McCormick Tops Third-Quarter Views Despite Volume Headwinds

12:17 PM EDT, 10/01/2026 (MT Newswires) -- McCormick's (MKC) fiscal third-quarter results exceeded Wall Street's expectations even as the spices and seasonings producer faced volume weakness amid macroeconomic uncertainty. Adjusted per-share earnings for the quarter ended Aug. 31 rose to $0.86 from $0.85 a year earlier, while the FactSet-polled consensus pointed to a decline to $0.76. Sales jumped 17% to $2.02 billion, while analysts projected $1.98 billion. McCormick de Mexico contributed about 14% to overall sales. Earlier this year, McCormick acquired an additional 25% stake, bringing its total ownership of McCormick de Mexico to 75%. Consolidated organic revenue rose 1.9%, driven by a 2.2% pricing gain as volume slipped. Consumer sales in the Americas were largely flat, weighed down by a 2.5% volume drop. "The volumes were pressured by the macro environment," Chief Financial Officer Marcos Gabriel said during an earnings call, according to a FactSet transcript. "We saw declines across certain categories, which were partially offset by growth in core herbs and spices for the quarter." The flavor solutions segment's organic revenue rose 3%, with the Americas and the Europe, the Middle East and Africa region reporting volume declines. "Geopolitical volatility, elevated fuel costs, and persistent inflation continue to influence consumer confidence and spending in the US," Chief Executive Brendan Foley told analysts. "Higher gas prices and the Cyclospora outbreak have added pressure and contributed to softer traffic across foodservice and grocery channels." The US Centers for Disease Control and Prevention announced last month that the outbreak associated with iceberg lettuce from Taylor Farms de Mexico had ended, though the Food and Drug Administration's investigation continued. For fiscal 2026, McCormick continues to expect adjusted EPS of $3.05 to $3.13 on net sales growth of 13% to 17%. Analysts are looking for non-GAAP EPS of $3.08 on sales of $7.91 billion, indicating a year-over-year increase of about 16%. The outlook assumes a 1% to 3% growth forecast for organic sales, McCormick said. UBS Securities analysts including Peter Grom said Sept. 23 that investor sentiment toward the company leaned mixed to slightly negative amid muted consumption trends and inflationary pressures. McCormick's pending merger transaction with Unilever (UL) also continues to weigh on the stock, according to Grom. At the end of March, McCormick agreed to combine with Unilever's food business in a deal that values the London-based consumer goods giant's unit at about $44.8 billion. The transaction is expected to close by mid-2027, McCormick said Thursday. Shares of McCormick were down 3.3% intraday Thursday. The stock has plunged 34% so far this year. On Wednesday, McCormick rival Conagra Brands (CAG) reported an unexpected year-over-year increase in fiscal first-quarter earnings, although volume weakness drove the packaged food company's revenue lower. Consumer food company General Mills (GIS) reported better-than-expected fiscal first-quarter results last week and reiterated its full-year outlook. Price: 44.82, Change: -1.58, Percent Change: -3.41