Chicken producer Pilgrim’s Pride (NASDAQ: PPC) announced better-than-expected revenue in Q2 CY2025, with sales up 4.3% year on year to $4.76 billion. Its non-GAAP profit of $1.70 per share was 7.8% above analysts’ consensus estimates.

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“During the quarter, our portfolio captured market upsides from attractive market fundamentals,” said Fabio Sandri, Pilgrim’s President and CEO.

Company Overview

Offering everything from pre-marinated to frozen chicken, Pilgrim’s Pride (NASDAQ: PPC) produces, processes, and distributes chicken products to retailers and food service customers.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years.

With $18.18 billion in revenue over the past 12 months, Pilgrim's Pride is larger than most consumer staples companies and benefits from economies of scale, enabling it to gain more leverage on its fixed costs than smaller competitors. Its size also gives it negotiating leverage with distributors, allowing its products to reach more shelves. However, its scale is a double-edged sword because there are only a finite number of major retail partners, placing a ceiling on its growth. To expand meaningfully, Pilgrim's Pride likely needs to tweak its prices, innovate with new products, or enter new markets.

As you can see below, Pilgrim's Pride grew its sales at a sluggish 2.8% compounded annual growth rate over the last three years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis.

This quarter, Pilgrim's Pride reported modest year-on-year revenue growth of 4.3% but beat Wall Street’s estimates by 2.9%.

Looking ahead, sell-side analysts expect revenue to remain flat over the next 12 months, a deceleration versus the last three years. This projection doesn't excite us and suggests its products will see some demand headwinds.

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Cash Is King

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Pilgrim's Pride has shown decent cash profitability, giving it some flexibility to reinvest or return capital to investors. The company’s free cash flow margin averaged 6.1% over the last two years, slightly better than the broader consumer staples sector.

Pilgrim's Pride’s free cash flow clocked in at $334.2 million in Q2, equivalent to a 7% margin. The company’s cash profitability regressed as it was 6.4 percentage points lower than in the same quarter last year. This warrants extra attention because consumer staples companies typically produce more consistent and defensive performance.

Key Takeaways from Pilgrim's Pride’s Q2 Results

We were impressed by how significantly Pilgrim's Pride blew past analysts’ EBITDA expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. Zooming out, we think this was a solid print. The stock remained flat at $47.92 immediately following the results.

Pilgrim's Pride put up rock-solid earnings, but one quarter doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.