SYSCO REPORTS FIRST QUARTER 2027 RESULTS
SYSCO CORP (SYY) filed an SEC Form 8-K — Results of Operations and Financial Condition. SYSCO REPORTS FIRST QUARTER 2027 RESULTS; REITERATES FY27 ADJUSTED EPS AND LOCAL VOLUME GUIDANCE HOUSTON, November 3, 2026 - Sysco Corporation (NYSE:SYY) (“Sysco” or the “company”) today announced financial results for its 13-week first fiscal quarter ended September 26, 2026. Ke
How this was made
The 30-second read
Why it matters
The reaffirmed guidance suggests the market will not see a sharp move, but the detailed segment performance offers insight into volume trends and cost pressures.
Market read
The filing provides fresh earnings data for a large-cap distributor, reaffirming guidance and offering modest trading signals.
What to watch
AI‑driven cost‑saving initiatives and the pending Jetro Restaurant Depot closure may drive longer‑term upside not reflected in the immediate numbers.
SYSCO REPORTS FIRST QUARTER 2027 RESULTS; REITERATES FY27 ADJUSTED EPS AND LOCAL VOLUME GUIDANCE
Sales, gross profit, adjusted operating income, adjusted net earnings and adjusted diluted EPS increased, with U.S. Foodservice local case volume growth of 2.7%. GAAP operating income declined 10.4% as acquisition-related costs tied to Jetro Restaurant Depot increased expenses, while management reiterated adjusted EPS growth and local volume guidance.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Sales, 13-week period ended September 26, 2026GAAP | $21.74B | – | 2.8% |
| Comparable sales using a constant currency basis, 13-week period ended September 26, 2026non-GAAP | $21.78B | – | 3.0% |
| Gross profit, 13-week period ended September 26, 2026GAAP | $4.05B | – | 3.8% |
| Comparable gross profit adjusted for Certain Items using a constant currency basis, 13-week period ended September 26, 2026non-GAAP | $4.06B | – | 4.0% |
| Gross margin, 13-week period ended September 26, 2026GAAP | 18.63% | – | 18 bps |
| Comparable gross margin adjusted for Certain Items using a constant currency basis, 13-week period ended September 26, 2026non-GAAP | 18.63% | – | 18 bps |
| Product cost inflation, first quarter fiscal year 2027other | 0.3% | – | – |
| Operating expenses, 13-week period ended September 26, 2026GAAP | $3.33B | – | 7.5% |
| Adjusted operating expenses, 13-week period ended September 26, 2026non-GAAP | $3.12B | – | 4.0% |
| Operating expense as a percentage of sales, 13-week period ended September 26, 2026GAAP | 15.33% | – | 67 bps |
| Adjusted operating expense as a percentage of sales, 13-week period ended September 26, 2026non-GAAP | 14.37% | – | 17 bps |
| Operating income, 13-week period ended September 26, 2026GAAP | $717M | – | (10.4)% |
| Adjusted operating income, 13-week period ended September 26, 2026non-GAAP | $927M | – | 3.2% |
| Operating margin, 13-week period ended September 26, 2026GAAP | 3.30% | – | -48 bps |
| Adjusted operating margin, 13-week period ended September 26, 2026non-GAAP | 4.26% | – | 1 bp |
| Interest expense, 13-week period ended September 26, 2026GAAP | $261M | – | 51.7% |
| Other (income) expense, net, 13-week period ended September 26, 2026GAAP | −$231M | – | NM |
| Earnings before income taxes, 13-week period ended September 26, 2026GAAP | $687M | – | – |
| Income taxes, 13-week period ended September 26, 2026GAAP | $161M | – | 29.8% |
| Net earnings, 13-week period ended September 26, 2026GAAP | $526M | – | 10.5% |
| Adjusted net earnings, 13-week period ended September 26, 2026non-GAAP | $574M | – | 4.2% |
| Diluted earnings per share, 13-week period ended September 26, 2026GAAP | $1.09 | – | 10.1% |
| Adjusted diluted earnings per share, 13-week period ended September 26, 2026non-GAAP | $1.19 | – | 3.5% |
| EBITDA, 13-week period ended September 26, 2026non-GAAP | $1.21B | – | 20.4% |
| Adjusted EBITDA, 13-week period ended September 26, 2026non-GAAP | $1.13B | – | 5.4% |
| U.S. Foodservice total case growth, first quarter fiscal year 2027other | 2.6% | – | – |
| U.S. Foodservice local case growth, first quarter fiscal year 2027other | 2.7% | – | – |
| Sysco Brand Sales as a % of Cases, U.S. Broadlineother | 35.8% | – | 8 bps |
| Sysco Brand Sales as a % of Cases, Localother | 46.6% | – | 44 bps |
| Net cash provided by operating activities, 13-week period ended September 26, 2026GAAP | $278M | – | – |
| Free Cash Flow, 13-week period ended September 26, 2026non-GAAP | $230M | – | – |
| Capital expenditures, net of proceeds from sales of plant and equipment, first 13 weeks of fiscal year 2027other | $48M | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| U.S. Foodservice OperationsBalanced volume growth, positive Sysco Brand penetration rates, effective margin management, and benefits associated with tariffs. | $15.14B | – | 2.4% |
| International Foodservice OperationsLocal volume growth, expanded margins, and double-digit adjusted profit growth. Foreign exchange rates decreased sales by 0.9%. | $4.17B | – | 5.1% |
| SYGMA | $2.15B | – | 1.1% |
| Other | $282M | – | 3.3% |
fiscal year 2027 outlook
- Revenuefull year sales growth is now expected to be at the lower end of our 6%-7% range
- NoteAdjusted EPS growth guidance of 9%-11%
- NoteLocal volume growth assumptions of approximately 2.5%
- NoteExpectation for $100 million in savings included in our FY27 guidance, with benefits accelerating in the second half
Capital returns
- During the first 13 weeks of fiscal year 2027, Sysco returned $264 million to shareholders via dividends.
- Dividends paid were $264 million for the 13-week period ended September 26, 2026, compared with $259 million for the 13-week period ended September 27, 2025.
What drove it
- Gross profit growth was primarily driven by growth from local volumes, benefits associated with tariffs, strategic sourcing efficiencies, and Sysco Brand penetration.
- U.S. Foodservice delivered 2.6% total case growth and 2.7% local case growth.
- International Foodservice sales increased 6.0% on a constant currency basis and adjusted operating income increased 12.9% on a constant currency basis.
- The company expects $100 million in AI technology-enabled savings in FY27 guidance, with benefits accelerating in the second half.
- A gain of $234 million in other income was related to deal contingent rate lock transactions entered into to mitigate interest rate risk on permanent debt issued to finance the Jetro Restaurant Depot transaction.
Concerns
- Management cited continued softness in restaurant foot traffic, higher than expected fuel costs, and lower than expected U.S. food cost inflation.
- GAAP operating income decreased 10.4% to $717 million, driven by acquisition costs related to Jetro Restaurant Depot.
- International Foodservice GAAP operating income decreased 28.1% to $82 million despite adjusted operating income increasing 12.2%.
- Operating expenses increased 7.5%, driven by acquisition-related costs, higher volumes, and investments in higher growth areas of the business.
- Full-year sales growth is expected at the lower end of the 6%-7% range, reflecting a lower inflation environment for the industry.
What to watch
- Delivery of adjusted EPS growth guidance of 9%-11% and local volume growth of approximately 2.5%.
- Whether benefits from $100 million in AI technology-enabled savings accelerate in the second half as expected.
- The anticipated closure of the Jetro Restaurant Depot transaction and related acquisition, financing, and integration costs.
- Restaurant foot traffic, fuel costs, and U.S. food cost inflation.
- Sustainability of U.S. Foodservice local case growth and International Foodservice constant-currency profit growth.
Balance sheet and cash flow
- Cash and cash equivalents were $3,171 million as of September 26, 2026, compared with $1,786 million as of June 27, 2026.
- Total liquidity was $5.8 billion as of the end of the quarter.
- Total Debt was $13,820 million as of September 26, 2026.
- Net Debt was $10,649 million as of September 26, 2026.
- Total Debt/Net Earnings Ratio was 7.65 as of September 26, 2026.
- Total Debt/Adjusted EBITDA Ratio was 3.11 as of September 26, 2026.
- Net Debt/Adjusted EBITDA Ratio was 2.40 as of September 26, 2026.
- Net cash provided by operating activities was $278 million, compared with $86 million in the prior-year 13-week period.
- Net cash used for investing activities was $(173) million, compared with $(107) million in the prior-year 13-week period.
- Net cash provided by financing activities was $1,150 million, compared with net cash used for financing activities of $(195) million in the prior-year 13-week period.
- Cash, cash equivalents and restricted cash at end of period were $3,369 million, compared with $1,127 million in the prior-year 13-week period.
Analysis
Sysco opened fiscal 2027 with sales of $21,744 million, up 2.8%, while gross profit increased 3.8% to $4,051 million. Gross margin expanded 18 basis points to 18.63%. The company attributed gross-profit growth to local volume growth, tariff benefits, strategic sourcing efficiencies, and Sysco Brand penetration. Product cost inflation was 0.3% at the total enterprise level, primarily in meat, and management said lower industry inflation is expected to place full-year sales growth at the lower end of its 6%-7% range.
Volume and mix indicators were constructive in the core U.S. business. U.S. Foodservice sales increased 2.4% to $15,142 million, total case volume increased 2.6%, and local case volume increased 2.7%. U.S. Foodservice gross margin rose 14 basis points to 19.24%, while adjusted operating income increased 2.7% to $941 million. Sysco Brand Sales as a percentage of cases rose to 35.8% in U.S. Broadline and 46.6% in Local. Management nevertheless identified continued softness in restaurant foot traffic and higher than expected fuel costs as operating headwinds.
International Foodservice was the strongest reported growth contributor, with sales up 5.1% to $4,168 million and up 6.0% on a constant currency basis. Gross profit increased 7.4% and adjusted operating income increased 12.2% to $165 million. Foreign exchange reduced International sales by 0.9%. Reported International operating income fell 28.1% to $82 million because reported operating expenses included restructuring, transformation, and acquisition-related costs. SYGMA sales increased 1.1%, but gross profit declined 1.8% and operating income declined 16.0%.
At the consolidated level, adjusted operating income increased 3.2% to $927 million, adjusted net earnings increased 4.2% to $574 million, and adjusted diluted EPS increased 3.5% to $1.19. GAAP operating income fell 10.4% to $717 million as operating expenses increased 7.5%, including acquisition-related costs tied to Jetro Restaurant Depot. GAAP net earnings nonetheless increased 10.5% to $526 million, aided by a $234 million gain in other income related to deal contingent rate lock transactions. The difference between GAAP and adjusted results is important because fiscal 2027 adjustments include transformation, restructuring, acquisition, bridge-loan amortization, and Jetro-related rate-lock items.
Cash flow strengthened year over year, with operating cash flow of $278 million versus $86 million and free cash flow of $230 million versus $(50) million. The company returned $264 million via dividends. Cash and cash equivalents were $3,171 million, total debt was $13,820 million, and Net Debt to Adjusted EBITDA was 2.40 as of September 26, 2026. Sysco reiterated FY27 adjusted EPS growth guidance of 9%-11% and local volume growth assumptions of approximately 2.5%, while expecting $100 million of AI technology-enabled savings in FY27, with benefits accelerating in the second half.
Management, verbatim
We are pleased to report a strong start to fiscal 2027. Our Q1 adjusted EPS performance was in-line with our expectations, fueled by positive volume growth, expanding gross margins, and disciplined expense control.
Kevin Hourican, Sysco’s Chair of the Board and Chief Executive Officer
Our teams delivered 2.7% local growth in our U.S. segment and grew adjusted operating income across our USFS and International segments.
Brandon Sewell, Sysco’s Chief Financial Officer
We remain confident in delivering on our adjusted EPS growth guidance of 9%-11%, reflecting unchanged local volume growth assumptions of approximately 2.5%, while full year sales growth is now expected to be at the lower end of our 6%-7% range, reflecting a lower inflation environment for the industry.
Brandon Sewell, Sysco’s Chief Financial Officer
Not in the filing
stated, not guessed- Prior outlook was not provided, so no comparison of actual results against prior guidance is available.
- Share repurchases were not reported for the first 13 weeks of fiscal year 2027.
- A forward revenue dollar guidance range was not reported.
- Forward gross margin, operating expense, and tax rate guidance were not reported.
- A GAAP EPS guidance figure and quantitative reconciliation of projected adjusted EPS to GAAP were not provided.
- Segment-level prior-quarter comparisons were not reported.
- Consolidated and segment revenue, gross profit, operating income, and EPS prior-quarter figures were not reported.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Sysco, the largest foodservice distributor in the U.S., released its FY2027 Q1 earnings via an SEC Form 8‑K, providing updated sales, profit, and guidance figures.
Ticker impact
Sysco Corp (NYSE:SYY) filed an 8‑K reporting its FY2027 Q1 results and reaffirmed FY27 adjusted EPS and local volume guidance.
likely modest pressure as the market prices in the reaffirmed guidance and mixed operating income trends
Large‑cap earnings with fresh numbers and guidance are material; the guidance is unchanged, so traders may adjust positions modestly.
Market effects
Foodservice distribution sector may see limited impact as Sysco's results are broadly in line with expectations.
U.S. consumer‑service stocks could see slight adjustments based on Sysco's volume growth data.
Minimal, as the release is company‑specific and does not alter broader macro outlooks.
Counterpoint
If investors expect stronger margin expansion, the modest operating income decline could be seen as a downside catalyst.
Key entities
- companySysco Corp
Foodservice distribution company reporting FY2027 Q1 results.
- executiveKevin Hourican
Chair of the Board and CEO of Sysco, quoted in the release.
