JBS profit plunges 72% as margins come under pressure - Valor International

JBS, one of the world’s largest food companies, reported a 71.8% drop in third-quarter net profit to $164 million, as weaker performance across most of its businesses squeezed margins despite a slight revenue increase, according to a statement released Monday (9). One factor was the exhaustion, around midyear, of China’s reduced-tariff beef import quota, which made sales to the country more difficult.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), calculated under U.S. generally accepted accounting principles (U.S. GAAP), fell 38.3% to $1.001 billion. Net sales rose 0.6% to $22.738 billion.

The company reported lower adjusted EBITDA across most business units, except for its U.S. beef operations, where the measure turned positive at $21 million. A year earlier, JBS had posted negative EBITDA of $46 million in that business.

The improvement was largely supported by the U.S. government’s August decision to reopen the border to imports of Mexican cattle for slaughter in the United States. The border had been closed for more than a year to contain the spread of the New World screwworm, a parasitic fly that infests livestock. Firm U.S. demand also helped sustain the result.

“JBS Beef North America accounts for one-third of our revenue. It returned to positive territory this quarter, and we’re seeing signs that the fourth quarter will be better,” JBS global CEO Gilberto Tomazoni told Valor.

“The resilience of U.S. beef demand is remarkable, even with prices so high. About 70% of consumers are unwilling to switch to another protein because of price,” said Wesley Batista Filho, head of JBS’s U.S. operations, who is set to become global CEO in 2027.

Seara reported a 6.4% increase in quarterly sales to $2.511 billion under U.S. GAAP, but adjusted EBITDA fell 2.5% to $255 million. In its statement, the company highlighted increases in both prices and volumes of fresh chicken meat exported during the quarter. Pork exports, meanwhile, remained under pressure from ample global supply.

JBS Brasil reported net revenue of $4.093 billion, down 1.6% from the third quarter of 2025. Adjusted EBITDA dropped 53.7% to $144 million. The result was mainly affected by lower export volumes to China after the country’s 2026 import quota was exhausted. Higher cattle prices also hurt profitability during the quarter.

“We resumed production for China in the second half of September. We haven’t booked the sales or shipped the products yet, but that tied up working capital. It will, however, benefit the fourth quarter,” Tomazoni said.

At Seara, third-quarter results were affected by the European Union’s suspension of Brazilian meat imports, which took effect on September 3 because Brazil had not yet provided sufficient guarantees that its production complied with EU rules prohibiting the use of certain antimicrobials to promote animal growth. The company brought forward production intended for the European market and completed shipments, meaning it recognized the associated production costs in the third quarter. At the same time, revenue from those sales is expected to be booked only in the fourth quarter, according to Tomazoni.

The Brazilian real’s recent depreciation against the dollar has helped offset rising domestic cattle prices by generating higher revenue in local currency, the CEO said. The exchange rate has also benefited Seara’s exports.

Pilgrim’s Pride, JBS’s poultry subsidiary operating in North America and Europe, had already reported in late October a 65.7% decline in third-quarter net profit to $117.6 million, reflecting increased chicken supply in the United States, which drove down prices.

JBS USA Pork posted a 15.3% drop in sales to $1.881 billion and a 57.3% decline in adjusted EBITDA to $97 million—weaker U.S. demand and increased global pork supply, which pushed average prices lower, weighed on results.

JBS Australia reported a 13.7% increase in sales to $2.494 billion, but adjusted EBITDA fell 31.9% to $155 million. As in Brazil, the decline reflected the filling of import quotas in China, South Korea, and Japan, as well as reduced shipments to the United States and higher cattle and sheep costs, the company said.