J & J Snack Foods Corp. reported financial results for the first quarter ended December 27, 2025.

J & J Snack Foods Corp. (Nasdaq: JJSF) today reported financial results for the first quarter ended December 27, 2025.

"Our first quarter results reflect disciplined execution of our key priorities to drive profitability," said Dan Fachner, J&J Snack Foods Chairman, President, and CEO. "We are pleased to deliver 7% year-over-year growth in adjusted EBITDA and a 200 basis point expansion in gross margin despite a 5.2% decline in sales and a $1 million expense for product disposal. Our results were enabled by our Project Apollo initiatives including strategic portfolio rationalization of lower margin products within our bakery business."

"We remain optimistic about our trajectory and have several exciting commercial initiatives underway. The momentum in our pretzel business from the second half of fiscal 2025 continued in the first quarter. We have several innovative product launches that will reach customers in the second quarter, including Dippin' Dots products for retail, as well as pretzel and frozen novelty products centered around better-for-you attributes. Project Apollo, our business transformation program, is progressing and we are on track to deliver the $20 million of annualized savings we outlined last quarter. Underscoring our confidence in the future and our focus on driving long-term value, we repurchased $42 million of stock during the first quarter and today are announcing a new $50 million repurchase authorization."

First Quarter Results

Net sales decreased 5.2% from the prior year quarter to $343.8 million, with most of the decline attributable to our bakery business and strategic portfolio rationalization efforts.

Food Service segment net sales decreased 8.3%

Retail Supermarket segment net sales increased 2.6%

Frozen Beverage segment net sales were approximately flat

 

Gross profit increased from $93.9 million in the prior year quarter to $96.0 million, while gross margin improved from 25.9% to 27.9%. The improvement in gross margin primarily reflects the early benefits of our Apollo transformation initiatives and favorable product mix, partially offset by $1.0 million in product disposal costs and approximately $0.6 million in tariff-related costs net of pricing offsets.

Total operating expenses of $95.4 million included $6.1 million in non-recurring plant closure costs as well as other non-recurring impacts.

Selling and Marketing expenses increased 9.9% to $31.5 million, or 9.2% of sales, up from 7.9% in the prior year quarter. Approximately 140 basis points of the increase was associated with higher commissions for retail vending sales, which is a growing component of our Dippin' Dots business. Investments to support our brands in preparation for our peak summer season accounted for approximately 250 basis points of the increase. Higher depreciation associated with customer equipment accounted for approximately 190 basis points of the increase, with almost half of that associated with growth in Dippin' Dots.

Distribution expenses decreased 3.9% to $38.1 million, or 11.1% of sales up from 10.9% in the prior year quarter, primarily reflecting lower volume.

Administrative expenses increased 7.8% to $20.4 million, or 5.9% of sales, up from 5.2% in the prior year quarter. Approximately 300 basis points of the increase was attributed to non-recurring restructuring and legal expenses. 

 

Operating income was $0.6 million, compared to $6.2 million in the prior year quarter, while adjusted operating income was $8.0 million, compared to $8.2 million in the prior year quarter. Earnings per diluted share were $0.05, compared to $0.26 in the prior year quarter, while adjusted earnings per diluted share were $0.33, flat with the prior year quarter. The effective tax rate was 27.0%, compared to 27.2% in the prior year quarter.

Food Service Segment

Net sales of $219.2 million, a year-over-year decrease of $19.7 million, or 8.3%. 

Bakery was down approximately 17% and accounted for $18 million of the decline in Food Service, reflecting ongoing efforts to improve profitability through portfolio rationalization.

Pretzel sales increased approximately 6.9%, continuing the growth momentum from the second half of fiscal 2025, with share gains driven by Bavarian formula pretzels.

Handheld sales declined approximately 22% on lower volumes and a contractual pricing true-up on lower costs of certain ingredients.

Operating income increased 14.6% to $10.1 million.

 

Retail Supermarket Segment

Net sales of $45.9 million, a year-over-year increase of $1.2 million, or 2.6%.

Handheld sales increased 35% as we lapped capacity constraints from the prior year facility fire.

Sales within the remaining retail portfolio decreased $0.6 million, primarily driven by lower frozen novelty sales as growth in Dogsters and Dippin' Dots at retail was more than offset by decreases in other frozen novelties.

Operating income decreased 2.6% to $1.2 million.

 

Frozen Beverages Segment

Net sales of $78.7 million were approximately flat with the prior year period.

Beverage sales were up modestly, whereas service and machine sales combined were down modestly.

Operating income decreased 13.7% to $4.0 million.

 

Share Repurchases

During the quarter, we repurchased approximately 458,467 shares of common stock for $42 million, completing our $50 million authorization. Including shares bought in fiscal 2025, we repurchased 525,243 shares for $50 million.

Our Board of Directors has approved a new $50 million share repurchase authorization that is effective for approximately two years. The new authorization reflects our confidence in the company's long-term value, as well as our strong balance sheet and liquidity position. Our approach to share repurchases will be opportunistic, and the extent of our repurchases and the timing will depend on market conditions, regulatory requirements and other factors. We may repurchase shares in the open market, through private transactions, or otherwise, including through Rule 10b5-1 trading plans. The authorization is consistent with our capital deployment discipline and focus on driving shareholder returns.

Conference Call

J&J Snack Foods Corp. will host a conference call to discuss results and business outlook on February 3, 2026, at 10:00 a.m. Eastern Time. 

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