Ingredion Inc.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 5 May 2026: press release. Guidance figures: 1 raised, 8 lowered, 5 new, 2 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Reported and adjusted EPS fell: Reported diluted EPS was $2.22 and adjusted $2.34, against $3.00 and $2.97 a year earlier. Reported operating income fell 26% to $203 million; adjusted operating income fell 22% to $212 million. Source
• Argo recovery ran longer than planned: Management said results in F&II - U.S./CAN were below its expectations, as operational problems at Argo took longer to resolve than it had anticipated. Source
• Texture & Healthful Solutions volume growth continued: T&HS net sales rose 2% to $617 million, flat excluding foreign exchange. Segment operating income was $100 million, up 1%, on favorable input costs, foreign exchange and better volume. Source
• U.S./CAN operating income fell 63%: F&II - U.S./CAN operating income was $34 million, down from $92 million, and net sales fell 9% to $475 million. Management cited production challenges at Argo along with softer volumes and mix. Source
• Operating costs rose and volumes fell: Excluding foreign exchange, reported operating income fell 28% and adjusted operating income fell 24%. Management attributed this primarily to higher operating costs and lower volumes in U.S./CAN. Source

“While we expected a challenging first quarter after last year’s strong first quarter, results were weaker than anticipated in Food & Industrial Ingredients - U.S./CAN due to operational challenges at our Argo facility,”

Jim Zallie, chairman, president and CEO

Guidance

What changed from last quarter

• Guidance lowered: Full-year EPS guidance lowered, from reported and adjusted $11.00 to $11.80 to the new reported and adjusted ranges. Source
• Guidance raised: Effective tax rate guidance raised from 25.5% to 27.0% to reported 26.3% to 27.8% and adjusted 26.0% to 27.5%. Source
• Guidance kept: All Other operating income improvement of $5 to $10 million is unchanged from the prior guidance. Source
• New: Planned cessation of the Cabo, Brazil manufacturing facility is newly disclosed, with restructuring and impairment charges expected. Source
• New: A thermal event at the Argo facility is now treated as an adjusting item, with $20 million of direct costs estimated. Source
• New: Jason Payant, vice president and interim chief financial officer, is named on the call; the February 2026 call named Jim Gray as chief financial officer. Source

First quarter results and drivers

• Reported and adjusted EPS fell: Reported diluted EPS was $2.22 and adjusted $2.34, against $3.00 and $2.97 a year earlier. Reported operating income fell 26% to $203 million; adjusted operating income fell 22% to $212 million. Source
• Net sales eased 1% overall: Net sales were $1,792 million, down 1% and down 3% excluding foreign exchange. Management attributed the decline mainly to lower volume and less favorable mix in U.S./CAN, partly offset by T&HS. Source
• Argo recovery ran longer than planned: Management said results in F&II - U.S./CAN were below its expectations, as operational problems at Argo took longer to resolve than it had anticipated. Source
• Restructuring drove the reported gap: The difference between reported and adjusted operating income came mainly from legal-entity restructuring and previously announced plant-closure costs, according to the company. Source

Segments and regions

• Texture & Healthful Solutions volume growth continued: T&HS net sales rose 2% to $617 million, flat excluding foreign exchange. Segment operating income was $100 million, up 1%, on favorable input costs, foreign exchange and better volume. Source
• LATAM profit down on Mexico currency: F&II - LATAM operating income was $115 million, down 9% (11% excluding foreign exchange), from $127 million. Net sales were $579 million, up 1%. Source
• U.S./CAN operating income fell 63%: F&II - U.S./CAN operating income was $34 million, down from $92 million, and net sales fell 9% to $475 million. Management cited production challenges at Argo along with softer volumes and mix. Source
• All Other profit improved by $3 million: All Other net sales rose 3% to $121 million, and operating income was $3 million, compared with nil a year earlier. Management credited the plant-based protein business. Source

“Excluding the impact of Argo, we are pleased with the performance and resilience of the other parts of our business, especially our Texture & Healthful Solutions segment which continues to find opportunities for growth.”

Jim Zallie, chairman, president and CEO

Costs, margins and volume

• Operating costs rose and volumes fell: Excluding foreign exchange, reported operating income fell 28% and adjusted operating income fell 24%. Management attributed this primarily to higher operating costs and lower volumes in U.S./CAN. Source
• Gross profit fell, operating expenses rose: Gross profit fell 14% to $401 million as cost of sales rose to $1,391 million. Operating expenses rose 4% to $200 million, and restructuring and impairment charges rose to $11 million. Source
• Tax rates mixed year over year: Reported effective tax rate was 25.8%, against 25.5% a year earlier. The adjusted rate was 25.1%, against 25.4%. Source

Demand and customers

• U.S./CAN customer demand softer than expected: Management said it had anticipated softer customer demand in the U.S./CAN business, and the Argo recovery then took longer than expected. Source
• Clean label demand supports texture sales: Management pointed to continued strong customer demand for its solutions portfolio, including clean label ingredients, behind T&HS volume growth. Source
• Macro uncertainty noted in two segments: Management said T&HS and LATAM performance was in line with its expectations, despite an increasingly uncertain macroeconomic environment. Source

“Our focus going forward remains on servicing our customers, delivering innovative solutions, and driving long-term value creation for our shareholders.”

Jim Zallie, chairman, president and CEO

Cash, balance sheet and shareholder returns

• Operating cash flow was $33 million: Cash provided by operating activities was $33 million, against $77 million a year earlier. Changes in other working capital absorbed $205 million. Source
• Debt and cash balances: Total debt was $1.8 billion at March 31, 2026. Cash including short-term investments was $918 million, against $1.0 billion at December 31, 2025. Source
• Dividends and buybacks in quarter: The company paid $52 million in dividends and repurchased $14 million of common stock. A $0.82 quarterly dividend was declared March 18 and paid April 21. Source
• Capital spending through March: Net capital expenditures were $110 million through March 31, 2026, against $92 million in the year-earlier period. Source

Non-GAAP measures and restructuring

• Adjusted measures forecast with more confidence: Management said it has more confidence in forecasting adjusted measures than GAAP measures, because adjustments exclude future items that are hard to predict. Source
• Restructuring costs rose year over year: Restructuring costs were $0.15 per share in Q1 2026, against $0.02 a year earlier. Impairment charges of $0.08 were recorded in Q1 2025 and none in Q1 2026. Source
• Tax items removed from adjusted EPS: The reconciliation removes tax items and other matters of $(0.13) per share in Q1 2025 and $(0.03) per share in Q1 2026. Source

Coming up, as management said on 5 May 2026

• Argo performance improves in second quarter: Management expects Argo-related performance to improve sequentially through the second quarter of 2026. Source
• Argo normal operations targeted in second half: Management is targeting a return to normal operations at the Argo facility in the second half of 2026. Source

Figures management reported

Risks management discussed

• Operational: The Argo facility recovery took longer than expected, which negatively affected first-quarter results in U.S./CAN. Source
• Demand: Management anticipated softer customer demand in the U.S./CAN business, which affected segment volume and mix. Source
• External: Mexican foreign exchange headwinds affected LATAM results on a year-over-year basis. Source
• External: Management described the macroeconomic environment as increasingly uncertain during the quarter. Source

Earlier plans management reported on

• Missed: Management expected a challenging first quarter, but U.S./CAN results came in below the anticipated level. Source
• Met: Management said LATAM delivered as expected, with disciplined execution across the region. Source
• Not stated: Management is targeting a return to normal operations at Argo in the second half of the year. Source

Other quarters

• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.