second quarter 2026
Filed Jul 30, 2026Darling Ingredients reported second-quarter 2026 net income of $387.3 million, or $2.41 per GAAP diluted share, on total net sales of $1.7 billion and combined Adjusted EBITDA of $741.7 million.
Second-quarter net income, GAAP diluted EPS, total net sales and combined Adjusted EBITDA were all substantially higher than the comparable 2025 period, led by a $350,030 thousand equity-in-net-income contribution from Diamond Green Diesel and higher results across the core segments.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total net salesGAAP | $1,724,078 (in thousands) | – | $242,560 (in thousands) |
| Net sales to third partiesGAAP | $1,310,614 (in thousands) | – | $120,626 (in thousands) |
| Net sales to related party - Diamond Green DieselGAAP | $413,464 (in thousands) | – | $121,934 (in thousands) |
| Gross marginGAAP | $503,373 (in thousands) | – | – |
| Cost of sales and operating expensesGAAP | $1,220,705 (in thousands) | – | $(85,104) (in thousands) |
| Selling, general and administrative expensesGAAP | $150,950 (in thousands) | – | $(12,881) (in thousands) |
| Restructuring and asset impairment chargesGAAP | $3,933 (in thousands) | – | $(3,933) (in thousands) |
| Acquisition and integration costsGAAP | $13,218 (in thousands) | – | $(9,835) (in thousands) |
| Depreciation and amortizationGAAP | $130,180 (in thousands) | – | $(9,118) (in thousands) |
| Equity in net income of Diamond Green DieselGAAP | $350,030 (in thousands) | – | $344,030 (in thousands) |
| Operating incomeGAAP | $555,238 (in thousands) | – | $479,370 (in thousands) |
| Interest expenseGAAP | $(55,526) (in thousands) | – | $(3,653) (in thousands) |
| Income tax expenseGAAP | $110,638 (in thousands) | – | $(106,573) (in thousands) |
| Net income attributable to DarlingGAAP | $387,312 (in thousands) | – | $374,651 (in thousands) |
| Diluted income per shareGAAP | $2.41 | – | $2.33 |
| Basic income per shareGAAP | $2.44 | – | $2.36 |
| Number of diluted common sharesGAAP | 160,627 (in thousands) | – | – |
| Segment Adjusted EBITDAnon-GAAP | $352,539 (in thousands) | – | – |
| DGD Adjusted EBITDA (Darling's Share)non-GAAP | $389,203 (in thousands) | – | – |
| Combined Adjusted EBITDAnon-GAAP | $741,742 (in thousands) | – | – |
| Six-month total net salesGAAP | $3,274,899 (in thousands) | – | $412,787 (in thousands) |
| Six-month operating incomeGAAP | $782,009 (in thousands) | – | $677,741 (in thousands) |
| Six-month net income attributable to DarlingGAAP | $521,625 (in thousands) | – | $535,124 (in thousands) |
| Six-month diluted income per shareGAAP | $3.24 | – | $3.33 |
| Six-month combined Adjusted EBITDAnon-GAAP | $1.15 billion | – | – |
| DGD renewable fuels sold, three months ended June 30, 2026other | 348.8 million gallons | – | – |
| DGD average EBITDA, three months ended June 30, 2026other | $2.23 per gallon EBITDA | – | – |
| DGD renewable fuels sold, first six months of 2026other | 621.2 million gallons | – | – |
| DGD average EBITDA, first six months of 2026other | $1.74 per gallon EBITDA | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Feed IngredientsSegment Adjusted EBITDA was $240,497 (in thousands), compared with $135,902 (in thousands) for the three months ended June 28, 2025. | $1,149,490 (in thousands) | – | – |
| Food IngredientsSegment Adjusted EBITDA was $108,480 (in thousands), compared with $69,946 (in thousands) for the three months ended June 28, 2025. | $408,514 (in thousands) | – | – |
| Fuel IngredientsEquity in net income of Diamond Green Diesel was $350,030 (in thousands), and combined Adjusted EBITDA was $415,172 (in thousands). | $166,074 (in thousands) | – | – |
| CorporateSegment Adjusted EBITDA was $(22,407) (in thousands), compared with $(17,591) (in thousands) for the three months ended June 28, 2025. | $— | – | – |
third quarter 2026 outlook
- NoteCore ingredients business Adjusted EBITDA of approximately $325-340 million.
- NoteCapital expenditures of approximately $450.0 million for fiscal year 2026.
- NoteNet debt at or below $3 billion at fiscal year 2026 end.
- NoteBank leverage ratio below 2X at fiscal year 2026 end.
Capital returns
- Repurchased $73.0 million in common stock.
- Received $280.0 million in cash distributions from Diamond Green Diesel.
- The company received approximately $211 million in dividends and approximately $69 million from Production Tax Credit sales from DGD.
What drove it
- Total net sales were $1,724,078 (in thousands), compared with $1,481,518 (in thousands) in the second quarter of 2025.
- Equity in net income of Diamond Green Diesel was $350,030 (in thousands), compared with $6,000 (in thousands) in the second quarter of 2025.
- DGD Adjusted EBITDA (Darling's Share) was $389,203 (in thousands), compared with $42,648 (in thousands) in the second quarter of 2025.
- Feed Ingredients, Food Ingredients and Fuel Ingredients all reported higher segment Adjusted EBITDA than in the comparable 2025 period.
- Management cited strong operational execution and margin management.
Concerns
- Interest expense was $(55,526) (in thousands), compared with $(51,873) (in thousands) in the second quarter of 2025.
- Restructuring and asset impairment charges were $3,933 (in thousands).
- Acquisition and integration costs were $13,218 (in thousands), compared with $3,383 (in thousands) in the second quarter of 2025.
- Corporate segment Adjusted EBITDA was $(22,407) (in thousands), compared with $(17,591) (in thousands) in the second quarter of 2025.
- Total debt outstanding was $3.9 billion as of July 4, 2026.
What to watch
- Core ingredients business Adjusted EBITDA guidance of approximately $325-340 million for third quarter 2026.
- DGD renewable-fuels volumes and average EBITDA per gallon.
- Progress toward net debt at or below $3 billion and a bank leverage ratio below 2X by fiscal year-end 2026.
- Execution of the acquired Brazilian rendering facilities and the sale of the majority of the non-core grease trap environmental services business.
- Fiscal-year 2026 capital expenditures estimated at approximately $450.0 million.
Balance sheet and cash flow
- Reduced net debt by $223.0 million.
- As of July 4, 2026, cash and cash equivalents were $160.7 million.
- As of July 4, 2026, $1.3 billion was available under the committed revolving credit agreement.
- Total debt outstanding as of July 4, 2026 was $3.9 billion.
- The preliminary leverage ratio as measured by the company’s bank covenant was 2.3X as of July 4, 2026.
- Capital expenditures were approximately $224.0 million year-to-date 2026.
- The company acquired three rendering facilities from the Patense Group in Brazil for approximately $122 million.
- On July 22, 2026, the company sold a majority of its non-core grease trap environmental services business for approximately $90.0 million to Waste Resource Management.
Analysis
Darling Ingredients delivered a materially stronger second quarter than the comparable 2025 period. Total net sales increased to $1,724,078 (in thousands) from $1,481,518 (in thousands), while operating income rose to $555,238 (in thousands) from $75,868 (in thousands). Net income attributable to Darling reached $387,312 (in thousands), or $2.41 per diluted share, versus $12,661 (in thousands), or $0.08 per diluted share. For the first six months, net income attributable to Darling was $521,625 (in thousands), compared with a loss of $(13,499) (in thousands) in the prior-year period.
DGD was the principal contributor to the earnings improvement. Equity in net income of Diamond Green Diesel was $350,030 (in thousands), compared with $6,000 (in thousands) a year earlier. DGD Adjusted EBITDA attributable to Darling was $389,203 (in thousands), compared with $42,648 (in thousands), and combined Adjusted EBITDA was $741,742 (in thousands), compared with $249,544 (in thousands). DGD sold 348.8 million gallons of renewable fuels at an average of $2.23 per gallon EBITDA for the three months ended June 30, 2026.
The core segments also improved. Feed Ingredients segment Adjusted EBITDA was $240,497 (in thousands), Food Ingredients was $108,480 (in thousands), and Fuel Ingredients segment Adjusted EBITDA was $25,969 (in thousands), each above the respective comparable-period figure. Consolidated gross margin was $503,373 (in thousands), compared with $345,917 (in thousands). The filing does not provide consolidated gross-margin percentages or explicitly quantify pricing, volume, or input-cost effects.
Cash deployment combined deleveraging, repurchases and portfolio actions. The company received $280.0 million in cash distributions from DGD, reduced net debt by $223.0 million, and repurchased $73.0 million in common stock. It reported $160.7 million of cash and cash equivalents, $3.9 billion of total debt outstanding, and a preliminary bank-covenant leverage ratio of 2.3X as of July 4, 2026. During the quarter it acquired three Brazilian rendering facilities for approximately $122 million, and subsequently sold a majority of its non-core grease trap environmental services business for approximately $90.0 million.
For the third quarter, management guides only its core ingredients business, estimating Adjusted EBITDA of approximately $325-340 million. It also estimates fiscal-year 2026 capital expenditures of approximately $450.0 million and anticipates ending the year with net debt at or below $3 billion and a bank leverage ratio below 2X. The key reported issues are the durability of DGD economics, delivery against the core-ingredients EBITDA range, and execution of the stated deleveraging plan.
Management, verbatim
Momentum continues to build across our business, which is reflected in our strong second quarter performance.
Randall C. Stuewe, Chairman and Chief Executive Officer
We stayed focused on the things we can control, including strong operational execution and margin management, which enabled us to generate strong cash flow, pay down debt, repurchase shares and further strengthen our financial position.
Randall C. Stuewe, Chairman and Chief Executive Officer
We feel very good about the balance of 2026 and the outlook for 2027.
Randall C. Stuewe, Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- Previous-period outlook was not provided, so no comparison of actual results with prior guidance is available.
- Operating cash flow was not reported in the provided filing text.
- Free cash flow was not reported in the provided filing text.
- Non-GAAP EPS was not reported in the provided filing text.
- A consolidated gross-margin percentage was not reported in the provided filing text.
- Quarter-over-quarter comparisons were not reported for the presented metrics.
- Explicit year-over-year percentage changes were not reported for the segment revenue line items.
- Third-quarter 2026 revenue, gross-margin, operating-expense and tax-rate guidance were not reported.
- The provided filing text is truncated after the beginning of the six-month segment financial tables; metrics that may appear only in the omitted portion cannot be captured.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.