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Nov 5, 2026, 6:49 AM ETConsumer Defensive

US Foods — Third Quarter Fiscal 2026 Earnings Summary

USFDUS FOODS HOLDING CORP
Source

Financial Performance

  • Net sales increased 2.1% year-over-year to $10.4 billion for the quarter.
  • Net income increased 42.5% year-over-year to $218 million, with net income margin expanding 60 basis points to 2.1%.
  • Diluted EPS increased 49.3% year-over-year to $1.00; Adjusted Diluted EPS increased 17.8% to $1.26.
  • Adjusted EBITDA increased 9.9% year-over-year to $555 million, with Adjusted EBITDA margin expanding 38 basis points to 5.3%.
  • Gross profit increased 8.6% to $1.9 billion, driven by case volume growth, improved cost of goods sold, and a $49 million favorable LIFO adjustment; gross profit margin was 18.3%.
  • Operating expenses increased 4.2% to $1.5 billion; Adjusted Operating expenses increased 4.0% to $1.3 billion.
  • Cash flow provided by operating activities for the first nine months of fiscal 2026 was $1,160 million, compared to $1,076 million in the prior year period.
  • Net debt was $5.1 billion at the end of the third quarter, with a Net Debt to Adjusted EBITDA ratio of 2.4x, down from 2.7x at the end of fiscal 2025.

Guidance and Future Outlook

  • Full-year fiscal 2026 Net Sales growth guidance tightened to 4% to 5% (previously 4% to 6%).
  • Full-year fiscal 2026 Adjusted EBITDA growth guidance tightened to 9% to 11% (previously 9% to 13%).
  • Full-year fiscal 2026 Adjusted Diluted EPS growth guidance tightened to 18% to 20% (previously 18% to 24%).
  • Guidance includes the impact of a 53rd week in fiscal 2026, expected to add approximately 1% to total case growth and Adjusted EBITDA growth.
  • Management cited a sustained slower macroeconomic environment and elevated fuel costs as drivers for tightening the outlook.

Business Segments and Product Lines

  • Total case volume increased 1.3% year-over-year.
  • Independent restaurant case volume increased 5.0% year-over-year.
  • Healthcare volume increased 3.3% year-over-year.
  • Hospitality volume increased 3.7% year-over-year.
  • Chain volume decreased 1.5% year-over-year.
  • Total organic case volume increased 1.2%.
  • Net sales growth was driven by case volume growth and 0.4% food cost inflation.
  • The company completed the acquisition of Prime Line Distributors, a specialty distributor of gourmet Italian products, in October.

Market and Competitive Landscape

  • US Foods extended its track record of market share gains to 22 consecutive quarters with Independent Restaurants and 24 consecutive quarters with Healthcare.
  • The company reported 22 consecutive quarters of share gains in the Independent Restaurant segment.
  • The company noted continued market share gains as a result of disciplined execution.

Risks and Challenges

  • Management identified a sustained slower macroeconomic environment as a headwind.
  • Elevated fuel costs were cited as a factor impacting the business.
  • The press release lists numerous forward-looking risks including consumer eating habits, cost inflation/commodity volatility, geopolitical developments, supply chain disruptions, competition, labor relations, cybersecurity incidents, and integration risks associated with acquisitions.

Management Commentary and Tone

  • Dave Flitman, Chair and CEO, stated results reflect "strength of our strategy and disciplined execution" with continued market share gains and strong earnings growth.
  • Management highlighted the impact of self-help initiatives and a laser focus on execution, driving 10% Adjusted EBITDA growth and 18% Adjusted Diluted EPS growth.
  • Dirk Locascio, CFO, noted the company continues to compound Adjusted EPS growth at a double-digit rate, generate strong cash flow, and maintain a healthy balance sheet.
  • Management expressed excitement regarding the advancement of digital ecosystem and AI initiatives driving topline growth and margin expansion.

Other Key Points

  • The company repurchased $191 million of common stock during the third quarter of fiscal 2026.
  • For the first nine months of fiscal 2026, the company repurchased $690 million of common stock, inclusive of fees, commissions, and excise tax.
  • The company had $450 million remaining in funds authorized under its November 2025 share repurchase program.
  • Cash capital expenditures for the first nine months of fiscal 2026 totaled $266 million, a $10 million decrease from the prior year.
  • The company serves approximately 250,000 customer locations with over 70 broadline locations and over 90 cash and carry stores.
  • The company has 30,000 associates.