TreeHouse Foods Q3 Earnings Miss Estimates, Sales Rise Y/Y

TreeHouse Foods, Inc. (THS) reported third-quarter 2025 results, wherein both top and bottom lines missed the Zacks Consensus Estimate. While net sales increased, earnings decreased from the year-ago period’s actuals.TreeHouse Foods announced that it has entered into a definitive agreement to be acquired by Investindustrial for $2.9 billion. In connection with the pending transaction, the company has withdrawn all financial guidance.TreeHouse Foods’ Quarterly Performance: Key InsightsTreeHouse Foods posted adjusted earnings of 43 cents per share, missing the Zacks Consensus Estimate, which was pegged at 53 cents. The adjusted earnings decreased from 74 cents per share reported in the year-ago quarter.TreeHouse Foods, Inc. Price, Consensus and EPS Surprise TreeHouse Foods, Inc. price-consensus-eps-surprise-chart | TreeHouse Foods, Inc. QuoteNet sales of $840.3 million rose 0.1% year over year, driven by favorable pricing actions to recover commodity inflation, the acquisition of a private-brand tea business and distribution gains. These benefits were partially offset by volume and mix declines reflecting broader macroeconomic consumption trends, distribution losses, planned margin management actions and the exit from the ready-to-drink business. Adjusted net sales were $841.9 million, down 1.5% from the prior year, which missed the consensus estimate of $852 million.In the third quarter, volume/mix had a negative impact of 8.6%, partially offset by a 4.3% contribution from a recent business acquisition. Pricing actions added 6.5%, while the business exit resulted in a 0.7% decline. Product recall returns contributed a 1.7% increase and unfavorable foreign currency reduced net sales by 0.1%.THS’ Margin & Cost DetailsTreeHouse Foods’ gross profit as a percentage of net sales rose 3.2 percentage points to 18.8% in the third quarter of 2025. This improvement was primarily driven by $17.5 million in insurance recoveries related to voluntary product recalls, supply-chain cost-saving initiatives and favorable margins from the Harris Tea acquisition. These gains were partially offset by unfavorable fixed-cost absorption resulting from softer consumption trends.Total operating expenses reached $412 million, up from $99.4 million in the third quarter of 2024, an increase of $312.6 million. The increase was primarily caused by a non-cash goodwill impairment loss of $289.7 million, higher restructuring costs mainly related to severance and professional fees, increased operating expenses associated with the Harris Tea acquisition and elevated employee incentive compensation. These increases were partially offset by cost reduction initiatives implemented in 2025.Adjusted EBITDA decreased to $91.6 million, down from $102.5 million in the same period of 2024. The decline was primarily caused by unfavorable volume and mix impacts resulting from planned margin management actions and broader macroeconomic consumption trends. These factors were partially offset by supply-chain savings initiatives, the accretive contribution from the Harris Tea acquisition and ongoing cost reduction efforts.TreeHouse Foods’ Financial Health SnapshotThis Zacks Rank #5 (Strong Sell) company concluded the quarter with cash and cash equivalents of $21 million, long-term debt of $1,486.1 million and total shareholders’ equity of $1,262.5 million. In the nine months ended Sept. 30, 2025, the company’s net cash used in operating activities was $62.5 million.TreeHouse Foods' stock has gained 28.1% in the past three months against the industry’s 8% decline.Image Source: Zacks Investment ResearchTop-Ranked StocksUnited Natural Foods, Inc. (UNFI) distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. At present, United Natural sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The consensus estimate for United Natural’s current fiscal-year sales and earnings implies growth of 1% and 167.6%, respectively, from the year-ago figures. UNFI delivered a trailing four-quarter earnings surprise of 416.2%, on average.Lamb Weston Holdings, Inc. (LW) engages in the production, distribution and marketing of frozen potato products in the United States, Canada, Mexico and internationally. It sports a Zacks Rank #1 at present. Lamb Weston delivered a trailing four-quarter earnings surprise of 16%, on average. The Zacks Consensus Estimate for Lamb Weston's current fiscal-year sales indicates growth of 1.3% from the prior-year levels.The Chefs' Warehouse, Inc. (CHEF) distributes specialty food and center-of-the-plate products in the United States, the Middle East and Canada. It currently carries a Zacks Rank of 1. CHEF delivered a trailing four-quarter earnings surprise of 14.7%, on average.The Zacks Consensus Estimate for The Chefs' Warehouse’s current fiscal-year sales and earnings indicates growth of 8.1% and 29.3%, respectively, from the prior-year levels.Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. Little-known AI firms tackling the world's biggest problems may be more lucrative in the coming months and years.See "2nd Wave" AI stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report United Natural Foods, Inc. (UNFI): Free Stock Analysis Report TreeHouse Foods, Inc. (THS): Free Stock Analysis Report The Chefs' Warehouse, Inc. (CHEF): Free Stock Analysis Report Lamb Weston (LW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks