US Foods Holding Corp (NYSE:USFD) reported its fourth-quarter and full-year fiscal 2025 results, delivering a mixed performance against analyst expectations. The company's earnings per share surpassed estimates, while revenue fell slightly short. The market's initial reaction appears cautiously positive, with the stock showing modest gains in pre-market trading.
Earnings and Revenue Versus Estimates
For the critical fourth quarter, US Foods presented a nuanced financial picture. The company's top-line growth was solid but did not meet the high bar set by Wall Street, whereas profitability metrics exceeded forecasts.
- Revenue: The company reported Q4 net sales of $9.8 billion, marking a 3.3% increase from the prior year. This figure came in just below the analyst consensus estimate of approximately $10.1 billion.
- Earnings Per Share: On a non-GAAP basis, Adjusted Diluted EPS for the quarter was $1.04. This represents a significant 23.8% year-over-year increase and notably exceeded the analyst estimate of $1.02.
For the full fiscal year 2025, the company achieved record results, with Adjusted EBITDA growing 11% to $1.93 billion and Adjusted Diluted EPS increasing 26% to $3.98. CEO Dave Flitman characterized the year as a "strong start" to the company's three-year long-range plan, achieved despite a "softer economic environment."
Market Reaction and Price Action
The immediate market response to the earnings release has been measured. Following the report, USFD shares are trading approximately 0.3% higher in pre-market activity. This muted but positive move suggests investors are balancing the revenue miss against the stronger-than-expected profitability and the company's forward-looking guidance.
The stock's recent performance shows a steady upward trend, with gains of 7.3% over the past two weeks and 13.4% over the past month, indicating building optimism ahead of the earnings announcement.
Key Highlights from the Press Release
Beyond the headline numbers, the earnings report highlighted several important operational and strategic developments:
- Customer Segment Growth: Case volume growth was driven by strong performance in target segments. Independent restaurant case volume grew 4.1% for the quarter, while healthcare and hospitality volumes also increased. This was partially offset by a decline in chain volume.
- Margin Expansion: The company demonstrated disciplined cost management. Adjusted EBITDA margin expanded by 35 basis points year-over-year to 5.0% in Q4, and by 30 basis points to 4.9% for the full year.
- Capital Allocation: A new $1 billion share repurchase authorization was announced, reinforcing management's confidence. The company repurchased $934 million worth of shares in fiscal 2025.
- Strong Cash Flow: Operating cash flow for the year was $1.37 billion, an increase of $195 million, supporting the aggressive buyback activity and investments.
Forward Outlook Versus Analyst Expectations
Management provided formal guidance for fiscal year 2026, which offers a point of comparison against existing analyst models.
The company's outlook includes:
- Net sales growth of 4% to 6%
- Adjusted EBITDA growth of 9% to 13%
- Adjusted Diluted EPS growth of 18% to 24%
This guidance, which includes a benefit from a 53rd week in the fiscal calendar, appears broadly in line with analyst expectations. Prior to the report, the consensus sales estimate for FY 2026 stood at approximately $42.84 billion, and the EPS estimate was around $4.76. The company's projected EPS growth range suggests confidence in its ability to continue its momentum and execute on productivity initiatives.
For a detailed breakdown of historical earnings and future analyst estimates for US Foods, you can review the data here.
Disclaimer: This article is for informational purposes only and does not constitute financial advice, a recommendation, or an offer or solicitation to buy or sell any securities. The information presented is based on data provided and should not be the sole basis for any investment decision. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions.
