McCormick & Company Inc (NYSE:MKC) shares climbed more than 5% after the spice and seasoning maker reported fiscal second quarter 2026 results that exceeded Wall Street expectations and reaffirmed its full-year guidance.
The company posted adjusted earnings of $0.80 per share for the quarter ended May 31, ahead of analyst estimates of $0.70 per share.
Revenue totaled $1.94 billion, surpassing consensus expectations of approximately $1.9 billion.
Net sales increased 16.7% year-over-year, benefiting from a 2.7% favorable currency impact and contributions from the McCormick de Mexico acquisition. Organic sales rose 1.7%.
Adjusted operating income climbed 30.1% to $336 million, while operating income increased to $276 million from $246 million a year earlier. Gross profit margin expanded by 270 basis points to 40.2%.
McCormick said it benefited from pricing actions, cost savings initiatives and contributions from McCormick de Mexico, though these gains were partly offset by higher commodity costs and expenses related to the conflict in the Middle East.
Consumer segment sales rose 22.8% to $1.14 billion, including a 20% contribution from McCormick de Mexico, while Flavor Solutions sales increased 8.9% to $794 million. Organic sales in the Flavor Solutions business advanced 2.9%, supported by gains in both pricing and volume.
The company also noted progress in planning for its proposed combination with Unilever Foods, which it said is expected to provide strategic and financial benefits, including earnings accretion.
McCormick reaffirmed its fiscal 2026 outlook, projecting reported net sales growth of 13% to 17% and adjusted earnings per share of $3.05 to $3.13.
The company expects organic sales growth of 1% to 3% and adjusted operating income growth of 16% to 20%.
McCormick CEO Brendan Foley said the company continued to see momentum in its Flavor Solutions business and plans to increase investments aimed at improving consumer volume trends during the remainder of the year. "Our fundamentals remain strong, supported by our advantaged categories and disciplined execution, giving us confidence in our ability to deliver on our 2026 outlook."