Darling Ingredients Inc Earnings
Darling Ingredients Inc (NYSE:DAR) has released its financial results for the third quarter of 2025, showcasing impressive earnings growth and strategic developments despite some challenges. The company reported a net income of $19.4 million, or $0.12 per GAAP diluted share, for Q3 2025. This demonstrates a year-over-year increase from the third quarter’s net income of $16.9 million, or $0.11 per diluted share, in 2024. The financial results for this quarter are in line with the company's robust operational performance and strategic objectives.
Darling Ingredients Inc Results
Below is a detailed presentation of Darling Ingredients Inc's key financial metrics, reflecting both its year-over-year and quarter-over-quarter performance:
| Financial Metric | Q3 2025 | Q3 2024 | Y-o-Y Change |
|---|---|---|---|
| Net Income | $19.4 million | $16.9 million | +14.8% |
| Earnings Per Share (EPS) | $0.12 | $0.11 | +9.1% |
| Total Net Sales | $1.6 billion | $1.4 billion | +14.3% |
| Combined Adjusted EBITDA | $244.9 million | $236.7 million | +3.5% |
For the first nine months of 2025, Darling Ingredients reported net sales of $4.4 billion, a slight increase over the $4.3 billion reported in the same period in 2024. However, net income for this period dropped to $5.9 million, or $0.04 per diluted share, versus $177.0 million, or $1.10 per diluted share, the previous year. The primary factor contributing to the reduced net income was lower earnings from Diamond Green Diesel (DGD).
Revenue Breakdown
The following table provides a breakdown of revenue performance across Darling Ingredients' key segments:
| Segment | Revenue (Q3 2025) | Revenue (Q3 2024) | Segment Performance |
|---|---|---|---|
| Core Ingredients Business | Not provided | Not provided | Strong momentum due to solid fundamentals |
| Diamond Green Diesel (DGD) | Negative EBITDA impacted overall performance |
Analysis: The core ingredients business continues to show strong momentum, posited by CEO Randall C. Stuewe as being driven by "strong fundamentals." However, the segment of Diamond Green Diesel (DGD) experienced weaker financial performance, with a negative EBITDA per gallon. Specifically, DGD sold 250 million gallons of renewable fuel in Q3 2025, resulting in a negative ($0.02) EBITDA per gallon when accounting for production tax credit adjustments. The challenges experienced in the renewable fuel segment underscore the complex landscape that Darling Ingredients navigates.
Key Developments
Significant developments in Q3 include Darling Ingredients' agreement to sell $125 million of production tax credits, expected to be received in the fourth quarter. This move reflects the company’s opportunistic approach to capitalize on available tax credits and strengthen liquidity amidst fluctuating market conditions. Furthermore, Darling Ingredients anticipates selling an additional $125-175 million in PTC credits by the end of 2025.
Comments from Company Officers
Randall C. Stuewe, Chairman and CEO, emphasized the company's momentum in core ingredients, stating: "Our core ingredients business continues to build momentum, driven by strong fundamentals across all segments. We are on the heels of public policy developments that we expect to play out in our favor — reinforcing our unmatched position in the industry and our focus on delivering long-term value to shareholders."
Dividends and Share Repurchases
Currently, there are no updates regarding dividends or share repurchase programs in the reported quarter. The company's strategic financial decisions, such as selling tax credits, indicate a focus on strengthening liquidity and financial flexibility, which could inform future decisions related to shareholder returns.
Darling Ingredients Inc Stock Forecast
Based on the financial performance and strategic business developments discussed, Darling Ingredients Inc holds a cautiously optimistic outlook. The company’s robust position in its core ingredients business, combined with its proactive financial measures, suggest potential growth in stock value. However, challenges within the renewable fuel segment warrant mindful consideration.
Stock Price Projections: - High Projection: Assumed continued strength in core business segments, public policy favoring renewable energy, and successful execution of tax credit sales could foresee stock prices increasing to approximately $2.20 per share. - Low Projection: Considering current challenges in DGD and market volatility, the stock price might stabilize around $1.60 per share, reflecting the need for successful mitigation of operational challenges.
In conclusion, Darling Ingredients Inc's strategic focus on core segments and financial agility positions it favorably for long-term shareholder value creation. The company's commitment to leadership in renewable fuels and sustainable practices continues to bolster its market position. However, investors should remain vigilant about the evolving landscape of public policies and market dynamics influencing the renewable energy sector.
