tapebrief
ADM · Q4 2025
Preliminary brief— based on press release only. Full analysis including management tone and Q&A will be added when the transcript is available.

ADM · Q1 2026 Earnings

Archer Daniels Midland

Reported May 5, 2026

30-second summary

30-second take: ADM raised FY2026 adjusted EPS guidance to $4.15–$4.70 from $3.60–$4.25 — a $0.55 midpoint lift (+14%) — after Q1 adjusted EPS of $0.71 and a faster-than-expected crush margin response to finalized 2026/2027 RVOs. Management's own words ("more violence than we expected") capture the inflection: the policy catalyst that was a contingent option on the Q4 call is now the operating reality, with North American March crush rates running 10% above last year and the 45Z full-year benefit revised to $150M from $100M. The high end of the prior range has effectively become the new low end; conviction has shifted from "highly predicated on policy" to actively raising estimates.

Headline numbers

EPS

Q1 FY2026

$0.71

Revenue

Q1 FY2026

$20.49B

+1.6% YoY

Gross margin

Q1 FY2026

6.0%

Operating margin

Q1 FY2026

1.9%

Key financials

Q1 FY2026
MetricQ1 FY2026YoYQ4 FY2025QoQ
Revenue$20.49B+1.6%$18.56B+10.4%
EPS$0.71—$0.87-18.4%
Gross margin6.0%—6.5%-53bps
Operating margin1.9%———

Guidance

ADM raised full-year 2026 adjusted EPS guidance by $0.45–$0.55 per share, citing RVO policy clarity and expected crushing/ethanol margin improvement.

Guidance is issued for both next quarter and the full year. Both may appear below.

Changes to prior guidance

MetricPeriodPrior guideNew guideΔResult
Adjusted EPS
FY2026
$3.60 to $4.25$4.15 to $4.70+$0.55 to +$0.45 at low/high end; midpoint +$0.55 (from $3.925 to $4.425)Raised

Reaffirmed unchanged this quarter: Capital expenditures ($1.3 to $1.5 billion)

Segment performance

Q1 FY2026
SegmentQ1 FY2026YoY
Ag Services and Oilseeds$16.001B+2.1%
Carbohydrate Solutions$2.559B-0.5%
Nutrition$1.805B-0.7%
Ag Services and Oilseeds Operating Profit$273M—
Carbohydrate Solutions Operating Profit$356M—
Nutrition Operating Profit$135M—

Platform metrics

Q1 FY2026
SegmentQ1 FY2026
Oilseeds Processed Volumes9,299K metric tons
Corn Processed Volumes4,542K metric tons

Profitability

Q1 FY2026
SegmentQ1 FY2026
Total Segment Operating Profit$764M
Adjusted ROIC6.4%
Adjusted EBITDA$812M

Management tone

Q1 2025: Policy tailwinds coming → Q2 2025: H2 recovery loaded into Q4 → Q3 2025: Recovery deferred to 2026 → Q4 2025: 2026 guided, hinged on policy → Q1 2026: Policy landed, raising estimates

The recovery thesis has progressed from "coming" to "guided" to "happening faster than modeled" — a complete inversion of the Q3 2025 narrative collapse. Three quarters ago management withdrew the $60–70/mt soybean crush anchor and admitted it was "difficult to predict the timing" of structural biofuel demand recovery. Two quarters ago they refused to quantify FY2026 crush margin assumptions at all. This quarter management volunteered: "Probably it happened with more violence than we expected. It was faster." That sentence, more than the guidance raise itself, is the tone shift — management was not just cautious, they were behind their own thesis.

The 45Z benefit has moved from estimate to delivering ahead of plan. On the Q4 call management estimated the full-year 45Z benefit at ~$100M and called out pending OMB clearance as the unknown. This quarter the number is $150M — a 50% upward revision in 90 days. From the call: "I think we mentioned last time it was going to be $100 million. Now we're saying it's $150 million...given what happened in the Q1, we are increasing the expected amount." This answers the Q4 watch item affirmatively and signals carbon intensity economics at ADM's plants are tracking better than the conservative estimate.

Decatur East has shifted from "ongoing recovery challenge" to "operating at full volume." Two quarters ago management described Decatur as "returning to plant utilization rate." Last quarter the segment showed $78M of full-year operating profit, distorted by insurance roll-offs. This quarter Nutrition operating profit of $135M in a single quarter exceeds half the prior full-year run rate, with management stating: "we finally brought the Decatur East plant back. That product has always been loaded as the best quality in the industry, and now we are back with our full volume and recovering the position we lost." The Q2 2025 thesis ($100M annualized bridge from Decatur) is now visible in the segment economics.

Biodiesel and renewable diesel have shifted from secondary opportunity to active demand driver reshaping crush dynamics. A year ago RD was framed as policy-contingent optionality with margins squeezed by pretreatment overhang. This quarter management described biodiesel/RD plants actively coming online and pulling soybean oil demand, expanding crush margin in real time. The 2.4B-gallon ethanol export figure is incremental color, but the structural point is that the demand stack management has been waiting on for "a couple of years" has materialized in a single policy event.

The hedging that remains is targeted, not pervasive. Management still flags China soybean buying normalization as an assumption and notes external monitoring of consumer trends, energy costs, and tariff conditions — but these read as residual risk callouts rather than thesis-undermining caveats. The dominant register is constructive: "we are increasingly constructive on our outlook for 2026...The policy clarity we now have, combined with our team's disciplined execution, position us well to deliver meaningful growth in 2026."

Recurring themes management leaned on this quarter:

RVO policy clarity enabling near-term margin expansion in crushing and ethanolDecatur East plant recovery driving human nutrition profitability leverage45Z tax credit monetization accelerating faster than modeledEthanol export demand surge (2.4B gallons expected) from global biofuel policy tailwindsFive-platform growth strategy (advanced nutrition, functional health, biosolutions, precision fermentation, decarbonization)Disciplined cost reduction and AI-driven operational efficiency initiatives

Risks management surfaced:

Inverted yield curve reflecting economic uncertainty and consumer behavior headwindsSweeteners and starches volumes down 3% with margin compression continuing from 2025 trendsEnergy and chemical input cost inflation impacting corn wet milling operationsChina soybean purchasing normalization assumption; tariff and trade dynamics remain fluidForeign exchange volatility and global supply chain dislocations

Answers to last quarter's watch list

Whether EPA finalizes the RVO before the Q1 print. Yes — finalization of the 2026 and 2027 renewable volume obligations was the explicit driver cited for the guidance raise. The high end of the prior range was not just reachable but has been exceeded by the new low end.
Resolved positively
Whether Q1 adjusted EPS lands above ~$0.75. No — Q1 came in at $0.71, roughly $0.04 below the implied floor. Management reconciled the miss to $275M of net negative mark-to-market, the majority of which is forecasted to reverse in Q2. The fact that FY guidance was raised on a soft Q1 print is the more important data point. Status: Resolved negatively (on the print), but offset by the FY raise
Whether management quantifies the 45Z benefit beyond the ~$100M estimate. Yes — full-year 45Z benefit revised to $150M from $100M, with management citing Q1 results as the basis for the upward revision.
Resolved positively
Carbohydrate Solutions segment operating profit run-rate vs. the FY2025 base of $299M. Q1 segment operating profit of $356M is already 19% above the entire FY2025 base in a single quarter, driven by ethanol margins flowing from RVO clarity. The "relatively flat" framing from Q4 has been decisively broken to the upside.
Resolved positively
Nutrition segment operating profit recovery off the $78M FY2025 base. Q1 segment operating profit of $135M is 73% above the FY2025 quarterly run rate, with Decatur East cited explicitly as the driver. The "specialty ingredients recovery" management referenced last quarter is now visible in dollars.
Resolved positively
Board crush vs. cash margin conversion. Management's "more violence than we expected" framing confirms cash margins are tracking board crush — North American March crush rates ran ~10% above last year, with crush rates jumping 6% in March alone. The conversion concern from Q4 has dissolved.
Resolved positively
10-K material weakness sign-off. Not addressed on this print; management did not volunteer governance status.
Continue monitoring

What to watch into next quarter

Whether the $275M Q1 mark-to-market reversal lands in Q2 as forecasted. Management said "the majority" reverses in Q2; if a material portion slips to H2 or doesn't fully reverse, the FY raise becomes harder to defend at the midpoint.

Whether Q2 adjusted EPS lands above ~$1.10 (rough quarter share consistent with the new $4.15 low end given Q1 actuals and the M2M reversal). A miss against this would suggest the raise was front-loaded with policy optimism rather than supported by run-rate economics.

Whether crush margins sustain the Q1 step-up or normalize as new biodiesel/RD capacity comes online. Management framed plant additions as expanding crush demand, but new capacity also competes for feedstock — the Q2 print is the first chance to see whether the margin expansion is durable or front-loaded.

Whether the China soybean buying assumption holds. The guide explicitly assumes China resumes "a normalized buying pattern." A breakdown in trade dynamics would compress AS&O run-rate even with the policy tailwind intact.

Nutrition Q2 operating profit relative to the $135M Q1 base. With Decatur East fully online, the question shifts from recovery to sustained margin — sequential maintenance at or above $135M would confirm the segment has structurally re-rated.

Carbohydrate Solutions ethanol margin trajectory as the 2.4B-gallon export demand expectation plays out across the year. Q1's $356M segment profit is the test case for whether structural S&S weakness can be more than offset by ethanol.

10-K material weakness sign-off. Governance gate remains open from prior quarters; auditor validation overdue relative to management's earlier framing.

Sources

  1. ADM Q1 2026 press release (Form 8-K Exhibit 99.1), filed 2026-05-05 — https://www.sec.gov/Archives/edgar/data/7084/000000708426000021/adm-ex991_20260331xq1.htm
  2. ADM Q1 2026 earnings call transcript (management prepared remarks)
  3. ADM Q4 2025 brief (tapebrief, 2026-02-03)
  4. ADM Q3 2025 brief (tapebrief, 2025-11-04)
  5. ADM Q2 2025 brief (tapebrief, 2025-08-05)

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