Shares in McCormick & Company (NYSE:MKC) fell nearly 5% on Thursday after the spices and seasonings group reported fourth-quarter earnings that came in just below expectations, despite delivering slightly stronger-than-forecast revenue.
McCormick posted adjusted earnings per share of $0.86 for the quarter, narrowly missing the consensus estimate of $0.87. Revenue reached $1.85 billion, edging past the $1.84 billion analysts had expected and marking a 2.9% increase from a year earlier. Organic sales rose 2.1%, supported by a combination of higher volumes and pricing.
Growth was led by the Consumer segment, where sales increased 3.9%, while the Flavor Solutions division recorded a 1.4% rise. However, margin pressure weighed on investor sentiment, with gross margin contracting by 130 basis points year on year to 38.9%. The company attributed the decline mainly to higher commodity costs, tariffs and increased investment in production capacity.
“McCormick’s performance in 2025 demonstrated the strength and resilience of our business. We achieved differentiated, volume-led organic growth and share gains powered by continued investment in our brands, expanded distribution, and innovation across our portfolio,” said Brendan M. Foley, Chairman, President and Chief Executive Officer.
Looking ahead to fiscal 2026, McCormick forecast adjusted earnings per share in the range of $3.05 to $3.13, above the analyst consensus of $3.02. The company expects reported net sales growth of 13% to 17%, including an 11% to 13% contribution from its recent acquisition of a controlling stake in McCormick de Mexico.
The outlook reflects continued investment in priority categories to support volume growth, while also factoring in ongoing pressures from global trade policies and inflation. On an organic basis, the company projects sales growth of 1% to 3% for the year.
“While global trade dynamics continue to create headwinds and we are facing elevated costs for the year, we are leveraging our competitive advantages, productivity initiatives, and cost management discipline to help mitigate these pressures,” Foley added.