Sysco Reports Third Quarter Fiscal Year 2026 Results
HOUSTON, April 28, 2026 (GLOBE NEWSWIRE) -- Sysco Corporation (NYSE:SYY) (“Sysco” or the “company”) today announced financial results for its 13-week third fiscal quarter ended March 28, 2026.
Key financial results for the third quarter of fiscal year 2026 include the following (comparisons are to the same period in fiscal year 2025):
“Sysco delivered strong results in the third quarter of fiscal 2026, driven by continued acceleration in local case volume and expanded gross margins,” said Kevin Hourican, Sysco’s Chair of the Board and Chief Executive Officer. “Importantly, our U.S. local volumes grew 3.3%, the highest quarterly rate in over three years. This exceeded our prior commitment, and we remain confident in delivering over 2.5% U.S. local growth in Q4, which would put us on pace to accelerate on a two-year stack basis. Our USFS segment returned to operating profit growth for the quarter. We are encouraged by the progress, results, and momentum across each of our business segments. As we look ahead, our strong operating foundation, improving productivity, and the compelling opportunity presented by the pending Jetro Restaurant Depot combination, position Sysco to grow profitably, deepen our relationships with more local customers, and create incremental value for our shareholders.”
“Third quarter results reflected strong earnings execution and solid cash flow generation, supported by continued volume acceleration, gross margin expansion, and disciplined cost management, which included headwinds from lapping $63 million of incentive compensation,” said Brandon Sewell, Sysco’s Interim Chief Financial Officer. “Year‑to‑date free cash flow increased 19%, and we are encouraged by improving productivity, particularly in our U.S. Foodservice local business. These results support our confidence in delivering full‑year adjusted EPS at the high end of our $4.50 to $4.60 guidance range, which continues to include an approximate $100 million ($0.16 per diluted share) headwind from lapping lower incentive compensation in fiscal 2025.”
(1) Adjusted financial results, including adjusted operating expense, adjusted operating income (loss), adjusted net earnings, adjusted earnings per share (EPS) and adjusted EBITDA, among others, are non-GAAP financial measures that exclude certain items, which primarily include acquisition-related costs, restructuring and severance costs, and transformational project costs. Adjustments provided herein for fiscal 2026 results of operations also remove the impact of a charge associated with a legal matter. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release. For additional information regarding forward-looking full year adjusted EPS see section below entitled “Projected Adjusted EPS Guidance.”
(2) Free cash flow is a non-GAAP financial measure that represents net cash provided from operating activities less purchases of plant and equipment and includes proceeds from sales of plant and equipment. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release.
(3) Earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted EBITDA are non-GAAP financial measures. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release.
(4) Earnings per share (EPS) is shown on a diluted basis, unless otherwise specified.
Third Quarter Fiscal Year 2026 Results (comparisons are to the same period in fiscal year 2025)
Total Sysco
Sales for the third quarter increased 4.7% to $20.5 billion.
Gross profit increased 6.5% to $3.8 billion, and gross margin increased 31 basis points to 18.6%. Product cost inflation was 2.8% at the total enterprise level, as measured by the estimated change in Sysco’s product costs, primarily in the dairy, meat, and seafood categories. The increase in gross profit for the third quarter was primarily driven by positive volumes, strategic sourcing efficiencies, and effective management of product cost inflation.
Operating expenses increased 10.1%, primarily driven by higher incentive compensation, sales headcount and capacity investments. Adjusted operating expenses increased 8.4% 1.
Operating income decreased 9.1% to $619 million, and adjusted operating income decreased 0.6% to $768 million 1.
U.S. Foodservice Operations
The U.S. Foodservice Operations segment results reflected positive case growth across local and national customers, higher gross margins, partially offset by lapping incentive compensation from the prior year and planned investments in sales headcount and expanded capacity.
Sales for the third quarter increased 3.1% to $14.2 billion. Total case volume within U.S. Foodservice Operations increased 2.3% for the third quarter, while local case volume within U.S. Foodservice Operations increased 3.3%.
Gross profit increased 5.2% to $2.7 billion, and gross margin increased 38 basis points to 19.2%.
Operating expenses increased 6.3%, and adjusted operating expenses increased 5.2% 1.
Operating income increased 2.4% to $772 million, and adjusted operating income increased 5.1% to $830 million 1.
International Foodservice Operations
The International Foodservice Operations segment delivered strong sales growth, robust local volume gains, and double-digit adjusted operating income growth.
Sales for the third quarter increased 12.4% to $3.9 billion. On a constant currency basis 5, sales for the third quarter increased 5.2% to $3.6 billion. Foreign exchange rates increased both International Foodservice Operations sales by 7.2% and total Sysco sales by 1.3% during the quarter.
Gross profit increased 14.6% to $834 million, and gross margin increased 41 basis points to 21.5%. On a constant currency basis 5, gross profit increased 6.7% to $777 million. Foreign exchange rates increased both International Foodservice Operations gross profit by 7.9% and total Sysco gross profit by 1.7% during the quarter.
(5) Represents a constant currency adjustment, which eliminates the impact of foreign currency fluctuations on current year results. These adjusted measures are non-GAAP financial measures. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release.
Operating expenses increased 18.8%, and adjusted operating expenses increased 15.0% 1. On a constant currency basis 5, adjusted operating expenses increased 6.7%. Foreign exchange rates increased both International Foodservice Operations operating expenses by 8.3% and total Sysco operating expenses by 1.8% during the quarter.
Operating income decreased 13.5% to $83 million, and adjusted operating income increased 12.5% to $144 million 1. On a constant currency basis 5, adjusted operating income increased 7.0% to $137 million. Foreign exchange rates increased both International Foodservice Operations operating income by 5.5% and total Sysco operating income by 1.0% during the quarter.
Balance Sheet, Cash Flow and Capital Spending
As of the end of the quarter, the company had a cash balance of $1.9 billion and total liquidity 6 of $4.4 billion.
Debt to net earnings was approximately 8.1 times, and Net Debt to adjusted EBITDA 7 was approximately 2.8 times.
During the first 39 weeks of fiscal year 2026, Sysco returned $978 million to shareholders via $200 million of share repurchases and $778 million of dividends.
Cash flow from operations was $1.5 billion and free cash flow 8 was $1.1 billion for the first 39 weeks of fiscal year 2026.
Capital expenditures, net of proceeds from sales of plant and equipment, for the first 39 weeks of fiscal year 2026 were $330 million.
Details of Previously Announced Acquisition of Jetro Restaurant Depot
On March 30, 2026, subsequent to quarter-end, the company announced that it had entered into an agreement to acquire Jetro Restaurant Depot, a leading U.S. wholesale cash-and-carry foodservice provider serving smaller, independent restaurants and businesses. Jetro Restaurant Depot operates 167 large-format warehouse stores across 35 states, serving more than 725,000 independent restaurants and foodservice operators with a broad assortment of fresh and low-priced products. This transaction remains subject to regulatory review and is expected to close by Sysco’s third quarter of fiscal 2027, subject to the satisfaction of customary closing conditions, including receipt of the regulatory approvals.
(6) Available liquidity includes cash and cash equivalents, available borrowing capacity under our revolving credit facility, less outstanding drawings under our commercial paper program, as of the applicable reporting date.
(7) Net debt to adjusted EBITDA is a non-GAAP financial measure frequently used by investors and credit rating agencies. Our net debt to adjusted EBITDA ratio is calculated using a numerator of our debt minus cash and cash equivalents, divided by the sum of the most recent four quarters of adjusted EBITDA. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release.
(8) Free cash flow is a non-GAAP financial measure that represents net cash provided from operating activities less purchases of plant and equipment and includes proceeds from sales of plant and equipment. Reconciliations of all non-GAAP financial measures to the nearest corresponding GAAP financial measure are included at the end of this release.
Conference Call & Webcast
Sysco will host a conference call to review the company’s third quarter fiscal year 2026 financial results on Tuesday, April 28, 2026, at 10:00 a.m. Eastern Time. A live webcast of the call, accompanying slide presentation and a copy of this news release will be available online at investors.sysco.com.
Forward-Looking Statements
Statements made in this press release or in our earnings call for the third quarter of fiscal year 2026 include statements that are forward-looking or that express management’s beliefs, expectations or hopes and are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements include, among other things, our future financial performance and results, business strategy, plans, goals and objectives, including certain outlook, business trends, our dividend and share repurchase programs, our expectation of future macroeconomic conditions and other statements that are not historical facts, including our expectations regarding foot traffic and volume growth, and benefits to gross margins; and our expectations regarding our future growth, including growth in sales and earnings per share; as well as statements about the expected timing and completion of the proposed transaction with Jetro Restaurant Depot and the anticipated benefits of such proposed transaction.
Such forward-looking statements reflect the views of management at the time such statements are made and are subject to a number of risks, uncertainties, estimates, and assumptions, including those outside of Sysco’s control. Risks and uncertainties include without limitation: the impact of geopolitical, economic and market conditions and developments, including changes in global trade policies and tariffs and foreign conflicts; risks related to our business initiatives; periods of significant or prolonged inflation or deflation and their impact on our product costs, volume, foot traffic, and profitability generally; risks related to our efforts to implement our transformation initiatives and meet our other long-term strategic objectives; risks of interruption of supplies and increase in product costs; risks related to changes in consumer eating habits; and impact of natural disasters or adverse weather conditions, public health crises, adverse publicity or lack of confidence in our products, and product liability claims as well as risks and uncertainties associated with our proposed transaction with Jetro Restaurant Depot, including but not limited to, the occurrence of any event, change or other circumstances that could give rise to the right of either or both parties to terminate the merger agreement; the risk that regulatory approvals may not be obtained or other closing conditions may not be satisfied in a timely manner or at all, as well as the risk that regulatory approvals are obtained subject to conditions that are not anticipated; the risk of other delays in closing the transaction; the possibility that any of the anticipated benefits and projected synergies of the transaction will not be realized or will not be realized within the expected time period; and the risk that the proposed transaction and its announcement could have an adverse effect on the market price of the common stock of Sysco. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Therefore, you should not place undue reliance on any of the forward-looking statements contained herein. For more information on these risks and other concerning factors that could cause actual results to differ from those expressed or forecasted, see our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the SEC. We do not undertake to update our forward-looking statements, except as required by applicable law.
About Sysco
Sysco is the global leader in selling, marketing and distributing food and related products to customers who prepare meals away from home. This includes restaurants, healthcare and educational facilities, lodging establishments, entertainment venues, and more. Sysco operates 337 distribution centers, in 10 countries, with 75,000 colleagues serving approximately 730,000 customer locations. The company generated sales of more than $81 billion in fiscal year 2025 that ended June 28, 2025.
As the world’s largest food-away-from-home distributor, Sysco offers customized supply chain solutions, bespoke specialty product offerings, and culinary support to drive customers to innovate and optimize their operations. We act as a trusted business partner to our customers, helping them grow through our industry-leading portfolio that includes fresh produce, premium proteins, specialty products, sustainably focused items, equipment and supplies, and innovative culinary solutions.
For more information, visit www.sysco.com. For important news and key information for Sysco investors, visit the Investor Relations section of the company’s website at investors.sysco.com.
SYY-INVESTORS
Sysco Corporation and its Consolidated Subsidiaries
Non-GAAP Reconciliation (Unaudited)
Free Cash Flow
(In Millions)
Free cash flow represents net cash provided from operating activities less purchases of plant and equipment and includes proceeds from sales of plant and equipment. Sysco considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases and sales of buildings, fleet, equipment and technology, which may potentially be used to pay for, among other things, strategic uses of cash including dividend payments, share repurchases and acquisitions. However, free cash flow may not be available for discretionary expenditures, as it may be necessary that we use it to make mandatory debt service or other payments. Free cash flow should not be used as a substitute for the most comparable GAAP financial measure in assessing the company’s liquidity for the periods presented. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. In the table that follows, free cash flow for each period presented is reconciled to net cash provided by operating activities.
Sysco Corporation and its Consolidated Subsidiaries
Non-GAAP Reconciliation (Unaudited)
Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
(Dollars in Millions)
EBITDA represents net earnings (loss) plus (i) interest expense, (ii) income tax expense and benefit, (iii) depreciation and (iv) amortization. The net earnings (loss) component of our EBITDA calculation is impacted by Certain Items that we do not consider representative of our underlying performance. As a result, in the non-GAAP reconciliations below for each period presented, adjusted EBITDA is computed as EBITDA plus the impact of Certain Items, excluding certain items related to interest expense, income taxes, depreciation and amortization. Sysco's management considers growth in this metric to be a measure of overall financial performance that provides useful information to management and investors about the profitability of the business, as it facilitates comparison of performance on a consistent basis from period to period by providing a measurement of recurring factors and trends affecting our business. Additionally, it is a commonly used component metric used to inform on capital structure decisions. Adjusted EBITDA should not be used as a substitute for the most comparable GAAP financial measure in assessing the company’s financial performance for the periods presented. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. In the tables that follow, adjusted EBITDA for each period presented is reconciled to net earnings.
Sysco Corporation and its Consolidated Subsidiaries
Non-GAAP Reconciliation (Unaudited)
Net Debt to Adjusted EBITDA
(In Millions)
Net Debt to Adjusted EBITDA is a non-GAAP financial measure frequently used by investors and credit rating agencies. It is an important measure used by management to evaluate our access to liquidity, and we believe it is a representation of our financial strength. Our Net Debt to Adjusted EBITDA ratio is calculated using a numerator of our debt minus cash and cash equivalents, divided by the sum of the most recent four quarters of Adjusted EBITDA. In the table that follows, we have provided the calculation of our debt and net debt as a ratio of Adjusted EBITDA.
Sysco Corporation and its Consolidated Subsidiaries
Non-GAAP Reconciliation (Unaudited)
Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (Trailing Twelve Months)
(In Millions)
Projected Adjusted EPS Guidance
Adjusted earnings per share is a non-GAAP financial measure; however, we cannot predict with certainty the magnitude or scope of certain items that would be included in the most directly comparable GAAP measure for the relevant future periods, and such items may be significant. Due to these uncertainties, we cannot provide a quantitative reconciliation of projected adjusted EPS to the most directly comparable GAAP financial measure without unreasonable effort. However, we expect to calculate adjusted earnings per share for future periods in the same manner as the reconciliations provided for the historical periods herein.
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