profit. Marshall attributed it to temporary supply chain costs linked to the bakery transition, with profitability expected to improve in coming quarters.
- Megan Klatt (Morgan Stanley) asked about the outlook for coffee margins. Marshall indicated modest improvement in Q3 and further gains in Q4 as tariff costs subside, but not reaching previous peak levels due to ongoing cost digestion.
- Alexia Howard (Bernstein) asked if the pace of innovation had accelerated. CEO Mark Smucker confirmed that innovation across Hostess, pet, and Uncrustables had picked up, with teams bringing new products to market faster than before.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be watching (1) whether the completion of the Indianapolis bakery closure delivers the anticipated cost savings, (2) if new product launches in pet snacks and Uncrustables sustain or accelerate volume growth, and (3) how the lifting of coffee tariffs influences segment profitability. We will also monitor management’s ability to contain SG&A while maintaining brand investment.
J. M. Smucker currently trades at $103.15, down from $104.27 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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