10-Q · May 14, 2026
The Middleby Corporation reported strong Q1 2026 results with revenue reaching $839.9 million, up 15.0% year-over-year, and EPS of $2.16, exceeding estimates. The company also announced a significant spin-off…
Earnings analysis · 10-Q
MIDD earnings analysis
Filed August 13, 2026 · Our reading of the company's report
The latest report
Middleby delivered strong second-quarter top-line performance, with revenue up 9.9% year over year to $875.5 million and both operating segments growing. Commercial Foodservice posted 8.3% organic growth, while Food…
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Middleby delivered strong second-quarter top-line performance, with revenue up 9.9% year over year to $875.5 million and both operating segments growing. Commercial Foodservice posted 8.3% organic growth, while Food Processing benefited substantially from acquisitions, but gross and operating margins declined to 38.3% and 16.9% due to tariffs, inflation and mix. Liquidity improved from $564.6 million of Residential transaction proceeds and $419.1 million of Credit Facility repayments, although operating cash flow declined to $187.5 million and affiliate, spin-off and discontinued-operation losses create significant GAAP volatility. The overall outlook remains bullish because FY2026 guidance was raised to $2.48-$2.53 billion of revenue and $6.73-$6.89 of adjusted EPS.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
Reported figures
- Earnings per share
- $1.2
What stood out
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Revenue grew 9.9% and beat consensus
Second-quarter net sales rose $78.7 million, or 9.9%, year over year to $875.5 million, including $54.9 million of growth excluding acquisitions. Revenue exceeded the reported consensus estimate of $747.4 million by $128.1 million.
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Commercial Foodservice momentum
Commercial Foodservice sales increased $50.0 million, or 8.6%, to $630.6 million, with organic growth excluding acquisitions and foreign exchange of 8.3%. International sales increased 15.4% to $193.8 million.
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Food Processing delivered strong growth
Food Processing sales increased $28.7 million, or 13.3%, to $244.9 million. Six-month Food Processing sales were $469.3 million, up 22.2%, while six-month organic growth excluding acquisitions and foreign exchange was 11.6%.
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Adjusted earnings beat expectations
Operating income from continuing operations was 16.9% of sales versus 18.6% in the prior-year quarter, while gross margin declined to 38.3% from 39.7%. Despite the margin contraction, reported diluted GAAP EPS was $1.20 and adjusted EPS was $2.35, above the $2.13 estimate.
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Residential proceeds strengthened liquidity
Operating cash flow from continuing operations was $187.5 million in the first six months versus $229.0 million a year earlier. Investing cash flow was $544.9 million, including $564.6 million of net proceeds from the Residential Transaction, and capital expenditures were $18.6 million.
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Debt reduction improved liquidity
Total debt declined to $2.0 billion from $2.2 billion at January 3, 2026, and the company repaid $419.1 million under its Credit Facility. Management stated that capital resources are expected to remain sufficient for operations, debt service and capital expenditures.
What to watch
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Tariffs and inflation pressured margins
Gross margin fell 140 basis points year over year to 38.3%, with management citing tariffs, input-cost inflation and product mix. Commercial Foodservice margin declined to 39.3% from 40.3%, while Food Processing margin declined to 35.4% from 37.4%.
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Spin-off creates reporting volatility
The July 6, 2026 Midera spin-off will cause Food Processing to be reported as discontinued operations beginning in the third quarter, including recast prior periods. The company also recorded a $134.8 million six-month loss from discontinued operations, including a $94.9 million pretax loss on the Residential disposition.
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Affiliate losses weigh on GAAP earnings
Equity in losses of the Composition Brands affiliate was $28.9 million, including $17.0 million of preliminary purchase-accounting adjustments, $6.2 million of interest expense and $5.0 million of transaction costs. The company has elected to report the affiliate's results on a one-quarter lag.
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Working capital absorbed cash
Cash and cash equivalents declined $63.0 million to $159.2 million at July 4, 2026 from $222.2 million at January 3, 2026. Six-month operating cash flow also declined to $187.5 million from $229.0 million, partly because inventory increased $51.7 million and accounts receivable increased $32.2 million.
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Higher rates sustain financing pressure
Interest expense and deferred financing amortization increased to $26.0 million in the quarter from $20.3 million, and to $51.4 million for six months from $39.1 million, primarily due to higher interest rates. Variable-rate debt totaled $1.981 billion at July 4, 2026, including $1.666 billion maturing in 2028.
Management's outlook
The 10-Q does not provide new numeric guidance. The August 11, 2026 earnings update raised FY2026 revenue guidance to $2.48-$2.53 billion and adjusted EPS guidance to $6.73-$6.89; the post-spin outlook excludes Food Processing and Residential.
Earlier filings 1
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.