Mission Produce Q4 Earnings Call Highlights

Mission Produce (NASDAQ:AVO) executives highlighted record full-year revenue, improved cash generation, and a planned CEO transition during the company’s fiscal fourth-quarter 2025 earnings call. Management also discussed the impact of lower avocado pricing on quarterly results, continued international expansion—particularly in Europe—and a stepped-down capital spending outlook as the company exits a heavy investment cycle.

Leadership transition set for April annual meeting

CEO Steve Barnard opened the call by addressing a succession plan that has been in development for several years. Barnard said that, effective at the company’s annual meeting in April, President and Chief Operating Officer John Pawlowski will become Chief Executive Officer, while Barnard will transition to Executive Chairman of the Board.

Barnard said the timing reflects “two consecutive years of exceptional financial performance,” the completion of a major capital investment cycle, and a balance sheet positioned for future opportunities. In the Q&A, Pawlowski indicated the transition is expected to be “steady as she goes,” noting he and Barnard have worked closely on direction and that management is focused on accelerating growth and evaluating capital deployment, including organic and potential inorganic opportunities.

Fiscal 2025 marked by record revenue and volume growth

Pawlowski described fiscal 2025 as a “defining year,” led by record revenue of $1.39 billion, up 13% from fiscal 2024. He said the company delivered 7% volume growth for the year and achieved a record $691 million of avocados sold through the Marketing & Distribution business. Pawlowski also said the fourth quarter produced record adjusted EBITDA and capped a two-year period with more than $180 million of operating cash flow.

Management repeatedly emphasized the company’s ability to shift supply across geographies and channels. Pawlowski said the commercial team managed Peruvian season supply shifts “seamlessly” across U.S. and European operations, contributing to revenue growth of over 60% in the United Kingdom during 2025 and a 40% increase in European volume sold. He added that Europe and Asia delivered strong volume growth in the quarter and full year, aided by consistent Peruvian supply that supported retailer programs in growth markets.

Quarterly results: lower pricing offset by higher volumes

Chief Financial Officer Bryan Giles reported fourth-quarter revenue of $319 million, down 10% from the prior year, which he said had been elevated by higher avocado prices. The company experienced a 27% decline in average per-unit avocado sales prices, which “masked” 13% volume growth in the quarter. Giles attributed the pricing and volume dynamics to higher industry supply, including greater availability of Mexican fruit from a larger crop and higher Peruvian production tied to improved weather conditions.

Gross profit was $55.7 million, essentially flat year over year, while gross margin increased 180 basis points to 17.5%. Giles said the margin percentage improvement was primarily driven by lower per-unit avocado pricing and noted that Marketing & Distribution profitability is managed on a per-unit basis, which can create margin percentage volatility when sales prices fluctuate.

SG&A expense increased $0.5 million, or 2%, largely due to higher operating costs including performance-based stock compensation, partially offset by lower statutory profit-sharing expense in Peru and Mexico. Adjusted net income was $22.2 million ($0.31 per diluted share) versus $19.6 million ($0.28 per diluted share) a year earlier. Giles also cited a 15% reduction in interest expense and a 55% increase in equity method income to $1.7 million, driven by results at joint venture investment Henry Avocado Corporation.

Adjusted EBITDA increased 12% to a quarterly record $41.4 million, reflecting increased production in International Farming and higher volume in Marketing & Distribution, according to Giles.

Segment performance: distribution growth and farming recovery

• Marketing & Distribution: Net sales decreased 15% to $271.9 million due to pricing. Segment adjusted EBITDA increased 11% to $28.3 million, which management attributed to higher avocado and mango volumes and “solid management of per-unit margins,” despite a difficult comparison against prior-year margins that exceeded historical averages.
• International Farming (avocados): Segment sales increased 97% to $59.7 million, and segment adjusted EBITDA more than tripled to $8.4 million. Giles said Peruvian orchard yields recovered, resulting in owned production sales more than three times the prior year. Lower selling prices were offset by lower per-unit production costs from higher yields. Management also cited better utilization of facilities from providing packing and cooling services to third parties.
• Blueberries: Net sales increased 16% to $36.5 million on higher volumes from expanded acreage, but segment adjusted EBITDA declined to $4.7 million from $8.6 million due to lower per-unit margin and higher unit costs tied to lower anticipated yields per hectare during the 2025–2026 harvest season. Giles said this reflects normal maturation on newer acreage, with expectations for improvement over time.

Pawlowski also discussed mango progress, saying the company grew market share to 5.2%, up roughly 150 basis points for the year. He added that household penetration in mangoes is approaching 40%, up from 35% three years ago, and said the strategy focuses on building the domestic market through innovation, consumer engagement, and customer programming.

Cash flow, capital spending outlook, and near-term market conditions

Giles said cash and cash equivalents were $64.8 million as of October 31, 2025. Full-year operating cash flow was $88.6 million, bringing the two-year total to more than $180 million. The company reduced long-term debt by approximately $18 million during fiscal 2025, contributing to a full-year interest expense decline of $3.2 million, or 25%. Net leverage ended the year “well below one times EBITDA,” according to Giles.

Capital expenditures were $51.4 million in fiscal 2025. For fiscal 2026, the company expects CapEx to step down to approximately $40 million. In Q&A, Giles estimated the $40 million is roughly split between maintenance and growth spending, acknowledging a “gray line” between the two categories.

Looking at the start of fiscal 2026, Giles said first-quarter avocado industry volumes are expected to increase about 10% year over year, driven by a larger Mexican crop, while pricing is expected to be about 25% lower than the $1.75 per pound average in the prior-year quarter. He also noted expected sequential margin compression consistent with seasonality. For blueberries, management expects Peru’s harvest to peak in the first quarter, with volume increases from new acreage and average sales prices expected to be flat to slightly higher, though profitability is expected to remain pressured by higher unit costs tied to lower projected yields per hectare.

During Q&A, management said mango growth in fiscal 2026 is expected to follow a similar “glide path” as 2024 and 2025, driven by share gains, expanded sourcing, and cross-selling programs with existing avocado customers. On capital allocation, Giles said the company’s priority remains growth, while noting it has repurchased shares in the past and intends to evaluate options to maximize shareholder value as cash generation improves.

About Mission Produce (NASDAQ:AVO)

Mission Produce, Inc is a leading global supplier, packer and distributor of fresh avocados, serving retail, foodservice and industrial customers. The company manages a vertically integrated supply chain that spans sourcing, post-harvest handling, packing and ripening. Through proprietary ripening technologies and cold-chain logistics, Mission Produce delivers consistent quality and extended shelf life for its avocado offerings.

Founded in 1983 and headquartered in Oxnard, California, Mission Produce grew from a regional packing operation into a publicly traded company listed on the Nasdaq under the ticker AVO.