MDLZ earnings analysis
What we found in MDLZ's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Mondelēz delivered Q2 revenue of $9.355 billion, up 4.1% YoY, and GAAP EPS of $1.20, up from $0.49, but the reported earnings expansion was heavily influenced by a $827 million derivative mark-to-market gain. Core profitability softened, with adjusted operating income down 4.8% and adjusted operating margin down 120 basis points to 13.1%, as input costs and SG&A more than offset pricing. Latin America and AMEA drove sales growth, while Europe posted declining revenue and a 25.7% segment-profit decline; liquidity remained solid with $1.322 billion of first-half operating cash flow.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue grew 4.1% YoY despite Q/Q decline
- Q2 net revenue increased $371 million, or 4.1% YoY, to $9.355 billion; Organic Net Revenue rose 2.2% to $9.172 billion. Sequentially, revenue declined from $10.080 billion in Q1 2026.
- GAAP profit and EPS surged on derivative swing
- GAAP operating income rose $774 million, or 66.0%, to $1.946 billion and operating margin expanded to 20.8% from 13.0%. GAAP diluted EPS increased $0.71 to $1.20 from $0.49, aided primarily by a $827 million mark-to-market derivative gain versus a $93 million loss a year earlier.
- Latin America and AMEA drove growth
- Latin America led regional growth, with revenue up $180 million, or 15.1%, to $1.374 billion, while AMEA revenue rose $150 million, or 8.2%, to $1.971 billion. AMEA volume/mix contributed 5.2 percentage points to growth.
- Cash generation remained substantial
- Operating cash flow was $1.322 billion for the first six months of 2026, down from $1.400 billion a year earlier. Management expects 2026 capital expenditures of up to $1.4 billion, primarily for manufacturing modernization, new-product capacity and productivity initiatives.
- Leverage ratio held steady despite higher debt
- Total debt was $21.5 billion at June 30, 2026, versus $21.2 billion at December 31, 2025, while the debt-to-capitalization ratio held at 0.45. The company had $2.9 billion remaining under its $4.0 billion long-term financing authorization.
- Dividend increased and buyback capacity remains
- Shareholder returns continued: dividends paid were $1.287 billion in the first half, and the July 28 quarterly dividend declaration increased 4% to $0.52 per share. The company also retained approximately $6.5 billion of repurchase authorization at June 30.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Underlying margin contracted
- Underlying profitability weakened despite the GAAP earnings surge: adjusted operating income declined $61 million, or 4.8%, to $1.222 billion, and adjusted operating margin fell to 13.1% from 14.3%. Higher SG&A expense reduced constant-currency adjusted operating income by $182 million.
- Europe volumes and profit deteriorated
- Europe was the principal operating drag: Q2 revenue declined $35 million, or 1.0%, to $3.377 billion and segment operating income fell $132 million, or 25.7%, to $382 million. Management attributed the pressure to chocolate volume declines and pricing elasticity.
- ERP transformation adds multi-year cost burden
- ERP program expense was $59 million in Q2, up from $37 million a year ago; total Board-approved funding is $1.2 billion, with completion expected by year-end 2028. The filing says a majority of program spending is expected to be operating expense.
- Commodity hedges delay cocoa-cost relief
- Management expects cocoa prices to remain elevated relative to historical levels in the near and medium term, while existing hedges delayed benefits from lower market cocoa prices. Higher input costs reduced Q2 constant-currency adjusted operating income by $56 million.
- Tariff exposure and refund uncertainty persist
- Trade-policy uncertainty remains material: the company paid approximately $20 million of IEEPA tariffs and had received about $6 million of refunds by June 30, 2026, with further refund timing and amount uncertain. Management states additional tariff actions could significantly hurt revenue and cost of goods sold.
- No formal risk-factor updates; conflict exposure remains
- Item 1A states there were no material changes to risk factors disclosed in the 2025 Form 10-K. Nonetheless, Russia represented 3.8% and Ukraine 0.4% of Q2 consolidated revenue, leaving operations exposed to continuing conflict disruption.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.2
- Operating margin
- 20.8%
- Segment
- Latin America revenue: $1.374 billion (+15.1% YoY); segment operating income: $166 million (+24.8%).
- Segment
- AMEA revenue: $1.971 billion (+8.2% YoY); segment operating income: $254 million (-6.3%).
- Segment
- Europe revenue: $3.377 billion (-1.0% YoY); segment operating income: $382 million (-25.7%).
- Segment
- North America revenue: $2.633 billion (+3.0% YoY); segment operating income: $431 million (-5.1%).
What they said about what is next.
The 10-Q provides no quantitative revenue or EPS outlook. Management expects 2026 capital expenditures of up to $1.4 billion and expects ERP implementation completion by year-end 2028.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 28, 2026
- Mondelez reported Q1 2026 net revenues of $10,080 million, up $767 million (+8.2% YoY) driven by pricing and favorable currency; Organic Net Revenue rose 3.0% to $9,581 million. Reported diluted EPS was $0.44 (up 41.9%…
- 10-K · February 4, 2026
- Mondelēz reports global net revenues of $38.5 billion and net earnings of $2.5 billion in 2025 and emphasizes a sharpened strategy focused on chocolate, biscuits & baked snacks with four strategic priorities…
- 10-Q · April 29, 2025
- Mondelēz reported Q1 2025 net revenue of $9,313 million, essentially flat versus Q1 2024 ($9,290 million) but down versus the prior quarter (Q4 2024 $9.6B). Gross margin and operating margin compressed materially —…
- 10-K · February 5, 2025
- Mondelēz reported full-year net revenues of $36.4 billion and net earnings of $4.6 billion in 2024 and reiterates a strategy to accelerate growth by prioritizing chocolate, biscuits and baked snacks while pursuing…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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