Sysco (NYSE:SYY) Q2 2026 Earnings call January 27, 2026 10:00 AM ET Company ParticipantsJohn Heinbockel - Managing DirectorKenny Cheung - CFOKevin Hourican - Chair of the Board and CEOKevin Kim - VP of Investor RelationsLauren Silberman - DirectorMark Carden - Director of Equity ResearchConference Call ParticipantsAlexander Slagle - AnalystDanilo Gargiulo - Senior Research AnalystJake Bartlett - Senior Equity Research AnalystJeffrey Bernstein - Equity Research AnalystJohn Ivankoe - Managing Director and Equ ...

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Financial Data and Key Metrics Changes - Sysco reported nearly $21 billion in total revenue for Q2, reflecting a growth rate of 3% year-over-year [5] - Adjusted EPS is expected to be at the high end of the previously provided guidance range of $4.50-$4.60, with a growth of 6.5% in Q2 [4][20] - Free cash flow grew by 25% year-to-date, indicating strong quality of earnings [20] Business Line Data and Key Metrics Changes - USFS local case volume increased by 1.2% in Q2, an improvement of 140 basis points compared to Q1 [5][6] - National contract business generated volume growth of 0.4%, with strong growth in food service management and healthcare, but softness in the national restaurant segment [7][8] - International segment sales grew by 7.3%, with local case growth of 4.5%, contributing to nearly 26% growth in adjusted operating income [10][24] Market Data and Key Metrics Changes - The overall restaurant traffic declined by more than 200 basis points year-over-year, yet Sysco managed to gain market share [6][8] - Sysco's performance improved relative to the industry, with a strong exit rate in December [42] Company Strategy and Development Direction - Sysco is focusing on enhancing its value tier product offerings to meet customer needs and improve profitability [9] - The company completed a tuck-in acquisition of Ginsberg's Foods, which is expected to enhance growth potential in the Northeast [17][24] - Continued investments in sales headcount and technology, such as the AI 360 CRM tool, are aimed at improving sales productivity [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving at least 2.5% local case growth in the second half of fiscal 2026, driven by improved sales colleague retention and productivity [19][36] - The company anticipates a stable macroeconomic environment, with growth primarily driven by internal initiatives rather than external factors [30][74] Other Important Information - Sysco's adjusted operating expenses were $3 billion for the quarter, reflecting planned investments in growth areas [28] - The company maintains a robust balance sheet with $2.9 billion in total liquidity [29] Q&A Session Summary Question: Variations in local case growth on a monthly basis and impact of winter storms - Sysco's performance strengthened each month of Q2, with January showing continued strength despite potential weather impacts [40][41] Question: Sales growth expectations for the second half of fiscal 2026 - Sysco anticipates at least 2.5% growth in local case volumes for Q3 and Q4, with expectations for improved performance compared to the previous year [50][76] Question: Contribution of new account wins versus existing account penetration - Growth is coming from both new account wins and improved penetration with existing accounts, with the spread between new and lost accounts widening [61][62] Question: Changes in sales force growth and hiring - Sysco is committed to growing its sales headcount in 2026, focusing on high-growth markets and optimizing training programs to enhance productivity [65]

Shares of Sysco Corporation ( SYY ) have been a poor performer over the past year, losing just over 1% of their value. While the company has been gaining market share and benefits from a weaker U.S. dollar (Over fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specific stock or have a question for an article, just let me know!Analyst’s Disclosure: I/we hav ...

Core Insights - Sysco reported quarterly earnings of $0.99 per share, exceeding the Zacks Consensus Estimate of $0.98 per share, and showing an increase from $0.93 per share a year ago, representing an earnings surprise of +1.43% [1] - The company posted revenues of $20.76 billion for the quarter ended December 2025, slightly missing the Zacks Consensus Estimate by 0.2%, but up from $20.15 billion year-over-year [2] - Sysco has surpassed consensus EPS estimates three times over the last four quarters and has topped revenue estimates twice in the same period [2] Earnings Outlook - The sustainability of Sysco's stock price movement will depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.91 on revenues of $20.53 billion, and for the current fiscal year, it is $4.55 on revenues of $84.45 billion [7] Industry Context - The Zacks Industry Rank for Food - Miscellaneous, which includes Sysco, is currently in the bottom 21% of over 250 Zacks industries, indicating potential challenges ahead [8] - Freshpet, another company in the same industry, is expected to report quarterly earnings of $0.43 per share, reflecting a year-over-year increase of +19.4%, with revenues projected at $285.8 million, up 8.8% from the previous year [9]

Fiscal Q2 2026 Earnings Results January 27, 2026 Forward-Looking Statements Statements made in this presentation include statements that are forward-looking or that express management's beliefs, expectations or hopes and are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements include, among other things, our future financial performance and results, business strategy, plans, goals and objectives, including certain outlook, business trends, our dividend and ...

Food distributor Sysco lifted its annual profit forecast and beat estimates for both second-quarter profit and sales on Tuesday, as strong demand for its steaks, fillets and frozen-food products helpe... ...

Core Viewpoint - Sysco's fiscal second-quarter net income decreased, but the company indicated it is on track to achieve the high end of its previous full-year adjusted-earnings forecast [1] Financial Performance - The net income for Sysco in the fiscal second quarter experienced a decline [1] - Despite the drop in net income, Sysco remains optimistic about reaching its adjusted-earnings target for the full year [1]

Financial Performance - Sales for the second quarter increased 3.0% to $20.8 billion compared to the same period in fiscal year 2025[5] - Gross profit increased 3.9% to $3.8 billion, with a gross margin of 18.3%, reflecting a 15 basis point increase[6] - Operating income decreased 2.8% to $692 million, while adjusted operating income increased 3.1% to $807 million[3] - Net earnings decreased 4.2% to $389 million, but adjusted net earnings increased 3.9% to $476 million[3] - Sales for the 13-week period ended December 27, 2025, were $20,762 million, an increase of 3.0% compared to $20,151 million for the same period in 2024[24] - Gross profit for the 26-week period ended December 27, 2025, was $7,693 million, up from $7,403 million in 2024, reflecting a growth of 3.9%[24] - Net earnings for the 26-week period ended December 27, 2025, were $866 million, a decrease of 3.3% from $896 million in the prior year[26] - Basic earnings per share for the 13-week period ended December 27, 2025, were $0.81, compared to $0.83 for the same period in 2024[24] - For the 26-week period, Sysco reported GAAP sales of $41,910 million, a 3.1% increase from $40,634 million in the prior year[36] - Diluted earnings per share (GAAP) decreased to $1.80, down 1.1% from $1.82[37] Cash Flow and Shareholder Returns - Cash flow from operations was $611 million, and free cash flow was $413 million for the first 26 weeks of fiscal year 2026[13] - The company returned $518 million to shareholders via dividends during the first 26 weeks of fiscal year 2026[13] - Free cash flow for the 26-week period ended December 27, 2025, was $413 million, up from $331 million in the prior year, reflecting an increase of $82 million[43] Sales Growth - U.S. Foodservice local case volume grew by 1.2%, contributing to overall positive case growth[1] - International Foodservice Operations sales increased 7.3% to $4.0 billion, with a gross profit increase of 9.5% to $832 million[11] - U.S. foodservice operations sales increased by $339 million, or 2.4%, reaching $14,383 million[38] - International foodservice operations sales grew by $271 million, or 7.3%, totaling $3,999 million[38] - Total Sysco sales rose by $611 million, or 3.0%, to $20,762 million[39] Operating Expenses - Operating expenses increased by 5.5% to $3,100 million, with adjusted operating expenses (Non-GAAP) at $2,985 million, reflecting a 4.1% increase[33] - Operating expenses for Total Sysco increased by 5.4% to $6,200 million, with adjusted operating expenses rising by 4.2% to $5,987 million[41] Debt and Leverage - Long-term debt stood at $12,440 million as of December 27, 2025, slightly up from $12,360 million as of June 28, 2025[25] - Total Debt (GAAP) stands at $13,590 million, with Net Debt (Non-GAAP) at $12,368 million[48] - The Net Debt to Adjusted EBITDA ratio (Non-GAAP) is 2.86, indicating the company's leverage relative to its earnings[48] Adjusted Metrics - Adjusted net earnings for fiscal 2026 were $1,028 million, a 3.1% increase from $997 million in fiscal 2025[37] - Adjusted EBITDA growth is considered a key measure of financial performance, with management emphasizing its importance for consistent period comparisons[44] - Adjusted EBITDA for the 13-week period, after certain item adjustments, increased to $1,001 million, reflecting a 3.3% rise from $969 million in the previous year[45] - Adjusted EBITDA for the 26-week period was $2,071 million, an increase of 1.7% compared to $2,037 million in the prior year[46] Strategic Focus - Sysco continues to focus on growth through acquisitions, excluding acquisition-related costs from its non-GAAP financial measures to enhance comparability[31] - The company reported a significant increase in acquisition-related costs, rising to $23 million from $8 million year-over-year, indicating ongoing strategic investments[45] - The impact of restructuring and transformational project costs was significant, with a total impact of $114 million on operating expenses for Total Sysco[41] - The impact of restructuring and transformational project costs in fiscal 2026 included $21 million in severance charges and $93 million in transformation initiative costs[37]

HOUSTON, Jan. 27, 2026 (GLOBE NEWSWIRE) -- Sysco Corporation (NYSE:SYY) (“Sysco” or the “company”) today announced financial results for its 13-week second fiscal quarter ended December 27, 2025. Key financial results for the second quarter of fiscal year 2026 include the following (comparisons are to the same period in fiscal year 2025): Sales increased 3.0%; U.S. Foodservice volume increased 0.8%, U.S. local volumes increased 1.2%;Gross profit increased 3.9% to $3.8 billion;Operating income decreased 2.8% ...