Portfolio reshaping: Middleby sold a 51% stake in its Residential Kitchen business to 26North at an $885 million enterprise value, receiving roughly $565 million in cash while retaining 49% and treating the JV as non‑core, and plans to spin off the Food Processing business in Q2 2026 with an Investor Day on May 12.
Q4 results: Combined Commercial Foodservice and Food Processing revenue was about $866 million with adjusted EBITDA of ~$197 million and adjusted EPS of $2.14 for the quarter ($8.39 for the year), plus operating cash flow of ~$178 million and free cash flow of ~$165 million.
Capital allocation & guidance: Middleby repurchased $710 million of stock in 2025 (reducing shares ~9%) and has bought additional shares in early 2026, and guided Q1 2026 revenue $760–788M/adj EPS $1.90–2.02 and full‑year 2026 revenue $3.27–3.36B/adj EPS $9.20–9.36 while flagging tariff and interest headwinds.
Middleby (NASDAQ:MIDD) executives highlighted a major shift in the company’s portfolio and capital allocation strategy while reporting fourth-quarter 2025 results that management said exceeded expectations for its remaining two operating segments, Commercial Foodservice and Food Processing.
Chief Executive Officer Tim FitzGerald said the company has taken “decisive actions” over the past year to optimize its business mix across Commercial Foodservice, Food Processing, and what was formerly its Residential Kitchen segment.
In February, Middleby completed the sale of a 51% stake in its Residential Kitchen business to 26North at an $885 million total enterprise valuation, delivering approximately $565 million in immediate cash proceeds (subject to closing adjustments). Middleby retained a 49% ownership stake, which FitzGerald said preserves “meaningful upside,” but management is treating the residential joint venture as non-core. The Residential Kitchen business was presented in discontinued operations in the fourth quarter and will be excluded from adjusted results going forward.
Looking ahead, FitzGerald reiterated that Middleby expects to separate its Food Processing business in the second quarter of 2026, creating two independent public companies. He said the company will host an Investor Day on May 12 in New York City ahead of the planned separation.
For the fourth quarter, Middleby reported total revenue of approximately $866 million for Commercial Foodservice and Food Processing combined, which management said exceeded expectations. Adjusted EBITDA was approximately $197 million, translating to adjusted EPS of $2.14 for the quarter and $8.39 for the full year, driven by operating results and share repurchases.
Chief Financial Officer Bryan Mittelman said the net adverse impact from tariffs reduced fourth-quarter adjusted EBITDA by approximately $7 million. The company expects pricing and operational actions implemented in 2025 to offset tariff costs in 2026, although it anticipates “margin dilution” in the first half of the year due to timing.
Middleby reported fourth-quarter operating cash flow of approximately $178 million and free cash flow of approximately $165 million. Leverage at year-end was 2.5x under the company’s credit agreement.
Commercial Foodservice revenue was approximately $602 million in the fourth quarter. FitzGerald attributed the outperformance primarily to “double-digit growth” in the general market with dealer partners, supported by improved demand from independents, the institutional market, and continued growth with emerging chains. He said Middleby has been gaining share with dealers due to investments made over several years to strategically align those relationships.
That strength was offset by continued declines among large quick-service restaurant (QSR) and convenience store customers, which management tied to lower traffic and cost pressures during 2025. FitzGerald said the company is encouraged by steps taken by larger chains heading into 2026, including menu pricing actions, limited-time offers, and new beverage programs aimed at driving traffic. He also cited early traction with some large customers tied to new ice and beverage innovations, which management described as a targeted growth area.
Mittelman said Commercial Foodservice delivered an EBITDA margin of “over 26%” in the quarter, and that the margin would have exceeded 27% without tariff impacts.
During the question-and-answer session, Chief Commercial Officer Steve Spittle said the fourth-quarter strength in dealer activity was not simply a seasonal inventory build, but rather reflected efforts to expand what dealers source from Middleby beyond legacy categories. He pointed to gains in products such as ice, combi ovens, rapid-cook, and coffee, and to increased “packaging” of broader Middleby solutions.
On QSR dynamics, management said some chains remained cautious on capital spending early in 2026, with new-store plans still experiencing push-outs. Executives also described increased QSR focus on improving traffic through the existing footprint, including beverage programs, which Spittle said Middleby is positioned to support with both equipment and installation and service capabilities.
Food Processing posted fourth-quarter revenue of approximately $265 million, which Segment President Mark Salman said outperformed expectations. Salman cited a strong order rate in the second half of 2025 following a more challenged first half that he linked to tariff disruption and high food costs that delayed customer purchasing. The company ended the year with what management called a record backlog.
Mittelman reported fourth-quarter orders of $322 million and backlog of $410 million, with growth across most served markets and continued momentum in the segment’s Total Line Solutions offering. Organic revenue growth was 1.3% in the quarter, helped by improvements in international markets. The segment’s organic EBITDA margin was 23%, with margins pressured by tariffs, higher costs, and order timing that affected production efficiencies.
Salman emphasized the segment’s strategy of building an integrated portfolio aimed at delivering end-to-end Total Line Solutions to protein, bakery, and snack processors, with a focus on lowering customers’ total cost of ownership. He also noted the opening of a new innovation center outside Venice, Italy, during the fourth quarter.
In response to analyst questions, Mittelman said a “significant majority” of the Food Processing backlog is deliverable in 2026, with a minority portion extending into early 2027. Salman added that typical time from order to revenue varies by equipment and solution but is generally “six to 12 months.”
Management emphasized aggressive share repurchases. FitzGerald said Middleby reduced its overall share count by approximately 9% in 2025 through $710 million in buybacks, and that repurchases continued into the first quarter of 2026 with an expected additional $300 million. Mittelman detailed that Middleby repurchased 4.9 million shares for $710 million in 2025 at an average price of about $144.50 per share, and an additional 1.7 million shares for approximately $250 million early in 2026 at an average price of about $154 per share.
Mittelman also noted that the company’s 1% convertible notes matured in the third quarter of 2025, increasing interest expense by about $6 million per quarter, which he said was a $0.12 headwind to fourth-quarter earnings. For full-year 2026, he pegged the interest-rate headwind at approximately $0.34.
For guidance, Middleby provided an outlook on a “current company basis,” assuming Commercial Foodservice and Food Processing remain together for the full year, while reiterating expectations to complete the Food Processing spinoff by the end of the second quarter and to provide updated standalone guidance at the May 12 Investor Day.
Q1 2026: Revenue of $760 million to $788 million; adjusted EBITDA of $161 million to $173 million; adjusted EPS of $1.90 to $2.02 (based on ~47.7 million weighted average shares).
Full-year 2026: Revenue of $3.27 billion to $3.36 billion; adjusted EBITDA of $745 million to $780 million; adjusted EPS of $9.20 to $9.36.
The company said the guidance excludes one-time costs associated with completing the spinoff transaction and does not include standalone public company costs for the Food Processing business. Mittelman said more detail on standalone costs is expected in connection with the upcoming Baird Food Processing Symposium on March 5, and that a registration statement including audited annual financials is expected to be filed in April.
Middleby Corporation is a global manufacturer and distributor of commercial foodservice and food processing equipment. The company designs, engineers and markets a wide range of cooking, baking, refrigeration, warewashing, holding and dispensing solutions. Middleby’s products serve restaurants, hotels, convenience stores, institutional cafeterias, cruise ships and other foodservice operators.
The company’s portfolio spans multiple well-known brands, including Blodgett ovens, TurboChef rapid‐cook ovens, Southbend ranges and broilers, Pitco fryers, and Viking residential and commercial kitchen appliances.
