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Nov 24, 2024
Lamb Weston Q2 2025 Earnings Report
Reported financial results below expectations due to higher manufacturing costs and softer volumes, while price/mix and operating expenses aligned with targets.
Key Takeaways
Lamb Weston's Q2 2025 results were below expectations with net sales declining 8% to $1,601 million and a net loss of $36 million. Adjusted EPS declined 54% to $0.66. The company updated its full-year financial targets for fiscal 2025, reflecting a challenging operating environment and reduced financial targets.
Net sales declined 8% to $1,601 million, and net loss was $36 million, a decrease of $251 million.
Adjusted Income from Operations declined 41% to $178 million.
Adjusted Diluted EPS declined 54% to $0.66.
The company updated its fiscal 2025 outlook with reduced targets for net sales, GAAP net income, Diluted EPS, and Adjusted EBITDA.
Lamb Weston
Lamb Weston
Lamb Weston Revenue by Segment
Lamb Weston Revenue by Geographic Location
Revenue by Segment
North America Revenue
CapyFin.comInternational Revenue
CapyFin.comRevenue by Geographic Location
North America Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
The Company updated its financial targets for fiscal 2025, reducing its annual net sales target range to $6.35 billion to $6.45 billion and Adjusted EBITDA target range to $1,170 million to $1,210 million.
Positive Outlook
- Company expects net sales growth of approximately 1 percent to 4 percent versus the prior year period in the second half of fiscal 2025, driven by higher volume.
- Company expects to be at the top of the range for its Adjusted SG&A(1) target range of $680 million to $690 million.
- Company estimates depreciation and amortization expense of approximately $375 million.
- Company expects cash used for capital expenditures, excluding acquisitions, if any, of approximately $750 million.
- Board of Directors declared a quarterly dividend of $0.37 per share of Lamb Weston common stock, a $0.01 increase.
Challenges Ahead
- Company reduced its annual net sales target range to $6.35 billion to $6.45 billion, from a previous range of $6.6 billion to $6.8 billion.
- Company reduced its target ranges for GAAP net income to $330 million to $350 million and Diluted EPS to $2.30 to $2.45.
- Company reduced its Adjusted EBITDA(1) target range to $1,170 million to $1,210 million from a previous target of approximately $1,380 million.
- Company reduced its Adjusted Net Income(1) target range to $440 million to $460 million, and Adjusted Diluted EPS(1) to $3.05 to $3.20.
- Company's effective tax rate(3) (full year) estimate of approximately 28 percent, excluding the impact of comparability items, which is an increase from the Company's previous estimate of approximately 25 percent.
Revenue & Expenses
Visualization of income flow from segment revenue to net income