Sysco Corporation now expects fiscal 2027 sales growth near the bottom of its 6%-7% range, while keeping its adjusted earnings target after Chief Financial Officer Brandon Sewell linked the outlook to lower industry inflation.
Sales for the 13 weeks through Sept. 26 reached $21.744 billion, up from $21.148 billion a year earlier. The U.S. Foodservice division generated $15.142 billion, 2.4% more than in the year-earlier quarter. Local case volume there rose 2.7%, and total cases increased 2.6%.
Gross profit advanced 3.8% to $4.051 billion. The gross margin moved up 18 basis points to 18.6%. Sysco put product-cost inflation at 0.3% for the quarter, with meat accounting for most of it.
Net earnings totaled $526 million, an increase of 10.5%, and diluted EPS was $1.09, up 10.1%. Adjusted diluted EPS reached $1.19, a 3.5% gain. Reported operating income fell 10.4% to $717 million as acquisition expenses tied to the planned Jetro Restaurant Depot purchase weighed on results, Sysco said. Adjusted operating income rose 3.2% to $927 million. The company’s adjusted results are non-GAAP measures that exclude items such as acquisition, restructuring, severance and transformation costs.
Other income included a $234 million gain from deal-contingent rate locks. Sysco said the transactions were designed to limit interest-rate risk on permanent debt issued to finance the planned purchase.
Sysco’s Sept. 9 reaffirmation kept adjusted EPS guidance at $5.02 to $5.12 for the 53-week fiscal year, including the benefit of the extra week. The company maintained its 9%-11% adjusted EPS growth target and an assumption of about 2.5% local-volume growth. Sewell said the FY27 plan includes $100 million in net savings from AI-related efforts. He expects those savings to contribute more in the year’s second half. Chair of the Board and Chief Executive Officer Kevin Hourican cited softer restaurant foot traffic and fuel costs above expectations as pressures during the quarter. Sysco scheduled its results call for Tuesday, Nov. 3, at 10 a.m. ET.
