Hershey planning ‘action-packed’ second half of 2026

HERSHEY, PA. — New product launches like Hershey crème-filled bars and Reese’s Pieces with chocolate cookie, coordinated promotions behind Halloween and football season, and attention generated for the upcoming film Hershey – a biopic about company founder Milton Hershey’s early years – are expected to increase Hershey Co.’s sales and consumer awareness throughout the rest of the year, the company said.  

“It’s a pretty action-packed back half given the innovation launches,” said Steve Voskuil, Hershey’s senior vice president and chief financial officer.  

The company expects a 30% year-over-year increase in brand investment to support growth in both 2026 and 2027, and a 30% increase in innovation versus the first half.

“Our product pipeline and improved core item availability positions us to accelerate demand creation in the second half,” said Kirk Tanner, president and chief executive officer, Hershey. “This includes large, national-scale launches such as Hershey’s crème-filled bars, and strong visibility into seasonal and tentpole programs with customers including Halloween and the Hershey movie.

“You’ll also see programming around Cadbury, Payday and Fulfil. We like the investments we’re making, and they’re tied to driving the growth and keeping the momentum going.”

Tanner added that “While some upcoming periods will face challenging year-over-year comparisons, we are confident these actions position us to grow on top of last year’s strong second-half performance in total.”

One of the challenging year-over-year comparisons is lapping last year’s launch of the successful Oreo/Reese’s collaboration.

“We, of course, encounter tougher comps in the second half, led by the Reese’s Oreo innovation that we had last year,” Tanner said. “That is still performing very well. But it was a very big success that we’re overlapping.”

Cocoa supply

Tanner also commented on weather event El Niño’s impact on cocoa markets, and how that might affect the company’s bottom line this year and next.

“El Niño speculation is certainly impacting pricing today and lately, but we do not expect cocoa to remain at current levels long term for a few reasons,” Tanner said. “If you remember the ‘23/’24 cycle, this is very different from that. One, we’re coming off historic surpluses. Inventories are healthier. Supply is more diversified and the industry is much more agile. The recent ‘26 and ‘27 West African crop data is, I’d say, encouraging after a slow start. So even if some of the origins are impacted by El Niño, we believe the market is already pricing it in. There is plenty of cocoa supply globally.”

Recent acquisition Lesser Evil added 22 points to Hershey’s Salty Snacks segment net sales during the second quarter. 

| Photo: ©JAMMER GENE – STOCK.ADOBE.COM

Second quarter results

For its second quarter ended June 28, Hershey saw net income rise to $457.7 million, equal to $2.32 per share on the common stock, up from $62.7 million and 32¢ a year ago. Net sales for the second quarter were $2.78 billion, compared to $2.61 billion last year.

In the company’s North American operating segments, Confectionery net sales were $2.17 billion, a 4.2% increase over $2.08 billion during the prior second quarter. Segment income for Confectionery was $705 million, a 40% rise over $503 million last year. Hershey’s nutrition bar brands – which include One and Fulfil – saw sales rise 12% during the quarter.  

The company said results in Confectionery were slightly ahead of expectations, and included a $9 million tariff refund.

North America Salty Snacks – which includes the brands Dot’s Pretzels, Skinny Pop, Lesser Evil, Pirate’s Booty and Reese’s Filled Pretzels – saw a 23% increase in net sales, with $388 million compared to $315 million last year. This included a 22-point boost from the acquisition of Lesser Evil last year, which was finalized in November.

Segment income however, fell 5.9% to $62.5 million compared to $66.4 million during the previous second quarter. The company said increased freight and logistics costs and production issues hindered the segment’s profitability.  

“Performance was below our expectations due to supply challenges on multipacks and Dot’s Pretzels in the second quarter,” Tanner said. “We’ve had some growing pains in keeping up with strong demand, particularly the Dot’s business, and that is largely behind us. We saw this coming and we’d already increased our investment in automation and capacity, with capacity coming online in 2027. Automation will start helping us right now.”

Voskuil added, “Obviously operating margin came in a bit below expectations due to those supply chain challenges. As a result of that, we had to use more spot freight usage, a little bit higher logistics costs, and some limited volume throughput versus what we had planned. Looking ahead, we expect to see some margin improvement in the second half as we move to capture demand and also optimize the supply chain while still having a little bit of a tail of elevated freight and logistics costs.”

The issue of SNAP waivers and their impact on Hershey’s sales was addressed during the earnings call, particularly how they affected the company on a state-by-state basis during the second quarter.

Hershey’s nutrition bar brands – which include One and Fulfil – saw sales rise 12% during the second quarter.  

| Photo: ©JAMMER GENE – STOCK.ADOBE.COM

“The SNAP waivers versus the outlook, I’d say it’s slightly better,” Tanner said. “I thought we did a really good job planning for the impact of SNAP and we’ve been very close to it. Where the difference comes in is the early adopting states had a little bit higher of an impact than the recent states, notably Texas and Florida – they’ve been on the lower end.

“The balance of that has been where we’ve seen a little bit of upside. But overall, I would say it’s in line with what we planned. And for me running this business, it feels like that’s the right approach, being able to understand the macro and plan for it accordingly. And so that gives us the confidence moving forward that we can have a good eye on these macro impacts.”

Second-half forecast  

Hershey updated its outlook for the rest of 2026 based on positive second quarter earnings, and said the forecast does not include potential future tariff rebates.

Prior guidance for net sales growth was upgraded from between 4% and 5% to 4.5% and 5%, which reflects an approximately 150 basis point benefit from the acquisition of Lesser Evil, while reported earnings per share growth was raised from between 79% and 89% to 82% and 89%.  

“We enter the second half with momentum, compelling growth plans, and increased investment behind our brands, merchandising and innovation,” Tanner said. “With cost visibility and operating flexibility, we are well positioned to navigate dynamic markets and deliver on our full-year financial commitments.”