The Hershey Company (NYSE:HSY) shares are trading lower on Thursday. The confectionery giant delivered a sweet quarter, but rising cost pressures left a bitter aftertaste for investors.
Strong brand momentum and snack demand weren't enough to fully calm concerns around margins and pricing strain.
Quarterly Details
The company reported first-quarter adjusted earnings per share of $2.35, beating the analyst consensus estimate of $2.04.
Quarterly sales of $3.104 billion (an increase of 10.6% year over year) outpaced the Street view of $3.028 billion. Organic net sales, on a constant currency basis, increased 7.9%.
Hershey's North America Confectionery segment net sales were $2.489 billion in the first quarter of 2026, an increase of 8.3% versus the same period last year.
Volume declined approximately 4 points, reflecting price elasticity and one fewer shipping day, partially offset by the timing of Q2 shipments and strong innovation performance.
North America Salty Snacks segment net sales were $350.1 million in the first quarter of 2026, an increase of 26.0%
"Hershey's and Reese's are key drivers, delivering first quarter non-seasonal retail sales lifts of 11% and 10%, respectively," said CEO Kirk Tanner.
The chocolate maker said volume in the quarter under review declined approximately 2 points, reflecting elasticity impacts in both the North America Confectionery and International segments.
Quarterly adjusted gross margin was 40.4%, a decrease of 80 basis points compared to the first quarter of 2025. This decrease reflects higher commodity and tariff-related costs during the first quarter of 2026.
Adjusted operating profit of $686.5 million increased 12.9% versus the first quarter of 2025. Adjusted operating profit margin of 22.1% increased 40 basis points.
Dividend
Hershey announced quarterly dividends of $1.452 on the Common Stock and $1.320 on the Class B Common Stock. The dividends were declared on April 29, 2026, and are payable on June 15.
Outlook
Hershey narrowed its FY2026 GAAP EPS guidance to $7.77–$8.19 from $7.77–$8.20, compared with the $8.08 estimate.
It reaffirmed its FY2026 adjusted EPS guidance of $8.20–$8.52 versus the $8.44 estimate and maintained its sales outlook of $12.159 billion–$12.277 billion compared with the $12.247 billion estimate.
HSY Price Action: Hershey shares were down 1.95% at $185.47 at the time of publication on Thursday, according to Benzinga Pro data.
Photo via Shutterstock
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