J & J Snack Foods (JJSF) Q2 2026 earnings summary

Executive summary

• Net sales declined 3.2% year-over-year to $344.8 million, mainly due to anticipated reductions in the bakery business and demand softness.

• Gross profit increased 3.8% to $99.3 million, with gross margin improving to 28.8% from 26.9%, driven by transformation initiatives, plant closures, and favorable product mix.

• Adjusted EBITDA rose 9.5% to $28.7 million, and adjusted EPS increased 14.3% to $0.40, while reported EPS was $0.09, down from $0.25, due to one-time charges.

• Project Apollo and other transformation initiatives delivered significant cost savings and operational efficiencies.

• $22 million of stock was repurchased during the quarter, with $28 million remaining under the current program.

Financial highlights

• Quarterly net sales were $344.8 million (down $11.3 million YoY); gross profit was $99.3 million (up $3.6 million YoY); operating income was $1.8 million, down from $6.0 million YoY.

• Adjusted operating income was $9.6 million, up from $8.9 million last year.

• Net earnings were $1.7 million, a 70.1% decrease year-over-year; diluted EPS was $0.09, down from $0.25.

• Selling and marketing expenses increased to $30.1 million (8.7% of sales); distribution expenses rose to 12.1% of sales.

• Cash and cash equivalents at quarter-end were $59.7 million; $181 million borrowing capacity.

Outlook and guidance

• Project Apollo is expected to generate at least $20 million in run-rate operating income by end of fiscal 2026, with full cost savings from plant closures and supply chain optimization by Q4.

• Anticipates continued planned volume reductions in Q3 (3.5%) and Q4 (2.5%), with Q3 environment expected to mirror Q2.

• Monitoring fuel costs closely; potential $3.5 million distribution headwind in the second half if prices persist.

• Inflation, tariffs, and consumer sentiment remain key risks to future performance.