Hershey (HSY) is anticipated to report a 4.3% year-over-year revenue increase to $3.12 billion for its upcoming third-quarter earnings, driven by transformation initiatives, pricing actions, and the Advancing Agility & Automation (AAA) program. However, profitability is expected to decline significantly, with EPS projected at $1.08, a 53.9% decrease, due to record-high cocoa prices, tariffs, and heightened brand investments, which are forecast to contract adjusted gross margin by 60 basis points. Despite these margin pressures, the Zacks model, leveraging HSY's Zacks Rank #3 and a +0.19% Earnings ESP, predicts an earnings beat for the quarter.
Hershey (HSY) is anticipated to report Q3 2025 revenues of $3.12 billion, a 4.3% year-over-year increase, fueled by strategic transformation initiatives, ERP platform efficiencies, and recent pricing actions across its U.S. confection portfolio. Despite this top-line growth, the consensus EPS estimate of $1.08 reflects a significant 53.9% decrease from the prior year, though Zacks' model predicts an earnings beat for the quarter. This prediction is based on HSY's positive Earnings ESP of +0.19% and a Zacks Rank #3, aligning with its 8.5% average trailing four-quarter earnings surprise. Profitability remains a key concern, with record-high cocoa prices, tariffs, and heightened brand investments expected to pressure margins. The adjusted gross margin, which contracted sharply in Q2, is projected to further deteriorate by 60 basis points to 35.3% in Q3. These cost headwinds are the primary drivers behind the substantial year-over-year decline in earnings per share, offsetting gains from operational improvements and pricing power.
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