Sysco Posts 3.3% Volume Growth and Raises EPS Outlook to $4.60
Sysco delivered 3.3% U.S. local volume growth in Q3, driving $20.5 billion revenue and absorbing a $63 million incentive headwind that cut EPS by $0.10. It raised full-year adjusted EPS guidance to the high end of $4.50–$4.60, sees 2.5% Q4 volume growth and plans Restaurant Depot close in Q3 FY27.
1. Q3 Financial Results
Sysco reported third-quarter sales of $20.5 billion, up 4.7% year-over-year, driven by 3.3% U.S. local case volume growth—the strongest in over three years. Adjusted EPS was $0.94, down 2.1% after absorbing a $63 million incentive compensation headwind that cut EPS by $0.10, while gross margin expanded 31 basis points to 18.6%.
2. Outlook and Guidance
Management reiterated full-year fiscal 2026 adjusted EPS guidance at the high end of $4.50 to $4.60, assuming sustained volume momentum. The company forecasts at least 2.5% U.S. local volume growth in Q4, representing a 120-basis-point acceleration on a two-year stack basis.
3. Restaurant Depot Acquisition and Capital Allocation
Sysco plans to close the Jetro Restaurant Depot acquisition by Q3 fiscal 2027, targeting 5–6 net new stores annually over the next 25 years. To fund the deal, it suspended the remaining $800 million in share repurchases, identified $60 million in run-rate cost savings and expects $250 million in net synergies, while aiming to cut leverage from 4.5x to 3.5x within 24 months post-close.