Hershey beat Wall Street's earnings estimates as higher candy prices lifted sales

The chocolate maker posted $3.1 billion in quarterly sales and adjusted EPS of $2.35, topping Wall Street forecasts

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Hershey reported first-quarter net sales of $3.10 billion, beating Wall Street estimates of $3.03 billion, as price increases across its candy and snack portfolio helped cushion the impact of higher commodity and tariff-related costs. At $2.35, adjusted earnings per share cleared the $2.04 analyst consensus, according to Reuters.

Organic, constant currency net sales grew 7.9% in the quarter ended March 29, 2026, driven by about 10 points of net price realization. Overall volume declined about 2 points, reflecting price elasticity in both the North America Confectionery and International segments, the company said.

Reported net income rose to $435.1 million, or $2.13 per diluted share, an increase of 93.6% from the same period a year earlier. The company attributed the large year-over-year swing in part to significantly lower derivative mark-to-market losses compared with the first quarter of 2025.

North America Confectionery, Hershey's largest segment, posted net sales of $2.49 billion, up 8.3%, with organic price realization of about 12 points. Volume fell about 4 points, reflecting price elasticity and one fewer shipping day. U.S. candy, mint, and gum retail takeaway rose 8.1% for the 12-week period ended March 29, the company said.

The North America Salty Snacks segment saw net sales climb 26.0% to $350.1 million. About 20 percentage points of that segment growth came from LesserEvil, a brand Hershey acquired last year that markets popcorn and snacks positioned as free of seed oils, Reuters reported. Organic volume in the segment rose more than 5 points. Segment income, however, fell 18.1% to $34.3 million, hurt by higher supply chain costs related in part to a voluntary temporary product withdrawal and increased consumer marketing spending.

Adjusted gross margin fell 80 basis points from a year ago to 40.4%, as higher commodity and tariff-related costs weighed on results. Reported gross margin improved to 39.4% from 33.7%, driven by price realization and lower derivative mark-to-market losses versus the prior-year period.

Hershey reaffirmed its full-year 2026 outlook, calling for net sales growth of 4% to 5% and adjusted earnings per share growth of 30% to 35%. CEO Steve Voskuil said the guidance reflects cautious assumptions around several risks, among them possible cuts to food assistance programs, a continued shift toward healthier eating, and the toll that Middle East hostilities could take on consumer spending.

Mondelez $MDLZ International, the maker of Toblerone, similarly beat estimates in its most recent quarterly report, with price increases providing a lift, Reuters noted.

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