Shares of Flowers Foods Inc. (NYSE: FLO) fell 4.6% in extended trading after the bakery operator reported weaker-than-expected second-quarter results and lowered its full-year guidance.
The Thomasville, Georgia-based company posted adjusted earnings per share of $0.21 for Q2, missing the $0.24 consensus estimate by $0.03. Revenue declined 4.0% year-over-year to $1.19 billion, below the $1.24 billion estimate. The revenue decline was driven by a 5.8% drop in volume, which outweighed a 1.8% favorable price/mix effect.
Branded retail net sales decreased 3.8% to $794.6 million, reflecting a 7.6% volume decline partially offset by a 3.8% pricing/mix improvement. Adjusted EBITDA fell 19.2% to $111.3 million, equating to 9.3% of net sales—a 180-basis point decline from the prior year. Management cited a challenging consumer environment, elevated marketing costs, and higher labor and freight expenses as key headwinds, though lower interest expenses and moderating ingredient costs provided partial relief.
For fiscal 2026, Flowers Foods revised its adjusted EPS guidance to a range of $0.75 to $0.85, with a midpoint of $0.80, trailing the $0.83 consensus. Revenue guidance was lowered to $5.07 billion to $5.142 billion, with a midpoint of $5.106 billion compared to the $5.167 billion estimate.
CEO Ryals McMullian attributed the results to "continued challenges across the fresh packaged bread category," including macroeconomic pressures, shifting consumer behavior, and sustained competitive activity.
