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Shares of Coffee Holding Co., Inc. (JVA - Free Report) have gained 0.5% since reporting results for the second quarter of fiscal 2026, matching the S&P 500 Index’s return. Over the past month, JVA shares have advanced 0.4%, outperforming the S&P 500’s decline of 0.4%.
Coffee Holding reported mixed second-quarter fiscal 2026 results, with revenues and earnings falling from the year-ago period. Net sales for the quarter ended April 30, 2026, decreased 5.1% year over year to $22.1 million from $23.3 million. Net income dropped 59.2% to $262,489, or 5 cents per diluted share, from $644,055, or 11 cents per share, in the prior-year quarter. Gross profit declined 6.5% to $3.49 million from $3.73 million, while operating income fell 61.5% to $342,496 from $888,615.
Coffee Holding Co., Inc. Price, Consensus and EPS Surprise
The decline in quarterly sales reflected lower green coffee prices and softer purchasing activity among customers. Management said that the rapid drop in coffee commodity prices that began in late January continued throughout the quarter, prompting the company to reduce prices and increase promotional activity for wholesale roasted coffee customers. Lower prevailing coffee prices also resulted in reduced pricing for wholesale green coffee sales.
Cost of sales fell to $18.6 million from $19.6 million a year earlier, but increased slightly as a percentage of revenues to 84.2% from 84%, reflecting higher product and packaging costs. The gross margin narrowed to 15.8% from 16%.
Despite the weak quarterly comparison, results for the first six months of fiscal 2026 were stronger. Net sales rose 6.9% year over year to $47.7 million, while net income increased 6.3% to $1.91 million, or 33 cents per share, from $1.80 million, or 31 cents per share. Gross profit improved 11.6% to $9.61 million.
Other Key Business Metrics
Coffee Holding’s revenue mix continued to shift toward packaged coffee products. For the first six months of fiscal 2026, packed coffee sales increased 17.3% to $30.9 million from $26.4 million in the prior-year period. Meanwhile, green coffee sales declined 8.2% to $16.8 million from $18.3 million.
The company generated operating income of $2.72 million in the first half of fiscal 2026, up 9.7% from $2.48 million a year earlier. However, gains from hedging activities declined substantially. Net gains from coffee futures and options contracts totaled about $161,000 in the first six months of fiscal 2026 compared with $1.46 million in the prior-year period.
Liquidity improved during the period. Cash and cash equivalents rose to $2.32 million at April 30, 2026, from $701,872 at the end of the fiscal year. Operating activities generated $6.65 million in cash during the first six months against a cash outflow of $1.56 million in the prior-year period. The balance on the company’s credit facility declined to $2.65 million from $6.05 million as of Oct. 31, 2025.
Management Commentary
President and chief executive officer Andrew Gordon attributed the quarter’s weaker results primarily to a roughly 25% decline in coffee commodity prices, which reduced profitability and led some wholesale customers to delay purchases while awaiting further market stabilization. He also noted that the company increased promotional efforts and lowered pricing for certain large retail customers to preserve expected sales volumes.
Gordon added that national coffee brands largely maintained their pricing, allowing Coffee Holding to hold pricing on some products and partially offset margin pressure. He also highlighted that the company recently secured substantial new business that should benefit from lower green coffee costs and support margins, particularly for its Café Caribe brand.
Factors Influencing Results
Management cited several factors affecting quarterly performance, including falling coffee commodity prices, lower sales volumes, increased promotional activity, and higher product and packaging costs. Interest expenses rose as a result of higher borrowing levels during the period, contributing to higher other expenses.
The company continues to scale back its use of coffee futures and options trading, using hedging activities in a more limited capacity while still seeking protection against coffee price volatility.
Management plans to continue reducing inventory levels as coffee prices normalize and believes that the company is well-positioned to maintain profitability through the remainder of fiscal 2026 despite ongoing commodity-price volatility.
Other Developments
The company continued integrating the assets acquired from Empire Coffee Company through its wholly-owned subsidiary, Second Empire. Acquired in November 2024 for $800,000, the business has contributed to customer sales during fiscal 2026.
Management cited a full six months of Second Empire customer sales as one factor supporting first-half revenue growth. The company also invested $850,000 in The Ryl Company LLC in the first quarter of fiscal 2026 for a passive minority ownership stake. Additionally, Coffee Holding paid out a cash dividend of 8 cents per share during the period.
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JVA Q2 Earnings Decline Y/Y as Lower Coffee Prices Hurt Sales
Shares of Coffee Holding Co., Inc. (JVA - Free Report) have gained 0.5% since reporting results for the second quarter of fiscal 2026, matching the S&P 500 Index’s return. Over the past month, JVA shares have advanced 0.4%, outperforming the S&P 500’s decline of 0.4%.
Coffee Holding reported mixed second-quarter fiscal 2026 results, with revenues and earnings falling from the year-ago period. Net sales for the quarter ended April 30, 2026, decreased 5.1% year over year to $22.1 million from $23.3 million. Net income dropped 59.2% to $262,489, or 5 cents per diluted share, from $644,055, or 11 cents per share, in the prior-year quarter. Gross profit declined 6.5% to $3.49 million from $3.73 million, while operating income fell 61.5% to $342,496 from $888,615.
Coffee Holding Co., Inc. Price, Consensus and EPS Surprise
Coffee Holding Co., Inc. price-consensus-eps-surprise-chart | Coffee Holding Co., Inc. Quote
Revenues & Margin Trends
The decline in quarterly sales reflected lower green coffee prices and softer purchasing activity among customers. Management said that the rapid drop in coffee commodity prices that began in late January continued throughout the quarter, prompting the company to reduce prices and increase promotional activity for wholesale roasted coffee customers. Lower prevailing coffee prices also resulted in reduced pricing for wholesale green coffee sales.
Cost of sales fell to $18.6 million from $19.6 million a year earlier, but increased slightly as a percentage of revenues to 84.2% from 84%, reflecting higher product and packaging costs. The gross margin narrowed to 15.8% from 16%.
Despite the weak quarterly comparison, results for the first six months of fiscal 2026 were stronger. Net sales rose 6.9% year over year to $47.7 million, while net income increased 6.3% to $1.91 million, or 33 cents per share, from $1.80 million, or 31 cents per share. Gross profit improved 11.6% to $9.61 million.
Other Key Business Metrics
Coffee Holding’s revenue mix continued to shift toward packaged coffee products. For the first six months of fiscal 2026, packed coffee sales increased 17.3% to $30.9 million from $26.4 million in the prior-year period. Meanwhile, green coffee sales declined 8.2% to $16.8 million from $18.3 million.
The company generated operating income of $2.72 million in the first half of fiscal 2026, up 9.7% from $2.48 million a year earlier. However, gains from hedging activities declined substantially. Net gains from coffee futures and options contracts totaled about $161,000 in the first six months of fiscal 2026 compared with $1.46 million in the prior-year period.
Liquidity improved during the period. Cash and cash equivalents rose to $2.32 million at April 30, 2026, from $701,872 at the end of the fiscal year. Operating activities generated $6.65 million in cash during the first six months against a cash outflow of $1.56 million in the prior-year period. The balance on the company’s credit facility declined to $2.65 million from $6.05 million as of Oct. 31, 2025.
Management Commentary
President and chief executive officer Andrew Gordon attributed the quarter’s weaker results primarily to a roughly 25% decline in coffee commodity prices, which reduced profitability and led some wholesale customers to delay purchases while awaiting further market stabilization. He also noted that the company increased promotional efforts and lowered pricing for certain large retail customers to preserve expected sales volumes.
Gordon added that national coffee brands largely maintained their pricing, allowing Coffee Holding to hold pricing on some products and partially offset margin pressure. He also highlighted that the company recently secured substantial new business that should benefit from lower green coffee costs and support margins, particularly for its Café Caribe brand.
Factors Influencing Results
Management cited several factors affecting quarterly performance, including falling coffee commodity prices, lower sales volumes, increased promotional activity, and higher product and packaging costs. Interest expenses rose as a result of higher borrowing levels during the period, contributing to higher other expenses.
The company continues to scale back its use of coffee futures and options trading, using hedging activities in a more limited capacity while still seeking protection against coffee price volatility.
Management plans to continue reducing inventory levels as coffee prices normalize and believes that the company is well-positioned to maintain profitability through the remainder of fiscal 2026 despite ongoing commodity-price volatility.
Other Developments
The company continued integrating the assets acquired from Empire Coffee Company through its wholly-owned subsidiary, Second Empire. Acquired in November 2024 for $800,000, the business has contributed to customer sales during fiscal 2026.
Management cited a full six months of Second Empire customer sales as one factor supporting first-half revenue growth. The company also invested $850,000 in The Ryl Company LLC in the first quarter of fiscal 2026 for a passive minority ownership stake. Additionally, Coffee Holding paid out a cash dividend of 8 cents per share during the period.