Group 1: Phillips 66 - Phillips 66 announced a definitive agreement to acquire the remaining 50% ownership interest in WRB Refining LP from subsidiaries of Cenovus Energy [1] - Shares of Phillips 66 fell 0.7% to settle at $131.42 on Wednesday [5] Group 2: Tandem Diabetes Care - Oppenheimer analyst maintained Tandem Diabetes Care with an Outperform rating and lowered the price target from $44 to $22 [2] - Tandem Diabetes Care shares fell 1.5% to settle at $12.37 on Wednesday [5] - Cramer described Tandem Diabetes Care as a "speculative stock for younger people" [1] Group 3: Cintas - Cramer recommended buying Cintas stock and suggested waiting for the quarter results [2] - Cintas announced it will release fiscal year 2026 first-quarter results on September 24 [2] - Cintas shares fell 0.3% to close at $201.40 [5] Group 4: Intuitive Surgical - Intuitive Surgical reported second-quarter revenue of $2.44 billion, beating analyst estimates of $2.35 billion [3] - The company reported second-quarter adjusted earnings of $2.19 per share, exceeding analyst estimates of $1.93 per share [3] - Shares of Intuitive Surgical fell 3.8% to close at $449.98 [5]

Group 1: Phillips 66 - Phillips 66 announced a definitive agreement to acquire the remaining 50% ownership interest in WRB Refining LP from subsidiaries of Cenovus Energy [1] Group 2: Tandem Diabetes Care - Oppenheimer analyst maintained an Outperform rating for Tandem Diabetes Care but lowered the price target from $44 to $22 [2] - Tandem Diabetes Care shares fell 1.5% to settle at $12.37 [5] Group 3: Cintas - Cintas is recommended for purchase, with a suggestion to buy more if the upcoming quarter's results are disappointing [2] - Cintas shares fell 0.3% to close at $201.40 [5] Group 4: Intuitive Surgical - Intuitive Surgical reported second-quarter revenue of $2.44 billion, exceeding analyst estimates of $2.35 billion [3] - The company reported second-quarter adjusted earnings of $2.19 per share, beating analyst estimates of $1.93 per share [3] - Intuitive Surgical shares fell 3.8% to close at $449.98 [5]

Core Viewpoint - Cintas Corporation will release its fiscal year 2026 first quarter results on September 24, 2025, and will hold a conference call to discuss these results [1] Company Announcement - The conference call will be available via a live webcast for individual investors and the public starting at 10:00 a.m. Eastern Time on September 24, 2025 [1] - The webcast can be accessed through the company's website at www.Cintas.com by clicking on the webcast icon [1]

Core Insights - Cintas Corporation (CTAS) is experiencing strong momentum across its segments, particularly in Uniform Rental and Facility Services, driven by new customer growth and increased product penetration [1] - The First Aid and Safety Services segment is benefiting from rising demand for AED Rentals, eyewash stations, and WaterBreak products, alongside strong customer retention and an improved sales mix [1] Segment Performance - The Uniform Rental and Facility Services segment is seeing growth from both new and existing customers, contributing to overall performance [8] - The First Aid segment's performance is bolstered by increasing demand for specific safety products [1][8] Acquisitions and Market Expansion - Cintas has enhanced its product portfolio through strategic acquisitions, including Paris Uniform Services and SITEX, totaling $232.9 million in fiscal 2025 [2][8] - These acquisitions have strengthened Cintas' market presence in key regions such as Pennsylvania, New York, Maryland, West Virginia, and the central Midwest [2] Shareholder Returns - In fiscal 2025, Cintas paid dividends of $611.6 million, reflecting a 15.2% year-over-year increase, and spent $934.8 million on share buybacks, up from $700 million the previous year [3][8] - The quarterly dividend was increased by 15.4% to $1.80 per share, marking 41 consecutive years of dividend increases [3] Financial Performance - Cintas' stock performance has shown a 1.6% gain over the past year, contrasting with a 1.4% decline in the industry [4] - However, the company faces challenges from rising costs, with a 6.9% year-over-year increase in the cost of sales to $1.34 billion and a 9.1% rise in selling and administrative expenses to $728.5 million in the fourth quarter of fiscal 2025 [6] International Exposure - Cintas has significant international operations, which expose it to political and economic disruptions that could impact profitability [7]

Part I [Item 1. Business](index=3&type=section&id=Item%201.%20Business) Cintas Corporation provides a wide range of products and services, primarily in uniform rental and facility services, and first aid and safety services, to over one million businesses across the U.S., Canada, and Latin America - Cintas serves over **one million** businesses, primarily in the U.S., Canada, and Latin America, offering products and services like uniforms, mats, mops, restroom supplies, first aid, safety products, and fire protection[4](index=4&type=chunk)[76](index=76&type=chunk) Revenue by Reportable Operating Segment (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :------------------------------- | :--------- | :--------- | :--------- | | Uniform Rental and Facility Services | $7,976,073 | $7,465,199 | $6,897,130 | | First Aid and Safety Services | $1,218,090 | $1,067,334 | $951,496 | | All Other | $1,146,018 | $1,064,082 | $967,143 | | **Total Revenue** | **$10,340,181** | **$9,596,615** | **$8,815,769** | - The company operates approximately **12,100** local delivery **routes**, **478** operational **facilities**, and **12** distribution **centers** as of May 31, 2025[9](index=9&type=chunk) - Cintas employed approximately **48,300** employee-partners globally as of May 31, 2025, with about **900** represented by labor unions[15](index=15&type=chunk) Environmental Spending (Fiscal Years Ended May 31) | Category | Fiscal 2025 (approx.) | Fiscal 2024 (approx.) | Fiscal 2023 (approx.) | | :---------------------------------- | :-------------------- | :-------------------- | :-------------------- | | Water treatment and waste removal | $29.0 million | $27.0 million | $26.0 million | | Capital expenditures for hazardous substances | $4.8 million | $1.7 million | $1.0 million | Overview Business Segments Customers Competition Operations and Distribution Sourcing Government Laws and Regulations Human Capital [Item 1A. Risk Factors](index=7&type=section&id=Item%201A.%20Risk%20Factors) Cintas faces various risks that could materially affect its financial performance, including negative global economic factors, intense competition, and challenges in operational expansion and acquisitions - Forward-looking statements are subject to risks including operating costs (energy, fuel), lower sales, customer loss, acquisition integration, supply chain constraints, inflation, labor costs, regulatory non-compliance, exchange rate fluctuations, environmental liabilities, cybersecurity threats, litigation, and global tax/labor law changes[23](index=23&type=chunk) - Cybersecurity attacks are evolving, with increasing sophistication (e.g., zero-day vulnerabilities, generative AI integration), posing risks of system disruptions, unauthorized data release, data corruption, and potential extended detection periods[32](index=32&type=chunk) - The company's indebtedness may limit cash flow for investments, acquisitions, dividends, and stock buybacks, and increase vulnerability to adverse economic conditions[41](index=41&type=chunk) - Compliance with environmental laws and regulations, including those related to sustainability, could result in significant costs, fines, and third-party claims, potentially exceeding current reserves[49](index=49&type=chunk) - Changes in tax laws (e.g., Inflation Reduction Act, Pillar Two global minimum tax) or unfavorable resolution of tax audits could increase the effective tax rate, restrict offshore earnings repatriation, or impose new costs[51](index=51&type=chunk)[52](index=52&type=chunk) Risks Relating to Business Strategy and Operations Financial Risks Legal and Regulatory Risks [Item 1B. Unresolved Staff Comments](index=13&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments to report - No unresolved staff comments were reported[53](index=53&type=chunk) [Item 1C. Cybersecurity](index=14&type=section&id=Item%201C.%20Cybersecurity) Cintas employs a cross-departmental approach to cybersecurity risk management, leveraging industry standards like NIST CSF 2.0, with oversight from the Board and Audit Committee - Cintas' cybersecurity risk management program is integrated into its enterprise risk management, utilizing NIST CSF 2.0 standards (govern, identify, protect, detect, respond, recover) with a layered strategy[55](index=55&type=chunk) - The Chief Information Security Officer (CISO), with over **25 years** of IT and cybersecurity experience, is responsible for the program and reports quarterly to the Audit Committee and Board[56](index=56&type=chunk) - The company conducts annual security awareness training for all employee-partners and specialized training for certain roles, along with periodic external penetration tests and response testing[57](index=57&type=chunk)[58](index=58&type=chunk) - An Incident Response Plan is in place, including escalation processes to executive leadership and the Board, and procedures to determine materiality for SEC disclosures[61](index=61&type=chunk) [Item 2. Properties](index=15&type=section&id=Item%202.%20Properties) Cintas operates 490 facilities across 341 cities, including 210 rental processing plants, 142 rental branches, 67 first aid and safety facilities, 12 distribution centers, and 5 manufacturing facilities - Cintas operates **490 facilities** in **341 cities**, with **255** leased and the remainder owned, including **4 of 5 manufacturing facilities**[63](index=63&type=chunk) Cintas' Facilities by Type (as of May 31, 2025) | Type of Facility | of Facilities | | :----------------------- | :-------------- | | Rental Processing Plants | 210 | | Rental Branches | 142 | | First Aid and Safety Facilities | 67 | | All Other Facilities | 54 | | Distribution Centers | 12 | | Manufacturing Facilities | 5 | | **Total** | **490** | - The company owns or leases approximately **22,900 vehicles** for route-based services and personnel[63](index=63&type=chunk) [Item 3. Legal Proceedings](index=16&type=section&id=Item%203.%20Legal%20Proceedings) Cintas refers to Note 15 of the Consolidated Financial Statements for detailed information on material legal proceedings, beyond ordinary routine litigation, including their basis and relief sought - Material legal proceedings are discussed in Note 15 of the Consolidated Financial Statements[65](index=65&type=chunk) [Item 4. Mine Safety Disclosures](index=16&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Cintas Corporation - Mine Safety Disclosures are not applicable[66](index=66&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=17&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Cintas' common stock trades on NASDAQ under 'CTAS' - Cintas' common stock trades on the NASDAQ Global Select Market under the symbol **'CTAS'**[67](index=67&type=chunk) - A **four-for-one stock split**, in the form of a stock dividend, was announced on May 2, 2024, and distributed on September 11, 2024[68](index=68&type=chunk) Dividends Declared (Fiscal Years Ended May 31) | Fiscal Year | Dividend Per Share | Total Amount (in millions) | | :---------- | :----------------- | :------------------------- | | 2025 | $1.56 | $631.8 | | 2024 | $1.3500 | $550.9 | Market and Shareholder Information Dividends Stock Performance Graph Equity Securities Purchases by Issuer (March-May 2025) | Period | Total Shares Purchased | Average Price Paid Per Share | | :----------------- | :--------------------- | :--------------------------- | | March 1 - 31, 2025 | 85,454 | $202.80 | | April 1 - 30, 2025 | 1,150,573 | $194.50 | | May 1 - 31, 2025 | 71,376 | $217.88 | | **Total** | **1,307,403** | **$196.32** | - As of May 31, 2025, **$1,263.6 million** remained available for purchase under the **$1.0 billion** share buyback program authorized on July 23, 2024[74](index=74&type=chunk) [Item 6. [Reserved]](index=18&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information - Item 6 is reserved[75](index=75&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Cintas' business strategy focuses on revenue growth through increased penetration at existing customers, broadening its customer base, and identifying new product/service opportunities - Cintas' principal objective is to exceed customer expectations to maximize long-term shareholder and partner value, achieved through revenue growth by increasing penetration at existing customers, broadening the customer base, and identifying additional product/service opportunities[77](index=77&type=chunk) Consolidated Financial Highlights (Fiscal 2025 vs. 2024) | Metric | Fiscal 2025 | Fiscal 2024 | Change (%) | | :-------------------------- | :------------------- | :------------------- | :--------- | | Total Revenue | $10.3 billion | $9.6 billion | 7.7% | | Organic Revenue Growth | 8.0% | N/A | N/A | | Total Gross Margin | 50.0% | 48.8% | +1.2 pp | | Total Operating Income | 22.8% of revenue | 21.6% of revenue | +1.2 pp | | Income Before Income Taxes | $2,264.2 million | $1,973.6 million | 14.7% | | Net Income | $1,812.3 million | $1,571.6 million | 15.3% | | Diluted EPS | $4.40 | $3.79 | 16.1% | Cash Flow Summary (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | | :--------------------------------- | :----------- | :----------- | | Net cash provided by operating activities | $2,165,905 | $2,068,500 | | Net cash used in investing activities | $(623,638) | $(603,334) | | Net cash used in financing activities | $(1,619,011) | $(1,247,506) | | Cash and cash equivalents at end of year | $263,973 | $342,015 | - Management has mitigated inflationary pressures (higher labor, fuel, transportation costs) through pricing and efficiency initiatives, preventing a material negative impact on financial condition or results of operations[120](index=120&type=chunk) Business Strategy Results of Operations Liquidity and Capital Resources Inflation and Changing Prices Litigation and Other Contingencies New Accounting Standards Critical Accounting Policies and Estimates [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Cintas' earnings are sensitive to short-term interest rate changes, with a half-percent change impacting income before taxes by approximately $0.3 million - A **one-half percent (50 basis points)** change in short-term interest rates would change Cintas' income before income taxes by approximately **$0.3 million**[131](index=131&type=chunk) - Foreign currency exposure, primarily from the Canadian dollar, impacts revenue and operating income, but foreign-denominated revenue was **less than 10%** of consolidated revenue for fiscal years 2023-2025[132](index=132&type=chunk) Item 8. Financial Statements and Supplementary Data [Index to Consolidated Financial Statements](index=30&type=section&id=Index%20to%20Consolidated%20Financial%20Statements) This section provides an index to the audited consolidated financial statements for the fiscal years ended May 31, 2025, 2024, and 2023, including management's report on internal control, independent auditor reports, and the primary financial statements and their accompanying notes - The index lists audited consolidated financial statements for fiscal years ended May 31, 2025, 2024, and 2023[133](index=133&type=chunk) - It includes Management's Report on Internal Control over Financial Reporting, Reports of Independent Registered Public Accounting Firm, Consolidated Statements of Income, Comprehensive Income, Balance Sheets, Shareholders' Equity, Cash Flows, and Notes to Consolidated Financial Statements[133](index=133&type=chunk) [Management's Report on Internal Control over Financial Reporting](index=31&type=section&id=Management's%20Report%20on%20Internal%20Control%20over%20Financial%20Reporting) Management, under the supervision of the CEO and CFO, assessed the effectiveness of Cintas' internal control over financial reporting as of May 31, 2025, based on the COSO framework - Management is responsible for establishing and maintaining adequate internal control over financial reporting[134](index=134&type=chunk) - As of May 31, 2025, management concluded that Cintas' internal control over financial reporting was effective based on the COSO (2013) framework[136](index=136&type=chunk)[137](index=137&type=chunk) - The assessment was reviewed with the Audit Committee, and Ernst & Young LLP issued an unqualified attestation report[138](index=138&type=chunk) [Reports of Independent Registered Public Accounting Firm](index=32&type=section&id=Reports%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Ernst & Young LLP issued an unqualified opinion on Cintas' consolidated financial statements for the three years ended May 31, 2025, confirming fair presentation in accordance with U.S. GAAP - Ernst & Young LLP issued an unqualified opinion on the consolidated financial statements for the three years ended May 31, 2025, stating they present fairly in all material respects[140](index=140&type=chunk) - The audit was conducted in accordance with PCAOB standards, assessing risks of material misstatement and evaluating accounting principles and estimates[143](index=143&type=chunk) - The valuation of insurance reserves (**$208.0 million** at May 31, 2025) was identified as a critical audit matter due to the judgmental and complex estimation of unasserted claims, which involves third-party actuarial specialists[145](index=145&type=chunk)[146](index=146&type=chunk) [Report of Independent Registered Public Accounting Firm (Internal Control)](index=34&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm%20(Internal%20Control)) Ernst & Young LLP provided an unqualified opinion on Cintas Corporation's internal control over financial reporting as of May 31, 2025, affirming its effectiveness in all material respects based on the COSO criteria - Ernst & Young LLP issued an unqualified opinion on Cintas' internal control over financial reporting as of May 31, 2025, concluding it was effective in all material respects based on COSO criteria[149](index=149&type=chunk) - The audit included obtaining an understanding of internal control, assessing risk of material weakness, and testing design and operating effectiveness[153](index=153&type=chunk) - Internal control over financial reporting is defined as a process providing reasonable assurance regarding financial reporting reliability and proper authorization of transactions[154](index=154&type=chunk) [Consolidated Statements of Income](index=35&type=section&id=Consolidated%20Statements%20of%20Income) Cintas reported total revenue of $10.34 billion in fiscal 2025, an increase from $9.60 billion in fiscal 2024 Consolidated Statements of Income Highlights (Fiscal Years Ended May 31) | (In thousands except per share data) | 2025 | 2024 | 2023 | | :----------------------------------- | :----------- | :----------- | :----------- | | Total revenue | $10,340,181 | $9,596,615 | $8,815,769 | | Operating income | $2,359,726 | $2,068,633 | $1,802,664 | | Income before income taxes | $2,264,202 | $1,973,635 | $1,693,148 | | Net income | $1,812,281 | $1,571,592 | $1,348,010 | | Diluted earnings per share | $4.40 | $3.79 | $3.25 | | Dividends declared and paid per share | $1.56 | $1.35 | $1.15 | - Total revenue increased by **7.7%** from fiscal 2024 to fiscal 2025[156](index=156&type=chunk) - Net income increased by **15.3%** from fiscal 2024 to fiscal 2025[156](index=156&type=chunk) [Consolidated Statements of Comprehensive Income](index=36&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Cintas reported comprehensive income of $1.81 billion in fiscal 2025, a slight decrease from $1.59 billion in fiscal 2024 Consolidated Statements of Comprehensive Income (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :------------------------------------------------- | :----------- | :----------- | :----------- | | Net income | $1,812,281 | $1,571,592 | $1,348,010 | | Other comprehensive (loss) income, net of tax: | | | | | Foreign currency translation adjustments | $(7,441) | $(1,291) | $(34,007) | | Change in fair value of interest rate lock agreements, net of tax | $5,752 | $18,163 | $10,111 | | Amortization of interest rate lock agreements, net of tax benefit | $(6,092) | $(5,984) | $(6,085) | | Other, net of tax expense (benefit) | $969 | $2,535 | $(158) | | Other comprehensive (loss) income, net of tax | $(6,812) | $13,423 | $(30,139) | | **Comprehensive income** | **$1,805,469** | **$1,585,015** | **$1,317,871** | - Comprehensive income for fiscal 2025 was **$1.81 billion**, a decrease from **$1.59 billion** in fiscal 2024[157](index=157&type=chunk) - Foreign currency translation adjustments resulted in a loss of **$7.4 million** in fiscal 2025, compared to a loss of **$1.3 million** in fiscal 2024[157](index=157&type=chunk) [Consolidated Balance Sheets](index=37&type=section&id=Consolidated%20Balance%20Sheets) As of May 31, 2025, Cintas reported total assets of $9.83 billion, an increase from $9.17 billion in the prior year Consolidated Balance Sheet Highlights (as of May 31) | (In thousands) | 2025 | 2024 | | :----------------------------------- | :----------- | :----------- | | **Assets** | | | | Cash and cash equivalents | $263,973 | $342,015 | | Accounts receivable, net | $1,417,381 | $1,240,000 | | Inventories, net | $447,408 | $410,201 | | Uniforms and other rental items in service | $1,137,361 | $1,043,715 | | Total current assets | $3,436,169 | $3,180,000 | | Property and equipment, net | $1,652,474 | $1,534,168 | | Goodwill | $3,400,227 | $3,212,424 | | **Total Assets** | **$9,825,241** | **$9,168,817** | | **Liabilities and Shareholders' Equity** | | | | Accounts payable | $485,109 | $333,000 | | Accrued compensation and related liabilities | $229,538 | $211,000 | | Total current liabilities | $1,644,502 | $1,820,000 | | Debt due after one year | $2,424,999 | $2,025,934 | | Total long-term liabilities | $3,496,258 | $3,020,000 | | **Total Shareholders' Equity** | **$4,684,481** | **$4,316,372** | - Total assets increased by approximately **$656.4 million (7.1%)** from May 31, 2024, to May 31, 2025[158](index=158&type=chunk) - Total shareholders' equity increased by approximately **$368.1 million (8.5%)** from May 31, 2024, to May 31, 2025[158](index=158&type=chunk) [Consolidated Statements of Shareholders' Equity](index=38&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) Cintas' total shareholders' equity increased to $4.68 billion at May 31, 2025, from $4.32 billion at May 31, 2024 Consolidated Statements of Shareholders' Equity Highlights (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :--------------------------------- | :----------- | :----------- | :----------- | | Balance at June 1 | $4,316,372 | $3,863,986 | $3,308,196 | | Net income | $1,812,281 | $1,571,592 | $1,348,010 | | Comprehensive (loss) income, net of tax | $(6,812) | $13,423 | $(30,139) | | Dividends | $(631,785) | $(550,952) | $(469,858) | | Stock-based compensation | $128,329 | $116,986 | $103,621 | | Repurchase of common stock | $(934,800) | $(700,033) | $(398,865) | | **Balance at May 31** | **$4,684,481** | **$4,316,372** | **$3,863,986** | - Total shareholders' equity increased by **$368.1 million** from May 31, 2024, to May 31, 2025[159](index=159&type=chunk) - Repurchase of common stock amounted to **$934.8 million** in fiscal 2025, an increase from **$700.0 million** in fiscal 2024[159](index=159&type=chunk) [Consolidated Statements of Cash Flows](index=39&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cintas generated $2.17 billion in net cash from operating activities in fiscal 2025, an increase of 4.7% from fiscal 2024 Consolidated Statements of Cash Flows Highlights (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :------------------------------------------------- | :----------- | :----------- | :----------- | | Net cash provided by operating activities | $2,165,905 | $2,068,500 | $1,586,228 | | Net cash used in investing activities | $(623,638) | $(603,334) | $(381,612) | | Net cash used in financing activities | $(1,619,011) | $(1,247,506) | $(1,166,752) | | Net (decrease) increase in cash and cash equivalents | $(78,042) | $217,866 | $33,678 | | Cash and cash equivalents at end of year | $263,973 | $342,015 | $124,149 | - Net cash provided by operating activities increased by **$97.4 million (4.7%)** in fiscal 2025 compared to fiscal 2024, primarily due to increased net income and favorable changes in working capital[102](index=102&type=chunk)[161](index=161&type=chunk) - Net cash used in financing activities increased by **$371.5 million** in fiscal 2025, mainly due to higher debt repayments, share buybacks, and increased dividends paid[104](index=104&type=chunk)[161](index=161&type=chunk) [Notes to Consolidated Financial Statements](index=40&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The Notes to Consolidated Financial Statements provide detailed disclosures on Cintas' accounting policies, financial statement components, and other significant financial information Note 1. Significant Accounting Policies This note outlines Cintas' core business, reportable operating segments, and fundamental accounting principles, including consolidation, use of estimates, and revenue recognition - Cintas' reportable operating segments are Uniform Rental and Facility Services and First Aid and Safety Services, with Fire Protection Services and Uniform Direct Sale included in 'All Other'[162](index=162&type=chunk) - Approximately **95%** of revenue is from route servicing, recognized over time as services are performed, or at a point in time when goods are transferred for the remaining **5%**[165](index=165&type=chunk) - Uniforms in service are amortized over **18 to 30 months**, and other rental items (mats, mops, etc.) over **8 to 60 months**, based on industry and company experience[174](index=174&type=chunk) - Goodwill is tested annually for impairment at the reporting unit level (Uniform Rental and Facility Services, First Aid and Safety Services, and two within All Other); no impairment was recognized in fiscal 2023-2025[177](index=177&type=chunk) - The insurance reserve, representing estimated ultimate costs for asserted and unasserted claims (workers' compensation, auto, general liability), is estimated using actuarial procedures and industry assumptions, adjusted for Cintas' claims history[182](index=182&type=chunk) - Cintas adopted ASU 2023-07 (Segment Reporting) on May 31, 2025, with no material impact, and is evaluating ASU 2023-09 (Income Taxes) and ASU 2024-03 (Income Statement Expense Disaggregation) for future periods[196](index=196&type=chunk)[198](index=198&type=chunk)[199](index=199&type=chunk) Note 2. Revenue Recognition Cintas' total revenue for fiscal 2025 was $10.34 billion, with Uniform Rental and Facility Services contributing 77.1%, First Aid and Safety Services 11.8%, and All Other (Fire Protection and Uniform Direct Sales) 11.1% Total Revenue Disaggregated by Operating Segment (Fiscal Years Ended May 31) | (In thousands) | 2025 | % | 2024 | % | 2023 | % | | :------------------------- | :----------- | :----- | :----------- | :----- | :----------- | :----- | | Uniform Rental and Facility Services | $7,976,073 | 77.1% | $7,465,199 | 77.8% | $6,897,130 | 78.2% | | First Aid and Safety Services | $1,218,090 | 11.8% | $1,067,334 | 11.1% | $951,496 | 10.8% | | Fire Protection Services | $817,463 | 7.9% | $728,610 | 7.6% | $627,747 | 7.1% | | Uniform Direct Sales | $328,555 | 3.2% | $335,472 | 3.5% | $339,396 | 3.9% | | **Total revenue** | **$10,340,181** | **100.0%** | **$9,596,615** | **100.0%** | **$8,815,769** | **100.0%** | - Capitalized commission expenses for obtaining route servicing contracts totaled **$96.5 million** (current) and **$275.3 million** (noncurrent) as of May 31, 2025[202](index=202&type=chunk) - Amortization expense related to capitalized commissions was **$106.3 million** in fiscal 2025, up from **$101.4 million** in fiscal 2024[202](index=202&type=chunk) Note 3. Fair Value Disclosures Cintas classifies its financial instruments measured at fair value into a three-level hierarchy Assets Measured at Fair Value (as of May 31, 2025) | (In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | | :----------------------- | :--------- | :--------- | :------ | :--------- | | Cash and cash equivalents | $263,973 | — | — | $263,973 | | Interest rate lock agreements | — | $102,550 | — | $102,550 | | **Total assets at fair value** | **$263,973** | **$102,550** | **—** | **$366,523** | - Cash and cash equivalents are generally classified within **Level 1**, based on quoted market prices in active markets[203](index=203&type=chunk) - Interest rate lock agreements are classified within **Level 2**, with fair values based on similar exchange-traded derivatives and benchmarked treasury rates[204](index=204&type=chunk) - Non-recurring fair values for business acquisitions use **Level 2** inputs for tangible assets and **Level 3** inputs (internal estimates of future cash flows) for goodwill and separately identifiable intangible assets[206](index=206&type=chunk)[231](index=231&type=chunk) Note 4. Property and Equipment Cintas' net property and equipment totaled $1.65 billion at May 31, 2025, an increase from $1.53 billion in the prior year Property and Equipment, Net (as of May 31) | (In thousands) | 2025 | 2024 | | :------------------------- | :----------- | :----------- | | Land | $195,406 | $194,661 | | Buildings and improvements | $769,119 | $744,617 | | Equipment | $3,279,593 | $2,963,860 | | Leasehold improvements | $48,463 | $46,490 | | Construction in progress | $202,034 | $166,616 | | Accumulated depreciation | $(2,842,141) | $(2,582,076) | | **Property and equipment, net** | **$1,652,474** | **$1,534,168** | - Internal use software included in equipment was **$377.7 million** at May 31, 2025, with **$50.5 million** in construction in progress[207](index=207&type=chunk)[208](index=208&type=chunk) - Amortization expense for internal use software was **$30.8 million** in fiscal 2025, increasing from **$26.6 million** in fiscal 2024[208](index=208&type=chunk) Note 5. Goodwill, Service Contracts and Other Assets Cintas' goodwill increased to $3.40 billion at May 31, 2025, primarily due to $189.5 million in goodwill acquired from business acquisitions during fiscal 2025 Goodwill by Operating Segment (as of May 31) | (In thousands) | 2025 | 2024 | | :------------------------------- | :----------- | :----------- | | Uniform Rental and Facility Services | $2,913,991 | $2,773,565 | | First Aid and Safety Services | $298,145 | $293,747 | | All Other | $188,091 | $145,112 | | **Total Goodwill** | **$3,400,227** | **$3,212,424** | - Goodwill acquired in fiscal 2025 totaled **$189.5 million**, contributing to the overall increase[209](index=209&type=chunk) Service Contracts, Net (as of May 31) | (In thousands) | 2025 | 2024 | | :------------------------------- | :----------- | :----------- | | Uniform Rental and Facility Services | $273,847 | $290,498 | | First Aid and Safety Services | $14,138 | $16,203 | | All Other | $21,843 | $15,201 | | **Total Service Contracts, Net** | **$309,828** | **$321,902** | - Amortization expense for service contracts and other assets was **$167.8 million** in fiscal 2025, up from **$158.9 million** in fiscal 2024[210](index=210&type=chunk) - Capitalized contract costs, net, increased to **$275.3 million** at May 31, 2025, from **$262.5 million** in the prior year[209](index=209&type=chunk) Note 6. Debt, Derivatives and Hedging Activities Cintas' total outstanding debt was $2.44 billion at May 31, 2025, with an average interest rate of 4.1% and maturities extending through fiscal year 2037 Outstanding Debt (as of May 31) | (In thousands) | Interest Rate | Fiscal Year Maturity | 2025 | 2024 | | :------------------------- | :------------ | :------------------- | :----------- | :----------- | | Debt due within one year | | | $— | $449,595 | | Senior notes (3.70%) | 3.70% | 2027 | $1,000,000 | $1,000,000 | | Senior notes (4.20%) | 4.20% | 2028 | $400,000 | $— | | Senior notes (4.00%) | 4.00% | 2032 | $800,000 | $800,000 | | Senior notes (6.15%) | 6.15% | 2037 | $236,550 | $236,550 | | Debt issuance costs | | | $(11,551) | $(10,616) | | **Total debt due after one year** | | | **$2,424,999** | **$2,025,934** | - Cintas repaid **$50.0 million** of **3.11%** senior notes and **$400.0 million** of **3.45%** senior notes in April and May 2025, respectively[212](index=212&type=chunk) - On May 2, 2025, Cintas issued **$400.0 million** aggregate principal amount of senior notes with a **4.20%** interest rate, maturing May 1, 2028[212](index=212&type=chunk) - The company has a **$2.0 billion** revolving credit facility, with no commercial paper outstanding or borrowings as of May 31, 2025 and 2024[215](index=215&type=chunk) - Cintas uses interest rate locks as cash flow hedges, with an aggregate notional value of **$500.0 million** outstanding at May 31, 2025[216](index=216&type=chunk)[217](index=217&type=chunk) Note 7. Leases Cintas has operating leases for facilities, vehicles, and equipment, recognizing right-of-use assets and lease liabilities on the balance sheet - Operating lease right-of-use assets and liabilities are recognized on the consolidated balance sheets, based on the present value of lease payments[220](index=220&type=chunk) Operating Lease Costs (Fiscal Years Ended May 31) | (In millions) | 2025 | 2024 | 2023 | | :-------------------- | :---- | :---- | :---- | | Operating lease costs | $91.1 | $83.2 | $79.8 | Operating Lease Key Metrics (as of May 31) | Metric | 2025 | 2024 | | :---------------------------------------- | :---------- | :---------- | | Weighted-average remaining lease term | 5.66 years | 5.15 years | | Weighted-average discount rate | 4.08% | 3.48% | - Total future minimum lease payments for operating lease liabilities as of May 31, 2025, are **$259.6 million**, with **$58.7 million** due in fiscal 2026[221](index=221&type=chunk) Note 8. Income Taxes Cintas' income before income taxes was $2.26 billion in fiscal 2025, with U.S. operations contributing $2.12 billion Income Before Income Taxes by Component (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :----------------- | :----------- | :----------- | :----------- | | U.S. operations | $2,117,251 | $1,860,859 | $1,632,391 | | Foreign operations | $146,951 | $112,776 | $60,757 | | **Total** | **$2,264,202** | **$1,973,635** | **$1,693,148** | Income Tax Expense and Effective Tax Rate (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | 2023 | | :----------------- | :----------- | :----------- | :----------- | | Total income tax expense | $451,921 | $402,043 | $345,138 | | Effective tax rate | 20.0% | 20.4% | 20.4% | - Net deferred tax liability was **$471.7 million** at May 31, 2025, compared to **$475.5 million** at May 31, 2024[223](index=223&type=chunk) - Total unrecognized tax benefits (exclusive of interest and penalties) were **$58.0 million** at May 31, 2025, with **$47.8 million** (net of federal benefit) favorably impacting the effective tax rate if recognized[226](index=226&type=chunk)[227](index=227&type=chunk) - Cintas expects the balance of unrecognized tax benefits will not materially change for the fiscal year ending May 31, 2026[228](index=228&type=chunk) Note 9. Acquisitions Cintas acquired 28 individually immaterial businesses in fiscal 2025 (7 in Uniform Rental, 4 in First Aid & Safety, 17 in All Other), with a total cash consideration of $232.9 million Number of Businesses Acquired by Segment (Fiscal Years Ended May 31) | Operating Segment | 2025 | 2024 | | :------------------------------- | :--- | :--- | | Uniform Rental and Facility Services | 7 | 7 | | First Aid and Safety Services | 4 | 1 | | All Other | 17 | 8 | Aggregate Purchase Price and Fair Value Allocations for Acquisitions (Fiscal Years Ended May 31) | (In thousands) | 2025 | 2024 | | :------------------------------------------- | :----------- | :----------- | | Fair value of tangible assets acquired | $25,649 | $14,350 | | Fair value of service contracts acquired | $45,749 | $29,416 | | Fair value of other intangibles acquired | $9,309 | $5,278 | | Net goodwill recognized | $189,511 | $157,239 | | Total fair value of assets acquired | $270,218 | $206,283 | | Total fair value of liabilities assumed | $(3,541) | $— | | Total fair value of net assets acquired, net of cash acquired | $266,677 | $206,283 | | Deferred purchase price consideration | $(33,778) | $(19,446) | | **Total cash consideration for acquisitions, net of cash acquired** | **$232,899** | **$186,837** | - Goodwill recognized from acquisitions represents estimated future economic benefits not individually identifiable, based on strategic benefits[230](index=230&type=chunk) Note 10. Employee Benefit Plans Cintas' Pension Plan, assumed from G&K, had plan assets of $52.5 million and a projected benefit obligation (PBO) of $63.7 million at May 31, 2025, resulting in a net pension liability of $11.2 million Pension Plan Funded Status (as of May 31) | (In millions) | 2025 | 2024 | | :------------------ | :---- | :---- | | Fair value of plan assets | $52.5 | $48.3 | | Projected benefit obligation (PBO) | $63.7 | $64.3 | | Net pension liability | $11.2 | $16.0 | - Pension Plan assets are diversified across equity, fixed income, and cash, primarily classified as **Level 1** or **Level 2** in the fair value hierarchy[233](index=233&type=chunk)[234](index=234&type=chunk) Total Contributions to Non-Contributory Retirement Plans (Fiscal Years Ended May 31) | (In millions) | 2025 | 2024 | 2023 | | :------------------------------------------ | :----- | :----- | :----- | | Partners' Plan (U.S.) | $129.8 | $115.1 | $99.1 | | Deferred Profit Sharing Plan (DPSP) (Canada) | $4.7 | $4.2 | $3.7 | | Supplemental Executive Retirement Plan (SERP) | $12.9 | $13.1 | $12.3 | | **Total Contributions** | **$147.4** | **$132.4** | **$115.1** | Note 11. Earnings per Share Cintas calculates basic and diluted earnings per share using the two-class method due to restricted stock awards Basic and Diluted Earnings per Share (Fiscal Years Ended May 31) | (In thousands except per share data) | 2025 | 2024 | 2023 | | :----------------------------------- | :----------- | :----------- | :----------- | | Net income available to common shareholders | $1,805,930 | $1,565,664 | $1,342,547 | | Basic weighted average common shares outstanding | 403,530 | 406,612 | 406,580 | | **Basic earnings per share** | **$4.48** | **$3.85** | **$3.30** | | Diluted weighted average common shares outstanding | 410,286 | 413,468 | 413,508 | | **Diluted earnings per share** | **$4.40** | **$3.79** | **$3.25** | - Options to purchase **1.0 million shares** were excluded from diluted EPS computation in fiscal 2025 due to anti-dilutive exercise prices[239](index=239&type=chunk) Share Buyback Activity by Program (Fiscal Years Ended May 31) | Buyback Program (In thousands except per share data) | 2025 Shares | 2025 Purchase Price | 2024 Shares | 2024 Purchase Price | 2023 Shares | 2023 Purchase Price | | :--------------------------------------------------- | :---------- | :------------------ | :---------- | :------------------ | :---------- | :------------------ | | July 27, 2021 | — | $— | 3,425 | $458,284 | 2,201 | $218,288 | | July 26, 2022 | 3,794 | $679,329 | 339 | $57,104 | — | $— | | July 23, 2024 | — | $— | — | $— | — | $— | | **Total repurchase of Cintas common stock** | **—** | **$934,800** | **—** | **$700,033** | **—** | **$398,865** | - From the inception of the July 26, 2022 share buyback program through July 28, 2025, Cintas purchased **4.1 million shares** for a total of **$736.4 million**[241](index=241&type=chunk) Note 12. Stock-Based Compensation Cintas recognized $128.3 million in stock-based compensation expense in fiscal 2025, an increase from $117.0 million in fiscal 2024 - Total stock-based compensation cost was **$128.3 million** in fiscal 2025, up from **$117.0 million** in fiscal 2024[242](index=242&type=chunk) - The Amended 2016 Plan allows for grants of up to **50,000,000 shares**, with **19,246,017 shares** reserved for future issuance as of May 31, 2025[242](index=242&type=chunk) Stock Options Outstanding (as of May 31) | (In thousands) | 2025 Shares | 2025 Weighted Average Exercise Price | 2024 Shares | 2024 Weighted Average Exercise Price | | :------------- | :---------- | :----------------------------------- | :---------- | :----------------------------------- | | Outstanding | 12,678,487 | $103.72 | 15,249,032 | $85.73 | - The weighted-average fair value of stock options granted was **$65.40** in fiscal 2025, increasing from **$53.66** in fiscal 2024[244](index=244&type=chunk) Restricted Stock Awards Outstanding (as of May 31) | (In thousands) | 2025 Shares | 2025 Weighted Average Grant Price | 2024 Shares | 2024 Weighted Average Grant Price | | :------------- | :---------- | :-------------------------------- | :---------- | :-------------------------------- | | Unvested grants | 2,037,001 | $155.77 | 2,612,104 | $122.58 | - The remaining unrecognized compensation cost for unvested stock options and restricted stock was **$315.6 million** at May 31, 2025, to be recognized over a weighted-average period of **2.2 years**[249](index=249&type=chunk) Note 13. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (loss) decreased to $84.4 million at May 31, 2025, from $91.2 million at May 31, 2024 Accumulated Other Comprehensive Income (Loss) (as of May 31) | (In thousands) | 2025 | 2024 | 2023 | | :------------------------------------------- | :--------- | :--------- | :--------- | | Balance at June 1 | $91,201 | $77,778 | $107,917 | | Net current period other comprehensive (loss) income | $(6,812) | $13,423 | $(30,139) | | **Balance at May 31** | **$84,389** | **$91,201** | **$77,778** | - Foreign currency translation adjustments resulted in a loss of **$7.4 million** in fiscal 2025, contributing to the decrease in accumulated other comprehensive income[250](index=250&type=chunk) - Amortization of interest rate locks reclassified from accumulated other comprehensive income to interest expense was **$6.1 million** (net of tax) in fiscal 2025[250](index=250&type=chunk) Note 14. Operating Segment Information Cintas' Chief Executive Officer, as the CODM, evaluates segment performance based on revenue and operating income - The Chief Executive Officer (CODM) evaluates operating segment performance based primarily on revenue and operating income[252](index=252&type=chunk) Operating Segment Performance (Fiscal Year Ended May 31, 2025) | (In thousands) | Uniform Rental and Facility Services | First Aid and Safety Services | All Other | Total | | :------------------------------- | :----------------------------------- | :---------------------------- | :----------- | :----------- | | Revenue | $7,976,073 | $1,218,090 | $1,146,018 | $10,340,181 | | Cost of sales | $4,040,888 | $521,480 | $603,649 | $5,166,017 | | Gross margin | $3,935,185 | $696,610 | $542,369 | $5,174,164 | | Selling and administrative expenses | $2,061,795 | $401,882 | $350,761 | $2,814,438 | | Operating income | $1,873,390 | $294,728 | $191,608 | $2,359,726 | | Depreciation and amortization | $385,360 | $86,286 | $22,537 | $494,183 | | Capital expenditures | $301,624 | $55,447 | $51,813 | $408,884 | | Total assets | $7,993,720 | $810,188 | $757,360 | $9,825,241 | - Corporate assets represent the consolidated cash balance[252](index=252&type=chunk) Note 15. Litigation and Other Contingencies Cintas is involved in various legal proceedings, including a class action lawsuit (City of Laurel, Mississippi v. Cintas Corporation No. 2) related to a contract dispute - Management believes aggregate liability from ordinary course legal proceedings will not materially affect Cintas' financial position, results, or cash flows[253](index=253&type=chunk) - A **$45.0 million** legal settlement for the City of Laurel, Mississippi v. Cintas Corporation No. 2 class action lawsuit was accrued in fiscal 2024 and paid in July 2025 after final court approval[254](index=254&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=64&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance is incorporated by reference from Cintas' definitive proxy statement for the 2025 annual meeting of shareholders - Information for this item is incorporated by reference from the 2025 Proxy Statement[261](index=261&type=chunk) [Item 11. Executive Compensation](index=64&type=section&id=Item%2011.%20Executive%20Compensation) Details on executive compensation are incorporated by reference from Cintas' definitive proxy statement for the 2025 annual meeting of shareholders - Information for this item is incorporated by reference from the Proxy Statement[262](index=262&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=64&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership and related stockholder matters is incorporated by reference from the Proxy Statement, with additional details provided on equity compensation plans - Information for this item is incorporated by reference from the Proxy Statement, except for equity compensation plan details[263](index=263&type=chunk) Equity Compensation Plan Information (as of May 31, 2025) | Plan Category | Number of shares to be issued upon exercise of outstanding options | Weighted average exercise price of outstanding options | Number of shares remaining available for future issuance | | :--------------------------------- | :--------------------------------------------------------------- | :----------------------------------------------------- | :------------------------------------------------------- | | Equity compensation plans approved by shareholders | 12,678,487 | $103.72 | 19,246,017 | | Equity compensation plans not approved by shareholders | — | — | — | | **Total** | **12,678,487** | **$103.72** | **19,246,017** | [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=64&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding certain relationships, related transactions, and director independence is incorporated by reference from Cintas' definitive proxy statement for the 2025 annual meeting of shareholders - Information for this item is incorporated by reference to the Proxy Statement[265](index=265&type=chunk) [Item 14. Principal Accountant Fees and Services](index=64&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information concerning principal accountant fees and services is incorporated by reference from Cintas' definitive proxy statement for the 2025 annual meeting of shareholders - Information for this item is incorporated by reference to the Proxy Statement[266](index=266&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=65&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all financial statements required by Item 8, the Schedule II: Valuation and Qualifying Accounts and Reserves, and a comprehensive list of exhibits filed with the SEC - All financial statements required by Item 8 are included in the Annual Report[267](index=267&type=chunk) - Schedule II: Valuation and Qualifying Accounts and Reserves is provided for the three years ended May 31, 2025[267](index=267&type=chunk) - A detailed list of exhibits, including articles of incorporation, by-laws, debt indentures, equity compensation plans, and certifications, is provided[267](index=267&type=chunk)[268](index=268&type=chunk) [Item 16. Form 10-K Summary](index=67&type=section&id=Item%2016.%20Form%2010-K%20Summary) This section indicates that no Form 10-K Summary is provided - No Form 10-K Summary is provided[269](index=269&type=chunk)

Core Insights - The author has a strong educational background with a master's degree in Analytics and a bachelor's degree in Accounting, indicating a solid foundation for investment analysis [1] - The author has over 10 years of experience in the investment arena, starting as an analyst and progressing to a management role, showcasing a deep understanding of the industry [1] - The author expresses a personal interest in dividend investing, suggesting a focus on income-generating investments [1] Company and Industry Summary - The author holds long positions in several companies including CTAS, JNJ, WST, O, HRL, LOW, PEP, and ROP, indicating a diversified investment strategy [2] - The article reflects the author's personal opinions and does not involve compensation from the companies mentioned, suggesting an independent analysis [2] - The disclosure emphasizes that past performance is not indicative of future results, highlighting the inherent uncertainties in investment decisions [3]

Financial Performance - Cintas Corporation reported fourth-quarter earnings per share of $1.09, exceeding the analyst consensus estimate of $1.07 [1] - Quarterly sales reached $2.667 billion, reflecting an 8% year-over-year increase and surpassing the expected $2.626 billion [1] Future Guidance - For fiscal 2026, Cintas expects GAAP EPS to range between $4.71 and $4.85, slightly above the consensus estimate of $4.84 [2] - The company projects revenue for fiscal 2026 to be between $11.00 billion and $11.15 billion, compared to the estimate of $11.04 billion [2] Stock Performance and Analyst Ratings - Following the earnings announcement, Cintas shares increased by 3.7%, closing at $221.92 [3] - Morgan Stanley analyst Toni Kaplan maintained an Equal-Weight rating and raised the price target from $213 to $220 [8] - Baird analyst Andrew Wittmann maintained a Neutral rating and increased the price target from $227 to $230 [8]

Core Insights - Cintas reported fiscal 2025 fourth-quarter results with an 8% year-over-year revenue increase to $2.67 billion and a 9% rise in diluted EPS to $1.09, achieving record full-year revenue of $10.34 billion and EPS growth of 16.1% [1] - The company projects fiscal 2026 revenue between $11 billion and $11.15 billion, reflecting a growth rate of 6.4% to 7.8%, and EPS between $4.71 and $4.85, indicating a growth of 7% to 10.2% [1][9] Revenue and Margin Performance - The Uniform Rental and Facility Services segment's gross margin increased by 40 basis points to 49%, while the First Aid and Safety Services segment saw a 140 basis point margin increase to 56.8% [3] - Productivity improvements are attributed to the adoption of SAP enterprise systems, auto sortation in plants, and the SmartTruck platform, enhancing cost efficiencies and service delivery [3][4] Capital Deployment and M&A Activity - Cintas generated $1.6 billion in free cash flow in FY2025 and allocated $2.23 billion towards acquisitions, marking the largest M&A activity in nearly two decades [5][6] - Additional capital priorities included $409 million in capital expenditures, $612 million in dividends, and $935 million in share repurchases [5] Segment Growth and Diversification - The First Aid and Safety segment achieved 18.5% organic growth, driven by recurring revenue products and training-related services, with expectations for low double-digit growth rates [7][8] - The uniform direct sale business grew by 9% in the quarter, indicating strong performance despite previous challenges [8] Future Outlook - For FY2026, management anticipates revenue of $11 billion to $11.15 billion and diluted EPS of $4.71 to $4.85, with an operating margin forecast to exceed 23% [9] - The outlook assumes no significant acquisitions or share repurchases, maintaining a disciplined capital expenditure strategy of 3.5% to 4% of revenue [9]

Core Insights - Cintas Corporation (CTAS) reported Q4 fiscal 2025 earnings of $1.09 per share, exceeding the Zacks Consensus Estimate of $1.07, with a 9% year-over-year increase despite rising operating costs [1][9] - Total revenues reached $2.67 billion, surpassing the consensus estimate of $2.63 billion, marking an 8% year-over-year growth driven by higher segmental revenues [2][9] - For fiscal 2025, net revenues were $10.34 billion, a 7.7% increase year over year, with adjusted earnings of $4.40 per share, up 16.1% year over year [2] Segment Performance - The Uniform Rental and Facility Services segment generated revenues of $2.03 billion, accounting for 76.1% of net sales, reflecting a 6.3% year-over-year increase [3] - The First Aid and Safety Services segment reported revenues of $324.4 million, representing 12.2% of net sales, up 16.8% year over year [4] - Revenues from All Other businesses totaled $312.6 million, making up 11.7% of net sales, with a 10.8% year-over-year increase [4] Financial Metrics - Cintas' cost of sales increased 6.9% year over year to $1.34 billion, representing 50.3% of net sales, while gross profit rose 9.1% to $1.33 billion, resulting in a gross margin of 49.7% [5] - Selling and administrative expenses totaled $728.5 million, a 9.1% increase from the previous year, representing 27.3% of net sales [6] - Operating income increased 9.1% year over year to $597.5 million, with an operating margin of 22.4% [6] Balance Sheet & Cash Flow - At the end of fiscal 2025, Cintas had cash and cash equivalents of $264 million, down from $342 million a year ago, with long-term debt increasing to approximately $2.42 billion [7] - The company generated net cash of $2.17 billion from operating activities, a 4.7% increase year over year, while capital expenditures totaled $408.9 million, down 0.1% [8] - Free cash flow increased 5.9% year over year to $1.76 billion [8] Future Guidance - For fiscal 2026, Cintas expects revenues between $11 billion and $11.15 billion, with an EPS estimate of $4.71 to $4.85, indicating a midpoint of $4.78, which is below the consensus estimate of $4.87 [11] - The company anticipates net interest expenses of approximately $98 million, down from $101.1 million in fiscal 2025, with an effective tax rate expected at 20% [12]

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