IFF

Materials

International Flavors & Fragrances

Price Chart

Market Data

Financials

XBRL · SEC EDGAR

2008–2025(18yr)

Revenue

Net Income

Free CF

Metric	FY 2008	FY 2009	FY 2010	FY 2011	FY 2012	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017	FY 2018	FY 2019	FY 2020	FY 2021	FY 2022	FY 2023	FY 2024	FY 2025Latest	YoY
Revenue	$2.4B	$2.3B	$2.6B	$2.8B	$2.8B	$3.0B	$3.1B	$3.0B	$3.1B	$3.4B	$4.0B	$5.1B	$5.1B	$11.7B	$12.4B	$11.5B	$11.5B	$10.9B	-5.2%
Gross Profit	$970.9M	$934.2M	$1.1B	$1.1B	$1.2B	$1.3B	$1.4B	$1.4B	$1.4B	$1.5B	$1.7B	$2.1B	$2.1B	$3.7B	$4.2B	$3.7B	$4.1B	$3.9B	-4.5%
Gross Margin	40.6%	40.2%	41.7%	39.6%	41.7%	43.5%	44.1%	44.7%	44.9%	43.5%	42.3%	41.1%	41.0%	32.0%	33.4%	32.1%	35.9%	36.2%	+0.3pp
Operating Income	—	$340.3M	$416.4M	$427.7M	$486.6M	$516.3M	$592.3M	$588.3M	$567.4M	$581.4M	$583.9M	$665.3M	$566.5M	$585.0M	-$1.3B	-$2.1B	$766.0M	-$382.0M	-149.9%
Operating Margin	—	14.6%	15.9%	15.3%	17.2%	17.5%	19.2%	19.5%	18.2%	17.1%	14.7%	12.9%	11.1%	5.0%	-10.7%	-18.4%	6.7%	-3.5%	-10.2pp
Net Income	$229.6M	$195.5M	$263.6M	$266.9M	$254.1M	$353.5M	$414.5M	$419.2M	$405.0M	$295.7M	$339.8M	$460.3M	$367.4M	$279.0M	-$1.9B	-$2.6B	$247.0M	-$359.0M	-245.3%
Net Margin	9.6%	8.4%	10.0%	9.6%	9.0%	12.0%	13.4%	13.9%	13.0%	8.7%	8.5%	9.0%	7.2%	2.4%	-15.0%	-22.3%	2.2%	-3.3%	-5.4pp
Free Cash Flow	$135.2M	$224.8M	$208.8M	$61.7M	$197.7M	$273.4M	$375.2M	$332.5M	$409.0M	$261.8M	$267.5M	$463.0M	$522.3M	$1.0B	-$107.0M	$936.0M	$607.0M	$256.0M	-57.8%
FCF Margin	5.7%	9.7%	8.0%	2.2%	7.0%	9.3%	12.1%	11.0%	13.1%	7.7%	6.7%	9.0%	10.3%	9.0%	-0.9%	8.2%	5.3%	2.4%	-2.9pp
EPS (Diluted)	$2.86	$2.46	$3.26	$3.26	$3.09	$4.29	$5.06	$5.16	$5.05	$3.72	$3.79	$4.00	$3.21	$1.10	$-7.32	$-10.05	$0.95	$-1.41	-248.4%

Total Debt$5.6B

Cash & Equiv.$590.0M

Net Debt$5.0B

4 min read

1. THE BIG PICTURE

International Flavors & Fragrances is a market leader in essential consumer ingredients that is currently forced to shrink to survive. International Flavors & Fragrances is aggressively divesting assets, such as its Food Ingredients segment, to address a massive $5.994 billion debt pile that has left it with negative net margins and limited room to maneuver (10-K Item 1A). While it remains a critical partner for global consumer brands, it is currently a turnaround story where the primary focus is financial stabilization rather than market expansion.

2. WHERE THE RISKS HIT HARDEST

International Flavors & Fragrances’s "global scale" and "customer intimacy" (10-K Item 1) are directly threatened by ongoing antitrust investigations in multiple countries and class action lawsuits in the U.S. and Canada. These legal challenges could result in material fines or business restrictions that would compromise its ability to maintain its "core list" status with major multinational clients (10-K Item 1A).

Furthermore, International Flavors & Fragrances’s commitment to being "dividend-focused" (XBRL) is at odds with its balance sheet reality. In 2025, International Flavors & Fragrances returned $447 million to shareholders despite generating only $256 million in Free Cash Flow (XBRL). This gap, combined with $5.994 billion in total debt, creates a precarious situation where any credit rating downgrade would immediately increase borrowing costs and likely force a reduction in capital returns (10-K Item 1A).

3. WHAT THE NUMBERS SAY TOGETHER

The financial data reveals that "portfolio optimization" is a necessity driven by deteriorating performance. While management characterized 2025 as "solid," International Flavors & Fragrances reported a net loss of $307 million (XBRL). Revenue fell 7% in the most recent quarter, a sharper decline than the -5.2% TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter growth rate, indicating that the sales contraction is accelerating (8-K). This divergence is largely tied to the Food Ingredients segment, which saw a 4% sales decrease and a $1.153 billion impairment charge (8-K, 10-K Item 1A).

Skeptical sentiment is evident in the supplemental data, with 9.2 million shares held short, representing 4.8% of the float (Yahoo Finance). This suggests that a significant portion of the market is betting against the turnaround. While the Scent and Health & Biosciences segments showed modest growth of 4% and 5% respectively, they are not yet large enough to offset the drag from the restructuring food business (8-K).

4. IS IT WORTH IT AT THIS PRICE?

At a Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations of 15.3x, the market is pricing in ~3.5% long-term growth (CAPM analysis). This represents a modest 20% discount to the peer median of 19.0x (Yahoo Finance).

This discount is justified by International Flavors & Fragrances's inferior margin profile. International Flavors & Fragrances reports a net margin of -2.7%, the lowest in a peer group where companies like Ecolab (ECL) and PPG maintain double-digit positive margins (Peer Benchmarking). For the current price to be "right," International Flavors & Fragrances must successfully execute its divestiture of Food Ingredients to de-lever the balance sheet. If growth instead slows to 2.5%, the justified multiple would fall to 13.3x, implying roughly 13% downside from current levels (CAPM analysis).

5. WHAT WOULD CHANGE THIS VIEW?

Cautious if antitrust investigations result in significant financial penalties or if International Flavors & Fragrances records further impairments against its $14.3 billion in intangible assets (10-K Item 1A).
Constructive if the sale of the Food Ingredients segment significantly reduces the $5.994 billion debt load and moves the operating margin toward the peer median (8-K, Peer Benchmarking).
Constructive if quarterly sales growth in the Scent and Health & Biosciences segments accelerates beyond the mid-single digits, proving the core business can grow independently of the divested units (8-K).

6. BOTTOM LINE

Structural Advantage: A vast library of proprietary trade secret formulas and a global network of creative centers that make International Flavors & Fragrances an indispensable, vertically integrated partner for the world's largest consumer brands.

Bottom Line: International Flavors & Fragrances is a high-risk turnaround play burdened by debt and legal clouds; until divestitures stabilize the bottom line, its valuation discount to peers is fully earned.

Source: Synthesis · LLM Analysis

4 min read

1. Top 5 Material Risks

Indebtedness: International Flavors & Fragrances carries approximately $5.994 billion in total debt as of December 31, 2025. This leverage limits financial flexibility, restricts the ability to return capital to shareholders, and subjects International Flavors & Fragrances to potential credit rating downgrades that would increase borrowing costs.
Legal and Antitrust Exposure: International Flavors & Fragrances is currently subject to antitrust investigations in multiple countries and class action lawsuits in the U.S. and Canada. Unfavorable outcomes could result in significant fines, penalties, or business restrictions that would negatively impact liquidity and financial condition.
Asset Impairment: With $14.3 billion in intangible assets and goodwill, International Flavors & Fragrances faces the risk of future impairment charges. International Flavors & Fragrances already recorded a $1.153 billion impairment charge in the Food Ingredients segment during 2025 following a segment restructuring.
Strategic Transformation Execution: International Flavors & Fragrances’s ongoing portfolio optimization, including potential strategic alternatives for the Food Ingredients segment, involves complex divestitures and acquisitions. Failure to execute these transactions successfully could lead to stranded costs, dis-synergies, and the assumption of unforeseen liabilities.
Input Cost Volatility: International Flavors & Fragrances is vulnerable to inflationary pressures affecting raw materials, transportation, and energy. If International Flavors & Fragrances cannot pass these costs to customers through price increases, its margins and operating results will suffer.

2. Company-Specific Risks

Customer Concentration: Approximately 32% of 2025 sales were generated by the 25 largest customers. The loss of "core list" status with these multinational companies, or the requirement to provide more favorable rebate terms, could adversely affect margins.
Pension Funding Obligations: International Flavors & Fragrances’s pension and postretirement plans are subject to funding requirements that fluctuate based on financial market performance and interest rates. Volatility in these markets can necessitate larger-than-expected cash contributions, impacting liquidity.
AI-Related Liabilities: International Flavors & Fragrances faces risks from the use of AI tools, including potential intellectual property disputes, loss of trade secrets, and inaccurate or biased business process outcomes that could lead to material liabilities.
N&B Transaction Indemnification: Under the Tax Matters Agreement related to the 2021 N&B Transaction, International Flavors & Fragrances is obligated to indemnify DuPont for tax liabilities resulting from a "Spinco Tainting Act," which could have a material adverse effect on International Flavors & Fragrances's financial condition.

3. Regulatory/Legal Risks

Environmental Compliance: Operations are subject to stringent laws regarding air emissions, waste disposal, and hazardous materials. Non-compliance could force the closure or relocation of production facilities and expose International Flavors & Fragrances to civil or criminal liability.
Anti-Bribery and Corruption: International Flavors & Fragrances is subject to the U.S. Foreign Corrupt Practices Act (FCPA) and similar international laws. Given its presence in emerging markets like China, India, and Brazil, International Flavors & Fragrances faces elevated risks of fraud and corruption investigations, which are costly and time-consuming to resolve.
Data Protection: International Flavors & Fragrances must comply with evolving global data protection laws, such as GDPR and CCPA. Failure to protect personal data or comply with localization requirements could result in significant fines, penalties, and litigation.
Tax Legislation: Changes in tax laws, including the U.S. Inflation Reduction Act, the One Big Beautiful Bill Act (OBBBA), and the OECD’s Pillar Two minimum tax framework, create uncertainty regarding International Flavors & Fragrances’s future effective tax rate and cash tax obligations.

4. Financial Impact Map

Indebtedness → Liquidity and Cost of Capital → $5.994 billion total debt as of December 31, 2025 Antitrust Investigations → Results of Operations → Potential fines, penalties, and business restrictions Goodwill and Intangible Assets → Profitability → $14.3 billion carrying value subject to impairment testing Input Cost Inflation → Gross Margin → Potential for margin compression if price increases do not offset raw material and energy costs Tax Legislation → Effective Tax Rate → Potential for increased tax liabilities and provision for income taxes due to Pillar Two and OBBBA implementation

Source: 10-K Item 1A · LLM Analysis

Recent Filings

Form	Filed	Period
10-K	Feb 2026	Dec 2025
8-K	Feb 2026	—
10-Q	Nov 2025	Sep 2025
14A	Mar 2025	—