Smithfield Foods forecasts US$70M-$90M Q3 fresh pork operating loss
Lower hog and pork cutout prices are squeezing industry margins, while Smithfield expects its packaged meats business to remain profitable despite cautious consumer spending.
USA – Smithfield Foods expects its fresh pork segment to swing to an adjusted operating loss of US$70 million to US$90 million in the third quarter, as lower hog prices and a narrowing industry market spread pressure margins.
The U.S. pork processor said falling USDA pork cutout and hog prices have squeezed industry profitability, leading it to adopt a more conservative outlook for the segment.
Fresh pork is Smithfield’s second-largest revenue generator and reported an adjusted operating profit of US$10 million in the same quarter last year.
“The change in our outlook is driven by external market conditions within portions of the pork value chain,” said Shane Smith, CEO of Smithfield Foods.
The company also expects its hog production business to report third-quarter adjusted operating income of US$25 million to US$45 million, down from $89 million a year earlier.
Despite the weaker outlook for fresh pork and hog production, Smithfield maintained its fiscal 2026 adjusted operating income forecast for packaged meats, its largest segment, at US$1.08 billion to US$1.15 billion.
“Our most important business segment, Packaged Meats, continues to perform well, gaining branded share and expanding distribution even as consumers remain cautious,” Smith said.
Smithfield expects total company adjusted operating income for the three months ending September to range between US$115 million and US$175 million, compared with US$310 million in the same period last year.
The company said it expects to provide updated full-year guidance for Fresh Pork, Hog Production and total company adjusted operating profit when it reports its third-quarter results.
Smithfield has been operating amid cautious consumer spending, which has affected parts of the pork market. The company said it was disappointed by the impact of commodity market conditions on its near-term results.
“While we are disappointed in how these commodity market dynamics will impact our near-term results, we remain focused on executing our strategies, maintaining operational discipline and relying on our strong balance sheet to manage through this environment and continue investing in long-term growth,” Smith said.
The revised third-quarter outlook follows Smithfield’s decision last month to cut its annual total sales and adjusted operating profit forecasts.
The company’s latest projections highlight weaker expected performance in fresh pork and hog production while its packaged meats business continues to meet its previously stated fiscal 2026 adjusted operating income outlook.
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