In a release dated January 7^th 2026 Cal-Maine Foods Inc. (CALM) announced results for the 2^nd Quarter of FY 2026 ending November 29^th 2025. This review summarizes data provided in the Company release and the concurrently filed SEC 10-Q Report.

Cal-Maine Foods exceeded the analysts’ earnings estimate of $2.08 by 2.4 percent but revenue of $770 million was 5.7 percent below consensus of $814 million.

It is noted that market conditions during Q2 2026 were less favorable compared with Q2 2025 resulting in an average Cal-Maine unit revenue of $2.01 per dozen for all eggs, compared to a corresponding price of $2.74 per dozen, a discrepancy of 26.7 percent. During Q2 The USDA daily average was down 40.8 percent, consistent with a 38 percent fall in the Southeast quotations for Large size as released by the widely used commercial price discovery system. Financial results that were below Street consensus for revenue reduced CALM price from $81.46 at the close on January 6^th by 4.5 percent to $77.50 at the close on January 7^th.

Despite acquiring further-processing enterprises, Cal-Maine still represents a bellwether for the shell egg sector as the only public-quoted company in the industry, supplying close to 20 percent of domestic shell egg consumption and encompassing all varieties. The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

Notes: $12.2 million ‘other income,’(excluding interest earned) in Q2 FY2026 compared to $10.9 million in Q2 FY2025:

           $0.2 million gain from non-controlling interest in Q2 2026 compared to $0.7million loss in Q2 FY2025.

 CALM Trailing P/E =3.0.  Beta = 0.24

52-Week Range in Share Price:  $74.74 to $126.40.   50-day Moving average of $85.78

Market close, Tuesday. Jan. 6^th  $79.00 pre-release.

Market open, Wednesday, Jan. 7^th $81.40 but down to $75.14 at noon, closing at $77.50

Shareholding distribution:-  93.0 percent of shares held by institutions; 9.8 percent insiders; 10.6 percent of float was short on December 15^th

In reviewing the CALM Q2 FY2026 report and the SEC 10-Q submission the following values represent key data for the most recent Quarter (with Q2 FY2025 and percentage differences in parentheses for comparison):-

• Conventional shell-egg sales attained $363.9 million in Q2 2026. This category of shell eggs comprised 47.2 percent of total shell egg revenue. ($616.9 million, in Q2 2025, based on 64.9 percent of revenue. Sales value for conventional shell eggs was down 41.0% reflecting lower average unit value for this category).

• Specialty shell-egg sales attained $255.7 million in Q2 2026. This category of shell eggs comprised 37.1 percent of total shell egg revenue. ($287.0 million, in Q2 2025, based on 64.6 percent of revenue. Sales value for specialty shell eggs was down 41.0% reflecting lower average unit value for this category).

• Prepared Foods sales attained $71.7 million in Q2 2026. This category comprised 9.3 percent of total revenue. ($10.4 million, in Q2 2025, based on 1.1 percent of revenue). Sales value for Prepared Foods was up 603% reflecting the contributions of JV Crepini Foods and acquired Echo Lake Foods.

• Egg Product sales attained $34.5 million in Q2 2026. This category comprised 4.5 percent of total revenue. ($30.2 million, in Q2 2026, based on 3.2 percent of revenue). Sales value for Egg Products was up 35.3% reflecting higher volume and average unit value).

• Sales to the Retail Channel attained $625.3 million in Q2 2026, comprising 81.3 percent of total revenue ($810.4 million in Q2 2025, representing 84.8%) Sales to the Food Service sector attained $125.0 million in Q2 2026, comprising 16.2 percent of total revenue ($123.9 million in Q2 2025, +14.0% reflecting sales of Prepared Foods)

• Dozen shell eggs sold (thousands): 322,586 (329,844; -2.3%)

• Average selling price of all shell eggs: $2.014 per dozen; ($2.740 per dozen;            -26.5%).
• Average selling price of specialty eggs (excluding co-pack): $2.396 cents per dozen; ($2.387 per dozen; -0.8%).

• Average selling price of conventional eggs: $1.802 cents per dozen; ($2.943 cents per dozen; -38.8%).

• Differential benefiting specialty eggs over conventional eggs: $0.567 per dozen; (-$0.056 cents per dozen.)

• Specialty eggs as a proportion of volume sold: 37.3%; (36.5%; -2.2%)

• Specialty eggs as a proportion of sales value: 44.0%; (31.7%; +38.8 %)

• Proportion of eggs sold that were produced by Cal-Maine and their contract flocks in Q2 2026: 89.9% (87.3%; +3.0%).

• Feed cost 47.7 cents per dozen (including specialty and breeder diets) (48.3 cents per dozen, down 1.2%)

The Q2-2026 10-Q report contained the following statements on pricing:-

“The majority of our conventional eggs are priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes. The majority of our specialty eggs are sold under frameworks that do not utilize market-based formulas, although we do have some customers that prefer market-based pricing for cage-free eggs. As a result, specialty egg prices typically do not fluctuate as much as conventional pricing”.

“During first quarter fiscal 2026, a higher proportion of our conventional eggs were sold on a hybrid pricing model that takes into account both our cost of production as well as wholesale market prices, instead of solely market-based pricing, in response to customer demand. We believe the hybrid pricing arrangement may help some customers better plan and manage their businesses and reinforces our role as a trusted supplier. Although hybrid pricing may reduce our profitability when egg prices are high, compared to pure market-based pricing, it could enhance our profitability when egg prices are low, and lead to reduced volatility in our financial results. A majority of our conventional eggs continue to be priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes”.

The top three customers represented 49.2 percent of sales value, with Walmart and Sam’s Club comprising 33.6 percent in FY 2025.

Presumed Q1 FY 2026 production costs for all categories of shell eggs expressed as cents per dozen (rounded) comprised:-

• Feed               47.7
• Production.    44.9¹
• Nest run.        92.6
• Packing          27.8
• Delivery.          8.1
• Marketing.       4.5
• Overhead.      12.9²      

Total.           145.9³

Notes: 1.0 Provision for pullet depreciation, is presumably included in the ‘production’ expense category

           2.0 Includes General and Administration expenses

           3.0 Divisor 322.6 million dozen sold

Cal-Maine Foods maintained a flock of 49.3 million hens on November 29^th 2025 reflecting acquisitions and growth, with 11.4 million pullets plus parent breeders representing under two percent of the total flock. 

• Effective May 31^st 2025 production capacities comprised:-

• Hens: 51.8 million on 49 farms
• Pullets:14.3 million on 37 farms.
• Packing: 22,490 cph in 50 plants.
• Hatching: 356,300 pullet chicks per week in 2 facilities.
• Parent breeders: 215,000 hens.
• Feed : 1,000 tons per hour in 30 plants.
• Egg products: 72,700 lbs. per hour. 

The following observations relate to the comparison of Q2 2026 with the corresponding Q2 2025:-

• Cal-Maine Foods was not affected by the HPAI epornitic during FY 2025 or thereafter. Management are applying appropriate biosecurity precautions as noted in the Analysts’ call.

• Comparing Q2 2026 with Q2 2025, gross profit was negatively impacted by lower unit revenue for conventional eggs but with minimal effect on specialty eggs. The average 1.2 percent higher feed cost to 47.7 cents per dozen was offset by a 7.4 percent lower cost in the ‘other farm production’ category including labor, consumables and maintenance.
• In a market characterized by low unit prices for conventional shell-eggs, the relative contribution of specialty eggs is more important to net earnings in contrast to an up-market for conventional eggs.

The Q2 press release repeated comments from the Q1 FY 2025 report noting “Significant progress on proactive steps to add production capacity and help mitigate the egg supply shortage across the country, including:

• A 2.6% increase in the average number of layer hens during Q2 2026 compared to the prior-year quarter, reflecting repopulation of flocks and both organic and expansion by acquisition.
• A 12.7% increase in the Company’s breeder flocks during Q2 FY 2026 compared to the end of the prior-year quarter.
• A 65% increase in total chicks hatched during Q2 2026 compared to the prior-year quarter.
• Continued progress on ongoing organic expansion projects that are expected to add approximately 1.1 million cage-free layer hens and 250,000 pullets and contract production of 1.2 million free-range layer hens during FY 2026.
• Added production support through the integration of recently acquired assets”

In the Q2 Cal-Maine release Sherman Miller, president and CEO, commented on the results of the 2^nd quarter of fiscal 2026. He stated, “Cal-Maine is systematically advancing a structural upgrade in the egg category from a position of strength. While the market has long viewed us as a pure commodity business, we are focused on becoming a higher-value, more stable earnings platform as consumer demand shifts toward specialty, premium, and convenient protein solutions. Our core shell-egg business provides a durable foundation, while specialty eggs, more hybrid pricing arrangements, and prepared foods are driving sales mix improvement, deeper customer engagement, and a higher earnings floor with more predictable and resilient results. This is not a pivot—it is a disciplined evolution of an essential food business into a more diversified platform with multiple growth engines and opportunity for improved long-term earnings visibility,” 

Extracts from the 10-Q provided insight into Cal-Maine pricing and marketing including:-

“Our operating results are materially impacted by market prices for eggs and feed grains (corn and soybean meal), which are highly volatile, independent of each other, and out of our control. Generally, higher market prices for eggs have a positive impact on our financial results while higher market prices for feed grains have a negative impact on our financial results. Our pricing for shell eggs is negotiated with our customers on individual terms. We sell our shell eggs at prices based on formulas that take into account, in varying ways, independently quoted regional wholesale market prices for shell eggs, formulas related to our costs of production, such as grain-based and variations of cost-plus arrangements, or hybrid models including cost of production and wholesale market prices”.

“Almost all of our conventional eggs are priced and sold under frameworks that generally utilize market-based formulas tied to independently quoted regional wholesale market quotes or utilize the hybrid models described above. The majority of our specialty eggs are sold under frameworks that do not utilize market-based formulas and instead are based on cost of production, although we do have some customers that prefer market-based pricing for cage-free eggs. As a result, specialty egg prices typically do not fluctuate as much as conventional pricing. We do not sell eggs directly to consumers or set the prices at which eggs are sold to consumers”.

“During the first two quarters of fiscal 2026, a higher proportion of our conventional eggs were sold on a hybrid pricing model that takes into account both our cost of production as well as wholesale market prices, instead of solely market-based pricing, in

response to customer demand. We believe the hybrid pricing arrangement may help some customers better plan and manage their businesses and reinforces our role as a trusted supplier. Although hybrid pricing may reduce our profitability when egg prices are high, compared to pure market-based pricing, it could enhance our profitability when egg prices are low, and lead to reduced volatility in our financial results”.

With respect to production systems and the rate of transition to cage-free housing the Company Q-10 stated “We are focused on adjusting our cage-free production capacity with a goal of meeting the future needs of our customers in light of changing state requirements and our customers’ goals. As always, we strive to offer a product mix that aligns with current and anticipated customer purchase decisions. We are engaging with our customers to help them meet their announced goals and needs. We have invested significant capital in recent years to acquire and construct cage-free facilities, and we expect our focus for future expansion will continue to include cage-free facilities. Our volume of cage-free egg sales has continued to increase and account for a larger share of our product mix”.

“In the second quarter of fiscal year 2026, cage-free egg revenue represented approximately 33.3% of our total shell egg revenue, compared to 23.4% in the second quarter of fiscal year 2025. At the same time, we understand the importance of our continued ability to provide conventional eggs in order to provide our customers with a variety of egg choices and to address hunger in

our communities”.

The Analysts’ call included the following statement by Sherman Miller

“We delivered solid results even against a tough comparison to last year, which was marked by supply-demand imbalances and historically high prices. With lower egg prices, our increasingly diversified business model, combined with effective execution, has proven to be a source of resilience.

That positions us uniquely today, a rare combination of both value and growth, with the potential to strengthen even further over time. Our specialty egg business maintained strong prices and volumes despite challenging comparisons and delivered growth in the first half of the fiscal year. At the same time, our recently announced expansions are positioning our prepared foods business to deliver sustained double-digit volume growth. Another key trend we're seeing is the ongoing shift in our sales mix across the portfolio. This shift was visible throughout the second quarter and first half of the fiscal year, and we expect it will steadily enhance the durability and predictability of our earnings.

It's a direct reflection of the deliberate execution of our long-term strategy. We believe our results continue to reinforce just how effective that approach will be in pursuit of operational and financial excellence”.

“Let me share a few strategic highlights from the second quarter and first half of the year that show how we're driving continued sale diversification and favorable mix shifts. In 2026, shell egg sales represented 84.4% of total net sales compared to 94.7%. Specialty eggs drove a greater portion of shell egg sales, accounting for 44% of total shell egg sales compared to 31.7%. Specialty eggs and prepared foods combined accounted for 46.4% of net sales compared to 31.2%.”

“In 2026, shell egg sales represented 85% of total net sales compared to 94.5% in 2025. Specialty eggs drove a greater portion of shell egg sales, accounting for 39.6% of total shell egg sales compared to 33%. Specialty eggs and prepared foods combined accounted for 42.8% of net sales compared to 32.4%”.

As of April 14^th Cal-Maine Foods ceased to be a “controlled company” with conversion of Class A shares to common stock. As part of the buy-back program the Company purchased shares to the value of $50 million from entities representing the Founder family. Future additional purchases valued at $450 million have been authorized by the Board.

Recent acquisitions include:-

• ISE America was purchased in Q1 2025: for $111.5 million comprised 4.7 million hens, (1.2 million cage-free), pullets, housing, packing plants and other facilities on 4,000 acres in MD., NJ., DE. and SC., representing a unit expenditure of $25/hen with established markets.
• Cal-Maine acquired the remaining 9.2 percent equity in Meadow Creek Foods located in MO. during Q2 FY 2025
• A majority shareholding in Crepini Foods was acquired in Q2 of FY 2025
• Echo Lake Foods was acquired in Q3 FY 2025, effective June 2^nd.
• Feed production facilities were acquired from Deal-Rite Foods in Q3 FY 2025 to supply cage-free contract farms in central North Carolina.
• Clean Egg LLC. In Texas was acquired on October 10^th 2025 for $23.7 million

Capital expenditure on property, plant and equipment during Q1 and Q2 amounted to $92.1 million compared to $65.6 million for the 1^st Half of FY2025.

Cal Maine Foods has expanded by purchase of existing integrated production facilities but has extended acquisitions to value-added products over the past two years.

The 10-Q Report filed on October 1^st 2025 documented approved capital investment of $257.3 million for FY 2026. Provisions comprised a feed mill (3.8% of proposed capital expenditure); Egg products equipment (7.6%); Expansion of prepared Foods (5.8%) and new cage-free housing and conversions (82.8%). Of this total $210.2 million (81.7%) was committed with $47.1 million to be expended.