Q3 2026 J M Smucker Co Earnings Call

February 26, 2026

Speaker #1: Good morning and welcome to the J M Smucker Company's fiscal 2026 third quarter earnings question and answer session. This conference call is being recorded.

Operator: Good morning. Welcome to the J.M. Smucker Company's Fiscal 2026 Q3 Earnings Question and Answer Session. This conference call is being recorded. All participants are in a listen-only mode. Please limit yourself to two questions. Re-queue if you have additional questions. I will now turn the conference call over to Crystal Beiting, Vice President, Investor Relations and Financial Planning and Analysis. Thank you. You may begin.

Speaker #1: And all participants are in a listen-only mode. Please limit yourself to two questions and requeue if you have additional questions. I will now turn the conference call over to Crystal Beiting, Vice President, Investor Relations and Financial Planning and Analysis.

Speaker #1: Thank you. You may begin.

Speaker #2: Good morning and thank you for joining our fiscal 2026 third quarter earnings question and answer session. I hope everyone had a chance to review our results as detailed in this morning's press release and management's prepared remarks.

Crystal Beiting: Good morning, thank you for joining our fiscal 2026 Q3 earnings question and answer session. I hope everyone had a chance to review our results as detailed in this morning's press release and management's prepared remarks, which are available on our corporate website at jmsmucker.com. We will also post an audio replay of this call at the conclusion of this morning's Q&A session. During today's call, we may make forward-looking statements that reflect our current expectations about future plans and performance. These statements rely on assumptions and estimates, and actual results may differ materially due to risks and uncertainties. Additionally, we will use non-GAAP results to evaluate performance internally. I encourage you to read the full disclosure concerning forward-looking statements and details on our non-GAAP measures in this morning's press release.

Speaker #2: Which are available on our corporate website at jmsmucker.com. We will also post an audio replay of this call at the conclusion of this morning's Q&A session.

Speaker #2: During today's call, we may make forward-looking statements that reflect our current expectations about future plans and performance. These statements rely on assumptions and estimates and actual results may differ materially due to risks and uncertainties.

Speaker #2: Additionally, we will use non-gap results to evaluate performance internally. I encourage you to read the full disclosure concerning forward-looking statements and details on our non-gap measures in this morning's press release.

Speaker #2: Participating on this call are Mark Smucker, Chief Executive Officer, President, and Chair of the Board; and Tucker Marshall, Chief Financial Officer, Executive Vice President, Frozen Handheld and Spreads, and Sweet Baked Snacks.

Crystal Beiting: Participating on this call are Mark Smucker, Chief Executive Officer, President, and Chair of the Board, and Tucker Marshall, Chief Financial Officer, Executive Vice President, Frozen Handheld and Spreads and Sweet Baked Snacks. We will now open the call for questions. Operator, please queue up the first question.

Speaker #2: We will now open the call for questions. Operator, please cue up the first question.

Speaker #1: Thank you. The question and answer session will begin at this time. If you are using a speakerphone, please pick up the handset before pressing any numbers.

Operator: Thank you. The question and answer session will begin at this time. If you are using a speakerphone, please pick up the handset before pressing any numbers. Should you have a question, please press star one on your telephone. If you wish to withdraw your question, please press star two. For operator assistance, please press star zero. As a reminder, please limit yourself to two questions during the Q&A session. Should you have additional questions, you may re-queue, and the company will take questions as time allows. Please stand by for the first question. Our first question comes from Andrew Lazar with Barclays. Please begin.

Speaker #1: Should you have a question, please press star one on your telephone. If you wish to withdraw your question, please press the press star two.

Speaker #1: For operator assistance, please press star zero. As a reminder, please limit yourself to two questions during the Q&A session. Should you have additional questions, you may requeue and the company will take questions as time allows.

Speaker #1: Please stand by for the first question. Our first question comes from Andrew Lazer with Barclays. Please begin.

Speaker #3: Great. Thanks so much. Good morning, everybody. Mark, I'm, I'm curious. Morning. I'm curious. Maybe, you know, in your discussions thus far with, with Elliot, I'm curious where maybe you are seeing the, the most common ground and where maybe the biggest opportunities are going forward.

Andrew Lazar: Great. Thanks so much. Good morning, everybody.

Crystal Beiting: Good morning.

Andrew Lazar: Mark, Morning. I'm curious maybe, you know, in your discussions thus far with Elliott, I'm curious where maybe you are seeing the most common ground and where maybe the biggest opportunities are going forward. You know, is it potentially in more aggressive portfolio optimization, or maybe should we be thinking more on the cost side and sort of capital allocation fronts?

Speaker #3: You know, is it potentially in, in more aggressive portfolio optimization or maybe should we be thinking more on the cost side and, and sort of capital allocation fronts?

Speaker #4: Thanks, Andrew. the engagement with Elliot is recent and has actually been very constructive. we've had a number of meetings with the folks there. And largely, what they see is what many of you already know, we're a great company with strong brands.

Mark Smucker: Thanks, Andrew. The engagement with Elliott is recent and has actually been very constructive. We've had a number of meetings with the folks there, and largely, what they see is what many of you already know. We're a great company with strong brands. There's really good alignment between what they're seeing and what we are seeing, focusing on continuing operating improvements, which will lead to profit restoration over time, continued portfolio management, in the near term, focusing on organic growth, disciplined capital allocation, and lastly, governance.

Speaker #4: And there's really good alignment between what they're seeing and what we are seeing focusing on continuing operating improvements, which will lead to profit restoration over time.

Speaker #4: the continued portfolio management, in the near term focusing on organic growth. Also, disciplined capital allocation. And then lastly, governance. And as you know, we do and have continued a pretty consistent board evolution over the last five years.

Mark Smucker: As you know, we do and have continued a pretty consistent board evolution over the last 5 years. These two recent additions of Bruce Chung and David Singer will further that governance, and in particular, making sure that we have the right support in terms of how we're thinking about capital allocation and our financial priorities. Really feel very good about where we are in the conversations with Elliott. Very confident that we have both the right board and the right team to continue to drive our strategy and the growth of the company.

Speaker #4: And these two recent additions of Bruce Chung and Dave Singer will further that, that, governance. And in particular, making sure that we have the right, support in terms of how we're thinking about capital allocation and, and our, our financial priorities.

Speaker #4: So really feel very good about where we are in the conversations with Elliot. And very confident that we have both the right board and the right team to continue to drive our strategy and the growth of the company.

Speaker #3: Great. Thanks for that. And then, you already discussed, I know, some of the, the change in promotional strategy in Sweet Baked Snacks, at Cagney last week.

Andrew Lazar: Great, thanks for that. You already discussed, I know, some of the change in promotional strategy in Sweet Baked Snacks at CAGNY last week. I'd love to dig in just a little bit further on sort of what you're really trying to accomplish with this move, and maybe what you're hoping to learn about the business through this, sort of, through this action. Thanks so much.

Speaker #3: But maybe I'd love to dig in just a little bit further on, on sort of what you're really trying to accomplish with this move and maybe what you're hoping to learn about the business through this, sort of through this, this action.

Speaker #3: Thanks so much.

Mark Smucker: Sure, Andrew. I mean, again, we are gonna continue to focus on stabilizing the brand and return Hostess to growth over time. That includes strengthening the portfolio. As you know, we've done some SKU rationalization, really staying focused on the icon brands of Cupcakes, Twinkies, and Donettes. Continuing to, as I just mentioned, improve operations, which will ultimately lead to improved profitability. Just taking a prudent approach to the investments in Sweet Baked Snacks to ensure that we're balancing both top line stabilization and profit improvement. Of course, you know, we did take an updated assumption of 2% growth trajectory going forward, but we are continuing at this time, just to stabilize the business.

Speaker #4: Sure, Andrew. I mean, again, we are gonna continue to focus on stabilizing the, the brand and return host as to growth over time. That includes strengthening the portfolio, as you know, we've done some skew rationalization, really staying focused on the icon brands of cupcakes, Twinkies, and Donuts.

Speaker #4: continuing to, as I just mentioned, improve operations, which will ultimately lead to improved profitability. And then just taking a prudent approach to the investments in Sweet Baked Snacks to ensure that we're balancing both top and bottom top-line stabilization and profit improvement.

Speaker #4: And of course, you know, we did take an updated assumption of 2% growth trajectory going forward. but we are continuing at this time just to stabilize, the business.

Speaker #3: Thanks so much.

Andrew Lazar: Thanks so much.

Speaker #1: Thank you. Our next question comes from Peter Galbo. Of Bank of America. Please proceed.

Operator: Thank you. Our next question comes from Peter Galbo of Bank of America. Please proceed.

Peter Galbo: Hey, good morning, Mark and Tucker. Thanks for the question.

Speaker #5: Hey, good morning, Mark and Tucker. Thanks, thanks for the question.

Speaker #4: Good morning.

Mark Smucker: Morning.

Peter Galbo: Mark Smucker, maybe just to dovetail off of that, I noted in the profile on Bruce Chung, specifically, just his background in M&A. Just, you know, the thought process there of his experience, whether that could maybe accelerate a more portfolio reshaping, and then just, like, how you would think about, you know, use of proceeds. I think in the past, again, we know the debt paydown piece, but in the past, as you parted with businesses, you've been willing to kind of return that, you know, in the form of share repurchase and just how that whole framework is entering your mind. Thanks very much.

Speaker #5: Mark, maybe just to, to dovetail off of that. I, I noted in, in the, the profile on, on Bruce specifically, just his background in, in M&A.

Speaker #5: so just, you know, the, the thought process there of, of his experience, whether that could maybe accelerate a mo a more portfolio reshaping and then just, like, how you would think about, you know, use of proceeds, I think in the past, again, we, we know that the debt paydown piece, but in the past, as you parted with, with businesses, you've been willing to kind of return that, you know, in the form of share repurchase and just how that whole framework is, is entering your mind.

Speaker #5: Thanks very much.

Speaker #4: Sure. Yeah. You know, we've been in conversations with Bruce for, for some time. And just feel very good about his, financial acumen. and as it relates to the portfolio, as you know, you know, we've been very consistent over the years in making sure that all of our shareholders understand that we always are review-reviewing our portfolio.

Mark Smucker: Sure. Yeah. You know, we've been in conversations with Bruce for some time and just feel very good about his financial acumen. As it relates to the portfolio, as you know, we've been very consistent over the years in making sure that all of our shareholders understand that we always are reviewing our portfolio. We really like our portfolio because of the diversity. It's obviously pets and coffee and then food and snacking. We play across multiple categories, the diversity does give us optionality. You know, as we've been very disciplined over these past years in reshaping our portfolio, that's something that we will continue to think about as we move forward.

Speaker #4: We're, we really like our portfolio. because of the diversity it obviously, Pat and Coffee and then Food and Snacking we have we play across multiple categories.

Speaker #4: So the diversity does give us optionality. and, you know, as we've been very disciplined over these past years in, in reshaping our portfolio, that's something that we will continue to think about as we move forward.

Tucker Marshall: Peter, good morning. As it relates to use of proceeds, we would just acknowledge historically, we've used proceeds from divestiture activity to either pay down debt or to repurchase shares. As we continue on our path to 3 times leverage or below by the end of next fiscal year, that enables the opportunity to consider share repurchases again.

Speaker #3: Peter, good morning. As it relates to use of proceeds, we would just acknowledge historically we've used proceeds from divestiture activity to either pay down debt or to repurchase shares.

Speaker #3: As we continue on our path to three times leverage or below by the end of next fiscal year, that enables the opportunity to consider share repurchases again.

Speaker #5: Great. thank you for that. And, and Tucker, maybe just to pivot, to, to the business and, and Coffee specifically, I think at Cagney you had some remarks about, you know, n-near term margin improvement that was predicated on some of the deflation, in, in green coffee costs.

Peter Galbo: Great. Thank you for that. Tucker, maybe just to pivot to the business and coffee specifically. I think at CAGNY, you had some remarks about, you know, near-term margin improvement that was predicated on some of the deflation in green coffee costs. You have a peer who obviously participates in this space that kind of talked about a recovery in some of the profit metrics in, like, the second half of calendar 2026. I know your fiscal is a bit different, but maybe you could put some guardrails around how you're thinking about that, you know, coffee deflation entering the P&L from a calendar 2026 perspective. Thanks very much.

Speaker #5: You have a peer, who, who obviously recovery, in, in some of the profit metrics and, like, the second half of, of calendar '26. and I know you're, your fiscal is a bit different, but maybe you could put some guardrails around how you're thinking about that, you know, Coffee deflation entering the P&L from a from a calendar '26 perspective.

Speaker #5: Thanks very much.

Speaker #3: Sure. Peter, the outlook for our Coffee portfolio is positive. It starts with the resilience and the strength of the category. And also the performance of our brands.

Tucker Marshall: Sure. Peter, the outlook for our coffee portfolio is positive. It starts with the resilience and the strength of the category, also the performance of our brands. We don't disclose our hedging or our cost position, but we do hedge for flexibility to support annual profit delivery. We would just share that, as we mentioned at CAGNY, deflation benefits both the absolute profit dollar and the profit margin percentage. Additionally, we will be lapping the impact of tariffs. We would anticipate profit and margin improvement as we move forward. In the Q4 of this fiscal year, we would expect a mid-20s segment profit margin. Hopefully, this continues to endure to the benefit of the portfolio and the profitability of the portfolio.

Speaker #3: And we don't disclose our hedging or our cost position, but we do hedge for flexibility to support annual profit delivery. And we would just share that as we mentioned at Cagney, deflation benefits both the absolute profit dollar and the profit margin percentage.

Speaker #3: And additionally, we will be lapping the impact of tariffs. And so we would anticipate profit and margin improvement as we move forward. And then the fourth quarter of this fiscal year, we would expect a mid-20s segment profit margin.

Speaker #3: And so hopefully this continues to endure to the benefit of the portfolio and the profitability of the portfolio.

Speaker #5: Okay. Thank you.

Operator: Okay, thank you. Thank you. Our next question comes from Peter Grom of UBS. Please go ahead.

Speaker #1: Thank you. Our next question comes from Peter Grom of UBS. Please go ahead.

Speaker #3: Great. Thank you. Good morning, everyone. So, I was hoping to get some perspective o-on the top-line trajectory, maybe first as it relates to Sweet Baked Snacks.

Peter Grom: Great. Thank you. Good morning, everyone.

Tucker Marshall: Yeah.

Peter Grom: I was hoping to get some perspective on the top line trajectory. Maybe first, as it relates to Sweet Baked Snacks, you touched on some of the drivers around the Q4 low double-digit decline. I'd be curious how we should be thinking about fiscal 27 in the context of this exit rate. Would you anticipate some of the changes you're making to drive stronger growth, or is this kind of low double-digit decline a fair run rate as you move into the first half of next year?

Speaker #3: Y-you touched on some of the drivers around the 4Q, low double-digit decline. But I'd be curious how we should be thinking about fiscal '27 in, in the context of this exit rate.

Speaker #3: Would you anticipate some of the changes you're making to drive stronger growth or is this kinda low double-digit decline a fair run rate as we move into the first half of next year?

Speaker #4: Yeah. Peter, I certainly appreciate the, the question, particularly as it relates to the growth trajectory on Sweet Baked Snacks. We'll just share that it's early for us to, to lean into what the outlook is for FY '27.

Tucker Marshall: Yeah, Peter, I certainly appreciate the question, particularly as it relates to the growth trajectory on Sweet Baked Snacks. I'll just share that it's early for us to lean into what the outlook is for FY27. We have acknowledged that our Q4 will be a softer quarter for the portfolio, just as it relates to some of the category trends that it's navigating, but also as it overcomes a temporary disruption associated with a plant or manufacturing fire. I would just sort of think through that we continue to advance the stabilization efforts across that portfolio to improve our share of market performance. We've obviously worked through some of the SKU rationalization efforts. We'll continue to improve profitability across that portfolio.

Speaker #4: We have acknowledged that our fourth quarter will be a softer quarter for the portfolio. Just as it relates to some of the category trends that it's navigating, but also as it overcomes a temporary disruption associated with a plant or manufacturing fire.

Speaker #4: and so I would just sort of think through that we continue to advance the stabilization efforts across that portfolio. To improve our share of market performance, we've obviously worked through some of the skew rationalization efforts.

Speaker #4: We'll continue to improve profitability across that portfolio. We'll begin to see the benefits of a recent plant closure, the Indianapolis facility. And we'll continue to look toward advancing growth over time.

Tucker Marshall: We'll begin to see the benefits of a recent plant closure, the Indianapolis facility, and we'll continue to look toward advancing growth over time. This continues to be a journey as we navigate the stabilization of this portfolio.

Speaker #4: But this continues to be a journey as we navigate the stabilization of this portfolio.

Speaker #5: Awesome. Thank you. And then I, I guess just, a follow-up on Coffee. there was some commentary or, or commentary earlier this week from one of your peers on some retail inventory dynamics happening in, in pods that they are expecting to impact their growth in the first half of the year.

Peter Grom: Awesome. Thank you. I guess, just a follow-up on coffee. There was some commentary earlier this week from one of your peers on some retail inventory dynamics happening in pods that they are expecting to impact their growth in the first half of the year. Is this a dynamic that you are seeing or contemplating in your guidance? Thanks.

Speaker #5: So is this a dynamic that you are seeing or, or contemplating in your guidance? Thanks.

Speaker #4: No, Peter. It we haven't seen any abnormalities in terms of inventories on Coffee. Our, our Coffee business continues to perform very well. And, obviously delivered great growth on Boostello and, and, we'll, we'll continue to, to do the right thing for our Coffee business.

Mark Smucker: No, Peter, we haven't seen any abnormalities in terms of inventories on coffee. Our coffee business continues to perform very well and obviously delivered great growth on Bustelo, and we'll continue to do the right thing for our coffee business.

Speaker #3: Great. Thank you so much. I'll pass it on.

Peter Grom: Great. Thank you so much. I'll pass it on.

Speaker #5: Yeah. Operator?

Operator: Operator? Thank you. Mm-hmm. Our next question comes from Robert Moskow with TD Cowen. Please proceed.

Speaker #1: thank you.

Speaker #5: Mm-hmm.

Speaker #1: Our next question comes from Robert Moscow with TD Cowen. Please proceed.

Speaker #6: Hi. Thanks for the question. I was hoping to drill down even further into the Coffee pricing strategy a-and maybe ask you to delineate between ground coffee and, and the single-serve pods.

Robert Moskow: Hi, thanks for the question. I was hoping to drill down even further into the coffee pricing strategy and maybe ask you to delineate between ground coffee and the single-serve pods. As your costs come down, would it be fair to say that, you know, the giveback on pricing would be more on the ground coffee than it would be on the pods, just because of how it plays out on a percentage of cost of goods?

Speaker #6: a-as your as your costs come down, would it be fair to say that, you know, the give-back on, on pricing would be more on the ground coffee than it would be on the pods just because of, of how it plays out on a percentage of cost of goods?

Speaker #4: Yeah. Rob, I think it's early for us to talk about sort of the magnitude of deflation and its implication to, to pricing. But as you know, roast and ground is a greater percentage of Coffee in the can as compared to in a single-serve K-cup.

Tucker Marshall: Yeah, Rob, I think it's early for us to talk about sort of the magnitude of deflation and its implication to pricing. As you know, roast and ground is a greater percentage of coffee in the can as compared to in a single-serve K-Cup. We'll continue to navigate the level of deflation and how we address deflation in our portfolio as we move forward. I guess I would just leave it there.

Speaker #4: And so, we'll continue to navigate the level of deflation and how we address deflation in our portfolio as we move forward. But I guess I would just leave it there.

Speaker #5: Yeah. Rob, it's Mark. I the only thing I would maybe just build is that, you know, we've been pretty consistent over the years highlighting that the profitability and the margins across the Co-Coffee portfolio are, are generally similar.

Mark Smucker: Yeah, Rob, it's Mark. The only thing I would maybe just build is that, you know, we've been pretty consistent over the years, highlighting that the profitability and the margins across the coffee portfolio are generally similar.

Speaker #6: Mm-hmm. Okay. And can I ask a follow-up on, on Hostess and Sweet Baked Snacks in general? y-you know, since, since you bought the business, a, a lot of the, the management team a-and probably the next layered level down, you know, has left the business.

Robert Moskow: Mm-hmm. Okay. Can I ask a follow-up on Hostess and Sweet Baked Snacks in general? You know, since you bought the business, a lot of the management team and probably the next layer level down, you know, has left the business. I'm just wondering, like, do you think that you need to make a bigger investment in talent or capabilities in order to stabilize the business? Have those departures, do you think, contributed to some of the weakness at in the division?

Speaker #6: And I-I'm, I'm just wondering, like, do you think that you need to make a bigger investment in talent or capabilities in order to stabilize the business?

Speaker #6: a-and, and has that have those departures, do you think, contributed to some of the, the weakness at, at in, in the division?

Speaker #4: No, Rob. I-I'm very confident that we have the, the right team in place on, Hostess. Some of the, the best and brightest, you know, I think what we're navigating is both the category dynamic and then, just as Tucker mentioned, just some operational challenges that we've had.

Mark Smucker: No, Rob, I'm very confident that we have the right team in place on Hostess, some of the best and brightest. You know, I think what we're navigating is both the category dynamic and then just as Tucker mentioned, some operational challenges that we've had. We are through the Indy closure, which as you know, was a bit more costly than we had anticipated, but that is largely behind us. Our focus now is to maintain and improve the operating efficiencies, and then to continue to make prudent investments on those parts of the branded Hostess portfolio that are truly going to help to stabilize the business and then ultimately get us back to some growth.

Speaker #4: We are through the indie closure, which, as you know, was a, a bit more costly than, than we had anticipated. But that is largely behind us.

Speaker #4: And so our focus now is, is to maintain and, and improve the, the operating efficiencies and then to continue to make prudent investments on those parts of the of the branded Hostess portfolio that are truly going to help to stabilize the business and then ultimately get us back to some growth.

Speaker #6: Okay. Thanks for answering the question. Appreciate it.

Robert Moskow: Okay, thanks for answering the question. Appreciate it.

Speaker #4: Thanks, Rob.

Mark Smucker: Thanks, Rob.

Speaker #1: Thank you. Our next question comes from Thomas Palmer of JPMorgan. Please go ahead.

Operator: Thank you. Our next question comes from Thomas Palmer of JP Morgan. Please go ahead.

Speaker #5: Good morning. thanks for the question. I think my, my questions are not gonna be totally different than the two topics we've addressed so far.

Thomas Palmer: Good morning. Thanks for the question. I think my questions are not gonna be totally different than the two topics we've addressed so far, but just first on Sweet Baked Snacks. I think a quarter ago, the message was that the earnings pressures would be greatest in Q2, and then we'd see sequential improvement. What really, I know there's the plant fire in Q4, but what really were the incremental items to think about in Q3 that drove the weakness? I know you've mentioned the plant closure. Was that it, or were there other items to really consider? I'm trying to think through the ultimate recovery here and kind of how much is simply volumes need to reverse versus you have kind of a clear line of sight operationally. Thanks.

Speaker #5: But just first on, on Sweet Baked Snacks. I think a quarter ago, the message was that the earnings pressures would be greatest in the second quarter.

Speaker #5: And then we'd see sequential improvement. So what really I, I know there's the plant fire in 4Q, but what really were the incremental items to think about in, in 3Q that, that drove the weakness?

Speaker #5: I, I know you've mentioned the, the plant closure. Was that it? Or were there other items to, to really consider? 'Cause I'm trying to think through the, the ultimate recovery here and, and kind of how much is simply volumes need to reverse.

Speaker #5: Versus you have kind of a, a clear line of sight operationally. Thanks.

Speaker #4: Yeah. Tom, what we would offer in our third quarter is top-line did come in below our expectations. largely due to category trends. Some of our own execution.

Tucker Marshall: Yeah, Tom, what we would offer in our Q3 is, top line did come in below our expectations, largely due to category trends, some of our own execution. I would also share that our bakery network cost came in much higher than we anticipated, and those two things really worked against the profit expectation of sequential improvement as we move through this fiscal year. I would just say that our Q4 should be better, but it will absorb the impact of the fire in the month of February, both at top line and bottom line.

Speaker #4: And then I would also share that our bakery network cost came in much higher than we anticipated. And those two things really worked against the profit expectation of sequential improvement as we move through this fiscal year.

Speaker #4: and I would just say that our fourth quarter should be better but it will absorb the impact of the fire in the month of February, both at top-line and bottom-line.

Speaker #5: Okay. Thank you for that. And, on Coffee, and I apologize if I missed this, you, you have been providing some, some kind of clear guidance over the expected Coffee impact in fiscal 26.

Thomas Palmer: Okay. Thank you for that. On coffee, and I apologize if I missed this, you have been providing some kind of clear guidance over the expected coffee impact in fiscal 2026. I think last time it was, and even last week, you were discussing a $0.50 unmitigated tariff headwind, and then coming out of the Q2, the coffee elasticity was expected to be a $0.40 headwind. Just any update on these items' expected impact now as we think about fiscal 2026, and especially when it comes to the tariff headwind, is that an item we should essentially think about reversing in full as we look at next year, given it's unmitigated?

Speaker #5: I think last time it was and even last week you were discussing a 50-cent unmitigated tariff headwind. And then coming out of the second quarter, the Coffee elasticity was expected to be a 40-cent headwind.

Speaker #5: Just any update on these items expected impact now as we think about fiscal 26? And especially when it comes to the tariff headwind, is that an item we should essentially think about reversing in full a-as we look at next year given its unmitigated?

Speaker #4: Yeah. Tom, so a couple of parts to break down there. Let's begin with tariffs. So we did call out a 75 million dollar unmitigated tariff impact that was affecting this fiscal year that we would be lapping next fiscal year.

Tucker Marshall: Yeah, Thomas Palmer, a couple of parts to break down there. Let's begin with tariffs. We did call out a $75 million unmitigated tariff impact that was affecting this fiscal year, that we would be lapping next fiscal year, so you can add that back to exit segment profit for this fiscal year. We would also just acknowledge, while we didn't update our elasticity impact in this call, we would just say that elasticities came in better than anticipated in our Q3, and we continue to take a prudent approach to forecasting elasticities, excuse me, in our Q4.

Speaker #4: So you can add that back to exit segment profit for this fiscal year. Then we would also just acknowledge while we didn't update our elasticity impact in this call, we would just say that elasticities came in better than anticipated in our third quarter.

Speaker #4: And we continue to take a prudent approach to forecasting elect elasticities, excuse me, in our fourth quarter.

Speaker #5: Okay. Understood. Thank you.

Thomas Palmer: Okay, understood. Thank you.

Speaker #1: Thank you. Our next question comes from Chris Carey of Wells Fargo Securities. Please go ahead.

Operator: Thank you. Our next question comes from Chris Carey of Wells Fargo Securities. Please go ahead.

Speaker #6: Good morning, guys. I do wanna ask one follow-up on the Sweet Baked Snacks segment. And I promised my other question will be something else.

Chris Carey: Morning, guys. I do wanna ask one follow-up on the Sweet Baked Snacks segment, then I promise my other question will be something else. I think the organic sales in the quarter were pretty substantially below consumption, at least on our data. Why was that? What drove the gap between, you know, consumption and what you reported, and I just wonder if we should expect that going forward? Just connected, when you talk about fiscal 27 being on algorithm or potentially better, within that statement, how are you ring-fencing the Sweet Baked Snacks segment? Back to Tom's point, obviously a quarter ago, there were different expectations than what played out. Just trying to understand the cushion in that fiscal 27 statement as it pertains to Sweet Baked Snacks.

Speaker #6: But I think the, the, the organic sales in the quarter were pretty substantially below consumption. At least on our data. Why, why was that?

Speaker #6: What, what drove the, the gap between you know, consumption and, and what you reported in? I just wonder if we should expect that going forward.

Speaker #6: and then just connected when you talk about fiscal 27 being on algorithm, or potentially better, w-within that statement, how are you ring-fencing the Sweet Baked Snacks segment?

Speaker #6: Because back to Tom's point, obviously a quarter ago there were different expectations than what played out. So just trying to understand the, the cushion in that in that fiscal 27 statement as it pertains to Sweet Baked.

Speaker #4: Yeah. So Chris, we your first question on Sweet Baked Snacks, I think we saw some timing around operational efficiencies and consumption. Just as we've navigated sort of the resetting of the bakery network.

Tucker Marshall: Yeah. Chris, your first question on Sweet Baked Snacks, I think we saw some timing around operational efficiencies and consumption, just as we've navigated sort of the resetting of the bakery network. We've also reset promotional activity in the back half on that business, where we've pulled promotional activity largely in support of then putting it back in to make sure that we're getting the most efficiency out of that spend. As you step into next fiscal year, I think it's hard for us to sort of communicate at this time the trajectory of the top line of the business, but we should begin to build back profitability because we're at such a low watermark at this point in time.

Speaker #4: We've also reset promotional activity in the back half on that business where we've pulled promotional activity largely in support of then putting it back in to make sure that we're getting the most efficiency out of that spend.

Speaker #4: And then as you step into next fiscal year, I think it's hard for us to sort of communicate at this time the trajectory of the top-line of the business.

Speaker #4: But we should begin to build back profitability because we're at such a low watermark at this point in time.

Speaker #6: Okay. In the pet segment for the quarter, you were lapping some headwinds from the year ago period in the top-line. how should we think about the performance for pet in the in the quarter?

Chris Carey: Okay. In the pet segment for the quarter, you were lapping some headwinds from the year ago period in the top line. How should we think about the performance for pet in the quarter? I think it came in a bit light of expectations. Perhaps those expectations were a function of that compare in the base period. I wonder if you could just.

Speaker #6: I think it came in a bit light of expectations. Perhaps those expectations were a function of that, that compare in the base period. So I wonder if you could just maybe contextualize how, how you all felt about delivery in the quarter and, and whether there were any shortfalls relative to your own expectations.

Megan Clapp: ... maybe contextualize how you all felt about delivery in the quarter and whether there were any shortfalls relative to your own expectations. Thank you.

Chris Carey: ... maybe contextualize how you all felt about delivery in the quarter and whether there were any shortfalls relative to your own expectations. Thank you.

Speaker #6: Thank you.

Speaker #4: Sure, Chris. It's Mark. overall, very pleased with the pet performance. I think, you know, meow mix continues its growth trajectory. still the number one leader in dry.

Mark Smucker: Sure, Chris, it's Mark. Overall, very pleased with the pet performance. I think, you know, Meow Mix continues its growth trajectory, still the number one leader in dry, solid consumption, 5% top-line growth in the quarter. Innovation is performing well. The Gravy Bursts platform that we've launched has done well, and we're actually expanding that with some new items. Milk-Bone specifically did start to grow again in the quarter, which is what we wanted to see. You know, it was supported by base biscuits. We did see some decent growth in base biscuits, which is important. The innovation there with the Peanut Buttery Bites platform, we talked about a new iteration of that innovation at CAGNY. That innovation continues to perform well.

Speaker #4: solid consumption, 5% top-line growth in the quarter. Innovation is performing well. The gravy bursts platform that we've launched has done well and we're actually expanding that.

Speaker #4: with some new, some new items. Milk bones specifically did, start to grow again in the quarter, which is what we wanted to see. you know, was supported, by base biz base biscuits.

Speaker #4: We did see some decent growth in base biscuits, which is important. And then the innovation there was the Peanut Buttery Bites platform. We talked about a new iteration of that in innovation at Cagney; that innovation continues to perform well.

Speaker #4: The, the, the tail of the pet business, which is, pepperoni and canine carryouts, continues to be a soft, largely driven by competition and, and private label.

Mark Smucker: The tail of the pet business, which is Pup-Peroni and Canine Carry Outs, continues to be soft, largely driven by competition and private label. We have begun a brand refresh on Pup and continue to invest in marketing to support the business, and we do see strong loyalty there. We think that will take time, but just keeping in mind that our focus on dog snacks will continue to be on Milk-Bone, and in that brand, specifically playing across multiple segments, both premium to value and different need states for dogs. Milk-Bone will continue to be, you know, sort of the crown jewel, and we'll continue to focus there and continue to drive growth as we seek to stabilize the Pup-Peroni business.

Speaker #4: But we have begun a brand refresh on pup and continue to invest in marketing to support the business and, and we do see strong loyalty there.

Speaker #4: So we think that will take time but just keeping in mind that our focus on dog snacks will continue to be on milk bone and in that brand specifically playing across multiple segments both premium to value and different need states for, for dogs.

Speaker #4: So milk bone will continue to be the, you know, sort of the crown jewel and we'll continue to, to focus there and continue to drive growth as we seek to stabilize the, the pepperoni business.

Speaker #6: Okay. Thank you both.

Megan Clapp: Okay. Thank you both.

Chris Carey: Okay. Thank you both.

Speaker #1: Thank you. Our next question comes from line of Max Gompert of VMP Parabus. Please proceed.

Operator: Thank you. Our next question comes from the line of Max Gumport of BNP Paribas. Please proceed.

Speaker #4: Hey, thanks for the question. I've got one more on, on Sweet Baked Snacks to, to throw in and it's r on, on the profit side.

Max Gumport: Hey, thanks for the question. I've got one more on Sweet Baked Snacks to throw in, and it's on the profit side. I recognize that this year has been impacted by a number of discrete items, and also that you've brought down the long-term sales growth target for the business. It felt like you had a clear path to returning to a 20% segment profit margin for Sweet Baked Snacks, if not in Q4, then sometime soon. Not asking you to put a timeline on it. I'm just curious if you have any color you can provide on what you view now as a reasonable, normalized segment profit margin for Sweet Baked Snacks, whenever you get back to that normal period. Thanks very much.

Speaker #4: So I recognize that this year has been impacted by a number of discrete items. and also that you've brought down the, the long-term sales growth target for the business.

Speaker #4: But it felt like you had, you know, a, a clear path to, to returning to a 20% segment profit margin for Sweet Baked Snacks if, if not in four Q then sometime soon.

Speaker #4: so not asking you to put a timeline on it. I'm just curious if you have any color you can provide on what you view now as a, a reasonable normalized segment profit margin for Sweet Baked Snacks.

Speaker #4: whenever you get back to that, that normal period. Thanks very much.

Speaker #2: Yeah. Max, excuse me. Certainly understand the question and obviously profitability is below our expectations and particularly in our third quarter. We should see an improvement into our fourth quarter from a profit standpoint.

Tucker Marshall: Max, excuse me. Certainly understand the question, and obviously, profitability is below our expectations, in particular in our Q3. We should see an improvement into our Q4 from a profit standpoint. Then as we get to our Q4 earnings call, we'll be able to kind of lay out how we see the profit trajectory of the business and also maybe a revised profit margin target to your question. I just think right now, the team still continues to advance its stabilization journey around improving profits, and that's really gonna come through how we continue to navigate our bakery environment and manage overall costs.

Speaker #2: And then as we get to our fourth quarter earnings call, we'll be able to kind of lay out how we see the profit trajectory of the business and also maybe a revised profit margin target to your question.

Speaker #2: I just think right now the team still continues to advance its stabilization journey around improving profits. And that's really gonna come through how we continue to navigate our bakery environments and manage overall costs.

Speaker #4: Great. Thanks very much. And then on, on crustables, so it's good to see that the total company business for uncrustable is growing 10%. I think retail is a, a bit slower at six.

Max Gumport: Great. Thanks very much. On Uncrustables, it's good to see that the total company business for Uncrustables is growing 10%. I think retail was a bit slower at 6%. I recognize that doesn't have the C-store business being booked under it. Just curious for an update on how you view these trends for Uncrustables and how you're thinking about that business as you are getting close to the $1 billion target for revenue. Thanks very much.

Speaker #4: I recognize that doesn't have the, the seized or business being booked under it. but just curious for an update on how you view these, these trends for uncrustables and how you're thinking about that business as you are getting close to the, the $1 billion target for revenue.

Speaker #4: Thanks very much.

Speaker #6: Sure, Max. uncrustables still feeling great about, of course, o-obviously you highlighted the numbers. it, it will continue to be a key dro growth driver for the company.

Mark Smucker: Sure, Max. Uncrustables, still feeling great about, of course, obviously, you highlighted the numbers. It will continue to be a key growth driver for the company. You know, our distribution gains, most recently in away from home and C-store, having tripled our C-store sales and continuing to add new households, on the order of, like, 3.5 million new households. The expansion of the brand, supported by strong in-store merchandising, consistent marketing, share of voice, and innovation, we believe will continue to drive growth there. As the category has expanded, right, and you are starting to see some store brands fill out the section, we remain the leader.

Speaker #6: You know, our distribution gains most recently in away from home and C-store having tripled our C-store sales and continuing to add new households. on the order of like three and a half million new households.

Speaker #6: So the, the expansion of the brand supported by strong in-store merchandising consistent marketing, share of voice, and then innovation we believe will continue to, to drive growth there.

Speaker #6: And so as the, expanded, right, and you are starting to see s-some store brands fill out the, the section, we remain the leader and so our job is to continue to bring insights to customers so that we can collectively grow the category and specifically the uncrustables brand.

Mark Smucker: Our job is to continue to bring insights to customers so that we can collectively grow, the category and specifically the Uncrustables brand.

Speaker #4: Great. Thanks very much.

Max Gumport: Great. Thanks very much.

Speaker #6: Thank you.

Mark Smucker: Thank you.

Speaker #1: Thank you. Our next question comes from Megan Clapp of Morgan Stanley. Please go ahead.

Operator: Thank you. Our next question comes from Megan Clapp of Morgan Stanley. Please go ahead.

Speaker #5: Hi. Good morning. Thanks so much. A couple quick ones from me. O-on the EPS guide, you kept the guide. It's still quite wide. I think for this point in the year, I think historically you've narrowed it a bit with one quarter left.

Megan Clapp: Hi, good morning. Thanks so much. A couple quick ones from me. On the EPS guide, you kept the guide. It's still quite wide, I think, for this point in the year. I think historically, you've narrowed it a bit with one quarter left. You narrowed the top line. Can you just talk about the decision to keep the EPS range where it is, and, you know, whether you're tracking towards one end or the other at this point? Thanks.

Speaker #5: So you narrowed the top line. Can you just talk about the decision to keep the EPS range where it is and, you know, whether you're tracking towards one end or the other at this point?

Speaker #5: Thanks.

Speaker #2: Sure. I, I think we're just continuing to maintain prudence throughout our fiscal year as we deliver against the midpoint of that guidance range. We feel very confident in achieving the $9 midpoint.

Tucker Marshall: Sure. I think we're just continuing to maintain prudence throughout our fiscal year as we deliver against the midpoint of that guidance range. We feel very confident in achieving the $9 midpoint, and any upside would largely come through your coffee portfolio. Candidly, the coffee portfolio is covering softness that we're experiencing in our Sweet Baked Snacks portfolio. The balance of the businesses continue in line with expectations. That was really the reason we remain confident in the range. We remain most confident at the midpoint.

Speaker #2: And any upside would largely come through your coffee portfolio but candidly, the coffee portfolio is covering softness that we're experiencing in our Sweet Baked Snacks portfolio.

Speaker #2: But the balance of the business is continuing in line with expectations. So that was really the reason we remain confident in the range.

Speaker #2: We remain most confident at the midpoint.

Speaker #5: Okay. Great. That's helpful. And then just on the SDNA, I think it's now you're expecting flat to slightly down versus flat prior. Can you just unpack a little bit more what changed there?

Megan Clapp: Okay, great. That's helpful. Just on the SD&A, I think it's now you're expecting flat to slightly down versus flat prior. Can you just unpack a little bit more what changed there? Is that just efficiencies coming in better than you expected, or are you pulling back in any certain areas that maybe would need to come back next year? Thanks.

Speaker #5: Is that just efficiencies coming in better than you expected or, or are you pulling back in any certain areas that maybe would need to come back next year?

Speaker #5: Thanks.

Speaker #2: Yes, Megan. They're largely driven by efficiencies and just prudent management of spend.

Tucker Marshall: Yes, Megan, they're largely driven by efficiencies and just prudent management of spend.

Speaker #5: Okay. Great. Thank you.

Megan Clapp: Okay, great. Thank you.

Speaker #6: Thanks.

Speaker #1: Thank you. Our next question comes from Alexia Howard of Bernstein. Please go ahead.

Tucker Marshall: Thanks.

Operator: Thank you. Our next question comes from Alexia Howard of Bernstein. Please go ahead.

Speaker #7: Thank you for the question. can I just follow up on Megan's question just there about the SDNA line? I think in the prepared remarks you commented that you had lower marketing and distribution spending this quarter.

Alexia Howard: Thank you for the question. Can I just follow up on Megan’s question just there, about the SD&A line? I think in the prepared remarks, you commented that you had lower marketing and distribution spending this quarter, but higher selling expenses. Is that a signal of a continuation of that kind of trend going forward, out into next quarter and perhaps out into fiscal 27, or should we expect some normalization of that?

Speaker #7: but higher selling expenses. Is that a signal of a, a continuation of that kind of trend going forward out into next quarter and perhaps out into fiscal '27?

Speaker #7: Or should we expect some normalization of that?

Speaker #2: No. We just had some, some savings and timing in our third quarter. Again, that supported the overdelivery in EPS. We've essentially locked that into our earnings guidance for the year.

Tucker Marshall: No, we just had some savings and timing in our Q3. Again, that supported the over-delivery in EPS. We've essentially locked that into our earnings guidance for the year, but we have some top-line softness coming through, associated with the Emporia, Kansas fire, that's kind of muting some of the savings from a bottom-line standpoint. There's nothing substantial to report in additional savings that would come through our Q4.

Speaker #2: But we have some top-line softness coming through associated with the Emporia Kansas Fire. And so that's kind of muting some of the, the savings.

Speaker #2: from a bottom-line standpoint. But there's, there's nothing substantial to report in additional savings that would come through our fourth quarter.

Speaker #7: Thank you. and then on the pace of innovation, have you quantified recently where you're at in terms of new products as a percent of sales?

Alexia Howard: Thank you. On the pace of innovation, have you quantified recently where you're at in terms of new products as a percent of sales and where you would hope to get to over time? Are you where you want to be on the innovation front now? Thank you. I'll pass it on.

Speaker #7: And where you would hope to get to over the time o-over time? Are you where you want to be on the innovation front now?

Speaker #7: Thank you. And I'll pass it on.

Speaker #6: Alexia, I'm not 100% sure I understood the question. Let me, let me try to answer it and then please come back if the it's Mark, of course.

Mark Smucker: Alexia, I'm not 100% sure I understood the question. Let me try to answer it, please come back if the. It's Mark, of course. Innovation is actually performing very well. We've gotten, you know, as we always do, listening to the consumer, making sure that we understand what their needs are and trying to meet them as quickly as possible. I mentioned some of the pet innovation. Even on Hostess, you know, despite some of the challenges we've had on that business, the innovation there has actually performed well. That's also true in Bustelo, Uncrustables.

Speaker #6: innovation is, is actually performing very well. We've gotten you know, as we always do, listening to the consumer, making sure that we understand what their needs are and trying to meet them as quickly as, as possible.

Speaker #6: I, I mentioned some of the pet innovation. e-even on Hostess, y-you know, despite some of the challenges we've had on that business, the, the, the innovation there has actually performed well.

Speaker #6: That's also true in Boostello on Crustables. And a lot of the innovation that we've that has been successful is generally closer in innovation as opposed to big bet innovation.

Mark Smucker: A lot of the innovation that has been successful is generally closer in innovation as opposed to big bet innovation, and that has really driven growth and helped to support the top line.

Speaker #6: And that has really driven growth and, and helped to support the top line.

Speaker #7: Thank you. That's helpful. and the overall pace, the proportion of sales that are coming from new products is that where you want it to be now?

Alexia Howard: Thank you. That's helpful. The overall pace, the proportion of sales that are coming from new products, is that where you want it to be now?

Speaker #6: Yeah. It's in line for sure.

Mark Smucker: Yeah, it's in line, for sure.

Speaker #7: Great. Thank you very much. I'll pass it on.

Alexia Howard: Great. Thank you very much. I'll pass it on.

Speaker #6: Thank you.

Mark Smucker: Thank you.

Speaker #1: Thank you. Our next question comes from Scott Marks of Jefferies. Please go ahead.

Operator: Thank you. Our next question comes from Scott Marks of Jefferies. Please go ahead.

Speaker #4: Hey. Good morning, all. Thanks so much for taking our questions. first thing I wanted to ask about just on the on the dog snack side of the business.

Scott Marks: Hey, good morning, all. Thanks so much for taking our questions.

Mark Smucker: Hi.

Scott Marks: First thing I wanted to ask about, just on the, on the dog snack side of the business, you made a comment in the prepared remarks about the category as a whole rebounding. Just wondering if you can kind of help us understand a little bit about what's going on there, you know, what's changed relatively in some prior quarters, where you've called out some discretionary spending pressure on the consumer.

Speaker #4: You made a comment in the prepared remarks about the category as a whole rebounding. And just wondering if you can kinda help us understand a little bit about what's going on there and, and, and, you know, what's changed relative to some prior quarters where you've called out some discretionary spending pressure on the consumer.

Speaker #6: Sure. Scott, it's Mark. yeah. The both of the categories that we participate in pet are, are doing very well. And in particular, dog snacks has continued to grow a lot of that growth has been driven by the humanization and premiumization trends in pet.

Mark Smucker: Sure. Scott, it's Mark. Yeah, both of the categories that we participate in pet are doing very well, and in particular, dog snacks has continued to grow. A lot of that growth has been driven by the humanization and premiumization trends in pet. To the extent, as I mentioned in Alexia's last question, the innovation that has been delivering, is delivering against that premiumization concept. In addition, as I mentioned earlier, we have been pleased with the base biscuit performance, which is the more affordable, more value-oriented part of the portfolio. Our strategy is to continue to make sure that we're winning in the different segments within that category, and continue to follow both consumer needs and where the growth is.

Speaker #6: So to the extent that I mentioned in, in Alexia's last question, the innovation that, that, that has been delivering is delivering against that premiumization concept.

Speaker #6: In addition, as I mentioned earlier, we have been pleased with the base biscuit performance, which is the more affordable, more value-oriented part of the portfolio.

Speaker #6: So we our strategy is to continue to make sure that we're winning in the different segments within that category. and, and continue to follow both consumer needs and where the growth is.

Speaker #4: Appreciate the color there. last one for me would just be regarding the uncrustables business. You made some comments in the prepared remarks just about distribution runway in some of the away from home channels.

Scott Marks: Appreciate the color there. Last one from me would just be regarding the Uncrustables business. You made some comments in the prepared remarks just about distribution runway in some of the away-from-home channels, talked about convenience channel. Amy, how should we be thinking about kind of the, I guess, more traditional channels, just in terms of, you know, distribution runway left versus, you know, maybe innovations on shelf? Just trying to contextualize how we should be thinking about maybe velocity improvements versus in-innovation in some of the larger, more mature channels for that business.

Speaker #4: Talked about the convenience channel—maybe how should we be thinking about kind of the, I guess, more traditional channels just in terms of, you know, distribution runway left versus, you know, maybe, you know, innovations on shelf.

Speaker #4: Just, just trying to contextualize how we should be thinking about maybe velocity improvements versus, versus in-innovation in some of the larger or more mature channels for that business.

Speaker #6: Yeah. In the traditional US retail channels like grocery and mass, you know, our distribution has expanded over the last year. As we've actually gained more freezer space, as new capacity came on at our facilities, that enabled our ability to deliver more innovation and meet demand.

Mark Smucker: Yeah, in the traditional US retail channels like grocery and mass, you know, our distribution has expanded over the last year as we've actually gained more freezer space. As new capacity came on in our facilities, that enabled our ability to deliver more innovation and meet demand. At the same time we were ramping up manufacturing, we were also turning on marketing, so that did drive distribution. I would say generally, we're everywhere with Uncrustables, and our continued growth is going to be driven largely by innovation. Obviously, like these new high-protein sandwiches are doing very well, and then continuing to drive household penetration where we still feel there is some runway.

Speaker #6: So at the same time, we were ramping up manufacturing. We were also turning on marketing. So that did drive distribution. I would say generally, we're everywhere with uncrustables.

Speaker #6: And our continued growth is going to be driven largely by innovation. Obviously, like these, these new high protein sandwiches are doing very well. And then continuing to drive household penetration where we still feel there is some runway.

Speaker #4: Appreciate the thoughts. I'll pass it on.

Scott Marks: Appreciate the thoughts. I'll pass it on.

Speaker #1: Thank you. Our next question comes from Steve Powers of Deutsche Bank. Please go ahead.

Operator: Thank you. Your next question comes from Steve Powers of Deutsche Bank. Please go ahead.

Speaker #8: Hey. Thanks very much. And good morning, everybody.

Steve Powers: Hey, thanks very much, and good morning, everybody.

Speaker #9: Good morning.

Speaker #8: Most of my ques morning. Most of my questions, I think, have been addressed. It's been a nice compliment today to what you said at Cagney.

Mark Smucker: Morning.

Steve Powers: Morning. Most of my questions, I think, have been addressed. It's been a nice complement today to what you said at CAGNY, so thank you for that. I did have one, I guess, more technical question, though, on Sweet Baked Snacks. It's probably for Tucker. Specifically, I just wanted to ask around the decision to start regularly amortizing the Hostess trademark, beginning in Q4. Just maybe you could talk a little bit about the trigger for that and I guess over what period of time you're now assuming that brand will, I guess, effectively depreciate.

Speaker #8: So, so thank you for that. I did have one I guess, more technical question though on Sweet Bake Stacks. It's probably for Tucker. specifically, I just wanted to ask around the decision to start regularly amortizing the Hostess trademark beginning in the fourth quarter.

Speaker #8: Just to maybe you could talk a little bit about the trigger for that and, and I guess over what period of time you're now assuming that brand will, I guess, effectively depreciate.

Speaker #10: Yeah. So as we have looked across the portfolio, and as we continue to evaluate the direction of the Sweet Bake Goods category and our brand and brands in that category, we have slowed the growth rate from our original expectations at the time of acquisition.

Tucker Marshall: Yeah, as we have looked across the portfolio and as we continue to evaluate the direction of the sweet baked goods category and our brands and brands in that category, we have slowed the growth rate from our original expectations at the time of acquisition, and now we have a long-term growth rate of 2%. As we've reduced that growth rate, and Mark shared in his comments and also in Q&A, we wanna continue to take a prudent approach to how we invest behind that business and those brands, and how we allocate resources not only to that aspect of our portfolio, but how we allocate resources toward our broader portfolio.

Speaker #10: And now we have a long-term growth rate of 2%. As we've reduced that growth rate, and March shared in his comments and also in Q&A, we want to continue to take a prudent approach to how we invest behind that business and those brands.

Speaker #10: And how we allocate resources not only to that aspect of our portfolio, but how we a-allocate resources toward our broader portfolio. It just came to us that we should begin amortizing that brand over a longer period of time versus it being an indefinite lifetime.

Tucker Marshall: It just came to us that we should begin amortizing that brand over a longer period of time versus it being an indefinite lived one, and that's really what we were trying to signal in my prepared remarks here today. Hopefully, Steve, that just provides some additional context.

Speaker #10: And that's really what we were trying to signal in my prepared remarks here today. so hopefully, Steve, that just provides some additional context.

Speaker #4: It, it does. Maybe it'll be in the queue. But is there a a, a life just a, a, a rate? I guess, you know, a, a time span of depreciation or amortization.

Steve Powers: It does. Maybe it'll be in the queue, but is there a life, just a rate, I guess, you know, a time span of depreciation or amortization we should be thinking about?

Speaker #4: We should be thinking about.

Speaker #10: Yeah. So our outlook for amortization for the full year is now 210 million. That includes the step-up in amortization that begins in the fourth quarter by putting that as by putting that brand on a life.

Tucker Marshall: Yeah, our outlook for amortization for the full year is now $210 million. That includes the step-up in amortization that begins in Q4 by putting that brand on a life, and we will continue to provide updates as it relates to that amortization as we move forward.

Speaker #10: And we will continue to provide updates as it relates to, to that amortization as we move forward.

Speaker #4: Okay. That's helpful. I appreciate it. Thank you.

Steve Powers: Okay, that's helpful. I appreciate it. Thank you.

Speaker #10: Sure.

Speaker #6: Thanks.

Tucker Marshall: Sure.

Mark Smucker: Thanks.

Speaker #1: Thank you. There are no further questions. I'll pass the call back over to management for any closing remarks.

Operator: Thank you. There are no further questions. I'll pass the call back over to management for any closing remarks.

Speaker #6: Well, thank you for your time and, and for joining the call this morning. It was great seeing many of you at Cagney last week where we outlined our objectives focused on continuing to advance our long-term growth strategy and furthering momentum of our portfolio of leading brands, improving profitability and earnings growth, and continuing a disciplined capital deployment scheme.

Mark Smucker: Well, thank you for your time and for joining the call this morning. It was great seeing many of you at CAGNY last week, where we outlined our objectives focused on continuing to advance our long-term growth strategy and furthering momentum of our portfolio of leading brands, improving profitability and earnings growth, and continuing a disciplined capital deployment scheme. Our results demonstrate our strategy is working, and we continue to take deliberate actions to advance these objectives. I'm confident that we have the right strategy and leaders in place to create value for our shareholders, and none of this would be possible without our dedicated employees for their unwavering commitment, outstanding talents, and contributions, and I would like to thank them for their continued hard work and dedication to our company. Have a great day, everyone.

Speaker #6: Our results demonstrate our strategy is working, and we continue to take deliberate actions to advance these objectives. I'm confident that we have the right strategy and leaders in place to create value for our shareholders.

Speaker #6: And none of this would be possible without our dedicated employees for their unwavering commitment and outstanding talents and contributions and I would like to thank them for their continued hard work and dedication to our company.

Speaker #6: Have a great day, everyone.

Operator: Everyone, this concludes our conference call for today. Thank you all for participating, and have a nice day. All parties may now disconnect.

Q3 2026 J M Smucker Co Earnings Call

Request a DemoDemo

SJM

J.M. Smucker

Earnings