SYSCO CORP
For the period ended Sep 27, 2025. Filed Oct 29, 2025.
View on SEC.govAbout this filing
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.
Sep 27, 2025 · Filed Oct 29, 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 2025-03-29; filed 2025-04-30.
0000096021-25-000037
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-27; filed 2025-10-29.
0000096021-25-000157
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 195 previous paragraphs and 138 current paragraphs.
80 unchanged; 40 reworded; 18 added; 73 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 33 previous and 23 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 (18)
Current report
◦increased 3.2%, or $664 million, to $21.1 billion;
Current report
◦adjusted operating income increased 2.9%, or $25 million, to $898 million;
Current report
◦adjusted net earnings increased 2.0%, or $11 million, to $551 million;
Current report
◦decreased 1.0%, or $0.01, to $0.99 per share;
Current report
◦unchanged, at $0.99 per share;
Current report
◦decreased 3.1%, or $32 million, to $1.0 billion; and
Current report
◦adjusted EBITDA increased 0.1%, or $1 million, to $1.1 billion.
Current report
In October 2025, we acquired Fairfax Meadow, a leading specialty meat supplier based in the United Kingdom. This acquisition follows our acquisition of Campbells Prime Meat last fiscal year and positions our team in the United Kingdom to achieve additional growth by leveraging additional specialty meat capabilities geographically. This company’s results will be included within International Foodservice Operations and are not expected to be material to our results of operations.
Current report
Gross margin, which is gross profit as a percentage of sales, was 19.10% in the first quarter of fiscal 2026, for our U.S. Foodservice Operations, which was a decrease of 3 basis points compared to gross margin of 19.13% in the first quarter of fiscal 2025. This decrease is primarily driven by customer mix, as national case sales volumes outpaced local case sales volumes.
Current report
The increase in operating expenses in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025 was primarily due to increases in colleague-related costs and the impact of foreign currency translation.
Current report
Interest expense increased $12 million for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. The increase was primarily due to interest on new senior notes that were issued in the third quarter of fiscal 2025.
Current report
Other Income and Expense
Current report
Other expense increased $22 million for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, primarily due to foreign exchange losses incurred in the first quarter of fiscal 2026. We expect other expense to approximate $65 million for fiscal year 2026.
Current report
•the risk that economic uncertainties can negatively impact consumer confidence and negatively impact foot traffic to restaurants;
Current report
•the risk that we may not be able to effectively execute our capital allocation framework;
Current report
•risks related to our ability to return capital to stockholders, including those related to the timing and amounts (including any plans or commitments in respect thereof) of any dividends and share repurchases;
Current report
•risks related to our ability to attract, motivate and retain employees, including key personnel;
Current report
In light of the significant risks and uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that such results will be achieved, and readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Except as required by law, we undertake no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. You should read this Form 10-Q, our fiscal 2025 Form 10-K and the documents we file with the SEC, with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by the cautionary statements referenced above.
Removed paragraphs (73)
Previous report
◦increased 1.1%, or $218 million, to $19.6 billion;
Previous report
◦decreased 5.7%, or $41 million, to $681 million;
Previous report
◦adjusted operating income decreased 3.3%, or $26 million, to $773 million;
Previous report
◦decreased 5.6%, or $24 million, to $401 million;
Previous report
◦decreased 3.5%, or $0.03, to $0.82 per share;
Previous report
◦decreased 3.5%, or $0.03, to $0.82 per share;
Previous report
◦adjusted diluted earnings per share unchanged, at $0.96;
Previous report
◦decreased 2.5%, or $23 million, to $910 million; and
Previous report
◦increased 3.3%, or $1.9 billion, to $60.2 billion;
Previous report
◦decreased 1.2%, or $26 million, to $2.2 billion;
Previous report
◦adjusted operating income increased 1.3%, or $30 million, to $2.4 billion;
Previous report
◦decreased 3.4%, or $46 million, to $1.3 billion;
Previous report
◦adjusted net earnings decreased 0.5%, or $7 million, to $1.5 billion;
Previous report
•Basic earnings per share:
Previous report
◦decreased 0.7%, or $0.02 to $2.65 per share;
Previous report
•Diluted earnings per share:
Previous report
◦decreased 0.8%, or $0.02, to $2.64 per share;
Previous report
•EBITDA:
Previous report
◦increased 0.9%, or $27 million, to $2.9 billion; and
Previous report
◦adjusted EBITDA increased 2.6%, or $77 million, to $3.0 billion.
Previous report
Earnings Per Share Trends
Previous 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.
Previous report
Divestitures
Previous report
In the second quarter of fiscal 2025, we sold our interest in our joint venture partnership in Mexico, which was a part of our International Foodservice Operations. This operation was not significant to Sysco’s business, and the divestiture will facilitate our efforts to improve our return on invested capital position.
Previous report
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 report
Sales
Previous report
Operating Income
Previous 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.
Previous 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.
Previous report
Net Earnings
Previous report
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 report
Projected Adjusted Earnings Per Share Guidance
Previous 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.
Previous report
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 report
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 report
•our expectations regarding the ability of our supply chain and facilities to remain in place and operational;
Previous report
•our plans regarding our transformation initiatives and the expected effects from such initiatives;
Previous report
•statements regarding uncollectible accounts, including that if collections continue to improve, additional reductions in bad debt expense could occur;
Previous report
•our expectations that our Recipe for Growth strategy will allow us to better serve our customers and differentiate Sysco from our competition;
Previous report
•our expectations regarding our fiscal 2025 sales and our rate of sales growth in fiscal 2025;
Showing the first 40 of 73 passages. Open the source sections for the rest.
Reworded paragraphs (40)
Previous wording
This discussion should be read in conjunction with our consolidated financial statements as of June 29, 2024, and for the fiscal year then ended, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, both contained in our Annual Report on Form 10-K for the fiscal year ended June 29, 2024 (our “fiscal 2024 Form 10-K”), as well as the consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) contained in this report.
Current wording
This discussion should be read in conjunction with our consolidated financial statements as of June 28, 2025, and for the fiscal year then ended, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, both contained in our fiscal 2025 Form 10-K, as well as the consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) contained in this report.
Previous 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.
Current wording
Our first quarter of fiscal 2026 results included sales growth of 3.2% as compared to the first quarter of fiscal 2025, driven by increased sales in our U.S. Foodservice Operations, International Foodservice Operations, and SYGMA segments. Our gross profit increased 3.9% compared to the first quarter of fiscal 2025, due to product cost savings driven by strategic sourcing initiatives. Operating income decreased 1.0% compared to the first quarter of fiscal 2025, 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 operating income increased 2.9% as compared to the first quarter of fiscal 2025. Our net earnings for the first quarter of fiscal 2026 decreased 2.9% as compared to the first quarter of fiscal 2025. Excluding Certain Item expenses, adjusted net earnings increased by 2.0% as compared to the first quarter of fiscal 2025. See below for a comparison of our fiscal 2026 results to our fiscal 2025 results, both including and excluding Certain Items.
Previous wording
Comparisons of results from the third quarter of fiscal 2025 to the third quarter of fiscal 2024 are presented below:
Current wording
Comparisons of results from the first quarter of fiscal 2026 to the first quarter of fiscal 2025 are presented below:
Previous wording
◦adjusted EBITDA decreased 0.8%, or $8 million, to $969 million.
Current wording
◦decreased 1.0%, or $8 million, to $800 million;
Previous wording
◦adjusted net earnings decreased 2.9%, or $14 million, to $469 million;
Current wording
◦decreased 2.9%, or $14 million, to $476 million;
Previous wording
◦adjusted diluted earnings per share increased 2.1%, or $0.06, to $2.98;
Current wording
◦adjusted diluted earnings per share increased 5.5%, or $0.06, to $1.15 per share;
Previous 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.
Current wording
Foot traffic to restaurant trends experienced a sequential improvement of 60 basis points for the first quarter of fiscal 2026 as compared to foot traffic to restaurant trends experienced in the fourth quarter of fiscal 2025. Our U.S. Foodservice Operations local case growth trends experienced a sequential improvement of 120 basis points during the same time period, outpacing the industry’s foot traffic improvement trends. The macroeconomic environment was similar in the first quarter of fiscal 2026 as compared to the two prior fiscal quarters, which has continued to adversely impact consumer sentiment. Despite the current macroeconomic landscape, we expect to grow both sales and net earnings per share in fiscal 2026. 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
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.
Current wording
Sales increased 3.2% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025. Our sales and gross profit performance are influenced by multiple factors, including price, volume, inflation, customer mix and product mix. We experienced a 0.1% increase in U.S. Foodservice Operations case volume in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. Our volume growth trends were attributable to national case volume increasing 0.7% and local volume decreasing 0.2% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025. Our volume reflects our broadline and specialty businesses. Beginning in fiscal 2026, we are now including volumes from our specialty meat business for all periods presented.
Previous 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.
Current wording
We experienced inflation at a rate of 3.4% in the first quarter of fiscal 2026, at the total enterprise level, primarily driven by inflation in the meat and seafood categories. We continue to manage inflation by successfully passing on cost increases to our customers in a timely manner. Gross margin increased 13 basis points in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, primarily due to benefits from our strategic sourcing initiatives.
Previous 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.
Current wording
Total operating expenses were $3.1 billion in the first quarter of fiscal 2026, a 5.3% increase compared to the first quarter of fiscal 2025. Total adjusted operating expenses were $3.0 billion in the first quarter of fiscal 2026, a 4.3% increase as compared to the first quarter of fiscal 2025. Operating expenses increased primarily due to sales headcount investments, higher incentive compensation, and costs associated with expanded building capacity, including depreciation expense related to new facilities. Adjusted operating expenses were 14.2% of sales during the first quarter of fiscal 2026, which represents a 14-basis point increase as compared to the first quarter of fiscal 2025, as a result of planned investments in higher growth areas of the business with sales headcount, fleet, and building expansions.
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 88.1% 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.
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 88.7% of Sysco’s overall sales in the first 13 weeks of fiscal 2026. U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 97.1% of total segment operating income, in the first 13 weeks of fiscal 2026. This illustrates that these segments represent a substantial majority of our total segment results when compared to other reportable segments.
Previous wording
The following tables set forth a summary of the components of operating income expressed as a percentage increase or decrease over the comparable period in the prior year:
Current wording
The following table sets forth a summary of the components of operating income expressed as a percentage increase or decrease over the comparable period in the prior year:
Previous 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.
Current wording
The sales growth in our U.S. Foodservice Operations was primarily driven by higher inflation. Case volumes from our U.S. Foodservice Operations increased 0.1% in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. This includes a 0.7% increase in national case volume, partially offset by a 0.2% decrease in local customer case volume in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.
Previous 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.
Current wording
The decrease in operating income for the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025 was driven by an increase in operating expenses, partially offset by gross profit dollar growth and case volume growth.
Previous 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.
Current wording
Gross profit dollars increased in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, primarily as a result of improvements in our strategic sourcing initiatives and the effective management of product cost fluctuations. The estimated change in product costs, an internal measure of inflation or deflation, increased in the first quarter of fiscal 2026.
Previous 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.
Current wording
The increase in operating expenses for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, was primarily driven by increases in colleague-related costs, bad debt expense, and other miscellaneous costs.
Previous wording
The following tables set forth the percentage and dollar value increase or decrease in the major components impacting sales as compared to the corresponding prior year period in order to demonstrate the cause and magnitude of change.
Current wording
The following table sets forth the percentage and dollar value increase or decrease in the major components impacting sales as compared to the corresponding prior year period in order to demonstrate the cause and magnitude of change.
Previous wording
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 wording
Sales for the first quarter of fiscal 2026 increased 4.5% as compared to the first quarter of fiscal 2025, primarily due to higher inflation, the impact of foreign currency translation, and local case growth. Excluding the impact of the Mexico joint venture, which was divested in the second quarter of fiscal 2025, sales increased 7.9% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.
Previous 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.
Current wording
The increase in operating income for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, was primarily due to growth in local case volumes and success in our strategic sourcing program, partially offset by increases in operating expenses.
Previous wording
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 wording
The increase in gross profit dollars in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, was primarily attributable to increases in local case volumes and benefits from our strategic sourcing efforts. Local case volumes increased approximately 5% in the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025.
Previous 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.
Current wording
SYGMA segment sales were 4.1% higher in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, primarily driven by the growth of new customers. We expect SYGMA’s sales growth rates to moderate in fiscal 2026 as we reach the one-year anniversary mark of fiscal 2025’s substantial customer additions. Operating income increased $7 million in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, primarily due to the growth of new customers and operating efficiencies.
Previous 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.
Current wording
For the operations that are grouped within Other, operating income decreased $5 million in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. 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 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.
Current wording
Our Global Support Center generally includes all expenses of the corporate office and Sysco’s shared service operations. These expenses in the first quarter of fiscal 2026 increased $12 million, or 5.3%, as compared to the first quarter of fiscal 2025, primarily due to increases in colleague-related costs and higher incentive compensation, partially offset by decreases in insurance costs.
Previous 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.
Current wording
Included in Global Support Center expenses are Certain Items that totaled $29 million in the first quarter of fiscal 2026, as compared to $19 million in the first quarter of fiscal 2025. Certain Items impacting the first quarter of fiscal 2026 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions. Certain Items impacting the first quarter of fiscal 2025 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions.
Previous 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.
Current wording
Net earnings decreased 2.9% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, 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% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, primarily due to the effective management of product cost fluctuations.
Previous 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.
Current wording
Basic earnings per share in the first quarter of fiscal 2026 were $0.99, a 1.0% decrease from the comparable prior year period amount of $1.00 per share. Diluted earnings per share in the first quarter of fiscal 2026 were $0.99, unchanged from the comparable prior year period amount of $0.99 per share. Adjusted diluted earnings per share, excluding Certain Items, in the first quarter of fiscal 2026 were $1.15, a 5.5% increase from the comparable prior year amount of $1.09 per share.
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, 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.
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 sales 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 $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.
Current wording
We produced negative free cash flow of $50 million in the first 13 weeks of fiscal 2026, as compared to positive free cash flow of $8 million in the first 13 weeks of fiscal 2025. The decrease in free cash flow is attributable to a decrease in proceeds from sales of plant and equipment and an increase in capital expenditures, partially offset by an increase 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 13 weeks of fiscal 2026 to the first 13 weeks of fiscal 2025 are provided.
Previous 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.
Current wording
Sysco generates cash in the U.S. and internationally. As of September 27, 2025, we had $844 million in cash and cash equivalents, approximately 70% 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 $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.
Current wording
We generated $86 million in cash flows from operations in the first 13 weeks of fiscal 2026, compared to cash flows from operations of $53 million in the first 13 weeks of fiscal 2025. In the first 13 weeks of fiscal 2026, these amounts included year-over-year favorable comparisons on working capital of $85 million due to favorable comparisons on accounts receivable and accounts payable, partially offset by an unfavorable comparison in inventory. Accrued expenses also had a favorable comparison, primarily related to lower payments of accrued incentive compensation in the first 13 weeks of fiscal 2026 in comparison to the first 13 weeks of fiscal 2025. Income tax payments negatively impacted cash flows from operations, as estimated payments made in the first 13 weeks of fiscal 2026 were higher compared to the first 13 weeks of fiscal 2025.
Previous 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.
Current wording
Our capital expenditures in the first 13 weeks of fiscal 2026 consisted primarily of investments in buildings and building improvements, technology equipment, warehouse equipment, and fleet. Our capital expenditures in the first 13 weeks of fiscal 2026 were $38 million higher than in the first 13 weeks of fiscal 2025, primarily due to timing of capital spending. Proceeds from sales of plant and equipment were $24 million in the first 13 weeks of fiscal 2026, as compared to $77 million in the first 13 weeks of fiscal 2025.
Previous 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.
Current wording
Proceeds from exercises of share-based compensation awards were $43 million in the first 13 weeks of fiscal 2026, as compared to $29 million in the first 13 weeks of fiscal 2025. 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 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.
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 no shares during the first 13 weeks of fiscal 2026. As of September 27, 2025, we had a remaining authorization of approximately $1.5 billion. We repurchased no additional shares under our authorization from the end of our fiscal first quarter through October 10, 2025.
Previous 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.
Current wording
Dividends paid in the first 13 weeks of fiscal 2026 were $259 million, or $0.54 per share, as compared to $251 million, or $0.51 per share, in the first 13 weeks of fiscal 2025. In August 2025, we declared our regular quarterly dividend for the first quarter of fiscal 2026 of $0.54 per share, which was paid in October 2025.
Previous wording
Certain statements made herein that look forward in time or express management’s expectations or beliefs with respect to the occurrence of future events are forward-looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “future,” “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “will,” “would,” “could,” “can,” “may,” “projected,” “continues,” “continuously,” variations of such terms, and similar terms and phrases denoting anticipated or expected occurrences or results. Examples of forward-looking statements include, but are not limited to, statements about:
Current wording
Certain statements made herein that look forward in time or express management’s expectations or beliefs with respect to the occurrence of future events are forward-looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “future,” “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “will,” “would,” “could,” “can,” “may,” “projected,” “continues,” “continuously,” variations of such terms, and similar terms and phrases denoting anticipated or expected occurrences or results. This report contains various statements relating to 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.
Previous wording
•periods of significant or prolonged inflation or deflation and their impact on our product costs and profitability generally;
Current wording
•periods of significant or prolonged inflation or deflation and their impact on our product costs and profitability generally, and our inability to predict inflation over the long term;
Previous wording
•the risk that our efforts to modify truck routing, including our small truck initiative, in order to reduce outbound transportation costs may be unsuccessful;
Current wording
•the risk that our efforts to modify truck routing in order to reduce outbound transportation costs may be unsuccessful;
Previous wording
•the risk that we may not realize anticipated benefits from our operating cost reduction efforts;
Current wording
•the risk that we that we may not realize anticipated benefits from our operating cost reduction efforts, including our ability to accelerate and/or identify additional administrative cost savings;
Previous wording
•the risk that we fail to comply with requirements imposed by applicable law or government regulations;
Current wording
•the risk that we fail to comply with requirements imposed by applicable law or government regulations, including but not limited to those related to environmental and tax and accounting laws, rules and regulations;
Previous wording
•labor issues, including the renegotiation of union contracts and shortage of qualified labor;
Current wording
•risks related to labor issues, including the renegotiation of union contracts and shortage of qualified labor; and
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Comparisons of results from the first 39 weeks of fiscal 2025 to the first 39 weeks of fiscal 2024 are presented below:
Previous report — wording carried elsewhere
•our belief that our purpose will allow us to grow substantially faster than the foodservice distribution industry and deliver profitable growth through our Recipe for Growth transformation, and statements regarding our plans with respect to our strategic pillars that support this growth transformation;