Nathan’s Famous, Inc. (NASDAQ: NATH) reported fiscal 2026 results on Tuesday, posting higher annual revenue driven by growth in its branded products business, while profitability declined as rising beef costs weighed on margins.
The company also announced a quarterly cash dividend of $0.50 per share, payable on June 30, 2026, to shareholders of record as of June 22, 2026.
Annual Revenue Rises, Earnings Decline
For the fiscal year ended March 29, 2026, Nathan’s Famous (NATH) generated revenue of $162.1 million, up from $148.2 million in fiscal 2025, representing growth of approximately 9.4%.
Despite the increase in sales, operating income declined to $30.1 million from $36.5 million a year earlier. Net income fell to $20.0 million, compared with $24.0 million in fiscal 2025.
Diluted earnings per share declined to $4.85 from $5.87 in the prior fiscal year.
Adjusted EBITDA, a non-GAAP measure used by management, decreased to $36.3 million from $39.2 million a year earlier.
Branded Products Business Drives Growth
The company’s branded products segment, which supplies Nathan’s Famous (NATH) hot dogs to foodservice customers, remained the largest contributor to revenue growth.
Sales within the segment increased to $105.8 million during fiscal 2026, compared with $91.8 million in fiscal 2025. The company attributed the increase primarily to higher selling prices, while product volume rose modestly by approximately 1%.
However, profitability in the segment was pressured by rising input costs. Nathan’s said beef and beef trimming costs increased approximately 19% year-over-year, contributing to a decline in operating income for the division.
Licensing Business Remains Stable
Nathan’s Famous (NATH) licensing segment continued to provide a steady source of revenue. License royalties totaled $37.4 million during fiscal 2026, largely unchanged from the previous year.
The company said the performance reflected continued strength in its long-term retail and foodservice licensing arrangement with Smithfield Foods.
Franchise and Restaurant Operations
Revenue from franchise operations increased to $4.3 million from $4.1 million a year earlier. Franchise royalties rose to $3.9 million as total franchise restaurant sales increased to $70.1 million.
During fiscal 2026, Nathan’s Famous (NATH) opened 23 franchised locations and closed 32 locations.
Sales at company-owned restaurants totaled $12.5 million, slightly below the $12.7 million reported in fiscal 2025. Management said unfavorable weather conditions, particularly at its flagship Coney Island locations during the summer season, contributed to lower customer traffic.
Fourth-Quarter Results
For the fourth quarter ended March 29, 2026, revenue increased to $35.1 million from $30.8 million in the same quarter a year earlier.
Quarterly net income totaled $2.8 million, compared with $4.2 million in the prior-year period. Diluted earnings per share declined to $0.68 from $1.03.
Adjusted EBITDA for the quarter increased to $7.6 million from $7.1 million a year ago.
Smithfield Acquisition Expected in Second Half of 2026
Nathan’s Famous (NATH) also provided an update on its pending acquisition by Smithfield Foods.
The company previously agreed to be acquired by Smithfield Foods in an all-cash transaction valued at approximately $450 million, with shareholders set to receive $102 per share.
Management said the transaction remains subject to shareholder approval, regulatory review, including clearance from the Committee on Foreign Investment in the United States (CFIUS), and other customary closing conditions.
Due in part to delays associated with the federal government’s partial shutdown affecting regulatory review timelines, Nathan’s Famous (NATH) now expects the acquisition to close during the second half of 2026.
Outlook
While rising commodity costs continue to pressure profitability, Nathan’s Famous (NATH) enters fiscal 2027 with stable licensing revenue, growing branded products sales, and continued expansion of its franchise network.
Investors are expected to remain focused on the pending Smithfield Foods acquisition, which would take NATH private and mark a significant milestone in the company’s history.