Did Sysco's profitability improve in the third quarter of fiscal 2026?

Partly. Gross profit rose 6.5% to $3.8 billion and gross margin expanded 31 basis points, but operating expenses increased 10.1%, driven mainly by higher incentive compensation, sales headcount and capacity investments. As a result, GAAP operating income fell 9.1% to $619 million, while adjusted operating income was roughly flat, down 0.6% to $768 million.

How strong was volume growth?

U.S. Foodservice total case volume rose 2.3% and local case volume rose 3.3%. Management described the 3.3% local growth as the highest quarterly rate in over three years and said it expects over 2.5% U.S. local growth in the fourth quarter.

What did Sysco do with its cash?

In the first 39 weeks of fiscal 2026, Sysco returned $978 million to shareholders, consisting of $200 million in share repurchases and $778 million in dividends. Capital expenditures, net of proceeds from asset sales, were $330 million, and the company ended the quarter with $1.9 billion in cash and $4.4 billion in total liquidity.

What is the status of the Jetro Restaurant Depot acquisition?

Sysco announced the agreement on March 30, 2026. Jetro Restaurant Depot operates 167 large-format warehouse stores across 35 states. The transaction remains subject to regulatory review and is expected to close by Sysco's third quarter of fiscal 2027, subject to customary closing conditions including regulatory approvals.

What is management's full-year outlook?

Management expects full-year fiscal 2026 adjusted EPS at the high end of its $4.50 to $4.60 guidance range. This outlook includes an approximate $100 million ($0.16 per diluted share) headwind from lapping lower incentive compensation in fiscal 2025.

SYY 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed April 28, 2026. Cited figures are marked; the original filing is the authoritative source.

Sysco Corporation (NYSE: SYY) furnished an 8-K on April 28, 2026 containing its press release reporting results for the third quarter of fiscal year 2026, which ended March 28, 2026.

Sales rose 4.7% to $20.5 billion^a and GAAP operating income fell 9.1% to $619 million, while adjusted operating income decreased 0.6% to $768 million. Net earnings decreased 15.2% to $340 million and diluted EPS fell 13.4% to $0.71; adjusted diluted EPS decreased 2.1% to $0.94, which management said includes a $63 million higher incentive compensation cost. U.S. Foodservice local case volume grew 3.3%, the highest quarterly rate in over three years according to the CEO, and the U.S. Foodservice segment returned to operating profit growth in the quarter.

For the first 39 weeks of fiscal 2026, cash flow from operations was $1.5 billion^b and free cash flow was $1.1 billion, up 19% year to date. Sysco returned $978 million to shareholders through $200 million of share repurchases and $778 million of dividends. Cash was $1.9 billion, total liquidity was $4.4 billion, and net debt to adjusted EBITDA was approximately 2.8 times.

Management stated it expects full-year fiscal 2026 adjusted EPS at the high end of its $4.50 to $4.60^c guidance range. The pending acquisition of Jetro Restaurant Depot, announced March 30, 2026, remains subject to regulatory review and is expected to close by the third quarter of fiscal 2027.

02—Key points

Key Highlights

Sales increased 4.7% to $20.5 billion; gross margin rose 31 basis points to 18.6%.
GAAP operating income decreased 9.1% to $619 million; adjusted operating income decreased 0.6% to $768 million.
Diluted EPS decreased 13.4% to $0.71; adjusted diluted EPS decreased 2.1% to $0.94, including a $0.10 impact from higher incentive compensation costs.
U.S. Foodservice local case volume increased 3.3%, and U.S. Foodservice operating income increased 2.4% to $772 million.
International Foodservice sales rose 12.4% to $3.9 billion, with adjusted operating income up 12.5% to $144 million.
Year-to-date free cash flow of $1.1 billion increased 19%; $978 million was returned to shareholders in the first 39 weeks.
Full-year adjusted EPS guidance of $4.50 to $4.60 is expected to be at the high end of the range; Jetro Restaurant Depot acquisition expected to close by Q3 fiscal 2027.

03—Questions

Frequently Asked Questions

Did Sysco's profitability improve in the third quarter of fiscal 2026?
Partly. Gross profit rose 6.5% to $3.8 billion and gross margin expanded 31 basis points, but operating expenses increased 10.1%, driven mainly by higher incentive compensation, sales headcount and capacity investments. As a result, GAAP operating income fell 9.1% to $619 million, while adjusted operating income was roughly flat, down 0.6% to $768 million.
How strong was volume growth?
U.S. Foodservice total case volume rose 2.3% and local case volume rose 3.3%. Management described the 3.3% local growth as the highest quarterly rate in over three years and said it expects over 2.5% U.S. local growth in the fourth quarter.
What did Sysco do with its cash?
In the first 39 weeks of fiscal 2026, Sysco returned $978 million to shareholders, consisting of $200 million in share repurchases and $778 million in dividends. Capital expenditures, net of proceeds from asset sales, were $330 million, and the company ended the quarter with $1.9 billion in cash and $4.4 billion in total liquidity.
What is the status of the Jetro Restaurant Depot acquisition?
Sysco announced the agreement on March 30, 2026. Jetro Restaurant Depot operates 167 large-format warehouse stores across 35 states. The transaction remains subject to regulatory review and is expected to close by Sysco's third quarter of fiscal 2027, subject to customary closing conditions including regulatory approvals.
What is management's full-year outlook?
Management expects full-year fiscal 2026 adjusted EPS at the high end of its $4.50 to $4.60 guidance range. This outlook includes an approximate $100 million ($0.16 per diluted share) headwind from lapping lower incentive compensation in fiscal 2025.

04—Continue

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