Middleby Outdoor Sees Revenue Growth, Replacement Sales

Much of the talk on Middleby’s earnings call today was centered around their major headwinds in their Commercial segment. The number of restaurant closures sounds pretty bleak, which directly impacts orders for Middleby.

At our Commercial Foodservice business, gradual improvement in ordering levels we saw throughout the first half, dropped off as we progressed through the third quarter. Restaurant traffic, which was anticipated to improve at many of our customers in Q3, declined by reported 3.5% across the restaurant sector for the quarter. At the same time, food costs, which have been improving throughout 2023, saw a reacceleration of cost increases in recent months. These factors slowed execution against our customers’ business plans and ordering of equipment for upgrades and new store openings.