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McCormick is trading lower despite delivering another solid quarterly performance in Q3 (Aug), marking its second consecutive EPS beat after a Q1 miss. Revenue rose 2.7% yr/yr to $1.72 bln, in line with expectations, driven largely by volume growth in the Consumer segment.

• Consumer segment sales rose 4% (+3% organic) to $973 mln, led by strong US volume gains, expanded Frank's RedHot promotions, new packaging, and innovation in mustard.
• Flavor Solutions segment grew 1% yr/yr (+1% organic) to $752 mln, overcoming softness in large CPG and foodservice customers with QSR growth in the Americas and Asia Pacific.
• MKC reaffirmed FY25 revenue guidance at +1-3% in constant currency, but lowered FY25 EPS guidance, citing rising commodity costs and incremental tariffs.
• Gross margin remained under pressure, especially from increased costs in the lower-margin FS segment.

Macro & Market Commentary: McCormick flagged continued macro challenges, particularly for low to mid-income consumers adjusting their buying habits — more frequent trips, fewer items per basket, and a focus on value. While cooking at home remains a tailwind, competitive pressure (notably in the US Mexican flavor category) and inflationary cost pressures loom large into FY26.

Briefing.com Analyst Insight:

Q3 results were encouraging, but the downward EPS guidance casts a shadow. Investors appear focused on the softer Q4 outlook and signs that headwinds will persist into next year. With a pressured margin profile and tough comps ahead, MKC may stay rangebound despite execution in its core Consumer business.