ORVILLE, OHIO — The J.M. Smucker Co. continues to battle slowdowns in discretionary spending and inflationary pressures within its pet food business, as shared in the company’s fourth quarter and fiscal year 2025 financial results for the period ended April 30. 

“Overall, the dog snacks category continues to be impacted by a slowdown in discretionary spending largely driven by inflationary pressures. Our portfolio remains well positioned as we continue to focus on driving growth for the Milk-Bone brand, with its strong leadership position in the category,” Mark Smucker, chair of the board and chief executive officer of Smucker. “In cat food, we continue to see tailwinds as the cat population is projected to grow, and we anticipate further share growth for the Meow Mix brand. Dog snacks and cat food are attractive categories, and e-commerce trends will remain a tailwind for our portfolio.”

Pet food performance

Fourth quarter net sales for Smucker’s US Retail Pet Foods business were reported at $395.5 million, a 13% decrease compared to $452.6 million in the prior year period. The company attributed this decrease to volume/mix, which dropped net sales by 11%, driven by decreases in dog snacks and lower contract manufacturing sales. Lower net price realization also decreased net sales by 2%, primarily attributed to lower net pricing for both dog snacks and cat food. The quarter’s net sales included $6.5 million in contract manufacturing sales, compared to $22.7 million in the prior year. 

Segment profit was $106.1 million, a decrease of 7% compared to $114.1 million in the prior year period. Smucker attributed this decrease to unfavorable volume/mix and lower price realization. Segment profit margin was 26.8%, an increase of 160 basis points. 

Retail dollar sales for dog snacks decreased 7% and cat food dollar sales from Meow Mix increased 3% during the quarter. The company revealed that unexpected retailer inventory headwinds led to an impact of around $20 million associated with destocking at certain retailers. Despite this, the company continues to reap growth from new product innovations.

“For the Milk-Bone® and Meow Mix® brands, we continued to drive the humanization trend in the pet category and have created opportunities for our brands to deliver meaningful innovation through our leading volume share positions in dog snacks and dry cat food,” Mark Smucker said. 

In line with humanization, the company continues to bring together its pet food and human food brands to create unique dog treats, like the Milk-Bone Peanut Buttery Bites made with Jif peanut butter.

“We launched the first dog treat featuring a human food brand, which outpaced all competitor innovations launched in 2024,” Mark Smucker shared. “The launch continues to exceed our expectations and contributed to the strong double-digit net sales growth for our Milk-Bone soft and chewy dog snacks this past fiscal year.”

Coming off the heels of the success with Milk-Bone and Jif, Smucker also collaborated with Just Born, Inc.’s Peeps brand to create limited-edition, Milk-Bone Peeps Artificially Marshmallow Flavored Dog Biscuits.

In cat food, Smucker continues to modernize its dry and wet offerings for Meow Mix.

“We continued to fuel growth through modernized packaging, elevated mainstream options, and margin accretive innovation. All of which drove share growth and household penetration in the dry cat food category this past year,” Mark Smucker said. “Our most recent innovation, Meow Mix Gravy Bursts, is off to a strong start and highlights our ability to bring unique innovation to the category.”

For the fiscal year 2025, pet food net sales were reported at $1.7 billion, an 8.7% decrease from $1.9 billion in 2024. This makes pet food account for 19% of Smucker’s total 2025 net sales, behind US Retail Coffee and US Retail Frozen Handheld & Spreads. Dog snacks continue to lead the segment, accounting for 54% of net sales, followed by cat food and snacks at 44%, and contract manufacturing of the divested pet food brands at 2%.

Segment profit was $459.6 million, a 14.3% increase from $402.1 million in the prior year. Segment profit margin was 27.6%. 

Overall performance

Total net sales for the fourth quarter were reported at $2.1 billion, a 3% decrease from $2.2 billion in the prior year period. Excluding noncomparable net sales in the prior year, net sales decreased 1%, which Smucker attributed to a 3% decrease in volume/mix lead by decreases in dog snacks, lower contract manufacturing sales from divested pet food brands and more. Net income was a loss of $729 million, compared to $245.1 million.

Gross profit was $823.3 million, a 10% decrease from $913.3 million in the prior year period. Operating income was a net loss of $599.1 million, compared to $406 million in the prior year. Adjusted earnings per share were $2.31, a 13% decrease year-over-year.

“Our fourth quarter and full-year results underscore the demand for our leading brands, the resilience of our business, and our ability to act with speed and agility in a dynamic operating environment,” said Mark Smucker. “This year we strengthened our financial position and grew both adjusted earnings per share and free cash flow, while investing in our business, paying down debt, and returning cash to our shareholders through dividends.”

For the fiscal year, net sales were $8.7 billion, a 7% increase from $8.2 billion in the previous year. Net income was a loss of $1.23 billion, compared to $744 million in the previous year. Gross profit was $3.4 billion, a 9% increase from $3.1 billion in 2024. Operating income was a loss of $673.9 million, compared to $1.3 billion. Adjusted earnings per share were $10.12, a 2% increase compared to 2024. 

Looking at its retail channel performance, Smucker shared that a majority (36%) of its fiscal 2025 net sales came from grocery, followed by Walmart at 29%. The pet specialty retail channel accounted for 2% of net sales, just behind e-commerce. 

Smucker also provided its full-year fiscal year 2026 guidance. Net sales are expected to rise between 2% and 4%. Adjusted earnings per share are expected to be between $8.50 and $9.50. Capital expenditures are expected to be around $325 million. The company is also expecting a net sales decline of about $38 million related to contract manufacturing sales from the divested pet food brands, as agreements concluded at the end of fiscal year 2025. 

The guidance factors in tariffs and trade-related impacts, as well as ongoing inflation, regulatory changes and shifts in consumer behavior. 

“As we look ahead to fiscal year 2026, we remain focused on delivering the business through the strength of our key growth platforms and advancing our strategic priorities. We are confident in our strategy, and we are well-positioned to deliver long-term growth and increase shareholder value,” Mark Smucker concluded. 

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