Smithfield Foods has lowered its full-year sales and profit forecasts as inflation-weary shoppers cut back on pork and it grapples with higher input costs.

The US meat producer now expects sales for its 2026 financial year to be broadly flat against 2025, having previously forecast low-single-digit growth.

Smithfield also cut its adjusted operating profit guidance to between $1.23bn and $1.38bn, down from its previous forecast of $1.33bn to $1.48bn, as cautious consumer spending and elevated costs continue to weigh on the business.

Chief executive Shane Smith said shoppers were buying less pork and fewer hams as persistent inflation continued to squeeze household budgets, prompting consumers to become more selective about what they put in their baskets.

Smithfield posted sales of $3.7bn for its second quarter to 28 June, down 2.3 per cent year on year. The business said the decline also reflected non-recurring sales to its hog production joint ventures in the previous year and the earlier timing of Easter in 2026.

Despite the sales fall, operating profit climbed 11.6 per cent to $290m, while adjusted operating profit edged higher to a record second-quarter level of $300m.

Net income attributable to Smithfield rose 26.6 per cent to $238m, while adjusted earnings came in at 62 cents per share, ahead of the 55 cents reported in the same period last year.

However, pressure was evident across several of its core meat divisions.

Sales in its packaged meats business, which includes bacon, sausages and ham, fell 2.7 per cent to $2.02bn, while fresh pork sales dropped 3.5 per cent to $2.01bn. Hog production sales declined 8.2 per cent to $772m.

The company has also seen consumers shift their spending as household finances remain stretched. Smithfield said retail demand for fresh pork had softened, while foodservice demand has proved more resilient as restaurants use pork as an alternative to increasingly expensive beef.

Smithfield president and chief executive Shane Smith said: “While our updated outlook reflects ongoing macroeconomic pressures, these external factors do not change our strategic priorities or our confidence in the business.”

The food giant said it would continue focusing on operational efficiencies and investment behind its brands as it navigates the tougher consumer backdrop.

The revised outlook includes a particularly steep reduction for Smithfield’s hog production arm, where adjusted operating profit is now expected to reach between $75m and $125m, compared with its previous $150m to $200m forecast.

Its packaged meats adjusted operating profit guidance was trimmed to $1.08bn to $1.15bn, while fresh pork is now expected to deliver between $180m and $240m.

The downgrade comes despite Smithfield delivering record adjusted operating profit of $638m across the first half, up 2.3 per cent year on year, while first-half net income attributable to the group jumped 17.6 per cent to $484m.

Smithfield said its balance sheet remained strong, with $3.65bn of available liquidity at the end of June, giving it flexibility to continue investing in its business despite the more challenging grocery environment.

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