McCormick & Company reported a 1% increase in net sales for the second quarter of 2025, with organic sales growing 2% driven by volume and product mix. Adjusted operating income increased by 10% from the year-ago period, or 11% in constant currency, to $259 million, exceeding analyst expectations.
Despite a 20 basis point contraction in gross profit margin to 37.5% due to costs for increased capacity and higher commodity costs, adjusted diluted earnings per share (EPS) remained consistent at $0.69 compared to the prior year. The company reaffirmed its fiscal year 2025 outlook, projecting net sales growth of 0% to 2% and adjusted diluted EPS between $3.03 and $3.08.
CEO Brendan Foley stated that McCormick is actively assessing and mitigating the impact of new tariffs on its sourcing, noting that 90% of U.S. products are made domestically, though many ingredients are sourced internationally. The company has successfully mitigated tariff impacts for the remainder of the year, leveraging cost savings and revenue growth management. Foley also highlighted that consumers are adapting to economic pressures by cooking more at home and prioritizing flavor, which benefits McCormick's business.
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