Hershey Q3 Beat; Raises 2025 Outlook Amid Costs

Hershey beat third-quarter expectations, reporting net sales of $3.18 billion (up 6.5% year‑over‑year) and adjusted EPS of $1.30, a roughly 44% decline from a year earlier. Adjusted gross margin fell about 850 basis points to 31.8% and adjusted operating margin declined roughly 860 basis points to about 13%, driven mainly by higher commodity and tariff costs and an unfavorable sales mix that offset pricing, supply‑chain productivity and transformation savings. Management raised 2025 net‑sales guidance to about 3% and slightly increased the lower end of its adjusted profit range, citing strong demand for healthier and zero‑sugar innovations and double‑digit volume growth in North America Salty Snacks (volumes +11%) even as core North America Confectionery volumes slipped 1%. Operating performance was helped by pricing and transformation program savings, but selling, marketing and administrative costs rose (driven by incentive compensation and consulting) while advertising spending fell about 5%. Market reaction was muted‑positive, with shares up premarket, and commentators noted broader consumer shifts — including potential GLP‑1 impacts — weighing on confectionery stocks.