Aramark
For the period ended Jan 2, 2026. Filed Feb 10, 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.
Jan 2, 2026 · Filed Feb 10, 2026
ARMK$52.54+4.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-27; filed 2025-08-05.
0001584509-25-000169
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-01-02; filed 2026-02-10.
0001584509-26-000040
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 93 previous paragraphs and 96 current paragraphs.
44 unchanged; 22 reworded; 29 added; 26 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 10 previous and 8 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 (29)
Current report
Revenue increased by approximately 6.1% or $279.4 million during the three month period of fiscal 2026 compared to the prior year period. The increase was primarily attributable to base business growth and net new business. Additionally, foreign currency translation favorably impacted revenue by 1.1%. The increase was partially offset by the estimated impact of the reduced number of operational service days in the first quarter of fiscal 2026 from the calendar shift related to the fifty-third week in fiscal 2025 (approximately 3%).
Current report
Cost of services provided (exclusive of depreciation and amortization) increased by $264.2 million during the three month period of fiscal 2026 compared to the prior year period, primarily driven by an increase in revenue as discussed above. Key drivers of the year-over-year increase include:
Current report
•Food and support service costs increased by $63.6 million, primarily due to food and beverage costs associated with business growth, partially offset by supply chain efficiencies.
Current report
•Personnel costs rose by $170.5 million, reflecting overall business expansion, higher medical claims ($7.5 million) and a multiemployer pension plan withdrawal charge ($5.6 million). In addition, the calendar shift related to the fifty‑third week in fiscal 2025 resulted in a reduced number of operational service days during the current period. As a portion of personnel costs is fixed, these costs did not decrease in line with the lower level of service days, leading to an increase in personnel costs as a percentage of revenue compared to the prior year period.
Current report
•Other direct costs grew by $30.1 million, driven by business growth and a non-cash charge for the impairment of certain assets related to a business held-for-sale ($6.1 million). This increase was partially offset by the absence of a prior-year charge related to contingent consideration liabilities from acquisition earn-outs ($11.1 million) and lower commissions primarily within our Higher Education business due to the reduced number of operational service days in the first quarter of fiscal 2026 from the calendar shift related to the fifty-third week in fiscal 2025 ($8.1 million).
Current report
Depreciation and amortization
Current report
Depreciation and amortization expenses increased by $12.7 million during the three month period of fiscal 2026 compared to the prior year period. The increase was driven by a higher depreciation expense on property and equipment ($10.1 million) and higher amortization expense, primarily from acquisition related intangible assets ($2.6 million).
Current report
Selling and general corporate expenses
Current report
Selling and general corporate expenses increased by $2.3 million during the three month period of fiscal 2026 compared to the prior year period. The increase was primarily driven by higher share-based compensation expenses compared to the prior year period.
Current report
Operating income
Current report
Operating income increased by $0.2 million during the three month period of fiscal 2026 compared to the prior year period as a result of the aforementioned changes. The reduced number of operational service days from the calendar shift related to the fifty-third week in fiscal 2025 negatively impacted the first quarter of fiscal 2026 operating income by an estimated $25 million.
Current report
Interest Expense, net
Current report
Interest Expense, net, increased by $6.1 million during the three month period of fiscal 2026 compared to the prior year period due to recently executed interest rate swaps with higher fixed rates replacing maturing swaps that were entered into during a lower interest rate environment and higher borrowings on the Receivables Facilities. The increase was also due to the payment of $0.7 million of transaction costs and a $0.4 million non-cash loss for the write-off of unamortized deferred financing costs and discount, both relating to the repricing of the U.S. Term B-8 Loans due 2030. These increases were partially offset by lower interest expense resulting from refinancing of term loan and senior note balances and repayments on term loan balances.
Current report
Provision for Income Taxes
Current report
The following table presents segment adjusted operating results for the three month periods of fiscal 2026 and fiscal 2025 (in millions)(1):
Current report
(1) Adjusted operating income represents operating income adjusted to eliminate the impact of amortization of acquisition-related intangible assets ($25.2 million and $23.9 million in the three month periods of fiscal 2026 and fiscal 2025, respectively) and other items impacting comparability ($11.6 million and $11.1 million in the three month periods of fiscal 2026 and fiscal 2025, respectively). The amounts in the table above may represent adjusted figures to arrive at adjusted operating income. Refer to Note 10 to the condensed consolidated financial statements for a description of adjustments comprising adjusted operating income.
Current report
Revenue
Current report
FSS United States segment revenue increased by approximately 1.9% during the three month period of fiscal 2026 compared to the prior year period, primarily driven by base business growth and new business. Growth in the Business & Industry sector was attributable to new business wins and base business growth, while the Healthcare and Facilities & Other sectors benefited from continued base business growth. The Sports, Leisure & Corrections sector experienced growth primarily from new business. The increase in segment revenue was partially offset by the estimated impact of the reduced number of operational service days in the first quarter of fiscal 2026 compared to the prior year period from the calendar shift related to the fifty-third week in fiscal 2025 (approximately 3%). The impact of the calendar shift was most evident in the Education, Sports, Leisure & Corrections and Business & Industry sectors.
Current report
Adjusted operating income
Current report
The Education and Facilities & Other sectors had adjusted operating income margins over ten percent in both the three month period of fiscal 2026 and the prior year period. The Healthcare sector had high-single digit adjusted operating income margins in both the three month period of fiscal 2026 and the prior year period. The Business & Industry sector had mid-single digit adjusted operating income margins in both the three month period of fiscal 2026 and the prior year period. The Sports, Leisure & Corrections sector had low-single digit adjusted operating income margins in both the three month period of fiscal 2026 and the prior year period.
Current report
Adjusted operating income decreased by $3.2 million during the three month period of fiscal 2026 compared to the prior year period. The decrease was primarily attributable to the estimated impact of the reduced number of operational service days in the first quarter of fiscal 2026 from the calendar shift related to the fifty-third week in fiscal 2025 (approximately $24 million) and higher costs related to medical claims ($7.5 million), largely offset by higher base business volume and strengthened supply chain economics from revenue growth.
Current report
The following table presents segment adjusted operating results for the three month periods of fiscal 2026 and fiscal 2025 (in millions)(1):
Current report
(1) Adjusted operating income represents operating income adjusted to eliminate the impact of amortization of acquisition-related intangible assets ($6.8 million and $4.6 million in the three month periods of fiscal 2026 and fiscal 2025, respectively) and other items impacting comparability ($1.8 million and $0.7 million in the three month periods of fiscal 2026 and fiscal 2025, respectively). The amounts in the table above may represent adjusted figures to arrive at adjusted operating income. Refer to Note 10 to the condensed consolidated financial statements for a description of adjustments comprising adjusted operating income.
Current report
Revenue
Current report
Adjusted operating income
Current report
Adjusted operating income increased by $9.5 million during the three month period of fiscal 2026 compared to the prior year period. The increase was primarily attributable to higher base business volume and strengthened supply chain economics from revenue growth.
Current report
During the three month period of fiscal 2025, cash provided by financing activities was primarily impacted by borrowings under the Receivables Facility ($525.0 million) and borrowings under the revolving credit facility ($178.4 million). Cash provided by financing activities more than offset taxes paid by us when we withhold shares upon an employee's exercise or vesting of equity awards to cover income taxes ($28.6 million), payment of dividends ($27.9 million) and repayment of long-term borrowings ($10.8 million).
Current report
We intend to continue to pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements, business prospects and other factors that our Board of Directors may deem relevant. However, the payment of any future dividends will be at the discretion of our Board of Directors, and our Board of Directors may, at any time, determine not to continue to declare quarterly dividends.
Current report
(2) Represents a fiscal 2025 non-cash charge for the impairment of an equity investment ($19.5 million) and a fiscal 2026 non-cash charge for the impairment of certain assets related to a business held-for-sale ($6.1 million).
Removed paragraphs (26)
Previous report
(1) As a percentage of total revenue, FSS United States represented 70.2% and 71.9% and FSS International represented 29.8% and 28.1% for the three months ended June 27, 2025 and June 28, 2024, respectively.
Previous report
(1) As a percentage of total revenue, FSS United States represented 71.4% and 72.4% and FSS International represented 28.6% and 27.6% for the nine months ended June 27, 2025 and June 28, 2024, respectively.
Previous report
Revenue increased by approximately 5.7% and 3.7% during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively. The increase was primarily attributable to base business growth and additional operating days due to a calendar shift at several universities in the FSS United States segment, partially offset by the exit of some lower margin accounts occurring later in fiscal 2024. The increase in the three month period of fiscal 2025 was also attributable to net new business and a favorable impact of foreign currency translation (0.5%). The increase for the nine month period of fiscal 2025 was partially offset by the negative impact of foreign currency translation (0.7%).
Previous report
The following table presents the percentages attributable to the components in cost of services provided (exclusive of depreciation and amortization) for the three and nine months ended June 27, 2025 and June 28, 2024.
Previous report
Operating income increased by $20.9 million and $86.3 million during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively, driven by base business growth and supply chain efficiencies, partially offset by higher medical claims ($13.0 million and $12.5 million, respectively). The increase in operating income during the three month period of fiscal 2025 was partially offset by severance charges ($12.7 million). In addition, the increase in operating income during the nine month period of fiscal 2025 was attributable to prior year expenses related to the separation and distribution of the Uniform segment ($29.0 million), which was partially offset by higher amortization of acquisition-related intangible assets ($11.8 million) and higher contingent consideration expenses ($10.6 million).
Previous report
Interest Expense, net, increased by 6.0% during the three month period of fiscal 2025 compared to the prior year period primarily due to the entering of new interest rate swap agreements at higher interest rates to replace maturing interest rate swap agreements. The interest costs were partially offset by the net effect of the retired United States dollar denominated Term B-4 Loans due January 2027 (“U.S. Term B-4 Loans due 2027”), the redeemed 5.000% Senior Notes due April 2025 (“5.000% 2025 Notes”) and the upsizing of the United States dollar denominated Term B-8 Loans due 2030 (“U.S. Term B-8 Loans due 2030”).
Previous report
Interest Expense, net, decreased by 10.8% during the nine month period of fiscal 2025 compared to the prior year period due to the following: a prior year payment of a $23.9 million call premium; a prior year $7.9 million non-cash loss for the write-off of unamortized deferred financing costs related to the repayment of the 6.375% Senior Notes due May 2025 (the "6.375% 2025 Notes"); a prior year $1.6 million write-off of unamortized deferred financing costs and discount on the United States dollar denominated Term B-5 Loans due 2028 and United States dollar denominated Term B-6 Loans due 2030; and transaction costs related to the repricing of these loans and lower borrowings under the Receivables Facility and revolving credit facility. The decrease was partially offset by the payment of $5.8 million of transaction costs related to the refinancing of the U.S. Term B-8 Loans due 2030, a $2.5 million non-cash loss for the write-off of unamortized deferred financing costs and discount on the U.S. Term B-4 Loans due 2027 and 5.000% 2025 Notes as well as the aforementioned increase referenced in the paragraph above.
Previous report
The Healthcare, Education and Facilities & Other sectors generally have high-single digit operating income margins and the Business & Industry and Sports, Leisure & Corrections sectors generally have mid-single digit operating income margins.
Previous report
FSS United States segment revenue increased by approximately 3.3% and 2.2% during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively, primarily attributable to base business growth. Specifically, for both the three and nine month periods: the Business & Industry sector increase was due to volume growth in base business and net new business; the Education sector revenue was positively impacted by additional operating days due to a calendar shift at several universities; the Sports, Leisure and Corrections sector increase was driven by higher net new business within the Corrections business; and the Facilities & Other sector decrease resulted from the exit of some lower margin accounts in late fiscal 2024, partially offset by increased revenues from procurement services.
Previous report
Operating income increased by $19.9 million and $46.2 million during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively. The increase was primarily attributable to base business growth and supply chain efficiencies, partially offset by higher medical claims ($13.0 million and $12.5 million for the three and nine month periods, respectively). The increase during the three month period of fiscal 2025 was also attributable to a greater number of operating days due to a calendar shift in the Education sector, partially offset by severance charges ($4.4 million). The increase during the nine month period of fiscal 2025 was partially offset by higher contingent consideration expenses ($10.6 million) and higher amortization of acquisition-related intangible assets ($5.2 million).
Previous report
Operating income decreased by $3.2 million during the three month period of fiscal 2025 compared to the prior year period primarily due to severance charges ($8.2 million), partially offset by base business growth and supply chain efficiencies. Operating income increased by $13.2 million during the nine month period of fiscal 2025 compared to the prior year period primarily attributable to base business growth and supply chain efficiencies, partially offset by severance charges ($8.2 million) and higher amortization of acquisition-related intangible assets ($6.6 million).
Previous report
Corporate
Previous report
Corporate expenses, those administrative expenses not allocated to the business segments, decreased by $4.2 million and $26.9 million during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively. The decrease during the three month period of fiscal 2025 was primarily attributable to lower share-based compensation expense. The decrease during the nine month period of fiscal 2025 was mainly attributable to prior year expenses related to the separation and distribution of the Uniform segment ($29.0 million), partially offset by an increase in acquisition costs.
Previous report
On March 19, 2025, we issued €400.0 million of euro denominated 4.375% Senior Notes due April 2033 (the "4.375% 2033 Notes"). We used a portion of the net proceeds from the issuance and sale of the 4.375% 2033 Notes to repay at maturity, April 1, 2025, all of the €325.0 million outstanding aggregate principal amount of euro denominated 3.125% Senior Notes due April 2025 (the "3.125% 2025 Notes") and the remainder for general corporate purposes, including reduction of debt (see Note 3 to the condensed consolidated financial statements).
Previous report
We entered into a credit agreement on March 28, 2017 (as subsequently amended the "Credit Agreement"). On February 18, 2025, we entered into an incremental amendment to the Credit Agreement (“Incremental Amendment No. 17”) to provide for, among other things, the establishment of new term loans comprised of new United States dollar denominated Term B-8 Loans ("New U.S. Term B-8 Loans due 2030") in an amount equal to $1,395.0 million, in the form of a fungible upsize to the existing U.S. Term B-8 Loans due 2030. The New U.S. Term B-8 Loans due 2030 were funded in full on the closing date of Incremental Amendment No. 17 and were applied to: (a) repay in full $839.3 million of the U.S. Term B-4 Loans due 2027 previously outstanding under the Credit Agreement; (b) to redeem the entire $551.5 million aggregate principal amount outstanding of the 5.000% 2025 Notes; and (c) to pay fees, premiums, expenses and other transaction costs in connection with the foregoing (see Note 3 to the condensed consolidated financial statements).
Previous report
•Accounts payable by $51.4 million, resulting in a higher use of cash due to the timing of disbursements;
Previous report
•Prepayments by $29.6 million, resulting in a higher use of cash due to the timing of insurance and other annual contractual payments compared to the prior period; and
Previous report
•Inventories by $26.3 million, resulting in a lower source of cash due to increased purchases from new business.
Previous report
These changes in operating assets and liabilities more than offset:
Previous report
•the upsizing of the U.S. Term B-8 Loans due 2030 ($1,395.0 million);
Previous report
•borrowings under the Receivables Facility ($570.0 million);
Previous report
•the issuance of the 4.375% 2033 Notes ($429.7 million); and
Previous report
These sources of cash were partially offset by repayment of the U.S. Term B-4 Loans due 2027 ($839.3 million), redemption of the 5.000% 2025 Notes ($551.5 million), repayment of the 3.125% 2025 Notes ($363.4 million), and the repurchase of common stock through the share repurchase program ($140.2 million).
Previous report
During the nine month period of fiscal 2024, cash used in financing activities was primarily impacted by repayment of the 6.375% 2025 Notes ($1,500.0 million), offset by borrowings under the Receivables Facility ($599.0 million) and borrowings under the revolving credit facility ($248.0 million).
Previous report
The "Other financing activities" caption also reflects a use of cash during the nine month periods of fiscal 2025 and fiscal 2024 primarily related to taxes paid by us when we withhold shares upon an employee's exercise or vesting of equity awards to cover income taxes. The nine month period of fiscal 2025 includes the payment of contingent consideration obligations ($25.2 million) and transaction costs related to the issuance of the 4.375% 2033 Notes and the U.S. Term B-8 Loans due 2030 ($15.1 million). The nine month period of fiscal 2024 includes the payment of a call premium on the 6.375% 2025 Notes ($23.9 million) and contingent consideration obligations ($12.8 million).
Previous report
(2) Represents the fiscal 2024 gain from the sale of our remaining equity investment in the San Antonio Spurs NBA franchise ($25.1 million).
Reworded paragraphs (22)
Previous wording
The following discussion and analysis of Aramark's (the "Company," "we," "our" and "us") financial condition and results of operations for the three and nine months ended June 27, 2025 and June 28, 2024 should be read in conjunction with our audited consolidated financial statements and the notes to those statements for the fiscal year ended September 27, 2024 included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on November 19, 2024.
Current wording
The following discussion and analysis of Aramark's (the "Company," "we," "our" and "us") financial condition and results of operations for the three months ended January 2, 2026 and December 27, 2024 should be read in conjunction with our audited consolidated financial statements and the notes to those statements for the fiscal year ended October 3, 2025 included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on November 25, 2025.
Previous wording
Recent developments regarding tariffs and global trade have resulted in increased volatility and uncertainty for macroeconomic conditions. Since the beginning of the fiscal year, we have seen a moderation in global inflationary costs in product, energy and labor as well as in market interest rates, while we have continued to experience volatility in foreign currencies. Given the uncertainty of tariff policy and the resulting impact on current and future macroeconomic conditions, we may see continued volatility in foreign currencies as well as fluctuating trends in global inflationary costs and market interest rates in the near term. We regularly evaluate and believe we take appropriate actions when necessary to mitigate the risk in these areas. These actions include management of operating costs, including supply chain initiatives and pricing actions, and managing interest rate risk through the use of interest rate swaps and other risk mitigation strategies.
Current wording
Recent developments regarding tariffs and global trade have resulted in increased volatility and uncertainty for macroeconomic conditions. Given the uncertainty of tariff policy and the resulting impact on current and future macroeconomic conditions, we may see continued volatility in foreign currencies as well as fluctuating trends in global inflationary costs and market interest rates in the near term. We regularly evaluate and believe we take appropriate actions when necessary to mitigate the risk in these areas. These actions include management of operating costs, including supply chain initiatives and pricing actions, and managing interest rate risk through the use of interest rate swaps and other risk mitigation strategies.
Previous wording
Our revenue and operating results have varied, and we expect them to continue to vary, from quarter to quarter as a result of different factors. Historically, within our FSS United States segment, there has been a lower level of activity during the first half of our fiscal year in operations that provide services to sports and leisure clients. This lower level of activity, historically, has been partially offset during the first half of our fiscal year by the increased activity levels in our educational operations. Conversely, historically there has been a significant increase in the provision of services to sports and leisure clients during the second half of our fiscal year, which is partially offset by the effect of summer recess at colleges, universities and schools in our educational operations. For cash flows, historically there has been cash usage during our first fiscal quarter due to lower activity within our sports and leisure clients as well as payments related to employee incentives. Conversely, historically there have been cash inflows during our fourth fiscal quarter due to an inflow of customer prepayments particularly within our Higher Education business in anticipation of the fall semester and higher activity within our sports and leisure clients.
Current wording
Our revenue and operating results have varied, and we expect them to continue to vary, from quarter to quarter as a result of different factors. Historically, within our FSS United States segment, there has been a lower level of activity during the first half of our fiscal year in operations that provide services to sports and leisure clients. This lower level of activity, historically, has been partially offset during the first half of our fiscal year by the increased activity levels in our educational operations. Conversely, historically there has been a significant increase in the provision of services to sports and leisure clients during the second half of our fiscal year, which is partially offset by the effect of summer recess at colleges, universities and schools in our educational operations. For cash flows, historically there has been cash usage during our first fiscal quarter due to lower activity within our sports and leisure clients as well as payments related to employee incentives. Conversely, historically there has been cash inflow during our fourth fiscal quarter due to customer prepayments particularly within our Higher Education business in anticipation of the fall semester and higher activity within our sports and leisure clients.
Previous wording
Our fiscal year is the fifty-two or fifty-three week period which ends on the Friday nearest September 30th. The fiscal year ending October 3, 2025 is a fifty-three week period and the fiscal year ended September 27, 2024 is a fifty-two week period.
Current wording
Our fiscal year is the fifty-two or fifty-three week period which ends on the Friday nearest September 30th. The fiscal year ending October 2, 2026 is a fifty-two week period, while the fiscal year ended October 3, 2025 was a fifty-three week period. The calendar shift resulting from the fifty-third week in the fiscal year ended October 3, 2025 is expected to affect the fiscal year ending October 2, 2026 quarterly comparisons of operating results due to the change in the number of operational service days in each quarter as compared to the corresponding prior year period.
Previous wording
The following tables present an overview of our results on a consolidated and segment basis with the amount of and percentage change between periods for the three and nine months ended June 27, 2025 and June 28, 2024 (in millions).
Current wording
The following table presents an overview of our results on a consolidated basis with the amount of and percentage change between periods for the three months ended January 2, 2026 and December 27, 2024 (in millions).
Previous wording
The following table presents the cost of services provided (exclusive of depreciation and amortization) by segment and as a percent of revenue for the three and nine months ended June 27, 2025 and June 28, 2024 (in millions).
Current wording
The following table presents the components in cost of services provided (exclusive of depreciation and amortization) and as a percentage of revenue for the three months ended January 2, 2026 and December 27, 2024 (in millions).
Previous wording
The Provision for Income Taxes for the three and nine month periods of fiscal 2025 was recorded at an effective tax rate of 25.2% and 25.6%, respectively. The Provision for Income Taxes for the three and nine month periods of fiscal 2024 was recorded at an effective tax rate of 27.5% and 32.0%, respectively. During the three and nine month periods of fiscal 2025, we recorded an income tax benefit of $3.1 million for the reversal of a valuation allowance against deferred tax assets within a foreign subsidiary due to an acquisition of a business. During the nine month period of fiscal 2024, we recorded a $7.1 million valuation allowance adjustment against certain foreign tax credits, as it is more likely than not a tax benefit will not be realized due to the reduction of future forecasted foreign income as a result of the separation and distribution of the Uniform segment (see Note 6 to the condensed consolidated financial statements).
Current wording
The Provision for Income Taxes for the three month periods of fiscal 2026 and fiscal 2025 were recorded at an effective tax rate of 28.8% and 25.3%, respectively, resulting in an increase of $3.3 million. During the three months ended January 2, 2026, we recorded a valuation allowance to the “Provision for Income Taxes” on the Condensed Consolidated Statements of Income of $3.4 million against foreign tax credits, as it is more likely than not a tax benefit will not be realized (see Note 6 to the condensed consolidated financial statements).
Previous wording
FSS International segment revenue increased by approximately 12.0% and 7.5% during the three and nine month periods of fiscal 2025 compared to the prior year periods, respectively. The increase was primarily attributable to base business growth and net new business growth. Additionally, the increase during the three month period of fiscal 2025 compared to the prior year period was favorably impacted by foreign currency translation (1.7%). The increase during the nine month period of fiscal 2025 was partially offset by the negative impact of foreign currency translation (2.5%).
Current wording
FSS International segment revenue increased by approximately 17.4% during the three month period of fiscal 2026 compared to the prior year period. The increase was primarily attributable to base business growth and net new business, driven largely by performance in the U.K., Chile, Germany and Spain and the favorable impact of foreign currency translation of approximately 4.1%. The increase was partially offset by the estimated impact of the reduced number of operational service days in the first quarter of fiscal 2026 from the calendar shift related to the fifty-third week in fiscal 2025 (approximately 1%).
Previous wording
As of June 27, 2025, we had$501.5 million of cash and cash equivalents,$43.7 million of marketable securities,$906.5 million of availability under our senior secured revolving credit facility and $30.0 million of availability under our Receivables Facility. A significant portion of our cash and cash equivalents are held in mature, liquid geographies where we have operations. As of June 27, 2025, we had$1,058.7 million of outstanding foreign currency borrowings.
Current wording
As of January 2, 2026, we had $439.6 million of cash and cash equivalents and $936.2 million of availability under our senior secured revolving credit facility. A significant portion of our cash and cash equivalents are held in mature, liquid geographies where we have operations. As of January 2, 2026, we had $1.1 billion of outstanding foreign currency borrowings.
Previous wording
We believe that our cash and cash equivalents, marketable securities and availability under our revolving credit facility and Receivables Facility will be adequate to meet anticipated cash requirements for the foreseeable future to fund working capital, capital spending, debt service obligations, refinancings, dividends and other cash needs. We also have flexibility to optimize working capital and defer certain capital expenditures as appropriate without a material impact to the business. We believe that our assumptions used to estimate our liquidity and working capital requirements are reasonable. For additional information regarding the risks associated with our liquidity and capital resources, see Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K filed with the SEC on November 19, 2024.
Current wording
We believe that our cash and cash equivalents and availability under our revolving credit facility will be adequate to meet anticipated cash requirements for the foreseeable future to fund working capital, capital spending, debt service obligations, refinancings, dividends and other cash needs. We also have flexibility to optimize working capital and defer certain capital expenditures as appropriate without a material impact to the business. We believe that our assumptions used to estimate our liquidity and working capital requirements are reasonable. For additional information regarding the risks associated with our liquidity and capital resources, see Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K filed with the SEC on November 25, 2025.
Previous wording
Cash used in operating activities decreased by $40.6 million during the nine month period of fiscal 2025 compared to the prior year period. The decrease was driven by higher net income, lower payments made to clients on contracts and favorable non-cash gains and losses, partially offset by a greater use of cash from the change in operating assets and liabilities as compared to the prior year period.
Current wording
Cash used in operating activities increased by $195.0 million during the three month period of fiscal 2026 compared to the prior year period. The increase was primarily driven by a greater use of cash from the change in operating assets and liabilities as compared to the prior year period ($159.3 million) and higher payments made to clients on contracts ($40.4 million).
Previous wording
The unfavorable change in operating assets and liabilities compared to the prior year period of $69.1 million was primarily due to:
Current wording
The unfavorable change in operating assets and liabilities compared to the prior year period was primarily due to:
Previous wording
•Receivables by $28.6 million, resulting in a lower use of cash due to the timing of collections; and
Current wording
•Receivables by $90.4 million, resulting in a higher use of cash due to base business growth, net new business and the timing of collections; and
Previous wording
•Accrued expenses by $9.6 million, resulting in a lower use of cash primarily due to the timing of interest payments and payroll, partially offset by higher employee incentive payments and higher commission payments mainly in our Sports business.
Current wording
•Accrued expenses by $63.5 million, resulting in a higher use of cash primarily due to the timing of tax payments and Sports business related commission payments, higher employee incentive payments and increased recognition of deferred income in our Higher Education business, partially offset by a lower use of cash due to the timing of payroll.
Previous wording
The "Other operating activities" caption in both periods reflect adjustments to net income in the current year and prior year periods related to non-cash gains and losses and adjustments to non-operating cash transactions.
Current wording
The "Other operating activities" caption in both periods reflects a source of cash due to adjustments to net income related to non-cash gains and losses and adjustments to non-operating cash transactions. The source of cash in the three month period of fiscal 2026 was partially offset by a higher use of cash due to the timing of insurance payments.
Previous wording
Cash flows used in investing activities were $234.8 million higher during the nine month period of fiscal 2025 compared to the prior year period primarily due to higher acquisitions of certain businesses ($156.7 million) and higher purchases of property and equipment ($58.9 million).
Current wording
Cash used in investing activities was $77.1 million lower during the three month period of fiscal 2026 compared to the prior year period primarily due to lower acquisitions of certain businesses ($78.6 million).
Previous wording
Cash Flows Provided by (Used in) Financing Activities
Current wording
Cash Flows Provided by Financing Activities
Previous wording
During the nine month period of fiscal 2025, cash provided by financing activities was primarily impacted by the following:
Current wording
During the three month period of fiscal 2026, cash provided by financing activities was primarily impacted by borrowings under the Receivables Facility ($625.0 million) and borrowings under the revolving credit facility ($229.1 million). Cash provided by financing activities more than offset the repurchase of common stock through the share repurchase program and taxes paid by us when we withhold shares upon an employee's exercise or vesting of equity awards to cover income taxes ($41.3 million), payment of dividends and contingent consideration ($31.5 million and $27.1 million, respectively) and repayment of long-term borrowings ($25.5 million).
Previous wording
(1) Represents non-cash share-based compensation expense resulting from the application of accounting for stock options, stock appreciation rights, restricted stock units, performance stock units and deferred stock unit awards.
Current wording
(1) Represents share-based compensation expense of equity awards resulting from the application of accounting for stock options, restricted stock units, performance stock units and deferred stock unit awards.
Previous wording
(4) "Other" includes adjustments to remove the impact attributable to the adoption of certain accounting standards that are made to the calculation in accordance with the Credit Agreement and indentures ($53.7 million), severance charges ($19.4 million), non-cash adjustments to inventory based on expected usage ($18.2 million), charges related to a ruling on a foreign tax matter ($6.8 million), dividends from miscellaneous investments, net of earnings ($5.0 million), the impact of hyperinflation in Argentina ($3.3 million), contingent consideration expense related to acquisition earn outs, net of reversals ($2.4 million), legal charges related to an anti-trust review ($1.1 million) and other miscellaneous expenses.
Current wording
(4) "Other" includes adjustments to remove the impact attributable to the adoption of certain accounting standards that are made to the calculation in accordance with the Credit Agreement and indentures ($54.7 million), severance charges ($36.4 million), non-cash charges for the impairments of assets ($8.9 million), the impact of hyperinflation in Argentina ($5.6 million), multiemployer pension plan withdrawal charge ($5.6 million), merger and integration charges ($4.1 million), legal charges related to an antitrust review ($3.8 million) and other miscellaneous expenses.
Previous wording
(1) The Credit Agreement requires ASI to maintain a maximum Consolidated Secured Debt Ratio, defined as consolidated total indebtedness secured by a lien to Covenant Adjusted EBITDA, not to exceed 5.125x. Consolidated total indebtedness secured by a lien is defined in the Credit Agreement as total indebtedness consisting of debt for borrowed money, finance leases, debt in respect of sales-leaseback transactions, disqualified and preferred stock and advances under the Receivables Facility secured by a lien reduced by the amount of cash and cash equivalents on the consolidated balance sheet that is free and clear of any lien. Non-compliance with the maximum Consolidated Secured Debt Ratio could result in the requirement to immediately repay all amounts outstanding under the Credit Agreement, which, if ASI's lenders under our Credit Agreement (other than the lenders in respect of ASI's United States Term B Loans, which lenders do not benefit from the maximum Consolidated Debt Ratio covenant) failed to waive any such default, would also constitute a default under the indentures governing our senior notes.
Current wording
(1) The Credit Agreement requires ASI to maintain a maximum Consolidated Secured Debt Ratio, defined as consolidated total indebtedness secured by a lien to Covenant Adjusted EBITDA, not to exceed 5.125x. Consolidated total indebtedness secured by a lien is defined in the Credit Agreement as total indebtedness consisting of debt for borrowed money, finance leases, debt in respect of sales-leaseback transactions, disqualified and preferred stock and advances under the Receivables Facility secured by a lien reduced by the amount of cash and cash equivalents on the consolidated balance sheet that is free and clear of any lien. Non-compliance with the maximum Consolidated Secured Debt Ratio could result in the requirement to immediately repay all amounts outstanding under the Credit Agreement, which, if ASI's lenders under our Credit Agreement (other than the lenders in respect of ASI's United States Term B Loans, which lenders do not benefit from the maximum Consolidated Secured Debt Ratio covenant) failed to waive any such default, would also constitute a default under the indentures governing our senior notes.
Previous wording
Our business activities do not include the use of unconsolidated special purpose entities and there are no significant business transactions that have not been reflected in the accompanying condensed consolidated financial statements. We insure portions of our risk related to general liability, automobile liability, workers’ compensation liability claims as well as certain property damage risks through a wholly owned captive insurance subsidiary (the "Captive") as part of our approach to risk finance. The Captive is subject to the regulations within its domicile of Bermuda, including regulations established by the Bermuda Monetary Authority (the "BMA") relating to levels of liquidity and solvency as such concepts are defined by the BMA. The Captive was in compliance with these regulations as of June 27, 2025. These regulations may have the effect of limiting our ability to access certain cash and cash equivalents held by the Captive for uses other than for the payment of our general liability, automobile liability, workers’ compensation liability, certain property damage and related Captive costs. As of June 27, 2025 and September 27, 2024, cash and cash equivalents at the Captive were$97.7 million and $94.7 million, respectively. The Captive also invests in United States Treasury securities where the amount as of June 27, 2025 and September 27, 2024 was$43.7 million and $42.3 million, respectively, and is recorded in "Prepayments and other current assets" on the Condensed Consolidated Balance Sheets.
Current wording
Our business activities do not include the use of unconsolidated special purpose entities and there are no significant business transactions that have not been reflected in the accompanying condensed consolidated financial statements. We insure portions of our risk related to general liability, automobile liability, workers’ compensation liability claims as well as certain property damage risks through a wholly owned captive insurance subsidiary (the "Captive") as part of our approach to risk finance. The Captive is subject to the regulations within its domicile of Bermuda, including regulations established by the Bermuda Monetary Authority (the "BMA") relating to levels of liquidity and solvency as such concepts are defined by the BMA. The Captive was in compliance with these regulations as of January 2, 2026. These regulations may have the effect of limiting our ability to access certain cash and cash equivalents held by the Captive for uses other than for the payment of our general liability, automobile liability, workers’ compensation liability, certain property damage and related Captive costs. As of January 2, 2026 and October 3, 2025, cash and cash equivalents at the Captive were $144.5 million and $133.5 million, respectively.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Cost of services provided (exclusive of depreciation and amortization)
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
•borrowings under the revolving credit facility ($394.7 million).