Sysco's Q2 Earnings Meet Estimates, Share Buyback Program Gets a Boost

Core Insights - Sysco Corporation reported strong second-quarter fiscal 2025 results, with both sales and earnings increasing year over year, surpassing the Zacks Consensus Estimate [1][4] Financial Performance - Adjusted earnings per share were 93 cents, in line with expectations, reflecting a 4.5% year-over-year increase [4] - Total sales reached $20,151 million, a 4.5% increase year over year, exceeding the consensus estimate of $20,102 million [4] - Gross profit rose 3.9% to $3.7 billion, although gross margin contracted by 11 basis points to 18.1% [5] - Operating income increased by 1.7% to $712 million, while adjusted operating income rose 5.1% to $783 million [6] Segment Performance - U.S. Foodservice Operations saw sales rise 4.1% to $14,044 million, with local case volumes down 0.9% [7] - International Foodservice Operations reported a 3.6% increase in sales to $3,728 million, with adjusted operating income growing 27.5% on a constant currency basis [8] - SYGMA's sales increased by 10.6% year over year, reaching $2,116 million [8] - The Other segment experienced a sales decline of 7.1% to $263 million [9] Future Outlook - Sysco reaffirmed its full-year guidance, expecting sales growth of 4-5% and adjusted EPS growth of 6-7% [3] - The company increased its share repurchase plan for the year to $1.25 billion from $1 billion [3] Financial Health - As of the end of the quarter, Sysco had cash and cash equivalents of $793 million and long-term debt of $11,393 million [11] - Cash flow from operations for the first 26 weeks of fiscal 2025 was $498 million, with free cash flow at $331 million [11] - Sysco returned $803 million to shareholders through share buybacks and dividends during the same period [12]