Pilgrim's Pride Corporation

What they do

Pilgrim's Pride produces, processes, markets, and distributes fresh, frozen, and value-added chicken and pork products to retailers, distributors, and foodservice operators. It is vertically integrated, controlling nearly every phase of production, and operates 39 processing plants, 28 prepared foods cook plants, and 5 pet food plants globally. The company's three reportable segments are U.S., Europe, and Mexico, serving over 120 countries.

Revenue drivers

• U.S. fresh products — Largest segment, with fresh products accounting for 80.9% of 2025 U.S. product sales, including chicken sold to foodservice and retail customers such as Chick-fil-A, Kroger, and Costco.
• Europe prepared foods — Prepared foods products, including sausages, bacon, and ready-to-cook meats, represented 58.6% of 2025 Europe product sales, sold to chains like McDonald's, Sainsbury's, and Tesco.
• Mexico fresh products — Fresh products, including live chicken, made up 83.2% of 2025 Mexico product sales, with retail customers such as Wal-Mart in Mexico.
• U.S. prepared foods — Prepared foods products accounted for 12.0% of 2025 U.S. sales, including Just Bare brand, which saw retail sales grow over 30% in Q2 2026.

Recent performance

For the second quarter ended June 28, 2026, Pilgrim's reported net sales of $4.63 billion, down 2.8% year-over-year, and GAAP EPS of $0.06, down from $1.49. Adjusted EBITDA was $360.0 million, a 47.6% decline, with margins of 8.7% in the U.S., 7.6% in Europe, and 3.9% in Mexico. The decline was driven by lower commodity market pricing for jumbo chicken, with cutout values falling more than 25% from the prior year, partially offset by improvements in productivity and live operations. For fiscal 2025, the company reported net income of $1.1 billion, or $4.54 per diluted share, on revenue of $18.50 billion, with consolidated operating margins of 8.7%.

Strategy

Management is investing in plant upgrades and capacity expansion to increase internal supply capabilities and support key customer growth, including a new prepared foods facility in Walker County, Georgia, and investments in Ellijay, Georgia, to increase deboning in the small bird category. The company is focused on improving operational efficiency, reducing volatility, and growing its value-added prepared foods portfolio, highlighted by strong performance of the Just Bare brand. Pilgrim's also plans to continue ramping up live operations in Mexico's Southern Peninsula. The company aims to maintain a net leverage ratio below its 2x-3x target, currently at 1.43x Adjusted EBITDA, to support growth opportunities.

Risks

• Commodity price volatility — Fluctuations in feed ingredient prices (corn, soybean meal, wheat) and chicken/pork market prices can materially affect earnings due to industry cyclicality.
• Supply-demand imbalance — In the second quarter of 2026, chicken supply growth rose faster than demand, pressuring commodity pricing and profitability, as seen in the jumbo cutout market decline.
• Global inflationary and FX pressures — Inflation in the U.S., U.K., Europe, and Mexico, along with currency movements (weakening peso), can impact costs and international operations.
• Trade policy and tariffs — Changes to tariffs and trade policies could impact export sales and international operations, although U.S. export sales are less than 3% of total net sales.

Outlook

Management expects chicken demand to remain firm across all regions as affordability continues to resonate with consumers, but supply growth may continue to outpace demand, pressuring commodity prices. The company anticipates that ongoing investments in plant upgrades, prepared foods capacity, and operational improvements will mitigate downside risks and support margin recovery. Management does not foresee material impacts from trade policy changes but will continue to monitor and take mitigation actions. Guidance for 2026 net leverage remains below target, supporting growth plans.