US Foods (NYSE:USFD) executives said fiscal 2025 results came in ahead of the company’s long-range plan expectations, with management pointing to market share gains in key customer types, operational productivity initiatives, and disciplined capital allocation as major contributors despite a “softer macro environment.”
Fiscal 2025 performance and strategic progress
Chief Executive Officer Dave Flitman said the company’s fiscal 2025 earnings “exceeded the long range plan” outlined at its June 2024 Investor Day. For the full year, US Foods reported adjusted EBITDA growth of 11% to a record of more than $1.9 billion, adjusted EBITDA margin expansion of 30 basis points to 4.9%, and record adjusted diluted EPS of $3.98, up 26% year over year. Flitman noted adjusted EPS growth outpaced EBITDA growth, which management attributed in part to share repurchases.
On technology, Flitman said US Foods expanded capabilities on its MOXĒ platform, including AI-driven ordering features that allow customers and sellers to upload photos, PDFs, and handwritten notes and translate them into orders.
Industry backdrop and customer trends
Flitman said chain restaurant foot traffic, citing Black Box, fell 2.8% in the fourth quarter and decelerated versus the third quarter. He attributed demand headwinds to the government shutdown, winter storms in December, and pressure on lower-income and younger consumers. US Foods’ chain business was down approximately 3.4% in the quarter, which management said was broadly in line with the industry.
Despite a challenging fourth-quarter traffic environment, Flitman said independent restaurant case volume grew 4.1%, accelerating from the third quarter and marking the company’s 19th consecutive quarter of share gains in that customer type. He also said net new independent accounts increased approximately 4.7% year over year in the quarter, which he characterized as the strongest net new independent account growth of the year and the best performance since the second quarter of 2023.
Healthcare and hospitality, which management said together account for more than 25% of sales, grew 2.9% and 3.1%, respectively, in the fourth quarter. Flitman said the company posted its 21st consecutive quarter of share gains in healthcare.
Management said early fiscal 2026 volume was strong in January before widespread storms and weather-related closures in late January and early February, which affected both customers and distribution centers. The Southeast was described as the company’s largest region and a focal point for disruption.
Fourth-quarter results: margin expansion and leverage
Chief Financial Officer Dirk Locascio said fourth-quarter net sales increased 3.3% to $9.8 billion, driven by total case volume growth of 0.8% and a 2.5% impact from food cost inflation and mix. Excluding the Freshway divestiture, total case growth was 1.2%.
Locascio said adjusted EBITDA rose 11% to $490 million, and adjusted EBITDA margin expanded 35 basis points to 5%. Adjusted diluted EPS increased 24% to $1.04.
On per-case trends, Locascio said adjusted gross profit per case increased $0.23, or 2.9%, in the fourth quarter, while adjusted operating expenses per case increased $0.02, or 0.3%. He said adjusted EBITDA per case increased $0.22 to $2.34. For the full year, Locascio said adjusted gross profit per case grew 180 basis points faster than adjusted operating expenses per case, above the company’s 100–150 basis point annual target discussed as part of its long-range plan.
Capital allocation: buybacks, tuck-in deals, leverage, and credit
Locascio said US Foods generated nearly $1.4 billion in operating cash flow during fiscal 2025 and invested $410 million in cash capital expenditures. The company repurchased 11.9 million shares for $934 million and completed two tuck-in acquisitions totaling $131 million. US Foods ended the year with net leverage of 2.7x, within its stated 2–3x target range, and Locascio said Moody’s upgraded the company’s corporate credit rating by one notch to Ba1.
Management reiterated that its M&A strategy remains focused on tuck-in acquisitions to add local density and improve distribution efficiency rather than pursuing large-scale deals. Executives also emphasized flexibility to toggle between acquisitions and share repurchases depending on opportunity.
Fiscal 2026 outlook and key initiatives
Locascio said fiscal 2026 includes a 53rd week, expected to add approximately 1% to total case growth and adjusted EBITDA growth, and that this is included in the company’s guidance. US Foods guided to:
- Net sales growth: 4% to 6%
- Total case growth: 2.5% to 4.5%
- Independent case growth: 4% to 7%
- Adjusted EBITDA growth: 9% to 13%
- Adjusted diluted EPS growth: 18% to 24%
The company expects a lower inflationary environment than much of 2025, with sales inflation and mix impact of approximately 1.5%. Executives said the midpoint of the outlook assumes macro conditions remain largely unchanged.
For the first quarter, Locascio said weather-related disruption is expected to pressure results, with first-quarter adjusted EBITDA anticipated to grow at an “upper single-digit” rate year over year. Management said it still expects to achieve full-year guidance despite the early-year impact.
Among growth initiatives, Flitman said Pronto, the company’s small truck delivery service, generated more than $1 billion in sales in 2025 and is live in 46 markets, with plans to launch in 10–15 additional markets in 2026. Pronto Next Day is live in 24 markets and expected to add approximately 10 more markets in 2026. In response to a question, Flitman said Pronto and Pronto Next Day have driven “meaningful” uplift in participating markets, typically at “double-digit levels” for customers, while the company monitors for broadline cannibalization.
Flitman also detailed the company’s planned transition to a 100% variable compensation structure for its local sales force, with a mid-year launch and an individualized “click down” approach that could take 2–3 years for the majority of sellers to transition. He said feedback from pilots has been positive and noted that turnover among experienced seller cohorts has improved since the company began discussing the change.
About US Foods (NYSE:USFD)
US Foods (NYSE: USFD) is a leading foodservice distributor in the United States that supplies a wide range of products and services to professional food operators. The company provides fresh, frozen and dry food items as well as non-food restaurant supplies and kitchen equipment. Its customer base includes independent restaurants, multi-unit chains, healthcare and senior living facilities, hospitality businesses, government and educational institutions, and other foodservice operators.
Beyond commodity and branded food products, US Foods offers value-added solutions designed to help customers run their businesses.
