McCormick & Company, Incorporated

Second-quarter adjusted EPS was $0.80, up 16% from the year-ago period. Total net sales grew 14% in constant currency, including 2% organic growth and 12% acquisition contribution from McCormick Mexico. Consumer constant-currency sales rose 20% with 1% organic growth; Flavor Solutions constant-currency sales rose 6% with 3% organic growth. Gross profit margin expanded 270 basis points, and underlying gross margin expanded 130 basis points after stripping out the tariff refund. Adjusted operating income increased 30%, or 27% in constant currency. For the first half, cash flow from operations was $431 million versus $161 million last year. For 2026, management expects gross margin expansion of 100 to 120 basis points, and Q3 adjusted operating income growth in the high single to low double digits.

Brendan Foley framed the quarter as evidence of the business’s resilience, saying strong sales, margin expansion, and higher earnings reflected disciplined execution and the benefits of a diversified flavor-focused portfolio. He emphasized that Flavor Solutions momentum offset weaker Consumer trends and said the company is taking targeted actions in U.S. spices and seasonings, including refined revenue growth management, expanded distribution, value-focused marketing, and innovation. On the Unilever Foods deal, he said integration planning is progressing well and that management remains confident in the previously announced growth, margin, and EPS accretion targets.

Marcos Gabriel highlighted the hard numbers behind the quarter: 14% constant-currency sales growth, 270 basis points of gross margin expansion, and $0.80 adjusted EPS, up 16%. He said gross margin benefited from McCormick Mexico accretion, a tariff refund, surgical pricing, and CCI savings, while SG&A rose due to Mexico consolidation plus technology and brand marketing investments. On cash flow, he cited $431 million from operations in the first half, $258 million returned through dividends, $75 million of capex, and a leverage ratio of about 2.9x; he also said the company expects $1.5 billion-$2 billion to pay down debt within the first two years after the Unilever Foods close.

Analysts focused on weak U.S. spices and seasonings consumption, asking whether this cycle differs from prior periods and how quickly management can restore volume; Foley said the playbook is broadly the same, but the consumer is under more pressure and the company is responding with faster, more targeted actions. Questions also centered on the quarter-to-quarter earnings cadence and Q3 guidance; Gabriel said the bigger EPS headwind is tax normalization back toward the full-year rate, plus SG&A timing for ERP, incentive comp, and brand marketing. On Flavor Solutions, management said reformulation and health-and-wellness briefs are coming through faster than expected and that branded food service is seeing improvement in QSRs, fast casual, and non-commercial channels.