SYSCO CORP
For the period ended Mar 29, 2025. Filed Apr 30, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 29, 2025 · Filed Apr 30, 2025
SYY$76.86+2.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-28; filed 2025-01-29.
0000096021-25-000010
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-29; filed 2025-04-30.
0000096021-25-000037
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 196 previous paragraphs and 195 current paragraphs.
131 unchanged; 39 reworded; 25 added; 25 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 33 previous and 33 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
◦increased 1.1%, or $218 million, to $19.6 billion;
Current report
◦decreased 5.7%, or $41 million, to $681 million;
Current report
◦adjusted operating income decreased 3.3%, or $26 million, to $773 million;
Current report
◦decreased 5.6%, or $24 million, to $401 million;
Current report
◦adjusted net earnings decreased 2.9%, or $14 million, to $469 million;
Current report
◦decreased 3.5%, or $0.03, to $0.82 per share;
Current report
◦decreased 3.5%, or $0.03, to $0.82 per share;
Current report
◦adjusted diluted earnings per share unchanged, at $0.96;
Current report
◦increased 3.3%, or $1.9 billion, to $60.2 billion;
Current report
◦decreased 1.2%, or $26 million, to $2.2 billion;
Current report
◦adjusted operating income increased 1.3%, or $30 million, to $2.4 billion;
Current report
◦decreased 3.4%, or $46 million, to $1.3 billion;
Current report
◦adjusted net earnings decreased 0.5%, or $7 million, to $1.5 billion;
Current report
◦decreased 0.7%, or $0.02 to $2.65 per share;
Current report
◦decreased 0.8%, or $0.02, to $2.64 per share;
Current report
◦increased 0.9%, or $27 million, to $2.9 billion; and
Current report
◦adjusted EBITDA increased 2.6%, or $77 million, to $3.0 billion.
Current report
Earnings Per Share Trends
Current report
Reflecting the current uncertain macroeconomic environment, including concerns regarding consumer confidence, we expect earnings per share and adjusted earnings per share growth of approximately 1% for the full fiscal 2025 year, as compared to our previous fiscal 2025 adjusted earnings per share growth target of 6-7% primarily due to lower than expected volume growth.
Current report
Sales for the third quarter of fiscal 2025 decreased by 1.1% as compared to the third quarter of fiscal 2024, primarily due to the impacts of exchange rate fluctuations, partially offset by higher inflation. Sales increased by 1.9% in the first 39 weeks of fiscal 2025 as compared to the first 39 weeks of fiscal 2024, primarily due to higher inflation, partially offset by impacts of exchange rate fluctuations. Excluding the impact of the Mexico joint venture, which was divested in the second quarter of fiscal 2025, sales increased 2.5% in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024.
Current report
The increase in gross profit dollars in the third quarter and first 39 weeks of fiscal 2025, as compared to the third quarter and first 39 weeks of fiscal 2024, was primarily attributable to increases in local case volumes. Local case volumes increased 4.5% in the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024.
Current report
Operating expenses decreased by 0.6% in the third quarter of fiscal 2025, as compared to the third quarter of fiscal 2024, which is primarily attributable to the joint venture in Mexico that was divested in the second quarter of fiscal 2025. Operating expenses increased by 3.7% in the first 39 weeks of fiscal 2025 as compared to the first 39 weeks of fiscal 2024, primarily due to increases in colleague-related costs, depreciation expense, and other miscellaneous costs.
Current report
Interest expense decreased $9 million and increased $27 million for the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. Interest expense incurred in a period is dependent upon the amount of commercial paper and senior notes outstanding, obligations under finance leases, and interest rates on outstanding borrowings and obligations. The $27 million increase in the first 39 weeks of fiscal 2025 as compared to the first 39 weeks of fiscal 2024 is attributable to interest on new senior notes issued and an increase in interest on outstanding commercial paper balances.
Current report
Projected Adjusted Earnings Per Share Guidance
Current report
Adjusted earnings per share is a non-GAAP financial measure; however, we cannot predict with certainty certain items that would be included in the most directly comparable GAAP measure for the relevant future periods. 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.
Removed paragraphs (25)
Previous report
◦increased 4.5%, or $863 million, to $20.2 billion;
Previous report
◦increased 1.7%, or $12 million, to $712 million;
Previous report
◦adjusted operating income increased 5.1%, or $38 million, to $783 million;
Previous report
◦decreased 2.2%, or $9 million, to $406 million;
Previous report
◦adjusted net earnings increased 2.0%, or $9 million, to $458 million;
Previous report
◦increased 1.2%, or $0.01, to $0.83 per share;
Previous report
◦unchanged, at $0.82 per share;
Previous report
◦adjusted diluted earnings per share increased 4.5%, or $0.04, to $0.93;
Previous report
◦increased 1.9%, or $17 million, to $931 million; and
Previous report
◦increased 4.4%, or $1.7 billion, to $40.6 billion;
Previous report
◦increased 1.0%, or $15 million, to $1.5 billion;
Previous report
◦adjusted operating income increased 3.5%, or $56 million, to $1.7 billion;
Previous report
◦adjusted net earnings increased 0.6%, or $6 million, to $997 million;
Previous report
◦unchanged, at $1.82 per share;
Previous report
◦increased 0.6%, or $0.01, to $1.82 per share; and
Previous report
◦increased 2.6%, or $50 million, to $2.0 billion; and
Previous report
◦adjusted EBITDA increased 4.4%, or $85 million, to $2.0 billion.
Previous report
Sales for the second quarter and first 26 weeks of fiscal 2025 were higher, as compared to the second quarter and first 26 weeks of fiscal 2024, due to an improvement in volume and higher inflation.
Previous report
The increase in operating expenses for the second quarter and first 26 weeks of fiscal 2025, as compared to the second quarter and first 26 weeks of fiscal 2024, was primarily driven by increases in colleague-related costs and freight costs, which are largely correlated with the increase in volumes, depreciation expense, and other miscellaneous costs.
Previous report
Interest expense increased $10 million and $35 million for the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. The increase was primarily due to interest on new senior notes that were issued in the second quarter of fiscal 2024, as well as an increase in outstanding commercial paper balances.
Previous report
Tax relief provided by the IRS related to the effects of Hurricane Beryl that began on July 5, 2024 resulted in the deferral of approximately $28 million of fiscal 2024 U.S. federal extension payments to the third quarter of fiscal 2025. Our first and second quarter U.S. estimated payments were also deferred to the third quarter of fiscal 2025.
Previous report
•our expectations of an improving market over the course of fiscal 2025;
Previous report
•our expectations regarding gross margins in fiscal 2025;
Previous report
•the expected long-term rate of return on plan assets of the U.S. Retirement Plan;
Previous report
•estimates regarding the outcome of legal proceedings;
Reworded paragraphs (39)
Previous wording
Our second quarter of fiscal 2025 results included sales growth of 4.5% as compared to the second quarter of fiscal 2024 primarily due to U.S. Foodservice Operations volume growth and moderate inflation. Our gross profit grew 3.9% compared to the second quarter of fiscal 2024, due to volume growth and the effective management of product inflation. Operating income increased 1.7% as compared to the second quarter of fiscal 2024. Adjusted operating income increased 5.1% as compared to the second quarter of fiscal 2024 primarily due to continued positive momentum within our International Foodservice Operations. Our net earnings for the second quarter of fiscal 2025 decreased by $9 million as compared to the second quarter of fiscal 2024 due to increased restructuring and transformational project costs and acquisition-related costs. We consider these “Certain Item” expenses (as defined below). Excluding Certain Item expenses, adjusted net earnings increased by $9 million. See below for a comparison of our fiscal 2025 results to our fiscal 2024 results, both including and excluding Certain Items.
Current wording
Our third quarter of fiscal 2025 results included sales growth of 1.1% as compared to the third quarter of fiscal 2024 primarily due to increased sales in our SYGMA and U.S. Foodservice Operations segments. Our gross profit decreased 0.8% compared to the third quarter of fiscal 2024, due to changes in customer mix attributable to national sales volumes outpacing local sales volumes and decreases in Sysco brand penetration rates. Operating income decreased 5.7% compared to the third quarter of fiscal 2024 and adjusted operating income decreased 3.3% as compared to the third quarter of fiscal 2024. These results reflect negative restaurant industry foot traffic partially attributable to lower levels of consumer confidence, and adverse weather and natural disasters. Our net earnings for the third quarter of fiscal 2025 decreased 5.6% as compared to the third quarter of fiscal 2024. Excluding Certain Item expenses, adjusted net earnings decreased by 2.9% as compared to the third quarter of fiscal 2024. See below for a comparison of our fiscal 2025 results to our fiscal 2024 results, both including and excluding Certain Items.
Previous wording
Comparisons of results from the second quarter of fiscal 2025 to the second quarter of fiscal 2024 are presented below:
Current wording
Comparisons of results from the third quarter of fiscal 2025 to the third quarter of fiscal 2024 are presented below:
Previous wording
◦decreased 2.5%, or $23 million, to $896 million;
Current wording
◦decreased 2.5%, or $23 million, to $910 million; and
Previous wording
◦adjusted EBITDA increased 4.4%, or $41 million, to $969 million.
Current wording
◦adjusted EBITDA decreased 0.8%, or $8 million, to $969 million.
Previous wording
Comparisons of results from the first 26 weeks of fiscal 2025 to the first 26 weeks of fiscal 2024 are presented below:
Current wording
Comparisons of results from the first 39 weeks of fiscal 2025 to the first 39 weeks of fiscal 2024 are presented below:
Previous wording
◦adjusted diluted earnings per share increased 3.1%, or $0.06, to $2.02;
Current wording
◦adjusted diluted earnings per share increased 2.1%, or $0.06, to $2.98;
Previous wording
Foot traffic to restaurants decreased approximately 2% for the second quarter of fiscal 2025, which represents a moderate improvement compared to the decrease of 3.6% experienced in the first quarter of fiscal 2025. We expect to see continued improvements in foot traffic trends in the second half of fiscal 2025. Despite the current macroeconomic landscape, we expect to grow both sales and net earnings in fiscal 2025. We believe the food-away-from-home sector is a healthy long-term growth market, and Sysco is diversified and well positioned as a market leader in food service.
Current wording
Foot traffic to restaurants decreased 3.1% for the third quarter of fiscal 2025, as compared to a decrease of 1.6% experienced in the second quarter of fiscal 2025. Winter storms throughout the U.S. and wildfires in the California region negatively affected foot traffic to restaurants during the third quarter of fiscal 2025. In addition, lower levels of consumer confidence due to macroeconomic conditions adversely impacted foot traffic trends during the quarter. Industry traffic trends, while still in a year-over-year decline, improved in March as compared to February. These trends have further modestly improved in April in comparison to March. We believe the food-away-from-home sector is a healthy long-term growth market, and Sysco is diversified and well positioned as a market leader in food service.
Previous wording
Our sales and gross profit performance are influenced by multiple factors, including price, volume, inflation, customer mix and product mix. We experienced a 1.4% and 2.1% improvement in U.S. Foodservice Operations case volume in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. Our volume growth was primarily attributable to national volume growth of 4.3% and 4.9% in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. Our volume reflects our broadline and specialty businesses, except for our specialty meats business, which measures its volume in pounds.
Current wording
Sales increased 1.1% in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024. Our sales and gross profit performance are influenced by multiple factors, including price, volume, inflation, customer mix and product mix. We experienced a 2.0% decrease and a 0.7% increase in U.S. Foodservice Operations case volume in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. Our volume growth trends were attributable to national volume growth remaining flat and local volume performance decreasing 3.5% in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024. Our volume reflects our broadline and specialty businesses, except for our specialty meats business, which measures its volume in pounds.
Previous wording
We experienced inflation at a rate of 2.1% in the second quarter of fiscal 2025, at the total enterprise level, primarily driven by inflation in the dairy and poultry categories. We continued to be successful in managing this inflation, resulting in an increase in gross profit dollars. Gross margin decreased 11 and 18 basis points in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024, primarily due to a shift in our customer mix driven by national volume growth, a decrease in Sysco brand penetration, and the timing of benefits from strategic sourcing initiatives.
Current wording
We experienced inflation at a rate of 2.1% in the third quarter of fiscal 2025, at the total enterprise level, primarily driven by inflation in the dairy and meat categories. We continue to manage inflation by successfully passing on cost increases to our customers in a timely manner. We now expect net sales growth of approximately 3% for the full fiscal 2025 year, as compared to our previous fiscal 2025 sales growth target of 4-5%, as a result of lower than expected volume. Gross margin decreased 35 and 25 basis points in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024, primarily due to a shift in our customer mix driven by national sales volumes outpacing local sales volumes and a decrease in Sysco brand penetration rates.
Previous wording
Total operating expenses increased 4.4% and 4.0% during the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. Total adjusted operating expenses increased 3.5% and 3.3% during the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. Operating expenses increased primarily due to an increase in volumes. In addition, higher pay-related expenses, which includes investments in our business, including sales professionals, and depreciation expense related to new facilities also resulted in an increase in operating expenses in the second quarter and first 26 weeks of fiscal 2025. Adjusted operating expenses were 14.2% of sales during both the second quarter and first 26 weeks of fiscal 2025, which is a 13-basis point and 15-basis point improvement from the second quarter and first 26 weeks of fiscal 2024, respectively, due to supply chain and Global Support Center efficiencies and gains from sale leaseback transactions.
Current wording
Total operating expenses increased 0.5% and 2.8% during the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. Total adjusted operating expenses decreased 0.1% and increased 2.2% during the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. Operating expenses increased primarily due to costs associated with expanded building capacity, including depreciation expense related to new facilities, sales headcount investments and higher supply chain labor rates, partially offset by lower annual bonus incentive compensation in the third quarter and first 39 weeks of fiscal 2025. Adjusted operating expenses were 14.3% and 14.2% of sales during the third quarter and first 39 weeks of fiscal 2025, respectively, which is a 17-basis point and 16-basis point improvement from the third quarter and first 39 weeks of fiscal 2024, respectively, due to lower annual bonus incentive compensation and recent supply chain and Global Support Center efficiency initiatives.
Previous wording
In the second quarter of fiscal 2025, we acquired Campbells Prime Meat, a leading specialty meat business based in Scotland. By combining the Campbells Prime Meat product offering with our broadline business, this acquisition provides a strategic opportunity to enable total team selling in this region. This company’s results are included within International Foodservice Operations and were not material to our results for the second quarter and first 26 weeks of fiscal 2025.
Current wording
In the second quarter of fiscal 2025, we acquired Campbells Prime Meat, a leading specialty meat business based in Scotland. By combining the Campbells Prime Meat product offering with our broadline business, this acquisition provides a strategic opportunity to enable total team selling in this region. This company’s results are included within International Foodservice Operations and were not material to our results for the third quarter and first 39 weeks of fiscal 2025.
Previous wording
Based on information in Note 13, “Business Segment Information,” in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Form 10-Q, U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 88.2% and 88.4% of Sysco’s overall sales in the second quarter and first 26 weeks of fiscal 2025, respectively. U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 97.6% and 97.5% of total segment operating income, in the second quarter and first 26 weeks of fiscal 2025, respectively. This illustrates that these segments represent a substantial majority of our total segment results when compared to other reportable segments.
Current wording
Based on information in Note 13, “Business Segment Information,” in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Form 10-Q, U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 88.1% and 88.3% of Sysco’s overall sales in the third quarter and first 39 weeks of fiscal 2025, respectively. U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 98.4% and 97.8% of total segment operating income, in the third quarter and first 39 weeks of fiscal 2025, respectively. This illustrates that these segments represent a substantial majority of our total segment results when compared to other reportable segments.
Previous wording
The sales growth in our U.S. Foodservice Operations was driven by higher inflation and volume growth, inclusive of benefits from acquisitions. Case volumes from our U.S. Foodservice Operations increased 1.4% and 2.1% in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. This included a 0.9% decrease in local customer case volume in the second quarter of fiscal 2025 and a 0.3% decrease in the first 26 weeks of fiscal 2025. Our Edward Don acquisition, completed in the second quarter of fiscal 2024, positively impacted volumes by 1.6% and local volumes by 1.0% in the second quarter of fiscal 2025. Our national customer volume has grown faster than local customer volume and is the result of contract renewals with existing customers and the addition of new customers.
Current wording
The sales growth in our U.S. Foodservice Operations was driven by higher inflation. Case volumes from our U.S. Foodservice Operations decreased 2.0% and increased 0.7% in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. This included a 3.5% decrease in local customer case volume in the third quarter of fiscal 2025 and a 1.4% decrease in the first 39 weeks of fiscal 2025. Case volumes have been negatively impacted by foot traffic to restaurant trends in the third quarter and first 39 weeks of fiscal 2025.
Previous wording
The decrease in operating income for the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024, was driven by an increase in operating expenses, partially offset by gross profit dollar growth and case volume growth, inclusive of benefits from acquisitions.
Current wording
The decrease in operating income for the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024, was primarily driven by an increase in operating expenses. The decrease in operating income in the third quarter of fiscal 2025 was also driven by a decrease in case volume and gross profit dollars. The decrease in operating income in the first 39 weeks of fiscal 2025 was partially offset by gross profit dollar growth and case volume growth, inclusive of benefits from acquisitions.
Previous wording
Gross profit dollar growth in the second quarter and first 26 weeks of fiscal 2025, as compared to the second quarter and first 26 weeks of fiscal 2024, was driven primarily by case volume growth as a result of acquisitions and effective management of product cost fluctuations. The estimated change in product costs, an internal measure of inflation or deflation, increased in the second quarter and first 26 weeks of fiscal 2025. Gross margin, which is gross profit as a percentage of sales, was 18.9% and 19.0% in the second quarter and first 26 weeks of fiscal 2025, respectively, for our U.S. Foodservice Operations, which was a decrease of 20 basis points compared to gross margin of 19.1% in the second quarter of fiscal 2024, and a decrease of 32 basis points compared to a gross margin of 19.3% in the first 26 weeks of fiscal 2024, primarily due to a change in customer mix, a decrease in Sysco brand penetration, and timing of benefits from strategic sourcing initiatives.
Current wording
Gross profit dollars decreased in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024, primarily as a result of case volume decreases and changes in customer mix. Gross profit dollars increased in the first 39 weeks of fiscal 2025 as compared to the first 39 weeks of fiscal 2024 as a result of case volume growth inclusive of benefits from acquisitions and effective management of product cost fluctuations. The estimated change in product costs, an internal measure of inflation or deflation, increased in the third quarter and first 39 weeks of fiscal 2025. Gross margin, which is gross profit as a percentage of sales, was 18.9% and 19.0% in the third quarter and first 39 weeks of fiscal 2025, respectively, for our U.S. Foodservice Operations, which was a decrease of 50 basis points compared to gross margin of 19.4% in the third quarter of fiscal 2024, and a decrease of 38 basis points compared to a gross margin of 19.3% in the first 39 weeks of fiscal 2024, primarily due to a shift in our customer mix driven by national sales volumes outpacing local sales volumes and a decrease in Sysco brand penetration rates.
Previous wording
The increase in operating expenses for the second quarter and first 26 weeks of fiscal 2025, as compared to the second quarter and first 26 weeks of fiscal 2024, was primarily driven by increases in colleague-related costs and freight costs, which are largely correlated with the increase in volumes, depreciation expense, and bad debt expense, partially offset by gains related to sale leaseback transactions.
Current wording
The increase in operating expenses for the third quarter and first 39 weeks of fiscal 2025, as compared to the third quarter and first 39 weeks of fiscal 2024, was primarily driven by increases in colleague-related costs, depreciation expense, and bad debt expense, partially offset by lower annual bonus incentive compensation.
Previous wording
The increase in operating income for the second quarter and first 26 weeks of fiscal 2025, as compared to the second quarter and first 26 weeks of fiscal 2024, was primarily due to growth in local case volumes, success in our strategic sourcing program, and positive contributions from our recent mergers and acquisitions efforts, partially offset by an increase in operating expenses.
Current wording
The increase in operating income for the third quarter and first 39 weeks of fiscal 2025, as compared to the third quarter and first 39 weeks of fiscal 2024, was primarily due to growth in local case volumes, success in our strategic sourcing program, and positive contributions from our recent mergers and acquisitions efforts.
Previous wording
For SYGMA, sales were 10.6% and 9.0% higher in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024, primarily driven by the growth of new customers. Operating income increased by $2 million and $7 million in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024, primarily due to the growth of new customers and the improvement of profits from strengthening productivity.
Current wording
SYGMA segment sales were 9.5% and 9.1% higher in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024, primarily driven by the growth of new customers. Operating income was unchanged in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024 and increased $8 million in the first 39 weeks of fiscal 2025 as compared to the first 39 weeks of fiscal 2024, primarily due to the growth of new customers and the improvement of profits from strengthening productivity.
Previous wording
For the operations that are grouped within Other, operating income decreased $4 million and $8 million in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024. The operations of this group primarily consist of our hospitality business, Guest Worldwide.
Current wording
For the operations that are grouped within Other, operating income decreased $9 million and $18 million in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024. The operations of this group primarily consist of our hospitality business, Guest Worldwide.
Previous wording
Our Global Support Center generally includes all expenses of the corporate office and Sysco’s shared service operations. These expenses in the second quarter of fiscal 2025 decreased $5 million, or 2.0%, as compared to the second quarter of fiscal 2024, primarily due to decreases in colleague-related costs, fuel hedging program expenses, and other miscellaneous costs. These expenses in the first 26 weeks of fiscal 2025 decreased $35 million, or 6.9%, as compared to the first 26 weeks of fiscal 2024, primarily due to decreases in colleague-related costs and fuel hedging program expenses.
Current wording
Our Global Support Center generally includes all expenses of the corporate office and Sysco’s shared service operations. These expenses in the third quarter of fiscal 2025 decreased $42 million, or 16.9%, as compared to the third quarter of fiscal 2024, primarily due to decreases in colleague-related costs, including lower annual bonus incentive compensation, and other miscellaneous costs. These expenses in the first 39 weeks of fiscal 2025 decreased $78 million, or 10.3%, as compared to the first 39 weeks of fiscal 2024, primarily due to decreases in colleague-related costs, including lower annual bonus incentive compensation, and other miscellaneous costs.
Previous wording
Included in Global Support Center expenses are Certain Items that totaled $12 million and $30 million in the second quarter and first 26 weeks of fiscal 2025, as compared to $14 million and $29 million in the second quarter and first 26 weeks of fiscal 2024, respectively. Certain Items impacting the second quarter and first 26 of fiscal 2025 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions. Certain Items impacting the second quarter and first 26 weeks of fiscal 2024 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions.
Current wording
Included in Global Support Center expenses are Certain Items that totaled $24 million and $54 million in the third quarter and first 39 weeks of fiscal 2025, as compared to $29 million and $57 million in the third quarter and first 39 weeks of fiscal 2024, respectively. Certain Items impacting the third quarter and first 39 weeks of fiscal 2025 were primarily expenses associated with severances, our business technology transformation initiatives and expenses associated with acquisitions. Certain Items impacting the third quarter and first 39 weeks of fiscal 2024 were primarily expenses associated with severances, our business technology transformation initiatives and expenses associated with acquisitions.
Previous wording
Net earnings decreased 2.2% and 2.5% in the second quarter and first 26 weeks of fiscal 2025, respectively, as compared to the second quarter and first 26 weeks of fiscal 2024, primarily due to the items noted above for operating income, and interest expense, as well as items impacting our income taxes that are discussed in Note 11, “Income Taxes,” in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Form 10-Q. Adjusted net earnings, excluding Certain Items, increased 2.0% and 0.6% in the second quarter and first 26 weeks of fiscal 2025, respectively, primarily due to an increase in sales volume.
Current wording
Net earnings decreased 5.6% and 3.4% in the third quarter and first 39 weeks of fiscal 2025, respectively, as compared to the third quarter and first 39 weeks of fiscal 2024, primarily due to the items noted above for operating income, and interest expense, as well as items impacting our income taxes that are discussed in Note 11, “Income Taxes,” in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Form 10-Q. Adjusted net earnings, excluding Certain Items, decreased 2.9% and 0.5% in the third quarter and first 39 weeks of fiscal 2025, respectively, primarily due to decreases in sales volumes, as well as gross margins being negatively impacted by changes in customer mix and a decrease in Sysco brand penetration.
Previous wording
Basic earnings per share in the second quarter of fiscal 2025 were $0.83, a 1.2% increase from the comparable prior year period amount of $0.82 per share. Diluted earnings per share in the second quarter of fiscal 2025 were $0.82, which is unchanged from the comparable prior year period amount of $0.82 per share. Adjusted diluted earnings per share, excluding Certain Items, in the second quarter of fiscal 2025 were $0.93, a 4.5% increase from the comparable prior year amount of $0.89 per share.
Current wording
Basic earnings per share in the third quarter of fiscal 2025 were $0.82, a 3.5% decrease from the comparable prior year period amount of $0.85 per share. Diluted earnings per share in the third quarter of fiscal 2025 were $0.82, a 3.5% decrease from the comparable prior year period amount of $0.85 per share. Adjusted diluted earnings per share, excluding Certain Items, in the third quarter of fiscal 2025 were $0.96, which is unchanged from the comparable prior year amount of $0.96 per share.
Previous wording
Basic earnings per share in the first 26 weeks of fiscal 2025 were $1.82, which is unchanged from the comparable prior year amount of $1.82 per share. Diluted earnings per share in the first 26 weeks of fiscal 2025 were $1.82, a 0.6% increase from the comparable prior year period amount of $1.81 per share. Adjusted diluted earnings per share, excluding Certain Items, in the first 26 weeks of fiscal 2025 were $2.02, a 3.1% increase from the comparable prior year amount of $1.96 per share.
Current wording
Basic earnings per share in the first 39 weeks of fiscal 2025 were $2.65, a 0.7% decrease from the comparable prior year amount of $2.67 per share. Diluted earnings per share in the first 39 weeks of fiscal 2025 were $2.64, a 0.8% decrease from the comparable prior year period amount of $2.66 per share. Adjusted diluted earnings per share, excluding Certain Items, in the first 39 weeks of fiscal 2025 were $2.98, a 2.1% increase from the comparable prior year amount of $2.92 per share.
Previous wording
The results of our operations can be impacted due to changes in exchange rates applicable in converting local currencies to U.S. dollars. We measure our results on a constant currency basis. Constant currency operating results are calculated by translating current-period local currency operating results with the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period.
Current wording
The results of our operations can be impacted due to changes in exchange rates applicable in converting local currencies to U.S. dollars. We measure our results on a constant currency basis. Constant currency operating results are calculated by translating current-period local currency operating results with the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period. We also measure our sales growth excluding the impact of our joint venture in Mexico which was divested in the second quarter of fiscal 2025.
Previous wording
Management believes that adjusting its operating expenses, operating income, operating margin, net earnings and diluted earnings per share to remove these Certain Items and presenting its results on a constant currency basis provides an important perspective with respect to our underlying business trends and results. It provides meaningful supplemental information to both management and investors that (1) is indicative of the performance of the company’s underlying operations and (2) facilitates comparisons on a year-over-year basis.
Current wording
Management believes that adjusting its operating expenses, operating income, operating margin, net earnings and diluted earnings per share to remove these Certain Items, presenting its results on a constant currency basis, and adjusting its results to exclude the impact of its joint venture in Mexico provides an important perspective with respect to our underlying business trends and results. It provides meaningful supplemental information to both management and investors that (1) is indicative of the performance of the company’s underlying operations and (2) facilitates comparisons on a year-over-year basis.
Previous wording
We produced positive free cash flow of $331 million in the first 26 weeks of fiscal 2025, as compared to positive free cash flow of $527 million in the first 26 weeks of fiscal 2024. The decrease in free cash flow is attributable to a decrease in cash provided by operating activities, partially offset by an increase in proceeds from sales of plant and equipment and a decrease in capital expenditures. In the table that follows, free cash flow for each period presented is reconciled to net cash provided by operating activities and comparisons of the significant cash flows from the first 26 weeks of fiscal 2025 to the first 26 weeks of fiscal 2024 are provided.
Current wording
We produced positive free cash flow of $954 million in the first 39 weeks of fiscal 2025, as compared to positive free cash flow of $864 million in the first 39 weeks of fiscal 2024. The increase in free cash flow is attributable to an increase in proceeds from sales of plant and equipment, partially offset by a decrease in cash provided by operating activities. In the table that follows, free cash flow for each period presented is reconciled to net cash provided by operating activities and comparisons of the significant cash flows from the first 39 weeks of fiscal 2025 to the first 39 weeks of fiscal 2024 are provided.
Previous wording
Sysco generates cash in the U.S. and internationally. As of December 28, 2024, we had $793 million in cash and cash equivalents, approximately 92% of which was held by our international subsidiaries. Sysco’s strategic objectives are funded primarily by cash from operations and external borrowings. Traditionally, our operations have produced significant cash flow. Due to our strong financial position, we believe we will continue to be able to effectively access capital markets, as needed. Cash is generally allocated to working capital requirements, investments compatible with our overall growth strategy (organic and inorganic), debt management, and shareholder return. The remaining cash balances are invested in high-quality, short-term instruments.
Current wording
Sysco generates cash in the U.S. and internationally. As of March 29, 2025, we had $1.5 billion in cash and cash equivalents, approximately 50% of which was held by our international subsidiaries. Sysco’s strategic objectives are funded primarily by cash from operations and external borrowings. Traditionally, our operations have produced significant cash flow. Due to our strong financial position, we believe we will continue to be able to effectively access capital markets, as needed. Cash is generally allocated to working capital requirements, investments compatible with our overall growth strategy (organic and inorganic), debt management, and shareholder return. The remaining cash balances are invested in high-quality, short-term instruments.
Previous wording
We generated $498 million in cash flows from operations in the first 26 weeks of fiscal 2025, compared to cash flows from operations of $856 million in the first 26 weeks of fiscal 2024. In the first 26 weeks of fiscal 2025, these amounts included year-over-year unfavorable comparisons on working capital of $360 million due to unfavorable comparisons on inventory, accounts receivable, and accounts payable, partially due to timing. Accrued expenses also had an unfavorable comparison, primarily related to accrued payroll in the first 26 weeks of fiscal 2025 in comparison to the first 26 weeks of fiscal 2024. Income taxes positively impacted cash flows from operations, as estimated payments made in the first 26 weeks of fiscal 2025 were lower compared to the first 26 weeks of fiscal 2024.
Current wording
We generated $1.3 billion in cash flows from operations in the first 39 weeks of fiscal 2025, compared to cash flows from operations of $1.4 billion in the first 39 weeks of fiscal 2024. In the first 39 weeks of fiscal 2025, these amounts included year-over-year favorable comparisons on working capital of $163 million due to favorable comparisons on accounts payable and accounts receivable, partially offset by an unfavorable comparison in inventory. Accrued expenses also had an unfavorable comparison, primarily related to accrued payroll in the first 39 weeks of fiscal 2025 in comparison to the first 39 weeks of fiscal 2024. Income tax payments made in the first 39 weeks of fiscal 2025 were unchanged compared to the first 39 weeks of fiscal 2024. During the third quarter of fiscal 2025, tax payments were made that had been previously deferred under IRS disaster relief provisions related to Hurricane Beryl. These payments related to tax obligations that were originally due in fiscal 2024 and the first and second quarters of fiscal 2025.
Previous wording
Our capital expenditures in the first 26 weeks of fiscal 2025 consisted primarily of investments in buildings and building improvements, technology equipment, warehouse equipment, and fleet. Our capital expenditures in the first 26 weeks of fiscal 2025 were $14 million lower than in the first 26 weeks of fiscal 2024 due to reduced spending in investments to advance our Recipe for Growth strategy.
Current wording
Our capital expenditures in the first 39 weeks of fiscal 2025 consisted primarily of investments in buildings and building improvements, technology equipment, warehouse equipment, and fleet. Our capital expenditures in the first 39 weeks of fiscal 2025 were $2 million higher than in the first 39 weeks of fiscal 2024.
Previous wording
During the first 26 weeks of fiscal 2025, we paid $40 million, net of cash acquired, for the acquisition of Campbells Prime Meat. The first 26 weeks of fiscal 2024 includes $1.2 billion of cash paid for the acquisitions of BIX Produce Company and Edward Don.
Current wording
During the first 39 weeks of fiscal 2025, we paid $40 million, net of cash acquired, for the acquisition of Campbells Prime Meat. The first 39 weeks of fiscal 2024 includes $1.2 billion of cash paid for the acquisitions of BIX Produce Company, Edward Don, and Ready Chef.
Previous wording
During the first 26 weeks of fiscal 2025, we received $166 million in proceeds from sales of plant and equipment, which is primarily attributable to proceeds received from sale leaseback transactions. During the first 26 weeks of fiscal 2024, we received $18 million in proceeds from sales of plant and equipment.
Current wording
During the first 39 weeks of fiscal 2025, we received $169 million in proceeds from sales of plant and equipment, which is primarily attributable to proceeds received from sale leaseback transactions. During the first 39 weeks of fiscal 2024, we received $21 million in proceeds from sales of plant and equipment.
Previous wording
Proceeds from exercises of share-based compensation awards were $67 million in the first 26 weeks of fiscal 2025, as compared to $57 million in the first 26 weeks of fiscal 2024. The level of option exercises, and thus proceeds, will vary from period to period and is largely dependent on movements in our stock price and the time remaining before option grants expire.
Current wording
Proceeds from exercises of share-based compensation awards were $96 million in the first 39 weeks of fiscal 2025, as compared to $103 million in the first 39 weeks of fiscal 2024. The level of option exercises, and thus proceeds, will vary from period to period and is largely dependent on movements in our stock price and the time remaining before option grants expire.
Previous wording
In May 2021, our Board of Directors approved a share repurchase program to authorize the repurchase of up to $5.0 billion of the company’s common stock, which will remain available until fully utilized. We repurchased 3,949,641 shares for $300 million during the first 26 weeks of fiscal 2025 and intend to repurchase up to a total of $1.25 billion in fiscal 2025. As of December 28, 2024, we had a remaining authorization of approximately $2.5 billion. We repurchased 286,506 additional shares for $21 million under our authorization from the end of our fiscal second quarter through January 10, 2025.
Current wording
In May 2021, our Board of Directors approved a share repurchase program to authorize the repurchase of up to $5.0 billion of the company’s common stock, which will remain available until fully utilized. We repurchased 9,418,578 shares for $700 million during the first 39 weeks of fiscal 2025 and intend to repurchase up to a total of $1.25 billion in fiscal 2025. As of March 29, 2025, we had a remaining authorization of approximately $2.1 billion. We repurchased no additional shares under our authorization from the end of our fiscal third quarter through April 11, 2025.
Previous wording
Dividends paid in the first 26 weeks of fiscal 2025 were $503 million, or $1.02 per share, as compared to $506 million, or $1.00 per share, in the first 26 weeks of fiscal 2024. In November 2024, we declared our regular quarterly dividend for the second quarter of fiscal 2025 of $0.51 per share, which was paid in January 2025.
Current wording
Dividends paid in the first 39 weeks of fiscal 2025 were $752 million, or $1.53 per share, as compared to $758 million, or $1.50 per share, in the first 39 weeks of fiscal 2024. In February 2025, we declared our regular quarterly dividend for the third quarter of fiscal 2025 of $0.51 per share, which was paid in April 2025. In April 2025, we declared our regular quarterly dividend for the fourth quarter of fiscal 2025 of $0.54 per share, representing an increase of $0.03 per share. This dividend will be payable in July 2025.
Previous wording
On January 19, 2011, the wholly owned U.S. Broadline subsidiaries of Sysco Corporation, which distribute a full line of food products and a wide variety of non-food products, entered into full and unconditional guarantees of all outstanding senior notes and debentures of Sysco Corporation. All subsequent issuances of senior notes and debentures in the U.S. and borrowings under the company’s $3.0 billion long-term revolving credit facility have also been guaranteed by these subsidiaries. As of December 28, 2024, Sysco had a total of $10.5 billion in senior notes, debentures and borrowings under the long-term revolving credit facility that were guaranteed by these subsidiary guarantors. Our remaining consolidated subsidiaries (non-guarantor subsidiaries) are not obligated under the senior notes indenture, debentures indenture or our long-term revolving credit facility. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” contained in our fiscal 2024 Form 10-K for additional information regarding the terms of the guarantees.
Current wording
On January 19, 2011, the wholly owned U.S. Broadline subsidiaries of Sysco Corporation, which distribute a full line of food products and a wide variety of non-food products, entered into full and unconditional guarantees of all outstanding senior notes and debentures of Sysco Corporation. All subsequent issuances of senior notes and debentures in the U.S. and borrowings under the company’s $3.0 billion long-term revolving credit facility have also been guaranteed by these subsidiaries. As of March 29, 2025, Sysco had a total of $11.8 billion in senior notes, debentures and borrowings under the long-term revolving credit facility that were guaranteed by these subsidiary guarantors. Our remaining consolidated subsidiaries (non-guarantor subsidiaries) are not obligated under the senior notes indenture, debentures indenture or our long-term revolving credit facility. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” contained in our fiscal 2024 Form 10-K for additional information regarding the terms of the guarantees.
Previous wording
•our expectations regarding our fiscal 2025 sales and our rate of sales growth in fiscal 2025 and the three years of our long-range plan;
Current wording
•our expectations regarding our fiscal 2025 sales and our rate of sales growth in fiscal 2025;
Previous wording
•the impact of geopolitical, economic and market conditions and developments, including the impact of the U.S. presidential election;
Current wording
•the impact of geopolitical, economic and market conditions and developments, including changes in global trade policies and tariffs and their ability to impact consumer confidence and foot traffic to restaurants;
Previous wording
•the impact and effects of natural disasters or adverse weather conditions, such as Hurricanes Helene and Milton;
Current wording
•the impact and effects of natural disasters or adverse weather conditions;
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The increase in gross profit dollars in the second quarter and first 26 weeks of fiscal 2025, as compared to the second quarter and first 26 weeks of fiscal 2024, was attributable to increases in sales volumes, success in our strategic sourcing program, and positive contributions from our recent mergers and acquisitions efforts.