Smithfield Foods, Inc. Common Stock

Smithfield Foods now expects its Fresh Pork business to swing to an adjusted operating loss in the third quarter of 2026, as the USDA pork cutout has weakened further and compressed the industry's processing spread, according to a September 9 report from Reuters. The company also expects lower adjusted operating profit from its Hog Production business, and the update follows an August cut to its full-year 2026 outlook, when it lowered its adjusted operating-profit guidance to $1.23 billion-$1.38 billion from $1.33 billion-$1.48 billion and moved from low-single-digit sales growth to roughly flat sales. The weakness is concentrated in the commodity side of the business: packaged meats are performing in line with expectations, while Fresh Pork sales volume fell 2% and the average selling price declined 1.5% in the second quarter. Fresh pork sales to restaurants rose 12% in the second quarter, according to the Wall Street Journal, even as consumers bought less pork amid pressured household budgets and pork lost some preference to chicken and beef. Smithfield's second-quarter Fresh Pork cost of sales fell 2.6% on lower hog prices, but rising manufacturing, distribution, fuel and freight costs continued to absorb that benefit, and Tyson's own recent profit-outlook cut points to a broader protein-market squeeze.

Following a federal complaint filed August 3 by the Center for Responsible Food Business, Smithfield Foods' lobbying firm Greenberg Traurig has amended its second-quarter report to disclose that WH Group, which owns 86.9% of Smithfield, has an interest in lobbying on the Farm Bill and foreign ownership of U.S. agricultural land. The original report, filed July 20, denied any foreign interest, covering $120,000 in lobbying. The amendment came fifteen days after the complaint, but fourteen of the fifteen quarterly reports since 2023 remain uncorrected. CRFB President Taylor Warren criticized the omission, saying it suggests Smithfield never intended to admit its lobbyists represent China.

Smithfield Foods stock fell 10.3% this week after the company lowered its full-year guidance despite beating second-quarter expectations. The company reported adjusted earnings of $0.62 per share, topping analyst estimates by $0.02, and sales of $3.7 billion, about $50 million above expectations but down 2.3% year over year. Smithfield now expects full-year revenue to be roughly flat, down from prior guidance of low-single-digit growth, and cut its adjusted operating income forecast to between $1.225 billion and $1.375 billion from a previous range of $1.325 billion to $1.475 billion. The packaged meats segment's operating margin declined to 13.1% from 14.5% a year earlier, contributing to the weaker outlook.