Pilgrim's Pride (PPC) Q1 2026 earnings summary

Executive summary

• Net sales for Q1 2026 reached $4.53 billion, up 1.6% year-over-year, but profitability declined sharply as adjusted EBITDA fell to $308.1 million (6.8% margin) from $533.2 million (12.0% margin) due to commodity market volatility, operational disruptions, and higher SG&A expenses, including legal settlements.

• Net income attributable to shareholders dropped to $101.5 million ($0.43 per diluted share), down 65.7% year-over-year, with EPS falling from $1.24.

• Growth investments in product mix, plant upgrades, and new facility construction progressed, causing planned downtime and higher costs but aiming to enhance margins and reduce volatility.

• U.S. Prepared Foods saw record retail volumes, with Just Bare retail sales up nearly 40% year-over-year, while Europe maintained steady sales and margins due to portfolio diversification and operational improvements.

• Mexico experienced double-digit growth in branded offerings, but margins compressed due to excess supply and increased imports.

Financial highlights

• Gross profit declined 37.7% year-over-year to $345.5 million, with gross margin at 7.6% versus 12.4% last year.

• Operating income was $162.6 million (3.6% margin), down from $404.5 million (9.1%) in Q1 2025.

• U.S. net revenues declined 3.9% to $2.64 billion; U.S. adjusted EBITDA dropped to $185.5 million from $392.5 million.

• Europe adjusted EBITDA rose 6.3% to $105.8 million; margins were 7.8% versus 8.1% last year.

• Mexico adjusted EBITDA was $16.8 million, down from $41.2 million, but improved sequentially from Q4 2025.

Outlook and guidance

• USDA expects U.S. chicken production to rise 2% in 2026, with Q2 growth forecast at 2.5% and more moderate growth in the second half.

• Full-year CapEx guidance remains $900–$950 million, with sustaining CapEx at $400 million and the remainder for growth and efficiency projects.

• Management anticipates more stable earnings as investments in efficiency and product mix mature, and expects sufficient liquidity for at least the next twelve months.

• Effective tax rate for the year is expected to be around 25%.

• Construction of the new value-added facility in Georgia remains on schedule, expected to enhance margins and sales.