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    ADM
    Earnings call· Jun 2026(Q2 FY26)

    Archer-Daniels-Midland Q2 FY26 earnings call ADM

    Aug 4, 2026 Source

    Executive summary

    Archer-Daniels-Midland Company Q2 FY26 — Strong Biofuels Environment and Nutrition Momentum Drive Raised Full-Year EPS Guidance

    ADM delivered a strong Q2 FY26, significantly raising its full-year EPS guidance, driven by robust performance in Ag Services and Crushing amid a constructive biofuels market, coupled with strong momentum in Nutrition. The company is focused on strategic organic investments and capital allocation while navigating global geopolitical and macroeconomic uncertainties.

    Highlights

    5

    • Reported adjusted earnings per share of $1.84.

    • Total segment operating profit increased significantly to $1.5 billion compared to the prior year quarter.

    • Full-year 2026 adjusted EPS guidance raised to a range of $5.16 to $5.60, up from $4.15 to $4.70.

    • Ag Services operating profit increased 159% to $293 million.

    • Crushing operating profit increased by approximately $330 million to $363 million, with global crush volumes up close to 5%.

    Concerns

    4

    • Refined Products and Other subsegment operating profit decreased 3% to $151 million, largely due to net negative mark-to-market and timing impacts.

    • Equity earnings from Wilmar decreased 22% to $60 million.

    • Liquid sweetener volumes and margins experienced ongoing pressure, most pronounced in North America.

    • Geopolitical conflicts in the Middle East and Ukraine create global volatility and potential for increased food prices.

    Guidance & targets

    5
    CategoryTargetConfidence
    Full-year 2026 Adjusted EPS
    $5.16 to $5.60
    high materiality
    High
    Net benefit from 45 (RVO policy incentives)
    approximately $250 million
    medium materiality
    High
    Year-end Net Leverage Ratio
    approximately 2x
    medium materiality
    High
    Cost Savings Program
    $500 million to $750 million
    medium materiality
    High
    Medium-term Flavors Growth
    mid-single digit
    low materiality
    Medium

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Ag Services & Oilseeds (AS&O)
    Operating profit increased significantly, driven by strong commercial execution, strategic leveraging of global assets, and improved South American operations. Crushing benefited from a constructive biofuels margin environment and higher asset utilization. Refined Products and Other saw a slight decrease due to negative mark-to-market and timing impacts.
    Ag Services Operating Profit: $293 millionAg Services Operating Profit Growth YoY: 159%Crushing Operating Profit: $363 millionCrushing Operating Profit Increase YoY: ~$330 millionGlobal Oilseed Process Volumes Growth: ~5% YoYRefined Products and Other Operating Profit: $151 millionRefined Products and Other Operating Profit Growth YoY: -3%Wilmar Equity Earnings: $60 millionWilmar Equity Earnings Growth YoY: -22%
    		—129%—$867 million
    Carbohydrate Solutions
    Operating profit increased, primarily driven by ethanol margin strength and policy incentives. This offset ongoing pressure on liquid sweetener volumes and margins in North America. Starch demand stabilized, and corn dry milling ethanol operations benefited from stronger margins and effective risk management.
    Starches and Sweeteners Operating Profit: $326 millionStarches and Sweeteners Operating Profit Growth YoY: 7%Vantage Corn Processors Operating Profit: $85 millionVantage Corn Processors Operating Profit Increase YoY: $52 million
    		—22%—$411 million
    Nutrition
    Operating profit increased significantly, driven by growth in flavors, particularly in EMEA and Asia Pacific, and progress at the Decatur East plant. Revenue decreased, inclusive of foreign exchange gains, with Human Nutrition impacted by a contract cancellation benefit and Animal Nutrition by portfolio actions and the Aquilo's joint venture.
    Human Nutrition Operating Profit: $139 millionHuman Nutrition Operating Profit Growth YoY: 51%Human Nutrition Revenue Decrease YoY: 4% (included $55M contract cancellation benefit)Animal Nutrition Operating Profit: $33 millionAnimal Nutrition Operating Profit Growth YoY: 50%Animal Nutrition Revenue Decrease YoY: 6%
    		$1.9 billion-5%—$172 million

    Operational metrics

    13
    Trailing fourth quarter adjusted ROIC
    7.8%
    trailing four quarters

    Reported for the trailing fourth quarter.

    Carbon sequestered
    337,000up from 300,000 last quarter
    this quarter

    Reflects progress in decarbonization efforts.

    Accounts payable cost per transaction reduction
    roughly 25%
    since beginning of year

    Achieved through 'frictionless finance' initiatives.

    Net leverage ratio
    1.6x
    June 30

    Reported as of June 30.

    North America crushing lock-in
    90%
    Q3

    Percentage of crush margins locked in for Q3.

    North America crushing lock-in
    30%
    Q4

    Percentage of crush margins locked in for Q4.

    Ethanol EBITDA margins
    highersequentially and compared to prior year quarter
    this quarter

    Base ethanol EBITDA margins were higher.

    Corporate expense
    higherthan 2025
    2026

    Driven by performance-based compensation, R&D, automation, and digitization.

    Second half operating profit contribution
    more than half
    FY26

    Expected to represent more than half of total operating profit for 2026.

    Q3 vs Q4 operating profit cadence
    Q3 potentially higher than Q4
    FY26

    Largely dependent on how executed crush margins develop in Q4.

    Phase 1 crush expansion cost
    $100 million
    overall

    Estimated cost for the first phase of expansion at 4 U.S. crush facilities.

    Phase 1 crush expansion capital intensity
    1/4
    compared to greenfield

    Capital intensity for brownfield expansion is significantly lower than greenfield.

    Insurance proceeds
    $20 million
    this quarter

    Received for Decatur East and included in AS&O results.

    Industry KPIs

    2
    MetricValueDetails
    Brand platform growth20%%
    Adjusted EPS operating income$1.84USD

    Product announcements

    2
    ProductTypeDetails
    Natural colorsexpansion
    Precision fermentation platformmilestone

    Deals & partnerships

    1
    Aquilo'sFormation of a joint venture

    The formation of the Aquilo's joint venture was mentioned as a factor in the decrease of Animal Nutrition revenue.

    Capital programs

    1
    Enterprise-wide cost saving programson track$500 million to $750 million
    Start: 2025

    Benefit: Reductions in transaction costs; cost per transaction in accounts payable reduced by roughly 25%; meaningful savings in Global Technology.

    Progressing towards targeted aggregated cost savings. Examples include 'frictionless finance' in accounts payable and consolidating global technology platforms.

    Risks & headwinds

    4
    Geopolitical Conflict (Middle East & Ukraine)ongoing

    Ukraine operations not financially material for us; oil prices swing by $3 or $4 daily.

    Mitigation: Leveraging ADM's flexible global asset network; team's ability to navigate disruptions.

    Global Energy Pricesongoing

    Higher energy cost and higher packaging.

    Mitigation: Managing through the impacts.

    Weather (Potential El Nino)coming

    Threatening some crops.

    Liquid Sweetener Volumes and Marginsongoing

    Softness, most pronounced in North America.

    Mitigation: Offset by strength in ethanol margins.

    What to watch in Q3 FY26

    5

    Ag Services performance

    next quarter
    CurrentQ2 operating profit $293M (+159% YoY)
    TargetQ3 performance relative to Q2

    Why it matters

    Ag Services is a key segment, and its performance is sensitive to global trade dynamics and geopolitical events.

    I would say probably Ag Services will be slightly lower only for our own results in Q3 than it was but Q4, it will depend on some of how those exports come into the U.S. and how much can we build sorghum and core program on top of the soybean program that seems to be built in for the later part of the year.

    Q&A highlights

    7

    Are brownfield expansions at existing crush plants more cost-effective and higher ROI than greenfield projects?

    Juan Luciano confirmed that brownfield expansions have a capital intensity about 1/4 of greenfield, offering attractive returns. Phase 1 involves 4 plants, costing around $100 million, and Monish added benefits of lower manufacturing cost per unit due to higher throughput.

    “the capital intensity is about 1/4 of what we will cost to build greenfield. So certainly very attractive opportunities.”

    asked by Manav Gupta · answered by Juan Luciano

    2 min read7 chapters

    Detailed Narrative

    01

    Strong Q2 Performance & Guidance Raise

    ADM reported adjusted EPS of $1.84 and total segment operating profit of $1.5 billion for Q2 FY26, marking a significant increase year-over-year. This strong performance led the company to raise its full-year 2026 adjusted EPS guidance to a range of $5.16 to $5.60, up from the previous range of $4.15 to $4.70, reflecting confidence in continued execution and a constructive market outlook.

    02

    Ag Services & Crushing Strength

    The Ag Services segment saw operating profit surge by 159% to $293 million, driven by strategic leveraging of ADM's global asset network and improved South American operations, including the Barcarena export terminal returning to full operation. The Crushing subsegment's operating profit increased by approximately $330 million to $363 million, benefiting from a constructive biofuels margin environment, higher domestic demand, and nearly 5% global crush volume growth.

    03

    Nutrition Business Momentum

    The Nutrition segment delivered a 51% increase in operating profit to $172 million. Human Nutrition's operating profit grew 51% to $139 million, primarily fueled by strong flavors sales, particularly in EMEA and Asia Pacific, and progress at the Decatur East plant. Animal Nutrition also improved by 50% to $33 million, reflecting ongoing improvements and benefits from portfolio actions.

    04

    Strategic Organic Investments

    ADM is making purposeful organic investments to drive future growth, focusing on expanding domestic crushing and ethanol capacity at existing facilities. Four U.S. crush facilities have been identified for a Phase 1 expansion, which is expected to cost around $100 million and offers a capital intensity approximately one-fourth of greenfield projects. The company is also building precision fermentation capabilities and expanding its natural colors footprint to capitalize on market shifts.

    05

    Capital Allocation & Shareholder Returns

    The company maintained its commitment to shareholder returns, paying its 378th consecutive quarterly dividend. With a strong balance sheet, reflected by a net leverage ratio of 1.6x at June 30, and robust cash flow generation, ADM is evaluating opportunistic share repurchases later in the year, aligning with its disciplined capital allocation strategy.

    06

    Cost Savings & Operational Efficiency

    ADM remains on track to achieve its enterprise-wide cost savings target of $500 million to $750 million over a three- to five-year period, which began in 2025. Notable progress includes a roughly 25% reduction in cost per transaction in accounts payable through 'frictionless finance' initiatives and meaningful savings expected from consolidating global technology platforms.

    07

    Geopolitical & Macroeconomic Environment

    Management acknowledged the ongoing conflicts in the Middle East and Ukraine, noting their potential to create global volatility🌐, impact oil prices, and increase food prices. Despite these external challenges🌐, ADM expressed confidence in its ability to navigate disruptions through its flexible global asset network and continued focus on executing its strategic priorities.

    AI-generated summary of the company’s earnings call. Not investment advice.