Sysco Raises Annual Profit Forecast Due to Strong U.S. Performance

• Sysco reported quarterly adjusted profit of 99 cents per share and net sales of $20.76 billion, with U.S. foodservice segment sales up 2.4% versus 1.4% a year earlier
• The company achieved positive 1.2% local case volume growth in the quarter, marking its third consecutive quarter of improving growth
• International business outperformed with sales rising 7.3% and gross margin expanding 42 basis points to 20.8%, while overall quarterly gross margin expanded 15 basis points to 18.3%

Sysco Raises Annual Profit Forecast on Strong U.S. Demand

Key Developments:

Food distributor Sysco Corporation raised its fiscal 2026 profit forecast and exceeded second-quarter earnings expectations, driven by robust demand for steaks, fillets, and frozen foods in its U.S. operations.

Financial Performance:

• Quarterly adjusted profit: $0.99 per share (beat estimates)
• Net sales: $20.76 billion (met analyst expectations)
• Quarterly gross margin: expanded 15 basis points to 18.3%
• U.S. foodservice segment sales: up 2.4% versus 1.4% year-over-year growth previously

Business Highlights:

Sysco, which supplies major chains including KFC and Subway, achieved positive U.S. foodservice local case volume growth of 1.2% in the quarter ended December 27—marking the third consecutive quarter of sequential improvement. CEO Kevin Hourican emphasized this milestone as particularly significant for the company's recovery trajectory.

The international business segment continued outperforming, with sales rising 7.3% and gross margin expanding 42 basis points to 20.8%.

Market Context:

Strong restaurant traffic from higher-income Americans bolstered demand despite lower-income households growing cautious amid trade policy uncertainty under the Trump administration. Sysco has implemented cost-cutting measures including reduced shipping expenses, renegotiated supplier contracts, and tightened warehouse/inventory spending to offset rising input costs.

Market Implications:

The raised guidance signals confidence in sustained recovery within the foodservice distribution sector, particularly as restaurants experience continued patronage from affluent consumers. The company's ability to expand margins while managing costs demonstrates operational resilience amid economic headwinds affecting lower-income segments.