Mission Produce earnings: record Q3 revenue, pricing to ease as volumes rise
- Hardik Shah
- Sep 9
- 4 min read
TLDR
Revenue Strength: Q3 revenue up 10% to $357.7M, driven by +10% avocado volume with only a –5% price headwind.
Margin Trends: Gross profit up 22% to $45.1M (gross margin 12.6%, +120 bps), led by International Farming yields.
Forward Outlook: Q4 industry volumes ~+15% YoY; pricing expected –20% to –25% YoY vs. $1.90/lb in Q4’24; FY25 capex $50–55M.
Business Overview
Mission Produce is a vertically integrated supplier of fresh Hass avocados, mangos, and blueberries, combining owned farming in Peru/Guatemala with global sourcing, ripening, packing and distribution across North America, Europe (including the U.K.), China and Asia. It operates five state-of-the-art packing facilities and forward distribution centers that provide ripening, bagging, custom pack and logistics services to retail, wholesale and foodservice customers in 25+ countries.
CEO Steve Barnard emphasized Mission’s ability to “deliver strong performance no matter what the market throws at us,” attributing consistency to vertical integration and global programming.
Mission Produce Earnings (Fiscal Q3 2025, ended July 31)
Revenue: $357.7M (+10% reported). Drivers: +10% avocado volume; –5% average price. (Company did not disclose “organic” metrics for the quarter.)
Gross Profit / Margin: $45.1M (+22%); 12.6% margin (+120 bps YoY), led by higher yields on owned Peruvian orchards.
Operating Income: $21.0M vs. $16.8M.
Net Income: $14.7M; EPS (diluted) $0.21 vs. $0.17.
Adjusted Net Income: $18.2M; Adj. EPS $0.26.
Adjusted EBITDA: $32.6M (+3%).
Segment detail
Marketing & Distribution: Sales $344.1M (+7%). Adj. EBITDA $20.0M (down vs. $26.8M on normalization from last year’s unusually high per-unit margins).
International Farming: Sales $49.0M (+79%); Adj. EBITDA $12.1M (+163%) on higher owned-farm yields and third-party services.
Blueberries: Sales $4.5M (+181%); Adj. EBITDA ~$0.5M. (Seasonality centered in FQ4/FQ1.)
Volume & price mix (avocados): 183.5M lbs sold (+10%), $1.74/lb (–$0.10 YoY).
CFO Bryan Giles noted the company expects ~$10M annualized direct tariff impact—“less than 1% of total cost of goods”—and maintained competitive positioning despite the headwind.
Forward Guidance
Industry avocado volumes expected ~+15% YoY in FQ4 on plentiful Peru supply and a larger Mexican crop.
Pricing expected –20–25% YoY vs. Q4’24 average $1.90/lb, reflecting increased availability.
Peru owned-crop exports: 105–110M lbs for the season; ~48M lbs sold through by Q3 end.
Blueberries: Volume ramp in FQ4; revenue benefit tempered by lower ASPs.
FY25 Capex: $50–55M (unchanged).
Risks & Opportunities
Risks: Pricing pressure from higher industry volumes; FX; incremental tariff costs; weather variability; labor/SG&A seasonality.
Opportunities: Improved Mexican packhouse capacity for peak season; continued European penetration; Asia customer wins; owned-farm yield recovery.
Operational Performance
Global execution: Commercial team “in the right place at the right time with the right price,” optimizing sourcing across Peru/Mexico and programming with retail.
Europe: +37% sales YoY; U.K. facility gaining utilization and customer penetration.
Mexico: Packhouse enhancements slated for the incoming season to increase throughput and network efficiency.
Diversification: Mango programs leveraging Mission’s avocado playbook (pricing commitments, supply consistency, packaging); blueberry acreage rising to 700+ hectares with a glide path toward ~1,000 hectares across FY26–FY28.
President/COO John Pawlowski highlighted Mission’s global platform, saying performance came from “decades of strategic investments” and differentiated category tools that elevate customers’ programs.
Market Insights
Retail dynamics: Retailers value year-round programming and price/promotional planning amid rising availability; Mission’s vertical model supports category consistency.
Pricing backdrop: Expectation of lower prices near term as the market absorbs higher Peru/Mexico volume; management sees disciplined execution sustaining margins within historical ranges.
Consumer Behavior & Sentiment
Higher availability and improved supply consistency should support consumption; Mission continues to pursue strategic contracts with large retailers in the U.S., U.K./Europe and Asia to meet demand reliably and cost-effectively.
Strategic Initiatives
Vertical integration & programming: Continued use of “owned Peruvian production” to balance global demand and stabilize category supply.
International expansion: U.K./Europe as an anchor for incremental growth; upgraded Asia team and new partnerships.
Operations & Productivity: Mexico packhouse upgrades; working-capital focus as Peru crop sells through in H2.
Capital Allocation
Cash & Liquidity: Cash $43.7M; net debt/Adj. EBITDA ~1x (management commentary).
Capex: $39.8M YTD focused on Latin America farming, Guatemala packhouse build, and Peru blueberries; FY25 plan $50–55M.
Buybacks: $5.5M of shares repurchased and retired YTD.
Debt reduction: Ongoing priority given leverage flexibility and free-cash-flow trajectory as investments moderate through FY26.
The Bottom Line
Mission posted record Q3 revenue with stronger gross margins and solid cash generation as owned-farm yields recovered. Near term, expect higher volumes and lower pricing, but management’s vertical integration, improved Mexico capacity, and expanding European/Asian channels aim to preserve consistency and share gains. Watch (1) Q4 pricing elasticity vs. volume, (2) tariff pass-through and cost discipline (currently <1% of COGS), and (3) execution on international retail programs as capex rolls off and free cash flow builds.
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