SYSCO CORP
For the period ended Dec 27, 2025. Filed Jan 28, 2026.
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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.
Dec 27, 2025 · Filed Jan 28, 2026
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 2025-09-27; filed 2025-10-29.
0000096021-25-000157
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-27; filed 2026-01-28.
0000096021-26-000009
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 138 previous paragraphs and 161 current paragraphs.
93 unchanged; 36 reworded; 31 added; 9 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 23 previous and 32 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 (31)
Current report
◦increased 3.0%, or $611 million, to $20.8 billion;
Current report
◦decreased 2.8%, or $20 million, to $692 million;
Current report
◦adjusted operating income increased 3.1%, or $24 million, to $807 million;
Current report
◦decreased 4.2%, or $17 million, to $389 million;
Current report
◦adjusted net earnings increased 3.9%, or $18 million, to $476 million;
Current report
◦decreased 2.4%, or $0.02, to $0.81 per share;
Current report
◦decreased 1.2% or $0.01, to $0.81 per share;
Current report
◦increased 3.1%, or $1.3 billion, to $41.9 billion;
Current report
◦decreased 1.7%, or $26 million, to $1.5 billion;
Current report
◦adjusted operating income increased 3.1%, or $51 million, to $1.7 billion;
Current report
◦decreased 3.3%, or $30 million, to $866 million;
Current report
◦adjusted net earnings increased 3.1%, or $31 million, to $1.0 billion;
Current report
•Basic earnings per share:
Current report
◦decreased 0.5%, or $0.01, to $1.81 per share;
Current report
•Diluted earnings per share:
Current report
◦decreased 1.1% , or $0.02 to $1.80 per share;
Current report
◦adjusted diluted earnings per share increased 5.9%, or $0.12, to $2.14 per share;
Current report
•EBITDA:
Current report
◦decreased 2.0%, or $39 million, to $1.9 billion; and
Current report
◦adjusted EBITDA increased 1.7%, or $34 million, to $2.1 billion.
Current report
Amortization Expense Trends
Current report
Sysco’s operations within the United Kingdom, located within the International Foodservice Operations segment, initiated a rebranding effort in the second quarter of fiscal 2026 to transition the Brakes® brand and other smaller brands to “Sysco GB.” This rebranding initiative will take approximately two years to complete and will result in Sysco amortizing previously indefinite-lived intangible assets on a straight-line basis over this two-year period. The rebranding is expected to result in approximately $100 million of additional amortization expense over two years, including approximately $29 million for the remainder of fiscal 2026. This amortization expense will be treated as a Certain Item, similar to how we have treated amortization expense on other previously acquired intangible assets.
Current report
In December 2025, we acquired Ginsberg’s Foods, a broadline distributor servicing restaurants, schools, and healthcare facilities across eastern New York and neighboring states. This acquisition opens opportunities to new customers while creating procurement efficiencies through Sysco buying programs and expanded access to Sysco brand products. This company’s results are included within U.S. Foodservice Operations and were not material to our results for the second quarter and first 26 weeks of fiscal 2026.
Current report
Sales
Current report
Operating Income
Current report
SYGMA segment sales were 0.5% and 2.2% higher in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. Operating income increased $2 million and $9 million in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. These results are reflective of recent supply chain operating efficiencies achieved, which we expect to moderate for the remainder of the fiscal year.
Current report
Net Earnings
Current report
Basic earnings per share in the first 26 weeks of fiscal 2026 were $1.81, a 0.5% decrease from the comparable prior year amount of $1.82 per share. Diluted earnings per share in the first 26 weeks of fiscal 2026 were $1.80, a 1.1% decrease from the comparable prior year period amount of $1.82 per share. Adjusted diluted earnings per share, excluding Certain Items, in the first 26 weeks of fiscal 2026 were $2.14, a 5.9% increase from the comparable prior year amount of $2.02 per share.
Current report
During the first 26 weeks of fiscal 2026, we paid $133 million, net of cash acquired, for the acquisitions of Fairfax Meadow and Ginsberg’s Foods. During the first 26 weeks of fiscal 2025, we paid $40 million, net of cash acquired, for the acquisition of Campbells Prime Meat.
Current report
During the first 26 weeks of fiscal 2026, we received $102 million in proceeds from sales of plant and equipment, which was primarily attributable to proceeds received from sale leaseback transactions. During the first 26 weeks of fiscal 2025, we received $166 million in proceeds from sales of plant and equipment, which was primarily attributable to proceeds received from sale leaseback transactions.
Current report
As part of the rebranding initiative in the United Kingdom discussed above, we performed impairment testing on the related indefinite-lived intangible assets during the second quarter of fiscal 2026. The assets were determined not to be impaired. The rebranding initiative will result in Sysco amortizing previously indefinite-lived intangible assets on a straight-line basis over a two-year period.
Removed paragraphs (9)
Previous report
◦increased 3.2%, or $664 million, to $21.1 billion;
Previous report
◦adjusted operating income increased 2.9%, or $25 million, to $898 million;
Previous report
◦decreased 2.9%, or $14 million, to $476 million;
Previous report
◦adjusted net earnings increased 2.0%, or $11 million, to $551 million;
Previous report
◦decreased 1.0%, or $0.01, to $0.99 per share;
Previous report
◦unchanged, at $0.99 per share;
Previous report
◦adjusted EBITDA increased 0.1%, or $1 million, to $1.1 billion.
Previous 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.
Previous report
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.
Reworded paragraphs (36)
Previous 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.
Current wording
Our second quarter of fiscal 2026 results included sales growth of 3.0% as compared to the second 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 second quarter of fiscal 2025, due to our strategic sourcing efforts and effective management of product cost inflation. Operating income decreased 2.8% compared to the second 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 3.1% as compared to the second quarter of fiscal 2025. Our net earnings for the second quarter of fiscal 2026 decreased 4.2% as compared to the second quarter of fiscal 2025. Excluding Certain Item expenses, adjusted net earnings increased by 3.9% as compared to the second 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 first quarter of fiscal 2026 to the first quarter of fiscal 2025 are presented below:
Current wording
Comparisons of results from the second quarter of fiscal 2026 to the second quarter of fiscal 2025 are presented below:
Previous wording
◦adjusted diluted earnings per share increased 5.5%, or $0.06, to $1.15 per share;
Current wording
◦adjusted diluted earnings per share increased 6.5%, or $0.06, to $0.99 per share;
Previous wording
◦decreased 1.0%, or $8 million, to $800 million;
Current wording
◦decreased 0.9%, or $8 million, to $923 million; and
Previous wording
◦decreased 3.1%, or $32 million, to $1.0 billion; and
Current wording
◦adjusted EBITDA increased 3.3%, or $32 million, to $1.0 billion.
Previous 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.
Current wording
Foot traffic to restaurant trends experienced a sequential decline of 230 basis points for the second quarter of fiscal 2026 as compared to foot traffic to restaurant trends experienced in the first quarter of fiscal 2026. Our U.S. Foodservice Operations local case growth trends experienced a sequential improvement of 140 basis points during the same time period, despite the industry’s foot traffic trends. The macroeconomic environment was similar in the second quarter of fiscal 2026 as compared to the three prior fiscal quarters, which has continued to adversely impact consumer sentiment. Despite the current macroeconomic landscape, we expect to grow our sales 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 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.
Current wording
Sales increased 3.0% and 3.1% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks 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 0.8% and 0.4% increase in U.S. Foodservice Operations case volume in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. Our volume growth trends were attributable to local case volume increasing 1.2% and 0.5% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. Our local case volumes have improved due to an increase in new customers, a reduction in lost customers, and improved productivity of our sales consultants. National case volume increased 0.4% and 0.6% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks 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. We expect our volume growth trends to continue in the second half of fiscal 2026 due to improved productivity of our sales consultants.
Previous 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.
Current wording
We experienced inflation at a rate of 2.9% in the second quarter of fiscal 2026, at the total enterprise level, primarily driven by inflation in the meat and seafood categories. We continue to address inflation by successfully managing through cost increases in a timely manner. Gross margin increased 15 and 14 basis points in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025, primarily due to benefits from our strategic sourcing initiatives and the effective management of product cost inflation.
Previous 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.
Current wording
Total operating expenses were $3.1 billion and $6.2 billion in the second quarter and first 26 weeks of fiscal 2026, a 5.5% and 5.4% increase compared to the second quarter and first 26 weeks of fiscal 2025, respectively. Total adjusted operating expenses were $3.0 billion and $6.0 billion in the second quarter and first 26 weeks of fiscal 2026, a 4.1% and 4.2% increase compared to the second quarter and first 26 weeks of fiscal 2025, respectively. Operating expenses increased primarily due to sales headcount investments, a decrease in gains on sale leaseback transactions, higher incentive compensation, increased acquisition-related costs, and increased costs associated with expanded building capacity, partially offset by decreases in insurance costs. Adjusted operating expenses were 14.4% and 14.3% of sales during the second quarter and first 26 weeks of fiscal 2026, which represents a 15 and 14 basis point increase as compared to the second quarter and first 26 weeks of fiscal 2025, respectively, as a result of sales headcount investments, a decrease in gains on sale leaseback transactions, higher incentive compensation, and increased costs associated with expanded building capacity in higher growth areas of the business, partially offset by decreases in insurance costs.
Previous wording
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 wording
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 are included within International Foodservice Operations and were not material to our results for the second quarter and first 26 weeks of fiscal 2026.
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 88.7% 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.
Current wording
Based on information in Note 14, “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 88.6% of Sysco’s overall sales in both the second quarter and first 26 weeks of fiscal 2026, respectively. U.S. Foodservice Operations and International Foodservice Operations, collectively, represented approximately 97.2% and 97.3% of total segment operating income, in the second quarter and first 26 weeks of fiscal 2026, 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 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.
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 0.8% and 0.4% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. The growth in case volumes was attributable to local case volumes increasing 1.2% and 0.5% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. National case volumes increased 0.4% and 0.6% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025.
Previous 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.
Current wording
The decrease in operating income for the second quarter and first 26 weeks of fiscal 2026 as compared to the second quarter and first 26 weeks 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 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.
Current wording
Gross profit dollars increased in the second quarter and first 26 weeks of fiscal 2026 as compared to the second quarter and first 26 weeks 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 second quarter and first 26 weeks of fiscal 2026. Gross margin, which is gross profit as a percentage of sales, was 18.91% and 19.01% in the second quarter and first 26 weeks of fiscal 2026, respectively, for our U.S. Foodservice Operations, which was an increase of 1 basis point compared to gross margin of 18.90% in the second quarter of fiscal 2025, and unchanged compared to a gross margin of 19.01% in the first 26 weeks of fiscal 2025. The improvement in the second quarter of fiscal 2026 is attributable to customer mix, as local case volume growth outpaced national case volume growth.
Previous 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.
Current wording
The increase in operating expenses for the second quarter and first 26 weeks of fiscal 2026, as compared to the second quarter and first 26 weeks of fiscal 2025, was primarily driven by increases in colleague-related costs, which is inclusive of incentive compensation, costs associated with investments in sales headcount and building expansions, and a decrease in gains on sale leaseback transactions.
Previous 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.
Current wording
Sales for the second quarter of fiscal 2026 increased 7.3% as compared to the second quarter of fiscal 2025. Sales for the first 26 weeks of fiscal 2026 increased 5.9% as compared to the first 26 weeks of fiscal 2025. The sales increase in both periods is 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 9.9% in the second quarter of fiscal 2026 as compared to the second quarter of fiscal 2025 and 8.9% in the first 26 weeks of fiscal 2026 as compared to the first 26 weeks of fiscal 2025.
Previous 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.
Current wording
The increase in operating income for the second quarter and first 26 weeks of fiscal 2026, as compared to the second quarter and first 26 weeks of fiscal 2025, was primarily due to growth in local case volumes and expanded supply chain capacity, partially offset by increases in operating expenses.
Previous 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.
Current wording
The increase in gross profit dollars in the second quarter and first 26 weeks of fiscal 2026, as compared to the second quarter and first 26 weeks of fiscal 2025, was primarily attributable to increases in local case volumes and expanded supply chain capacity. Local case volumes increased approximately 4.5% in the second quarter of fiscal 2026 as compared to the second quarter of fiscal 2025.
Previous wording
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 wording
The increase in operating expenses in the second quarter and first 26 weeks of fiscal 2026 as compared to the second quarter and first 26 weeks of fiscal 2025 was primarily due to increases in colleague-related costs and the impact of foreign currency translation.
Previous 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.
Current wording
For the operations that are grouped within Other, operating income increased $2 million and decreased $2 million in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks 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 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.
Current 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 2026 increased $35 million, or 14.1%, as compared to the second quarter of fiscal 2025, primarily due to increases in colleague-related costs, which is inclusive of incentive compensation, and acquisition-related costs, partially offset by decreases in insurance costs. These expenses in the first 26 weeks of fiscal 2026 increased $47 million, or 9.9%, as compared to the first 26 weeks of fiscal 2025, primarily due to increases in colleague-related costs, which is inclusive of incentive compensation, and acquisition-related costs, partially offset by decreases in insurance costs.
Previous 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.
Current wording
Included in Global Support Center expenses are Certain Items that totaled $38 million and $68 million in the second quarter and first 26 weeks of fiscal 2026, as compared to $12 million and $30 million in the second quarter and first 26 weeks of fiscal 2025, respectively. Certain Items impacting the second quarter and first 26 weeks of fiscal 2026 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 2025 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions.
Previous wording
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 wording
Interest expense increased $13 million and $25 million for the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025. The increase was primarily due to interest on new senior notes that were issued in the third quarter of fiscal 2025 and interest expense on recent commercial paper issuances.
Previous wording
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 wording
Other expense decreased $10 million and increased $13 million for the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks of fiscal 2025, primarily due to foreign exchange gains and losses incurred in those periods.
Previous 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.
Current wording
Net earnings decreased 4.2% and 3.3% in the second quarter and first 26 weeks of fiscal 2026, respectively, as compared to the second quarter and first 26 weeks 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 12, “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 3.9% and 3.1% in the second quarter and first 26 weeks of fiscal 2026 respectively, as compared to the second quarter and first 26 weeks of fiscal 2025, primarily due to increases in sales volumes and the effective management of our product cost inflation and strategic sourcing efforts.
Previous 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.
Current wording
Basic earnings per share in the second quarter of fiscal 2026 were $0.81, a 2.4% decrease from the comparable prior year period amount of $0.83 per share. Diluted earnings per share in the second quarter of fiscal 2026 were $0.81, a 1.2% decrease 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 2026 were $0.99, a 6.5% increase from the comparable prior year amount of $0.93 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. 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.
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 year 2025.
Previous 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.
Current wording
We produced free cash flow of $413 million in the first 26 weeks of fiscal 2026, as compared to $331 million in the first 26 weeks of fiscal 2025. The increase in free cash flow is attributable to an increase in cash provided by operating activities and a decrease in capital expenditures, partially offset by a decrease in proceeds from sales of plant and equipment. 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 2026 to the first 26 weeks of fiscal 2025 are provided.
Previous 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.
Current wording
Sysco generates cash in the U.S. and internationally. As of December 27, 2025, we had $1.2 billion in cash and cash equivalents, approximately 56% 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 $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.
Current wording
We generated $611 million in cash flows from operations in the first 26 weeks of fiscal 2026, compared to cash flows from operations of $498 million in the first 26 weeks of fiscal 2025. In the first 26 weeks of fiscal 2026, these amounts included year-over-year favorable comparisons on working capital of $144 million due to a favorable comparison in inventory, partially offset by unfavorable comparisons on accounts payable and accounts receivable. Accrued expenses also had a favorable comparison, primarily related to lower payments of accrued incentive compensation in the first 26 weeks of fiscal 2026 in comparison to the first 26 weeks of fiscal 2025. Partially offsetting these favorable comparisons, a decrease in accrued income taxes negatively impacted cash flows from operations due to lower net earnings in the first 26 weeks of fiscal 2026 compared to the first 26 weeks of fiscal 2025.
Previous 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.
Current wording
Our capital expenditures in the first 26 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 26 weeks of fiscal 2026 were $33 million lower than in the first 26 weeks of fiscal 2025, primarily due to timing of capital spending.
Previous 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.
Current wording
Proceeds from exercises of share-based compensation awards were $60 million in the first 26 weeks of fiscal 2026, as compared to $67 million in the first 26 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 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.
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 26 weeks of fiscal 2026. As of December 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 second quarter through January 9, 2026. We intend to resume share repurchases in the second half of fiscal 2026, which could result in approximately $1.0 billion in total spend; however, this amount could be reduced due to factors such as economic conditions and acquisition activity.
Previous 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.
Current wording
Dividends paid in the first 26 weeks of fiscal 2026 were $518 million, or $1.08 per share, as compared to $503 million, or $1.02 per share, in the first 26 weeks of fiscal 2025. In November 2025, we declared our regular quarterly dividend for the second quarter of fiscal 2026 of $0.54 per share, which was paid in January 2026.
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 September 27, 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 2025 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 December 27, 2025, Sysco had a total of $11.0 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 2025 Form 10-K for additional information regarding the terms of the guarantees.
Previous 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;
Current wording
•the risk 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;
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Comparisons of results from the first 26 weeks of fiscal 2026 to the first 26 weeks of fiscal 2025 are presented below: