ADM delivered a sharp year-on-year increase in third-quarter earnings and raised its full-year adjusted EPS guidance, helped by stronger North American biofuels conditions. The company also cut its projected 2026 capital spending range, while warning that policy, trade and market factors remain fluid.
- GAAP EPS of US$1.70 and adjusted EPS of US$1.77
- Total segment operating profit up 64% to US$1.382 billion
- Full-year adjusted EPS guidance raised to approximately US$5.50-US$5.80
- Ag Services and Oilseeds operating profit more than doubled
- 2026 capital expenditure forecast reduced to US$1.2-US$1.3 billion
Biofuels turned into a powerful earnings lever for Archer-Daniels-Midland Company (NYSE:ADM) in the third quarter, helping the agricultural processor more than double its GAAP earnings before income taxes to US$997 million. ADM raised its full-year adjusted EPS guidance to approximately US$5.50-US$5.80, up from US$5.15-US$5.60, after reporting adjusted EPS of US$1.77 for the quarter.
Biofuels margins drive the earnings upgrade
Total segment operating profit, a non-GAAP measure, rose 64% year on year to US$1.382 billion. Reported net earnings attributable to ADM reached US$821 million, compared with US$108 million a year earlier, while GAAP diluted EPS increased to US$1.70 from US$0.22. Adjusted net earnings were US$858 million, compared with US$448 million in the prior-year quarter.
The largest contribution came from Ag Services and Oilseeds, where segment operating profit climbed 105% to US$778 million. Crushing profit rose to US$311 million from US$13 million, supported by what ADM described as a constructive North American biofuels margin environment, higher domestic demand following the Renewable Volume Obligation policy finalised in March, higher global energy prices and a 1.6% increase in global crush production volumes.
Carbohydrate Solutions adds a second earnings engine
Carbohydrate Solutions operating profit increased 40% to US$470 million. Strong ethanol margins, policy incentives and higher domestic demand helped Starches and Sweeteners and Vantage Corn Processors, although liquid sweetener margins and volumes remained soft. Vantage Corn Processors generated US$146 million, up from US$43 million in the same quarter last year.
Nutrition was comparatively subdued, with operating profit edging 3% higher to US$134 million. Animal Nutrition rose 21% amid operational improvements and portfolio actions, but Human Nutrition fell 3% as unplanned downtime, input-cost inflation and softness in Biotics outweighed progress in Flavors and the recovery of the Decatur East plant.
Guidance rises while capital spending falls
ADM now expects full-year 2026 adjusted EPS of approximately US$5.50-US$5.80, reflecting expected year-on-year operating profit improvement in all segments during the fourth quarter. The company has not provided a quantitative reconciliation to forecast GAAP EPS, citing uncertainty around potential impairments, restructuring charges, acquisition-related expenses and legal, regulatory and tax matters.
The capital spending forecast was lowered to US$1.2-US$1.3 billion from US$1.3-US$1.5 billion, which ADM said reflected its prioritisation of high-return investments. Cash flow from operating activities was US$1.788 billion in the first nine months, down from US$5.765 billion a year earlier, although the company’s non-GAAP cash flow measure before working capital was US$3.0 billion. The difference highlights the impact of a US$1.225 billion working-capital outflow during the period.
There are also limits to how cleanly the quarter can be read as a recurring run-rate. Ag Services and Oilseeds included approximately US$35 million of net positive mark-to-market and timing impacts, including about US$45 million in Refined Products and Other. ADM says those gains are tied to market-factor changes and are realised when underlying contracts and inventories settle. The next test is whether biofuels margins and policy support can carry the fourth-quarter improvement assumed in the upgraded guidance, particularly as ADM continues to monitor energy prices, trade conditions and changes in government programmes.
Bottom Line?
The guidance upgrade is substantial, but the durability of biofuels margins and the conversion of earnings into operating cash remain the key tests for ADM’s 2026 outlook.
Questions in the middle?
- How much of the raised adjusted EPS range depends on biofuels policy support and favourable energy prices?
- Can North American crushing margins remain strong as global commodity flows and Brazilian policy conditions change?
- Will the reduced capital expenditure plan improve cash generation without slowing ADM’s highest-return investments?