CAL-MAINE FOODS INC 10-Q

ITEM 1. FINANCIAL STATEMENTS Cal-Maine Foods, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands, except for par value amounts) (Unaudited) February 28, 2026 May 31, 2025 Assets Current assets: Cash and cash equivalents $ 392,159 $ 499,392 Investment securities available-for-sale 759,768 892,708 Trade and other receivables, net 185,176 259,304 Income tax receivable 49,722 13,057 Inventories 348,910 295,670 Prepaid expenses and other current assets 13,751 7,979 Total current assets 1,749,486 1,968,110 Property, plant & equipment, net 1,221,162 1,026,684 Investments in unconsolidated entities 9,182 11,095 Goodwill 87,059 46,776 Intangible assets, net 53,361 15,157 Other long-term assets 19,011 16,797 Total Assets $ 3,139,261 $ 3,084,619 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 106,494 $ 101,033 Accrued wages and benefits 36,618 60,263 Dividends payable 16,841 114,163 Accrued expenses and other liabilities 53,025 32,912 Total current liabilities 212,978 308,371 Other noncurrent liabilities 34,625 55,582 Deferred income taxes, net 184,526 154,651 Total liabilities 432,129 518,604 Commitments and contingencies - see Note 10 — — Stockholders’ equity: Common stock ($ 0.01 par value) - authorized 120,000 shares, issued 75,061 shares 751 751 Paid-in capital 84,382 80,845 Retained earnings 2,800,993 2,565,928 Accumulated other comprehensive income (loss), net of tax 1,404 ( 1,007 ) Common stock in treasury at cost – 27,686 shares at February 28, 2026 and 26,567 shares at May 31, 2025 ( 187,362 ) ( 85,893 ) Total Cal-Maine Foods, Inc. stockholders’ equity 2,700,168 2,560,624 Noncontrolling interest in consolidated entity 6,964 5,391 Total stockholders’ equity 2,707,132 2,566,015 Total Liabilities and Stockholders’ Equity $ 3,139,261 $ 3,084,619 See Notes to Condensed Consolidated Financial Statements. Index 4 Cal-Maine Foods, Inc. and Subsidiaries Condensed Consolidated Statements of Income (In thousands, except per share amounts) (Unaudited) Thirteen Weeks Ended Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025 Net sales $ 666,951 $ 1,417,685 $ 2,359,051 $ 3,158,227 Cost of sales 547,668 701,570 1,721,068 1,838,852 Gross profit 119,283 716,115 637,983 1,319,375 Selling, general and administrative 83,304 79,967 235,705 219,532 (Gain) loss on involuntary conversions ( 480 ) — ( 7,968 ) 156 (Gain) loss on disposal of fixed assets 515 478 1,249 ( 1,001 ) Operating income 35,944 635,670 408,997 1,100,688 Other income (expense): Interest income, net 11,268 12,628 36,384 32,183 Patronage dividends 11,670 11,197 11,670 11,197 Other, net ( 696 ) 3,534 479 5,875 Total other income, net 22,242 27,359 48,533 49,255 Income before income taxes 58,186 663,029 457,530 1,149,943 Income tax expense 7,068 154,876 104,378 273,841 Net income 51,118 508,153 353,152 876,102 Less: Income (loss) attributable to noncontrolling interest 659 ( 380 ) 594 ( 1,471 ) Net income attributable to Cal-Maine Foods, Inc. $ 50,459 $ 508,533 $ 352,558 $ 877,573 Net income per common share: Basic $ 1.07 $ 10.42 $ 7.37 $ 17.99 Diluted $ 1.06 $ 10.38 $ 7.34 $ 17.92 Weighted average shares outstanding: Basic 47,299 48,798 47,866 48,774 Diluted 47,414 48,971 48,003 48,962 See Notes to Condensed Consolidated Financial Statements. Index 5 Cal-Maine Foods, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Income (In thousands) (Unaudited) Thirteen Weeks Ended Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025 Net income $ 51,118 $ 508,153 $ 353,152 $ 876,102 Other comprehensive income, before tax: Unrealized holding gain on available-for- sale securities, net of reclassification adjustments 103 200 3,183 1,342 Income tax expense related to items of other comprehensive income ( 25 ) ( 49 ) ( 772 ) ( 326 ) Other comprehensive income, net of tax 78 151 2,411 1,016 Comprehensive income 51,196 508,304 355,563 877,118 Less: Comprehensive income (loss) attributable to the noncontrolling interest 659 ( 380 ) 594 ( 1,471 ) Comprehensive income attributable to Cal- Maine Foods, Inc. $ 50,537 $ 508,684 $ 354,969 $ 878,589 See Notes to Condensed Consolidated Financial Statements. Index 6 Cal-Maine Foods, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited) Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 Cash flows from operating activities: Net income $ 353,152 $ 876,102 Depreciation and amortization 90,294 69,430 Deferred income taxes 29,127 ( 14,749 ) Other adjustments, net 4,349 ( 119,057 ) Net cash provided by operations 476,922 811,726 Cash flows from investing activities: Purchases of investment securities ( 503,677 ) ( 813,130 ) Sales and maturities of investment securities 659,728 654,392 Distributions from unconsolidated entities — 1,550 Acquisition of businesses, net of cash acquired ( 299,010 ) ( 116,193 ) Purchases of property, plant and equipment ( 123,708 ) ( 115,395 ) Net proceeds from disposal of property, plant and equipment 191 3,650 Net cash used in investing activities ( 266,476 ) ( 385,126 ) Cash flows from financing activities: Payments of dividends ( 214,796 ) ( 160,805 ) Purchase of common stock by treasury ( 100,996 ) ( 3,953 ) Principal payments on long-term debt — ( 2,481 ) Net cash used in financing activities ( 315,792 ) ( 167,239 ) Net change in cash, cash equivalents and restricted cash ( 105,346 ) 259,361 Cash, cash equivalents and restricted cash at beginning of period 499,392 237,878 Cash, cash equivalents and restricted cash at end of period $ 394,046 $ 497,239 See Notes to Condensed Consolidated Financial Statements. Index 7 Cal-Maine Foods, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (Unaudited) Note 1 - Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements of Cal-Maine Foods, Inc. and its subsidiaries (“Cal-Maine Foods,” the “Company,” “we,” “us,” “our”) have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial reporting and should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended May 31, 2025 (the “2025 Annual Report”). These statements reflect all adjustments that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented and, in the opinion of management, consist of adjustments of a normal recurring nature. Operating results for the interim periods are not necessarily indicative of operating results for the entire fiscal year. Fiscal Year The Company’s fiscal year ends on the Saturday closest to May 31. Each of the three-month and year-to-date periods ended on February 28, 2026 and March 1, 2025 included 13 and 39 weeks, respectively. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Dividends Payable Dividends are accrued at the end of each quarter according to the Company’s dividend policy adopted by its Board of Directors (the “Board”). The Company pays a dividend to holders of its Common Stock (and, prior to its conversion to Common Stock on April 14, 2025, Class A Common Stock) on a quarterly basis for each quarter for which the Company reports net income attributable to Cal-Maine Foods, Inc., computed in accordance with GAAP, in an amount equal to one-third (1/3) of such quarterly net income. Dividends are paid to stockholders of record as of the 60th day following the last day of such quarter, except for the fourth fiscal quarter. For the fourth quarter, the Company pays dividends to stockholders of record on the 65th day after the quarter end. Dividends are payable on the 15th day following the record date. Following a quarter for which the Company does not report net income attributable to Cal-Maine Foods, Inc., the Company will not pay a dividend for a subsequent profitable quarter until the Company is profitable on a cumulative basis computed from the date of the most recent quarter for which a dividend was paid. The dividend policy is subject to periodic review by the Board. Revenue Recognition The Company recognizes revenue through the sale of its products to customers through retail, foodservice and other distribution channels. The majority of the Company’s revenue is derived from agreements or contracts with customers based upon the customer ordering its products with a single performance obligation of delivering the product. The Company believes the performance obligation is met upon delivery and acceptance of the product by its customers, which generally occurs upon shipment or delivery to a customer based on the terms of the sale. Costs paid to third party brokers to obtain agreements are expensed as the Company’s agreements are generally less than one year. Revenues are recognized in an amount that reflects the net consideration we expect to receive in exchange for delivery of the products. The Company periodically offers sales incentives or other programs such as rebates, discounts, coupons, volume- based incentives, guaranteed sales and other programs. The Company records an estimated allowance for costs associated with these programs, which is recorded as a reduction in revenue at the time of sale using historical trends and projected redemption rates of each program. The Company regularly reviews these estimates and any difference between the estimated costs and actual realization of these programs would be recognized in the subsequent period. Index 8 Business Combinations The Company applies the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed, including amounts attributable to noncontrolling interests, are recorded at their respective fair values at the date of acquisition. The excess of the purchase price over fair values of identifiable assets and liabilities is recorded as goodwill. We use various models and methods to determine the fair values of identifiable assets and liabilities, such as top-down and bottom-up approach for inventory, cost method and market approach for property, and relief-from-royalty and multi-period excess earnings to value intangibles. Significant estimates in valuing certain intangible assets include, but are not limited to, the amount and timing of future cash flows, growth rates, discount rates and useful lives. New Accounting Pronouncements and Policies In December 2023, the Financial Accounting Standards Board (“FASB ”) issued Accounting Standards Update (“ASU”) 2023- 09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures . This ASU requires that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid. The ASU is intended to enhance the transparency and decision usefulness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statement disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40) . The objective of ASU 2024-03 is to improve disclosures about a public entity’s expenses, primarily through additional disaggregation of income statement expenses. Additionally, in January 2025, the FASB further clarified the effective date of ASU 2024-03 with the issuance of ASU 2025-01. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted and may be applied either on a prospective or retrospective basis. The Company is currently evaluating the impact of ASU 2024-03 on its consolidated financial statement disclosures. There are no other new accounting pronouncements issued or effective during the fiscal year that had or are expected to have a material impact on our consolidated financial statements. Index 9 Note 2 - Acquisitions Acquisition of Echo Lake Foods, LLC Effective June 2, 2025 , the Company acquired Echo Lake Foods, LLC and certain related companies (collectively “Echo Lake Foods”). Echo Lake Foods is based in Burlington, Wisconsin and produces, packages, markets and distributes prepared foods, including waffles, pancakes, scrambled eggs, frozen cooked omelets, egg patties, toast and diced eggs. The Company accounted for the acquisition as a business combination. The Company finalized the business combination accounting during the second quarter of fiscal 2026, which resulted in immaterial measurement period adjustments. The following table summarizes the consideration paid for Echo Lake Foods and the value of assets acquired and liabilities assumed recognized at the acquisition date (in thousands): Cash consideration paid $ 275,406 Recognized amounts of identifiable assets acquired and liabilities assumed Cash $ 115 Investment securities available-for-sale 14,147 Accounts receivable 31,923 Inventories 21,601 Prepaid expenses and other current assets 3,131 Property, plant & equipment 151,697 Intangible assets 36,800 259,414 Accounts payable and other current liabilities ( 14,114 ) Total identifiable net assets 245,300 Goodwill 30,106 $ 275,406 Cash and accounts receivable acquired along with liabilities assumed were valued at their carrying value which approximates fair value due to the short maturity of these instruments. Inventories consisted primarily of raw materials, supplies and finished goods. Raw materials and supplies were valued at their carrying value as management believes that their carrying value best approximates their fair value. Finished goods were valued using both the bottom-up and top-down approach. The bottom-up approach measures the value of inventory as the value created by the target company (i.e., the costs incurred, profit realized, and tangible and intangible assets utilized) pre-acquisition date. The top-down approach measures the value of inventory as the incremental inventory value created by the market participant buyer as part of its selling effort to an end customer (i.e., the costs that will be incurred, the profit that will be realized, and the tangible and intangible assets that will be utilized) post-acquisition date. Property, plant and equipment were valued utilizing the cost approach and market approach. Machinery and equipment were valued utilizing the cost approach which is based on replacement or reproduction costs of the assets and subtracting any depreciation resulting from physical deterioration and/or functional or economic obsolescence. Land and buildings were valued utilizing the market approach by using a real estate valuation. Intangible assets consisted primarily of customer relationships and a trade name. Customer relationships were valued using the multi-period excess earnings method and the trade name was valued using the relief-from-royalty method. Goodwill represents the excess of the purchase price of the acquired business over the acquisition date fair value of the net assets acquired. Goodwill recorded in connection with the Echo Lake Foods acquisition is primarily attributable to projected synergies from integrating the operations of Echo Lake Foods with the operations of the Company. The Company recognized goodwill of $ 30.1 million as a result of the acquisition, all of which is deductible for tax purposes. Index 10 The Company recorded transaction costs of $ 594 thousand in the first quarter of fiscal 2026 and $ 6.6 million in the fourth quarter of fiscal 2025, respectively, as a result of the Echo Lake Foods acquisition, within selling, general and administrative expenses in the condensed consolidated statements of income. Acquisition of Clean Egg, LLC Effective October 10, 2025 , the Company acquired certain assets of Clean Egg, LLC (“Clean Egg”) based in Langwood, Texas, for approximately $ 23.7 million. The assets acquired included 677 thousand brown cage-free and free-range layers and pullets and other inventory, machinery and equipment related to its processing facility and contract production. The Company accounted for the acquisition as a business combination. Note 3 - Investment Securities Available-for-Sale The following represents the Company’s investment securities available-for-sale as of February 28, 2026 and May 31, 2025 (in thousands): February 28, 2026 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value Municipal bonds $ 17,494 $ 48 $ — $ 17,542 Commercial paper 20,801 — 6 20,795 Corporate bonds 553,535 2,713 — 556,248 Certificates of deposits 4,055 10 — 4,065 US government and agency obligations 130,573 175 — 130,748 Treasury bills 30,360 10 — 30,370 Total current investment securities $ 756,818 $ 2,956 $ 6 $ 759,768 May 31, 2025 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value Municipal bonds $ 21,695 $ 3 $ — $ 21,698 Commercial paper 90,880 — 50 90,830 Corporate bonds 431,378 130 — 431,508 Certificates of deposits 5,200 — 6 5,194 US government and agency obligations 240,655 — 260 240,395 Treasury bills 103,119 — 36 103,083 Total current investment securities $ 892,927 $ 133 $ 352 $ 892,708 Actual maturities may differ from contractual maturities as some borrowers have the right to call or prepay obligations with or without penalties. Contractual maturities of current investment securities at February 28, 2026 are as follows (in thousands): Estimated Fair Value Within one year $ 353,520 1-5 years 406,248 Total $ 759,768 Note 4 - Fair Value Measurements The Company is required to categorize both financial and nonfinancial assets and liabilities based on the following fair value hierarchy. The fair value of an asset is the price at which the asset could be sold in an orderly transaction between unrelated, knowledgeable, and willing parties able to engage in the transaction. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a new obligor in a transaction between such parties, not the amount that would be paid to settle the liability with the creditor. • Level 1 - Quoted prices in active markets for identical assets or liabilities Index 11 • Level 2 - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly, including: ◦ Quoted prices for similar assets or liabilities in active markets ◦ Quoted prices for identical or similar assets in non-active markets ◦ Inputs other than quoted prices that are observable for the asset or liability ◦ Inputs derived principally from or corroborated by other observable market data • Level 3 - Unobservable inputs for the asset or liability that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities The disclosures of fair value of certain financial assets and liabilities that are recorded at cost are as follows: Cash and Cash Equivalents, Accounts Receivable, and Accounts Payable The carrying amount approximates fair value due to the short maturity of these instruments. Assets and Liabilities Measured at Fair Value on a Recurring Basis In accordance with the fair value hierarchy described above, the following table shows the fair value of our financial assets and liabilities that are required to be measured at fair value on a recurring basis as of February 28, 2026 and May 31, 2025 (in thousands): February 28, 2026 Level 1 Level 2 Level 3 Balance Assets Municipal bonds $ — $ 17,542 $ — $ 17,542 Commercial paper — 20,795 — 20,795 Corporate bonds — 556,248 — 556,248 Certificates of deposits — 4,065 — 4,065 US government and agency obligations — 130,748 — 130,748 Treasury bills — 30,370 — 30,370 Total assets measured at fair value $ — $ 759,768 $ — $ 759,768 Liabilities Contingent consideration $ — $ — $ 23,000 $ 23,000 Total liabilities measured at fair value $ — $ — $ 23,000 $ 23,000 May 31, 2025 Level 1 Level 2 Level 3 Balance Assets Municipal bonds $ — $ 21,698 $ — $ 21,698 Commercial paper — 90,830 — 90,830 Corporate bonds — 431,508 — 431,508 Certificates of deposits — 5,194 — 5,194 US government and agency obligations — 240,395 — 240,395 Treasury bills — 103,083 — 103,083 Total assets measured at fair value $ — $ 892,708 $ — $ 892,708 Liabilities Contingent consideration $ — $ — $ 21,500 $ 21,500 Total liabilities measured at fair value $ — $ — $ 21,500 $ 21,500 Investment securities – available-for-sale are all classified as Level 2 and consist of securities with maturities of three months or longer when purchased. We classified these securities as current because amounts invested are readily available for current operations. Observable inputs for these securities are yields, credit risks, default rates, and volatility. Contingent consideration classified as Level 3 consists of the potential obligation to pay an earnout to Fassio Egg Farms, Inc. (“Fassio”) contingent on the acquired business meeting certain return on profitability milestones over a three-year period that commenced on the date of the acquisition in the second quarter of fiscal 2024. The fair value of the contingent consideration is Index 12 estimated using a discounted cash flow model. Key assumptions and unobservable inputs that require significant judgment used in the estimate include weighted average cost of capital, egg prices, projected revenue and expenses over the period for which the contingent consideration is measured, and the probability assessments with respect to the likelihood of achieving the forecasted projections. The following table shows the beginning and ending balances in fair value of the contingent consideration (in thousands): Fassio Contingent Consideration Balance, May 31, 2025 $ 21,500 Fair value adjustments 1,500 Balance, February 28, 2026 $ 23,000 Adjustments to the fair value of contingent consideration are recorded within the selling, general and administrative expenses in the condensed consolidation statements of income. Note 5 - Inventories Inventories consisted of the following as of February 28, 2026 and May 31, 2025 (in thousands): February 28, 2026 May 31, 2025 Flocks, net of amortization $ 176,270 $ 166,507 Feed and supplies 113,986 99,188 Raw materials and finished goods inventory 58,654 29,975 $ 348,910 $ 295,670 We grow and maintain flocks of layers (mature female chickens), pullets (female chickens, under 18 weeks of age), and breeders (male and female chickens used to produce fertile eggs to hatch for egg production flocks). Our total flock at February 28, 2026 and May 31, 2025 consisted of approximately 14.3 million and 11.5 million pullets and breeders and 48.0 million and 48.3 million layers, respectively. Note 6 - Equity The following reflects equity activity for the thirteen weeks ended February 28, 2026 and March 1, 2025 (in thousands): Thirteen Weeks Ended February 28, 2026 Cal-Maine Foods, Inc. Stockholders Treasury Paid In Accum. Other Retained Noncontrolling Amount Amount Capital Comp. Income Earnings Interest Total Balance at November 29, 2025 $ 751 $ ( 161,477 ) $ 83,514 $ 1,326 $ 2,767,347 $ 6,305 $ 2,697,766 Other comprehensive income, net of tax — — — 78 — — 78 Stock compensation plan transactions — ( 1,366 ) 868 — — — ( 498 ) Repurchase of shares — ( 24,519 ) — — — — ( 24,519 ) Dividends ($ 0.355 per share) — — — — ( 16,813 ) — ( 16,813 ) Net income — — — — 50,459 659 51,118 Balance at February 28, 2026 $ 751 $ ( 187,362 ) $ 84,382 $ 1,404 $ 2,800,993 $ 6,964 $ 2,707,132 Index 13 Thirteen Weeks Ended March 1, 2025 Cal-Maine Foods, Inc. Stockholders Class A Treasury Paid In Accum. Other Retained Noncontrolling Amount Amount Amount Capital Comp. Loss Earnings Interest Total Balance at November 30, 2024 $ 703 $ 48 $ ( 31,661 ) $ 78,600 $ ( 908 ) $ 1,998,585 $ 6,116 $ 2,051,483 Other comprehensive income, net of tax — — — — 151 — — 151 Stock compensation plan transactions — — ( 3,835 ) 1,077 — — — ( 2,758 ) Dividends ($ 3.456 per share) Common — — — — — ( 152,932 ) — ( 152,932 ) Class A common — — — — — ( 16,589 ) — ( 16,589 ) Net income (loss) — — — — — 508,533 ( 380 ) 508,153 Balance at March 1, 2025 $ 703 $ 48 $ ( 35,496 ) $ 79,677 $ ( 757 ) $ 2,337,597 $ 5,736 $ 2,387,508 Thirty-nine Weeks Ended February 28, 2026 Cal-Maine Foods, Inc. Stockholders Accum. Other Treasury Paid In Comp. Income Retained Noncontrolling Amount Amount Capital (Loss) Earnings Interest Total Balance at May 31, 2025 $ 751 $ ( 85,893 ) $ 80,845 $ ( 1,007 ) $ 2,565,928 $ 5,391 $ 2,566,015 Other comprehensive income, net of tax — — — 2,411 — — 2,411 Stock compensation plan transactions — ( 1,360 ) 3,537 — — — 2,177 Contributions — — — — — 979 979 Repurchase of shares — ( 100,109 ) — — — — ( 100,109 ) Dividends ($ 2.456 per share) — — — — ( 117,493 ) — ( 117,493 ) Net income — — — — 352,558 594 353,152 Balance at February 28, 2026 $ 751 $ ( 187,362 ) $ 84,382 $ 1,404 $ 2,800,993 $ 6,964 $ 2,707,132 Index 14 Thirty-nine Weeks Ended March 1, 2025 Cal-Maine Foods, Inc. Stockholders Class A Treasury Paid In Accum. Other Retained Noncontrolling Amount Amount Amount Capital Comp. Loss Earnings Interest Total Balance at June 1, 2024 $ 703 $ 48 $ ( 31,597 ) $ 76,371 $ ( 1,773 ) $ 1,756,395 $ ( 3,104 ) $ 1,797,043 Other comprehensive income, net of tax — — — — 1,016 — — 1,016 Stock compensation plan transactions — — ( 3,899 ) 3,306 — — — ( 593 ) Contributions to Crepini Foods LLC — — — — — — 6,485 6,485 Acquisition of noncontrolling interest in MeadowCreek Foods LLC — — — — — ( 3,826 ) 3,826 — Dividends ($ 5.965 per share) Common — — — — — ( 263,918 ) — ( 263,918 ) Class A common — — — — — ( 28,627 ) — ( 28,627 ) Net income (loss) — — — — — 877,573 ( 1,471 ) 876,102 Balance at March 1, 2025 $ 703 $ 48 $ ( 35,496 ) $ 79,677 $ ( 757 ) $ 2,337,597 $ 5,736 $ 2,387,508 Note 7 - Net Income per Common Share Basic net income per share attributable to Cal-Maine Foods, Inc. is based on the weighted average shares of Common Stock (and when they were outstanding shares of Class A Common Stock) outstanding. All shares of Class A Common Stock were converted into Common Stock on April 14, 2025. Diluted net income per share attributable to Cal-Maine Foods, Inc. is based on weighted-average shares of Common Stock outstanding during the relevant period adjusted for the dilutive effect of share- based awards. Index 15 The following table provides a reconciliation of the numerators and denominators used to determine basic and diluted net income per common share attributable to Cal-Maine Foods, Inc. (amounts in thousands, except per share data): Thirteen Weeks Ended Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025 Numerator Net income $ 51,118 $ 508,153 $ 353,152 $ 876,102 Less: Gain (loss) attributable to noncontrolling interest 659 ( 380 ) 594 ( 1,471 ) Net income attributable to Cal-Maine Foods, Inc. $ 50,459 $ 508,533 $ 352,558 $ 877,573 Denominator Weighted-average common shares outstanding, basic 47,299 48,798 47,866 48,774 Effect of dilutive restricted shares 115 173 137 188 Weighted-average common shares outstanding, diluted 47,414 48,971 48,003 48,962 Net income per common share attributable to Cal-Maine Foods, Inc. Basic $ 1.07 $ 10.42 $ 7.37 $ 17.99 Diluted $ 1.06 $ 10.38 $ 7.34 $ 17.92 Note 8 - Stock Based Compensation Total stock-based compensation expense was $ 4.0 million and $ 3.4 million for the thirty-nine weeks ended February 28, 2026 and March 1, 2025, respectively. Unrecognized compensation expense as a result of non-vested shares of equity-based awards outstanding under the Amended and Restated 2012 Omnibus Long-Term Incentive Plan at February 28, 2026 of $ 11.2 million will be recorded over a weighted average period of 2.3 years. Refer to Part II Item 8, Notes to Consolidated Financial Statements and Supplementary Data, Note 13 – Stock-Based Compensation in our 2025 Annual Report for further information on our stock compensation plans. The Company’s equity-based award activity for the thirty-nine weeks ended February 28, 2026 was as follows: Number of Shares Weighted Average Grant Date Fair Value Outstanding, May 31, 2025 212,717 $ 66.93 Granted 95,747 78.69 Vested ( 81,358 ) 54.12 Forfeited ( 3,766 ) 82.85 Outstanding, February 28, 2026 223,340 $ 76.37 Index 16 Note 9 – Segment Reporting The Company has one operating and one reportable segment, which is the production, packaging, marketing and distribution of shell eggs, prepared foods and egg products. The Company is managed on a consolidated basis. The Company’s operating segment is determined on the basis of our organizational structure and information that is regularly reviewed by our Chief Operating Decision Maker (“CODM”). The Company’s CODM is Sherman Miller, President and Chief Executive Officer. The CODM reviews net income, which is reported on the Condensed Consolidated Statements of Income, to assess the performance of, and make decisions on how to allocate resources to, the segment. The CODM utilizes consolidated expense information regularly provided in the CODM package in order to assist with assessing performance and deciding how to allocate resources, which align with the consolidated expense categories as disclosed on the face of the Condensed Consolidated Statements of Income. The measure of segment assets is reported on the Condensed Consolidated Balance Sheet as Total assets. Revenue primarily derives from the sales of shell eggs, prepared foods, and egg products throughout the United States. The Company’s shell egg product offerings include specialty and conventional shell eggs. Specialty shell eggs include cage-free, organic, brown, free-range, pasture-raised and nutritionally enhanced eggs. Conventional shell eggs sales represent all other shell egg sales not sold as specialty shell eggs. The Company’s prepared foods include offerings such as pre-cooked egg patties, omelets, folded and scrambled egg formats, hard-cooked eggs, pancakes, waffles, and specialty wraps. Egg products include liquid and frozen egg products. Other sales represent feed sales, miscellaneous byproducts and resale products. The following table provides revenue disaggregated by product category (in thousands): Thirteen Weeks Ended Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025 Conventional shell egg sales $ 283,173 $ 1,016,438 $ 1,152,979 $ 2,118,065 Specialty shell egg sales 289,141 328,944 858,299 872,691 Prepared foods 63,626 11,757 219,212 31,134 Egg products 18,360 49,267 89,998 105,716 Other 12,651 11,279 38,563 30,621 $ 666,951 $ 1,417,685 $ 2,359,051 $ 3,158,227 The following table provides revenue disaggregated by sales channel (in thousands): Thirteen Weeks Ended Thirty-nine Weeks Ended February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025 Retail $ 560,843 $ 1,199,697 $ 1,925,993 $ 2,679,826 Foodservice 94,389 207,315 371,410 451,040 Other 11,719 10,673 61,648 27,361 $ 666,951 $ 1,417,685 $ 2,359,051 $ 3,158,227 Retail customers include primarily national and regional grocery store chains, club stores, and companies servicing independent supermarkets in the U.S. Foodservice customers include primarily companies that sell food products and related items to restaurants, convenience stores, healthcare and education facilities and hotels. Note 10 - Commitments and Contingencies In re Shell Eggs Litigation Since November 2025, the Company has been named as a defendant in several lawsuits filed in federal courts alleging substantially identical claims, including: (1) the following lawsuits in the Southern District of Indiana: (a) King Kullen Grocery Co., Inc. v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-2274, (b) Nineteenseventynine LLC d/b/a The Breakfast Joynt v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-2301, (c) Taylor Egg Products, Inc. v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-2554, (d) Hudson v. Cal-Maine Foods, Inc. et al., Case No. 1:25-cv-02573, (e) Brandon Huyler v. Cal-Maine Foods, Inc., et al., Case No. 1:26-cv-00135, and (f) Gloria Emery, Carol Goldberg, and Casey Whalen v. Cal-Maine Foods, Inc., et al., Case No. 1:26-cv-00135; (2) the following lawsuits in the Northern District of Illinois: (a) Birchmans Parisian, LLC (d/b/a Index 17 Lisciandro's Restaurant) v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-14030, (b) Phil-N-Cindy's Lunch, Inc. v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-14082, (c) Yell -O-Glow Corporation v. Cal-Maine Foods, Inc., et al., Case No. 1:25-cv- 15084, and (d) Tariq Habash, Delia Govea, Andrew Phillips, and Catalina Torres v. Urner Barry Publications, Inc., Cal-Maine Foods, Inc., et al., Case No. 1:25-cv-14112; (3) the following lawsuits in the Western District of Wisconsin: (a) Matthew Edlin v. Cal-Maine Foods, Inc., et al., Case No. 3:25-cv-946, and (b) India Price, Lakia Session, and Karen Solomon v. Cal-Maine Foods, Inc., et al., Case No. 3:25-cv-1016; and (4) the following lawsuit in the Western District of Missouri: (a) Ryan v. Cal- Maine Foods, Inc., et al., Case No. 4:25-cv-00999. The lawsuits generally allege that the Company, along with other egg producers and industry associations, conspired to artificially inflate the prices of conventional shell eggs nationwide, primarily through manipulation of industry price benchmarks (such as the Urner Barry Egg Index and Eggs Clearinghouse, Inc. spot market), coordinated reporting and supply restrictions, particularly during the calendar year 2022 highly pathogenic avian influenza (“HPAI”) outbreak. In each case, the plaintiff seeks certification of a putative class of either direct or indirect purchasers, monetary damages, injunctive relief, attorneys’ fees, and, in some cases, restitution under Section 1 of the Sherman Act, 15 U.S.C. § 1 (the “Sherman Act”) and various state antitrust and consumer protection statutes. On February 10, 2026, the Joint Panel on Multidistrict Litigation issued a Transfer Order, consolidating the above actions and transferring them to the Western District of Wisconsin for pre-trial proceedings. The parties in each case had agreed to stay the deadline for the Company to answer or otherwise respond to the complaints pending an initial case management order and initiation of pretrial proceedings in the multi-district litigation. No discovery has taken place in any of the actions. The Company disputes plaintiffs’ allegations in each of these actions and intends to vigorously defend itself in these actions. Civil Investigative Demand In March 2025, the Company received a Civil Investigative Demand (“CID”) from the Department of Justice (“DOJ”) in connection with an antitrust investigation to determine whether there is, has been or may be a violation of the antitrust laws by anticompetitive conduct by and among egg producers. In August 2025, the Company received a subpoena from the State of New York requesting information and documents related to its investigation of anticompetitive conduct and high egg prices in the egg industry, and in March 2026, the Company received a similar subpoena from the State of Washington related to its investigation of anticompetitive conduct and high egg prices in the egg industry. Additionally, various state Attorneys General have sought to join the DOJ’s investigation or have requested access to the confidential disclosures by the Company to DOJ. The Company is complying with the CID and the subpoenas and cooperating with the investigations. Management cannot predict the eventual scope, duration or outcome of these investigations and is unable to estimate the amount or range of potential losses, if any, at this time. State of Texas v. Cal-Maine Foods, Inc. d/b/a Wharton; and Wharton County Foods, LLC On April 23, 2020, the Company and its subsidiary Wharton County Foods, LLC (“WCF”) were named as defendants in State of Texas v. Cal-Maine Foods, Inc. d/b/a Wharton; and Wharton County Foods, LLC, Cause No. 2020-25427, in the District Court of Harris County, Texas. The State of Texas (the “State”) asserted claims based on the Company’s and WCF’s alleged violation of the Texas Deceptive Trade Practices—Consumer Protection Act, Tex. Bus. & Com. Code §§ 17.41-17.63 (“DTPA”). The State claimed that the Company and WCF offered shell eggs at excessive or exorbitant prices during the COVID-19 state of emergency and made misleading statements about shell egg prices. The State sought temporary and permanent injunctions against the Company and WCF to prevent further alleged violations of the DTPA, along with over $ 100,000 in damages. In January 2026, the Company and WCF reached a settlement with the State of Texas with no admission of wrongdoing. Under the agreed order implementing the settlement, the Company and WCF agreed to donate 180,000 dozen large shell eggs to certain Texas food banks at no cost to the food banks. Kraft Foods Global, Inc. et al. v. United Egg Producers, Inc. et al. On September 25, 2008, the Company was named as one of several defendants in numerous antitrust cases involving the U.S. shell egg industry. The Company settled all of these cases, except for the claims of certain plaintiffs who sought substantial damages allegedly arising from the purchase of egg products (as opposed to shell eggs). These remaining plaintiffs are Kraft Food Global, Inc., General Mills, Inc., and Nestle USA, Inc. (the “Egg Products Plaintiffs”) and, until a subsequent settlement was reached as described below, The Kellogg Company. On September 13, 2019, the case with the Egg Products Plaintiffs was remanded from a multi-district litigation proceeding in the United States District Court for the Eastern District of Pennsylvania, In re Processed Egg Products Antitrust Litigation, MDL No. 2002, to the United States District Court for the Northern District of Illinois, Kraft Foods Global, Inc. et al. v. United Egg Producers, Inc. et al., Case No. 1:11 -cv-8808, for trial. The Egg Products Plaintiffs alleged that the Company and other defendants violated Section 1 of the Sherman Act, 15. U.S.C. § 1, by agreeing to limit the production of eggs and thereby Index 18 illegally to raise the prices that plaintiffs paid for processed egg products. In particular, the Egg Products Plaintiffs attacked certain features of the United Egg Producers animal-welfare guidelines and program used by the Company and many other egg producers. On October 24, 2019, the Company entered into a confidential settlement agreement with The Kellogg Company dismissing all claims against the Company for an amount that did not have a material impact on the Company’s financial condition or results of operations. On November 11, 2019, a stipulation for dismissal was filed with the court, and on March 28, 2022, the court dismissed the Company with prejudice. The trial of this case began on October 17, 2023. On December 1, 2023, the jury returned a decision awarding the Egg Products Plaintiffs $ 17.8 million in damages. On November 6, 2024, the court entered a final judgement against the Company and other defendants, jointly and severally, totaling $ 43.6 million after trebling. On December 4, 2024, the Company filed a renewed motion for judgment as a matter of law or for a new trial, and a motion to alter or amend the judgment. On December 13, 2024, the court granted defendants’ November 20, 2024 motion to stay enforcement of the judgment and entered an agreed order requiring the defendants to post security during post-judgment proceedings and appeal, and stayed proceedings to enforce the judgment until the disposition of the post-judgment motions and ultimate appeals. On December 17, 2024, the Company posted a bond in the approximate amount of $ 23.9 million, representing a portion of the total bond required to preserve the right to appeal the trial court’s decision. Another defendant posted a bond for the remaining amount. On November 19, 2025, the plaintiffs filed a motion to lift stay of proceedings on attorney’s fees and costs, and on December 5, 2025, the defendants filed their response in opposition to such motion. The court has not ruled on this motion. The Company intends to continue to vigorously defend the claims asserted by the Egg Products Plaintiffs. If the jury’s decision is ultimately upheld, the Company would be jointly and severally liable with other defendants for treble damages, or $ 43.6 million, subject to credit for certain settlements with previous settling defendants, plus the Egg Product Plaintiffs’ reasonable attorneys’ fees. During our second quarter of fiscal 2024, we recorded an accrued expense of $ 19.6 million in selling, general and administrative expenses in the Company’s Condensed Consolidated Statements of Income and classified as other noncurrent liabilities in the Company’s Condensed Consolidated Balance Sheets. Although less than the bond posted by the Company, the accrual represents our estimate of the Company’s proportional share of the reasonably possible ultimate damages award, excluding the Egg Product Plaintiffs’ attorneys’ fees that we believe would be approximately offset by the credits noted above. We have entered into a judgment allocation and joint defense agreement with the other defendants remaining in the case. Our accrual may change in the future to the extent we are successful in further proceedings in the litigation. State of Oklahoma Watershed Pollution Litigation On June 18, 2005, the State of Oklahoma filed suit, in the United States District Court for the Northern District of Oklahoma, against Cal-Maine Foods, Inc. and Tyson Foods, Inc., Cobb-Vantress, Inc., Cargill, Inc., George’s, Inc., Peterson Farms, Inc. and Simmons Foods, Inc., and certain of their affiliates. The State of Oklahoma claims that through the disposal of chicken litter the defendants polluted the Illinois River Watershed. This watershed provides water to eastern Oklahoma. The complaint sought injunctive relief and monetary damages, but the claim for monetary damages was dismissed by the court. Cal-Maine Foods, Inc. discontinued operations in the watershed in or around 2005. Since the litigation began, Cal-Maine Foods, Inc. purchased 100 % of the membership interests of Benton County Foods, LLC, which is an ongoing commercial shell egg operation within the Illinois River Watershed. Benton County Foods, LLC is not a defendant in the litigation. We also have a number of small contract producers that operate in the area. The non-jury trial in the case began in September 2009 and concluded in February 2010. On January 18, 2023, the court entered findings of fact and conclusions of law in favor of the State of Oklahoma, but no penalties were assessed. The court found the defendants jointly and severally liable for state law nuisance, federal common law nuisance, and state law trespass. The court also found the producers vicariously liable for the actions of their contract producers. On June 12, 2023, the court ordered the parties to mediate, but the mediation was unsuccessful. On June 26, 2024, the district court denied defendants’ motion to dismiss the case. On September 13, 2024, a status hearing was held and the court scheduled an evidentiary hearing for December 3, 2024, to determine whether any legal remedy is available based on the now 15-year-old record and changed circumstances of the Illinois River watershed. On June 17, 2025, the court entered an opinion and order that found that the State satisfied its burden to show that conditions in the Illinois River watershed have not materially changed since the original trial and the case was not moot. On July 9, 2025, the State of Oklahoma filed its form of proposed final judgment and brief in support thereof seeking over $ 100 million in total fines from all defendants, including approximately $ 18.2 million in fines from the Company, plus attorneys’ fees. On July 30, 2025, the Company and other defendants filed their form of proposed final judgment and brief in support thereof seeking no monetary fines or penalties. On December 9, 2025, the court entered a final judgment imposing approximately $ 420,000 in total penalties for all defendants and awarding certain non-monetary remedies, including injunctive relief. Pursuant to the final judgment, the Company is to pay approximately $ 70,000 in penalties. The judgment also entitles the State of Oklahoma to an award of attorneys’ fees and costs in an amount to be determined at a later Index 19 date. The defendants expect to appeal this judgement. No accrual for this legal proceeding has been recorded as such amount is not deemed material. The injunctive relief provides for, among other things, a special master to oversee an investigation, develop a remediation plan subject to court approval, and provide ongoing monitoring of remediation projects, the costs of which will be paid jointly and severally by the defendants. The defendants are required to fund $ 10 million within 5 days of appointment of the special master, and ongoing funding requirements of $ 5 million any time the fund is below $ 5 million. This funding obligation is expected to continue for the 30 years term. The defendants are in discussions of a potential expense sharing agreement; however, the Company does not currently expect to have a material share of the funding. The injunctive relief also includes certain annual reporting requirements and certain requirements on future operations within the Illinois River Watershed, including relating to removal of litter, storage, transportation, disposal and future land applications. The Company is continuing to review and analyze the effects of the final judgement and cannot estimate the range of possible losses, but currently does not expect these additional requirements to have a material impact on its operations. On December 29, 2025, the defendants, including the Company, filed a motion to stay enforcement of the judgment, and a brief in support thereof, pending the defendants’ appeals to the United States Court of Appeals for the Tenth Circuit. On January 2, 2026, the Company filed its notice of appeal to the United States Court of Appeals for the Tenth Circuit. On January 16, 2026, the district court stayed the monetary portions of the judgement but declined to stay the injunctive portions. Certain defendants, not including the Company, have since negotiated settlements in the form of consent judgments, and filed a joint brief with the State of Oklahoma supporting the entry of the consent judgments. The trial court has not issued an indicative ruling on whether it would approve or disapprove of the settlements. On March 24, 2026, the Tenth Circuit entered an order denying the defendants’ request for a stay pending the appeal. The Company intends to continue to vigorously defend the claims asserted by the State of Oklahoma. Other Matters In addition to the above, the Company is involved in various other claims and litigation incidental to its business. Although the outcome of these matters cannot be determined with certainty, management, upon the advice of counsel, is of the opinion that the final outcome should not have a material effect on the Company’s consolidated results of operations or financial position. Note 11 - Subsequent Events Effective on March 2, 2026 , the Company acquired the shell egg, egg products, and prepared foods assets of Creighton Brothers LLC, including Crystal Lake LLC, for a total purchase price of approximately $ 128.5 million, subject to post-closing adjustments. The acquired assets include commercial shell egg production and grading with capacity of approximately 3.2 million layers, including 500 thousand cage-free layers, and 865 thousand pullets, a feed mill, 1,007 acres of land, as well as an egg products and hard-cooked egg processing facility located near Warsaw, Indiana. Index 20