What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-12-02 compared with 2025-06-10 · 129 added, 181 removed, 233 unchanged (57% of the section changed)

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• changes in relationships with our suppliers;

• our ability to operate, and rely on third parties to operate, reliable and secure technology systems, and the effectiveness of our business continuity plans in response to an incident impacting our technology systems, such as the unauthorized incident on our technology systems;

• our ability to develop, implement, operate and maintain, and rely on third parties to operate and maintain, reliable and secure technology systems, and the effectiveness of our business continuity plans in response to an incident impacting our technology systems, such as the unauthorized incident on our technology systems;

• labor and other workforce shortages and challenges;

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• our ability to continue to grow sales, including of our higher margin natural and organic foods and non-food products;

• our ability to maintain sufficient volume in our wholesale distribution and services businesses to support our operating infrastructure;

• our ability to maintain sufficient volume in our Natural and Conventional businesses to support our operating infrastructure;

• our ability to access additional capital;

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• the potential for disruptions in our supply chain or our distribution capabilities from circumstances beyond our control, including due to lack of long-term contracts, severe weather, labor shortages or work stoppages or otherwise;

• the effect of adverse decisions in, or settlement of, litigation or other proceedings to which we are subject;

• moderated supplier promotional activity, including decreased forward buying opportunities;

• union-organizing activities that could cause labor relations difficulties and increased costs;

• changes in tax laws and regulations, and actions by federal, state and local taxing authorities related to the interpretation and application of such tax laws and regulations;

• our ability to maintain food quality and safety;

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UNFI is a leading distributor of grocery and non-food products, and support services provider to retailers in the United States and Canada.

We believe we are uniquely positioned to provide the broadest array of products and services to customers throughout North America.

Our diversified customer base includes over 30,000 customer locations ranging from some of the largest grocers in the country to smaller independents, as well.

We believe we are uniquely positioned to provide the broadest array of products, programs and services to customers throughout North America.

Our diversified customer base includes over 30,000 customer locations ranging from some of the largest grocers in the country to smaller retailers.

We offer approximately 230,000 products consisting of national, regional and private label brands grouped into the following main product categories:

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We plan to continue to pursue new business opportunities with independent retailers that operate diverse formats, regional and national chains, as well as international customers with wide-ranging needs.

Our business is classified into two reportable segments:

Wholesale and Retail;

and also includes a manufacturing division and a branded product line division.

We have introduced and are executing against a new strategy and three-year financial objectives that seek to add value to our customers and suppliers through our portfolio of products, services, programs and insights while improving our efficiency and cash flow.

Our business is classified into three reportable segments:

Natural, Conventional and Retail.

We are executing against the strategy we introduced in October 2024 and three-year financial objectives that seek to add value to our customers and suppliers through our portfolio of products, programs, insights and services while improving our effectiveness, efficiency and cash flow.

To accomplish the latter, we are focused on controllable variables in four key areas:

intensifying and expanding our network optimization;

reducing annual capital spending;

managing annual capital spending;

optimizing our cost structure;

and reducing our net working capital position.

We are nearing finalization of the realignment of our commercial wholesale organization into two product-centered divisions, which is enabling enhanced service to our customers and suppliers.

These two divisions, Conventional Grocery Products and Natural, Organic, Specialty & Fresh Products, each have focused sales teams aligned to the unique product and service needs of their customers and are supported by dedicated functional experts in merchandising, operations, procurement and supplier services.

In addition, capability centers of excellence in areas such as supply chain, professional and digital services, and private brands work across the divisions to help create customized programs to help customers and suppliers accelerate their growth strategies.

We expect to continue to use available capital to re-invest in our business and are committed to improving our free cash flow and financial leverage while reducing outstanding debt.

We believe we can optimize our performance and profitability through our improvement efforts, which we expect will improve our cost structure, increase sales of products and services, and position us to provide tailored, data-driven solutions to help our customers run their businesses more efficiently and contribute to customer acquisitions.

Trends and Other Factors Affecting Our Business

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Wholesale Distribution Network Optimization

We are working to optimize our distribution center network to better and more efficiently service customers and suppliers.

In the first quarter of fiscal 2025, we consolidated the volume of two distribution centers into other facilities in the Central region.

In the second quarter of fiscal 2025, we announced the closure of a third distribution center in the Central region, which was completed in the third quarter of fiscal 2025.

We expect to achieve cost savings as a result of these efforts through streamlining operations and delivering efficiencies, including incurring lower operating and shrink expenses, while also improving product assortment and overall customer experience.

Subsequent to the third quarter of fiscal 2025, we came to a mutual agreement with a customer in the East region to terminate our supply agreement, pursuant to which we served as the primary grocery wholesaler to this customer’s locations in the Northeast.

In connection with this termination, we expect to cease operations at our Allentown, Pennsylvania distribution center in early fiscal 2026 and consolidate the remaining volume into other facilities in the Northeast.

In connection with the termination of our supply agreement with a customer in the East region in fiscal 2025, we ceased operations at our Allentown, Pennsylvania distribution center in the first quarter of fiscal 2026 with the remaining volume consolidated into other facilities in the Northeast.

Business with this customer in the Northeast accounted for approximately $1 billion in annual sales.

The termination enables us to accelerate progress toward our longer-term strategic and three-year financial objectives.

In the first quarter of fiscal 2025, we began operating a new distribution center in Manchester, Pennsylvania, which has approximately 1.3 million square feet, optimizes volume from other nearby distribution centers in the East region and primarily distributes natural products.

In the third quarter of fiscal 2025, we implemented a full case automation system at the Manchester distribution center and are expanding volume through this new solution.

Also in the first quarter of fiscal 2025, we began the development of a new distribution center in Sarasota, Florida, which has approximately 1.0 million square feet.

We recognized a $118 million right-of-use asset and operating lease liability for this distribution center in the first quarter of fiscal 2025.

We expect to begin operating this facility in the first half of fiscal 2026.

We plan to continue to evaluate our distribution center network to further optimize performance and expect to incur incremental expenses related to any future network realignment, expansion or improvements, including network optimization and automation initiatives.

We continue to evaluate our distribution center network to better and more efficiently service customers and suppliers and further optimize performance.

We could incur incremental expenses related to any future network realignment, expansion or improvements, including network optimization and automation initiatives.

We are working to both minimize future costs and obtain new business to further improve the efficiency of our distribution network.

Retail Operations

We currently operate 75 grocery stores, including 53 Cub Foods stores and 22 Shoppers stores.

In addition, we supply another 26 Cub Foods stores operated by our Wholesale customers through franchise and minority equity ownership arrangements.

We operate 80 pharmacies primarily within the stores we operate and the stores of our franchisees.

In addition, we operate 23 “Cub Wine and Spirit” and “Cub Liquor” stores.

We plan to continue to invest in our Retail segment in areas such as customer-facing merchandising initiatives, physical facilities, technology and operational tools.

Cub Foods and Shoppers anticipate continued investment in improving the customer and associate experience through express remodels focused on customer facing elements.

We operated 70 grocery stores, including 53 Cub Foods stores and 17 Shoppers stores, as of November 1, 2025.

In addition, we supplied another 24 Cub Foods stores operated by our wholesale customers through franchise and minority equity ownership arrangements.

We operated 77 pharmacies primarily within the stores we operate and the stores of our franchisees.

In addition, we operated 23 “Cub Wine and Spirit” and “Cub Liquor” stores.

Subsequent to the end of the first quarter of fiscal 2026, we closed four Shoppers stores which were previously announced for closure during the first quarter of fiscal 2026.

We plan to continue to invest in and optimize our Retail segment in areas such as customer-facing merchandising initiatives, physical facilities, technology and operational tools.

Impact of Product Cost Changes

We experienced a mix of inflation and deflation across product categories during the third quarter of fiscal 2025.

In the aggregate across our businesses, including the mix of products, management estimates our businesses experienced product cost inflation of approximately two percent in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024.

We experienced a mix of inflation and deflation across product categories during the first quarter of fiscal 2026.

In the aggregate across our businesses, including the mix of products, management estimates our businesses experienced product cost inflation of approximately three percent in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.

Cost inflation and deflation estimates are based on individual like items sold during the periods being compared.

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Under the last-in, first out (“LIFO”) method of inventory accounting, product cost increases are recognized within Cost of sales based on expected year-end inventory quantities and costs, which generally has the effect of decreasing Gross profit and the carrying value of inventory during periods of inflation.

We continued to experience fewer and less significant vendor product cost increases in the third quarter of fiscal 2025, which negatively impacted our gross profit rate when comparing to the third quarter of fiscal 2024.

Composition of Condensed Consolidated Statements of Operations and Business Performance Assessment

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The following table sets forth a summary of our results of operations and Adjusted EBITDA for the periods indicated.

13-Week Period Ended 39-Week Period Ended

(in millions) May 3, 2025 April 27, 2024 Change May 3, 2025 April 27, 2024 Change

13-Week Period Ended

(in millions) November 1, 2025 November 2, 2024 Change

Net sales $ 7,840 $ 7,871 $ (31)

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The following table reconciles Net loss including noncontrolling interests to Adjusted EBITDA:

13-Week Period Ended 39-Week Period Ended

(in millions) May 3, 2025 April 27, 2024 May 3, 2025 April 27, 2024

13-Week Period Ended

(in millions) November 1, 2025 November 2, 2024

Net loss including noncontrolling interests $ (4) $ (20)

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Net periodic benefit income, excluding service cost

(5) (4) (15) (11)

Interest expense, net 34 36

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Share-based compensation 11 7

LIFO (benefit) charge (5) 6 5 19

LIFO charge 5 7

Restructuring, acquisition and integration related expenses (1)

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Business transformation costs (3)

Cybersecurity incident (4)

Other adjustments (5)

Adjusted EBITDA $ 167 $ 134

(1) Fiscal 2025 primarily includes a $24 million non-cash asset impairment charge related to a distribution center in our East region.

Fiscal 2024 primarily includes a $21 million non-cash asset impairment charge related to one of our corporate-owned office locations and a $7 million non-cash asset impairment charge related to the decision to close certain retail store locations.

(2) Reflects costs associated with business transformation initiatives, primarily including third-party consulting costs and licensing costs, and third-party professional service fees related to the board-led financial review and strategic initiatives, all of which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

(3) Fiscal 2025 primarily reflects certain estimated accrued legal-related costs, which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

Fiscal 2024 primarily reflects third-party professional service fees related to shareholder negotiations, which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

(1) Fiscal 2026 primarily reflects adjustments to previously recorded multiemployer pension plan withdrawal liabilities, distribution center and store closure charges and costs and costs associated with certain employee severance and other employee separation costs.

Fiscal 2025 primarily reflects costs associated with certain employee severance and other employee separation costs.

(2) Fiscal 2026 primarily includes a $10 million non-cash asset impairment charge related to the decision to close certain retail store locations.

(3) Reflects costs associated with business transformation initiatives, primarily including third-party consulting costs and licensing costs, which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

(4) Fiscal 2026 includes costs and charges related to the Cybersecurity Incident, of which $13 million are included within Gross profit and $1 million are included within Operating expenses in the Condensed Consolidated Statements of Operations.

These were partially offset by $10 million of insurance recoveries which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

(5) Fiscal 2026 reflects accrued costs related to an agreement to settle certain legal proceedings, which are included within Operating expenses in the Condensed Consolidated Statements of Operations.

RESULTS OF OPERATIONS

In the second quarter of fiscal 2025, we announced that we are realigning our commercial wholesale organization as discussed in the Executive Overview - Business Overview section above.

We updated our presentation of disaggregated revenue to align with how management evaluates our top-line commercial and financial performance.

Prior period disaggregation of revenue amounts have been recast to conform with our current period presentation.

The following table sets forth Net sales by category for the periods indicated.

Refer to Note 3—Revenue Recognition in Part 1, Item 1 of this Quarterly Report on Form 10-Q for our category definitions and additional information.

The following table sets forth Net sales by segment.

Prior periods have been recast to conform to our current period presentation.

Refer to Note 14—Business Segments in Part 1, Item 1 of this Quarterly Report on Form 10-Q for our category definitions and additional information.

13-Week Period Ended

Increase (Decrease) 39-Week Period Ended

Increase (Decrease)

(in millions, except percentages) May 3,

2025 April 27,

2024 $ % May 3,

2025 April 27,

(in millions, except percentages) November 1,

2025 November 2,

Natural $ 4,240 $ 3,838 $ 402 10.5 %

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Total net sales $ 7,840 $ 7,871 $ (31) (0.4) %

Third Quarter

Our Net sales for the third quarter of fiscal 2025 increased approximately 7.5% from the third quarter of fiscal 2024.

The increase in Net sales was primarily driven by an increase in Natural unit volumes, including new business with existing and new customers, as well as inflation.

Retail Net sales increased primarily due to a 1.5% increase in identical store sales and inflation, partially offset by lower volume and store closures.

Our Net sales for fiscal 2025 year-to-date increased approximately 5.5% from fiscal 2024 year-to-date.

The increase in Net sales was primarily driven by an increase in Natural unit volumes, including new business with existing and new customers, as well as inflation.

Retail Net sales decreased primarily due to a 0.1% decrease in identical store sales from lower volume, and store closures.

Our Net sales for the first quarter of fiscal 2026 decreased approximately 0.4% from the first quarter of fiscal 2025.

The decrease in Net sales was primarily driven by a decrease in unit volumes, partially offset by inflation.

Natural Net sales for the first quarter of fiscal 2026 increased approximately 10.5% from the first quarter of fiscal 2025.

The increase was primarily driven by an increase in unit volumes, including new business with existing and new customers, as well as inflation.

Conventional Net sales for the first quarter of fiscal 2026 decreased approximately 11.7% from the first quarter of fiscal 2025.

The decrease was driven by a decline in unit volumes primarily due to the transition out of our Allentown, Pennsylvania distribution center, partially offset by increases from inflation.

Retail Net sales for the first quarter of fiscal 2026 decreased approximately 5.5% from the first quarter of fiscal 2025.

The decrease was primarily driven by a 3.1% decrease in identical store sales from lower volume, and store closures.

Lower eliminations of Net sales for the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025 were primarily due to a decrease in Conventional to Retail sales, which are eliminated upon consolidation.

Cost of Sales and Gross Profit

Our Gross profit increased $62 million, or 6.1%, to $1,082 million for the third quarter of fiscal 2025, from $1,020 million for the third quarter of fiscal 2024.

Our Gross profit as a percentage of Net sales decreased to 13.4% for the third quarter of fiscal 2025 compared to 13.6% for the third quarter of fiscal 2024.

The LIFO (benefit) charge was $(5) million and $6 million in the third quarters of fiscal 2025 and 2024, respectively.

E xcluding the non-cash LIFO (benefit) charge, gross profit rate was 13.4% of Net sales and 13.7% of Net sales for the third quarter of fiscal 2025 and 2024 , respectively.

The decrease in gross profit rate, excluding the LIFO (benefit) charge, was primarily driven by lower product margin rates and customer and product mix, which were partially offset through supplier programs and the benefit of lower shrink expense.

Our Gross profit increased $107 million, or 3.5%, to $3,192 million for fiscal 2025 year-to-date, from $3,085 million for fiscal 2024 year-to-date.

Our Gross profit as a percentage of Net sales decreased to 13.3% for fiscal 2025 year-to-date compared to 13.5% for fiscal 2024 year-to-date.

The LIFO charge was $5 million and $19 million for fiscal 2025 and 2024 year-to-date, respectively.

E xcluding the non-cash LIFO charge, gross profit rate was 13.3% of Net sales and 13.6% of Net sales for fiscal 2025 and 2024 year-to-date , respectively.

The decrease in gross profit rate, excluding the LIFO charge, was primarily driven by lower product margin rates and customer and product mix, which were partially offset through supplier programs and the benefit of lower shrink expense.

Our Gross profit increased $13 million, or 1.3%, to $1,051 million for the first quarter of fiscal 2026, from $1,038 million for the first quarter of fiscal 2025.

Our Gross profit as a percentage of Net sales increased to 13.4% for the first quarter of fiscal 2026 compared to 13.2% for the first quarter of fiscal 2025.

The increase in gross profit rate of 22 basis points was primarily driven by the positive impact of network optimization and customer mix, the favorable impact of supplier programs and higher levels of procurement gains, which were partially offset by lower product margin rates and $13 million of charges associated with the previously disclosed Cybersecurity Incident.

Operating Expenses

Operating expenses increased $33 million, or 3.3%, to $1,025 million, or 12.7% of Net sales, for the third quarter of fiscal 2025 compared to $992 million, or 13.2% of Net sales, for the third quarter of fiscal 2024.

The decrease in Operating expenses as a percentage of Net sales was primarily driven by the leveraging impact of higher sales and the benefits from cost saving initiatives.

Operating expenses increased $46 million, or 1.5%, to $3,071 million, or 12.7% of Net sales, for fiscal 2025 year-to-date compared to $3,025 million, or 13.3% of Net sales, for fiscal 2024 year-to-date.

The decrease in Operating expenses as a percentage of Net sales was primarily driven by benefits from cost saving initiatives and the leveraging impact of higher sales.

Operating expenses decreased $19 million, or 1.9%, to $996 million, or 12.7% of Net sales, for the first quarter of fiscal 2026 compared to $1,015 million, or 12.9% of Net sales, for the first quarter of fiscal 2025.

The decrease in Operating expenses as a percentage of Net sales was primarily driven by the benefits from cost saving initiatives and a $10 million cybersecurity insurance recovery.

Restructuring, Acquisition and Integration Related Expenses

Restructuring, acquisition and integration related expenses increased $5 million to $14 million for the third quarter of fiscal 2025, compared to $9 million for the third quarter of fiscal 2024.

The increase was primarily driven by increased costs associated with outsourcing certain corporate functions under restructuring initiatives in the third quarter of fiscal 2025.

Restructuring, acquisition and integration related expenses increased $18 million to $35 million for fiscal 2025 year-to-date, compared to $17 million for fiscal 2024 year-to-date.

The increase was primarily driven by increased costs associated with outsourcing certain corporate functions under restructuring initiatives, higher closed property charges and costs and an increase in certain employee severance and other employee separation costs in fiscal 2025 year-to-date.

Restructuring, acquisition and integration related expenses increased $10 million to $22 million for the first quarter of fiscal 2026, compared to $12 million for the first quarter of fiscal 2025.

The increase was primarily driven by an adjustment to previously recorded multiemployer pension plan withdrawal liabilities in the first quarter of fiscal 2026.

Loss on Sale of Assets and Other Asset Charges

Loss on sale of assets and other asset charges increased $15 million to $28 million for the third quarter of fiscal 2025, from $13 million for the third quarter of fiscal 2024.

The third quarter of fiscal 2025 primarily included a $24 million non-cash asset impairment charge related to the Allentown, Pennsylvania distribution center.

The third quarter of fiscal 2024 primarily included a $7 million asset impairment charge related to certain retail store locations.

The third quarters of fiscal 2025 and 2024 included losses on the sales of receivables under the accounts receivable monetization program.

Loss on sale of assets and other asset charges increased $2 million to $39 million for fiscal 2025 year-to-date, from $37 million for fiscal 2024 year-to-date.

Fiscal 2025 year-to-date primarily included a $24 million non-cash asset impairment charge related to the Allentown, Pennsylvania distribution center.

Fiscal 2024 year-to-date primarily included $28 million in asset impairment charges related to one of our corporate-owned office locations and certain retail store locations.

Fiscal 2025 and 2024 year-to-date included losses on the sales of receivables under the accounts receivable monetization program.

Loss on sale of assets and other asset charges increased $8 million to $14 million for the first quarter of fiscal 2026, from $6 million for the first quarter of fiscal 2025.

The first quarter of fiscal 2026 primarily included a $10 million non-cash asset impairment charge related to the decision to close certain retail store locations, while there were no asset impairment charges in the first quarter of fiscal 2025.

The first quarters of fiscal 2026 and 2025 included losses on the sales of receivables under the accounts receivable monetization program.

Operating Income

Reflecting the factors described above, Operating income increased $9 million to $15 million for the third quarter of fiscal 2025, compared to Operating income of $6 million for the third quarter of fiscal 2024.

The increase in Operating income was primarily driven by an increase in Gross profit, partially offset by an increase in Operating expenses, Loss on sale of asset and other asset charges and Restructuring, acquisition and integration related expenses in the third quarter of fiscal 2025, each as described above.

Reflecting the factors described above, Operating income increased $41 million to $47 million for fiscal 2025 year-to-date, compared to Operating income of $6 million for fiscal 2024 year-to-date.

The increase in Operating income was primarily driven by an increase in Gross profit, partially offset by an increase in Operating expenses, Restructuring, acquisition and integration related expenses and Loss on sale of assets and other asset charges in fiscal 2025 year-to-date, each as described above.

Reflecting the factors described above, Operating income increased $14 million to $19 million for the first quarter of fiscal 2026, compared to Operating income of $5 million for the first quarter of fiscal 2025.

The increase in Operating income was primarily driven by a decrease in Operating expenses and an increase in Gross profit, partially offset by an increase in Restructuring, acquisition and integration related expenses and Loss on sale of asset and other asset charges and in the first quarter of fiscal 2026, each as described above.

Interest Expense, Net

13-Week Period Ended 39-Week Period Ended

(in millions) May 3, 2025 April 27, 2024 May 3, 2025 April 27, 2024

13-Week Period Ended

(in millions) November 1, 2025 November 2, 2024

Interest expense on long-term debt, net of capitalized interest $ 32 $ 35

Interest expense on finance lease obligations — 1 1 2

Amortization of financing costs and discounts 2 2

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Interest expense, net $ 34 $ 36

The decrease in interest expense, net, in the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 was primarily driven by lower outstanding debt balances.

The decrease in interest expense, net, in fiscal 2025 year-to-date compared to fiscal 2024 year-to-date was primarily driven by lower outstanding debt balances.

The decrease in interest expense, net, in the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was primarily driven by lower outstanding long-term debt balances.

Benefit for Income Taxes

The effective tax rate for the third quarter of fiscal 2025 was a benefit rate of 56.3% on pre-tax loss compared to a benefit rate of 23.1% on pre-tax loss for the third quarter of fiscal 2024.

The change from the third quarter of fiscal 2024 is primarily driven by the impact of a partnership investment entered into in the third quarter of fiscal 2025 as well as a discrete tax benefit recorded in the third quarter of fiscal 2025 for return to provision tax credits, combined with a reduction in pre-tax loss.

The effective tax rate for fiscal 2025 year-to-date was a benefit rate of 35.6% on pre-tax loss compared to a benefit rate of 21.5% on pre-tax loss for fiscal 2024 year-to-date.

The change from fiscal 2024 year-to-date is primarily driven by the impact of a partnership investment entered into in the third quarter of fiscal 2025 combined with a reduction in pre-tax loss.

The effective tax rate for the first quarter of fiscal 2026 was a benefit rate of 55.6% on pre-tax loss compared to a benefit rate of 16.7% on pre-tax loss for the first quarter of fiscal 2025.

The change from the first quarter of fiscal 2025 is primarily driven by discrete tax benefits from favorable tax audit settlements and employee stock awards in the first quarter of fiscal 2026, as well as the tax credit benefit of a solar array that was placed in service during the first quarter of fiscal 2026.

Net Loss Attributable to United Natural Foods, Inc.

Reflecting the factors described in more detail above, Net loss attributable to United Natural Foods, Inc.

was $7 million, or $0.12 per diluted common share, for the third quarter of fiscal 2025, compared to Net loss attributable to United Natural Foods, Inc.

of $21 million, or $0.34 per diluted common share, for the third quarter of fiscal 2024.

Reflecting the factors described in more detail above, Net loss attributable to United Natural Foods, Inc.

was $31 million, or $0.51 per diluted common share, for fiscal 2025 year-to-date, compared to Net loss attributable to United Natural Foods, Inc.

of $75 million, or $1.26 per diluted common share, for fiscal 2024 year-to-date.

Segment Results of Operations

In evaluating financial performance in each business segment, management primarily uses Net sales and Adjusted EBITDA of its business segments as discussed and reconciled within Note 13—Business Segments within Part I, Item 1 of this Quarterly Report on Form 10-Q and the above table within the Executive Overview section.

The following tables set forth Net sales and Adjusted EBITDA by segment for the periods indicated.

13-Week Period Ended 39-Week Period Ended

(in millions) May 3, 2025 April 27, 2024 Change May 3, 2025 April 27, 2024 Change

Wholesale $ 7,776 $ 7,236 $ 540 $ 23,238 $ 22,004 $ 1,234

Retail 573 571 2 1,769 1,808 (39)

Other 56 50 6 167 162 5

Eliminations (346) (359) 13 (1,086) (1,149) 63

Total Net sales $ 8,059 $ 7,498 $ 561 $ 24,088 $ 22,825 $ 1,263

was $4 million, or $0.06 per diluted common share, for the first quarter of fiscal 2026, compared to Net loss attributable to United Natural Foods, Inc.

of $21 million, or $0.35 per diluted common share, for the first quarter of fiscal 2025.

Adjusted EBITDA

Wholesale $ 158 $ 125 $ 33 $ 425 $ 360 $ 65

The following table sets forth Adjusted EBITDA by segment for the periods indicated.

Prior periods have been recast to conform to our current period presentation.

Refer to Note 14—Business Segments within Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

13-Week Period Ended

(in millions) November 1, 2025 November 2, 2024 Increase (Decrease)

Natural $ 127 $ 102 $ 25

Conventional 70 45 25

Retail (9) 1 (10)

Other (3) 7 (10) 3 14 (11)

Eliminations 1 1 — 1 (3) 4

Corporate and Other (21) (14) (7)

Total Adjusted EBITDA $ 167 $ 134 $ 33

Third Quarter

Wholesale’s Net sales increased in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024 primarily due to a 4% increase in unit volumes, including new business with existing and new customers, as well as inflation, as discussed in Results of Operations - Net Sales section above.

Retail’s Net sales increased in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024 primarily due to a 1.5% increase in identical store sales and inflation, partially offset by lower volume and store closures.

Lower eliminations of Net sales in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024 were primarily due to a decrease in Wholesale to Retail sales, which are eliminated upon consolidation.

Wholesale’s Net sales increased for fiscal 2025 year-to-date as compared to fiscal 2024 year-to-date primarily due to an increase in unit volumes, including new business with existing and new customers, as well as inflation, as discussed in Results of Operations - Net Sales section above.

Retail’s Net sales decreased for fiscal 2025 year-to-date as compared to fiscal 2024 year-to-date primarily due to a 0.1% decrease in identical store sales from lower volume, and store closures.

Lower eliminations of Net sales for fiscal 2025 year-to-date as compared to fiscal 2024 year-to-date were primarily due to a decrease in Wholesale to Retail sales, which are eliminated upon consolidation.

Adjusted EBITDA

Third Quarter

Wholesale’s Adjusted EBITDA increased $33 million, or 26.4%, for the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024.

The increase was driven by gross profit growth excluding the LIFO (benefit) charge, partially offset by an increase in operating expenses.

Wholesale’s Gross profit excluding the LIFO (benefit) charge for the third quarter of fiscal 2025 increased $50 million and gross profit rate decreased approximately 19 basis points driven primarily by lower product margin rates and customer and product mix, which were partially offset through supplier programs and the benefit of lower shrink expense.

Wholesale’s Operating expense increased $17 million, which excludes depreciation and amortization, share-based compensation and other adjustments as outlined in Note 13—Business Segments.

Wholesale’s operating expense rate decreased 50 basis points primarily due to benefits from cost saving initiatives and the leveraging impact of higher sales.

Retail’s Adjusted EBITDA increased $4 million for the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024.

The increase was driven primarily by lower operating expenses from operating efficiencies.

Retail’s Adjusted EBITDA excludes depreciation and amortization, share-based compensation, LIFO charge and other adjustments as outlined in Note 13—Business Segments.

Wholesale’s Adjusted EBITDA increased $65 million, or 18.1%, for fiscal 2025 year-to-date as compared to fiscal 2024 year-to-date.

The increase was driven by gross profit growth excluding the LIFO charge, partially offset by an increase in operating expenses.

Wholesale’s Gross profit excluding the LIFO charge for fiscal 2025 year-to-date increased $96 million and gross profit rate decreased approximately 22 basis points driven primarily by lower product margin rates and customer and product mix, which were partially offset through supplier programs and the benefit of lower shrink expense.

Wholesale’s Operating expense increased $31 million, which excludes depreciation and amortization, share-based compensation and other adjustments as outlined in Note 13—Business Segments.

Wholesale’s operating expense rate decreased 42 basis points primarily due to benefits from cost saving initiatives and the leveraging impact of higher sales.

Retail’s Adjusted EBITDA increased $3 million, or 75.0%, for fiscal 2025 year-to-date as compared to fiscal 2024 year-to-date.

The increase was driven primarily by lower operating expenses from operating efficiencies, which was largely offset by a decline in gross profit primarily due to lower sales volume and store closures.

Retail’s Adjusted EBITDA excludes depreciation and amortization, share-based compensation, LIFO charge and other adjustments as outlined in Note 13—Business Segments.

Natural Adjusted EBITDA increased $25 million, or 24.5%, for the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.

The increase was driven by an increase in gross profit excluding the LIFO charge and other adjustments as outlined in Note 14—Business Segments, partially offset by an increase in operating expenses.

• Natural Gross profit, which excludes the LIFO charge and other adjustments as outlined in Note 14—Business Segments, increased $48 million.

Natural gross profit rate decreased approximately 17 basis points driven primarily by lower product margin rates and customer and product mix, which were partially offset through supplier programs and higher levels of procurement gains.

• Natural Operating expense, which excludes depreciation and amortization, share-based compensation and other adjustments as outlined in Note 14—Business Segments, increased $23 million.

Natural operating expense rate decreased approximately 50 basis points primarily due to the leveraging impact of higher sales and the benefits from cost saving initiatives, partially offset by increases in bad debt expense and costs associated with union and other employee benefits.

Conventional Adjusted EBITDA increased $25 million, or 55.6%, for the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.

The increase was driven by a decrease in operating expenses, partially offset by a decrease in gross profit excluding the LIFO charge and other adjustments as outlined in Note 14—Business Segments.

• Conventional Gross profit, which excludes the LIFO charge and other adjustments as outlined in Note 14—Business Segments, decreased $10 million.

Conventional gross profit rate increased approximately 105 basis points driven primarily by customer mix, higher levels of procurement gains and recoveries related to settlements with customers and suppliers in the first quarter of fiscal 2026.

• Conventional Operating expense, which excludes depreciation and amortization, share-based compensation and other adjustments as outlined in Note 14—Business Segments, decreased $35 million.

Conventional operating expense rate increased approximately 14 basis points primarily due to the deleveraging impact of lower sales on fixed costs, partially offset by benefits from cost saving initiatives.

Retail Adjusted EBITDA decreased $10 million for the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.

The decrease was driven by a decrease in gross profit excluding the LIFO charge, partially offset by a decrease in operating expenses.

• Retail Gross profit, which excludes the LIFO charge and other adjustments as outlined in Note 14—Business Segments, decreased $14 million.

Retail gross profit rate decreased approximately 107 basis points driven primarily by lower sales volume and changes in category mix.

• Retail Operating expense, which excludes depreciation and amortization, share-based compensation and other adjustments as outlined in Note 14—Business Segments, decreased $4 million.

Retail operating expense rate increased approximately 73 basis points primarily due to the deleveraging impact of lower sales, partially offset by lower labor costs from operating efficiencies.

LIQUIDITY AND CAPITAL RESOURCES

• Total liquidity as of May 3, 2025 was $1,494 million and consisted of the following:

◦ $1,442 million of unused credit under our asset-based revolving credit facility (the “ABL Credit Facility”), which increased $207 million from $1,235 million as of August 3, 2024, primarily due to a reduction of net borrowings under the ABL Credit Facility and an increase in the borrowing base;

◦ $52 million of cash and cash equivalents, which increased $12 million from $40 million as of August 3, 2024.

• Total debt decreased $123 million to $1,962 million as of May 3, 2025 from $2,085 million as of August 3, 2024, primarily related to a reduction in net borrowings under the ABL Credit Facility due to net cash provided by operating activities, partially offset by payments for capital expenditures.

• Working capital decreased $36 million to $1,001 million as of May 3, 2025 from $1,037 million as of August 3, 2024, primarily due to an increase in accounts payable to support higher purchasing levels and a decrease in prepaid expenses and other current assets, partially offset by increases in accounts receivable from higher sales.

• Subsequent to the third quarter of fiscal 2025, on May 5, 2025, we made a voluntary prepayment of $100 million on the Term Loan Facility funded with incremental borrowings under the ABL Credit Facility.

• In connection with the contract termination described in Note 15—Subsequent Events, we expect to pay $53 million in installment payments over a transition period commencing in the fourth quarter of fiscal 2025 and ending in the first quarter of fiscal 2026.

• Total liquidity as of November 1, 2025 was $1,327 million and consisted of the following:

◦ $1,289 million of unused credit under our asset-based revolving credit facility (the “ABL Credit Facility”), which decreased $164 million from $1,453 million as of August 2, 2025, primarily due to increased cash utilized to fund seasonal working capital increases and a reduction in the borrowing base;

◦ $38 million of cash and cash equivalents, which decreased $6 million from $44 million as of August 2, 2025.

• Total debt increased $58 million to $1,920 million as of November 1, 2025 from $1,862 million as of August 2, 2025, primarily related to an increase in net borrowings under the ABL Credit Facility due to net cash used in operating activities and payments for capital expenditures.

• Working capital increased $148 million to $969 million as of November 1, 2025 from $821 million as of August 2, 2025, primarily due to a seasonal increase in inventory levels combined with a decrease in accrued compensation and benefits, partially offset by a decrease in accounts receivable and an increase in accounts payable to support higher inventory levels.

• In connection with the contract termination described further in Note 4—Restructuring, Acquisition and Integration Related Expenses, we paid the remaining installments totaling $35 million in the first quarter of fiscal 2026.

Sources and Uses of Cash

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We currently do not pay a dividend on our common stock.

In addition, we are limited in the aggregate amount of dividends that we may pay under the terms of our senior secured first lien term loan (the “Term Loan Facility”), ABL Credit Facility and our $500 million of unsecured 6.750% senior notes due October 15, 2028 (the “Senior Notes”).

In addition, we are limited in the aggregate amount of dividends that we may pay under the terms of our Term Loan Facility, ABL Credit Facility and our $500 million of unsecured 6.750% senior notes due October 15, 2028 (the “Senior Notes”).

Subject to certain limitations contained in our debt agreements and as market conditions warrant, we may from time to time refinance indebtedness that we have incurred, including through the incurrence or repayment of loans under existing or new credit facilities or the issuance or repayment of debt securities.

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Long-Term Debt

During fiscal 2025 year-to-date, we reduced borrowings by a net $121 million under the ABL Credit Facility.

During the first quarter of fiscal 2026, we borrowed a net $58 million under the ABL Credit Facility.

Refer to Note 9—Long-Term Debt in Part I, Item 1 of this Quarterly Report on Form 10-Q for a detailed discussion of the provisions of our credit facilities and certain long-term debt agreements and additional information.

Our term loan agreement dated as of October 22, 2018 (as amended, the “Term Loan Agreement”) and our Senior Notes do not include any financial maintenance covenants.

Our revolving credit agreement dated as of June 3, 2022 (as amended, the “ABL Loan Agreement”) subjects us to a fixed charge coverage ratio of at least 1.0 to 1.0 calculated at the end of each of our fiscal quarters on a rolling four quarter basis, if the adjusted aggregate availability is ever less than the greater of (i) $220 million, or $210 million if no ABL FILO Loans are then outstanding at such time, and (ii) 10% of the aggregate borrowing base.

Our Term Loan Agreement and Senior Notes do not include any financial maintenance covenants.

Our ABL Loan Agreement subjects us to a fixed charge coverage ratio of at least 1.0 to 1.0 calculated at the end of each of our fiscal quarters on a rolling four quarter basis, if the adjusted aggregate availability is ever less than the greater of (i) $220 million, or $210 million if no ABL FILO Loans are then outstanding at such time and (ii) 10% of the aggregate borrowing base.

We have not been subject to the fixed charge coverage ratio covenant under the ABL Loan Agreement, including through the filing date of this Quarterly Report on Form 10-Q.

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If we fail to comply with any of these covenants, we may be in default under the applicable debt agreement, and all amounts due thereunder may become immediately due and payable.

The potential amount of prepayment under the Term Loan Facility from Excess Cash Flow (as defined in the Term Loan Agreement) in fiscal 2025 that may be required in fiscal 2026 is not reasonably estimable as of May 3, 2025.

The potential amount of prepayment under the Term Loan Facility from Excess Cash Flow (as defined in the Term Loan Agreement) in fiscal 2026 that may be required in fiscal 2027 is not reasonably estimable as of November 1, 2025.

Derivatives and Hedging Activity

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Interest rate swap contracts are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those exposures.

As of May 3, 2025, we had an aggregate of $750 million of floating rate notional debt subject to active interest rate swap contracts, which effectively fix the Secured Overnight Financing Rate (“SOFR”) component of our floating interest payments through pay fixed and receive floating interest rate swap agreements.

As of November 1, 2025, we had an aggregate of $550 million of floating rate notional debt subject to active interest rate swap contracts, which effectively fix the Secured Overnight Financing Rate (“SOFR”) component of our floating interest payments through pay fixed and receive floating interest rate swap agreements.

These fixed rates range from 3.597% to 4.130%, with maturities between October 2026 and June 2028.

The fair values of these interest rate derivatives represent a total net liability of $1 million as of May 3, 2025, and are subject to volatility based on changes in market interest rates.

The fair values of these interest rate derivatives represent a total net liability of $3 million as of November 1, 2025, and are subject to volatility based on changes in market interest rates.

From time to time, we enter into fixed price fuel supply agreements and foreign currency hedges.

As of May 3, 2025, we had fixed price fuel contracts and foreign currency forward agreements outstanding.

As of November 1, 2025, we had fixed price fuel contracts and foreign currency forward agreements outstanding.

Gains and losses and the outstanding assets and liabilities from these arrangements are insignificant.

Payments for Capital Expenditures and Cloud Technology Implementation Expenditures

Our capital expenditures for fiscal 2025 year-to-date were $157 million compared to $217 million for fiscal 2024 year-to-date, a decrease of $60 million.

Our capital spending for fiscal 2025 and 2024 year-to-date principally included supply chain and information technology expenditures, including investments in growth initiatives and maintenance expenditures.

Cloud technology implementation expenditures, which are included in operating activities in the Condensed Consolidated Statements of Cash Flows, were $6 million for fiscal 2025 year-to-date compared to $28 million for fiscal 2024 year-to-date.

Fiscal 2025 capital and cloud implementation spending is expected to be approximately $300 million and include projects that automate, optimize and expand our distribution network, as well as our technology platform investments.

Our capital expenditures for the first quarter of fiscal 2026 were $16 million compared to $49 million for the first quarter of fiscal 2025, a decrease of $33 million.

Our capital spending for the first quarter of fiscal 2026 and 2025 principally included supply chain and information technology expenditures, including maintenance expenditures and investments in growth initiatives.

Cloud technology implementation expenditures, which are included in operating activities in the Condensed Consolidated Statements of Cash Flows, were $1 million for the first quarter of fiscal 2026 compared to $4 million for the first quarter of fiscal 2025.

Fiscal 2026 capital and cloud implementation spending is expected to be approximately $250 million and include technology platform investments and projects that automate and optimize our distribution network.

The components of capital and cloud implementation expenditures for fiscal 2026 will be primarily dependent on the nature of certain contracts to be executed.

The timing of capital and cloud implementation spending is expected to vary based on a number of factors such as project execution milestones, which can result in fluctuations in cash outflows that are not necessarily indicative of future trends.

We expect to finance fiscal 2026 capital and cloud implementation expenditures requirements with cash generated from operations and borrowings under our ABL Credit Facility.

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13-Week Period Ended

(in millions) May 3, 2025 April 27, 2024 Change

Net cash provided by operating activities

(in millions) November 1, 2025 November 2, 2024 Change

Net cash used in operating activities

$ (38) $ (110) $ 72

Net cash used in investing activities

(153) (226) 73

Net cash (used in) provided by financing activities

(145) 174 (319)

Effect of exchange rate on cash — — —

Net increase in cash and cash equivalents

Net cash provided by financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents, at beginning of period 44 40 4

Cash and cash equivalents, at end of period $ 38 $ 37 $ 1

The increase in net cash provided by operating activities in fiscal 2025 year-to-date compared to fiscal 2024 year-to-date was primarily due to lower levels of cash utilized in net working capital.

The decrease in net cash used in investing activities in fiscal 2025 year-to-date compared to fiscal 2024 year-to-date was primarily due to lower payments for capital expenditures and for investments in fiscal 2025 year-to-date.

The increase in net cash used in financing activities in fiscal 2025 year-to-date compared to fiscal 2024 year-to-date was primarily due to an increase in net repayments of borrowings under the ABL Credit Facility resulting from the increase in net cash provided by operating activities and the decrease in net cash used in investing activities, as described above.

The decrease in net cash used in operating activities for the first quarter of 2026 compared to the first quarter of fiscal 2025 was primarily due to lower levels of cash utilized in net working capital, including lower inventory and receivable levels compared to the first quarter of fiscal 2025.

These decreases were partially offset by lower levels of cash generated by an increase in Accounts payable due to the lower inventory levels in the first quarter of fiscal 2026 and payments related to the contract termination described further in Note 4—Restructuring, Acquisition and Integration Related Expenses in the first quarter of fiscal 2026.

The decrease in net cash used in investing activities was primarily due to lower payments for capital expenditures in the first quarter of fiscal 2026.

The decrease in net cash provided by financing activities for the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was primarily due to a decrease in net borrowings under the ABL Credit Facility resulting from the decreases in net cash used in operating activities and investing activities, as described above.

Other Obligations and Commitments

Our principal contractual obligations and commitments consist of obligations under our long-term debt, interest on long-term debt, operating and finance leases, purchase obligations, self-insurance liabilities and multiemployer plan withdrawal liabilities.

Except as otherwise disclosed in Note 15—Subsequent Events, Note 14—Commitments, Contingencies and Off-Balance Sheet Arrangements and Note 8—Long-Term Debt, there have been no material changes in our contractual obligations since the end of fiscal 2024.

Except as otherwise disclosed in Note 15—Commitments, Contingencies and Off-Balance Sheet Arrangements and Note 9—Long-Term Debt, there have been no material changes in our contractual obligations since the end of fiscal 2025.

Refer to Item 7 of the Annual Report for additional information regarding our contractual obligations.

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Retirement Plan under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

An insignificant amount of contributions are expected to be made to other defined benefit pension plans and postretirement benefit plans in fiscal 2025.

An insignificant amount of contributions is expected to be made to other defined benefit pension plans and postretirement benefit plans in fiscal 2026.

We fund our tax-qualified defined benefit pension plan based on the minimum contribution required under ERISA, the Pension Protection Act of 2006 and other applicable laws and additional contributions made at our discretion.

We may accelerate contributions or undertake contributions in excess of the minimum requirements from time to time subject to the availability of cash in excess of operating and financing needs or other factors as may be applicable.

We assess the relative attractiveness of the use of cash to accelerate contributions considering such factors as expected return on assets, discount rates, cost of debt, reducing or eliminating required Pension Benefit Guaranty Corporation variable rate premiums or in order to achieve exemption from participant notices of underfunding.

We assess the relative attractiveness of the use of cash to accelerate contributions considering such factors as expected return on assets, discount rates, cost of debt, reducing or eliminating required Pension Benefit Guaranty Corporation variable rate premiums or the ability to achieve exemption from participant notices of underfunding.

Off-Balance Sheet Multiemployer Pension Arrangements

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The benefits are paid from assets held in trust for that purpose.

Plan trustees typically are responsible for determining the level of benefits to be provided to participants as well as the investment of the assets and plan administration.

Trustees are appointed in equal number by employers and unions that are parties to the relevant collective bargaining agreements.

Plan trustees are typically responsible for determining the level of benefits to be provided to participants as well as the investment of the assets and plan administration.

Trustees are appointed in equal number by employers and the unions that are parties to the relevant collective bargaining agreements.

Based on the assessment of the most recent information available from the multiemployer plans, we believe that most of the plans to which we contribute are underfunded.

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However, the amount of any increase or decrease in contributions will depend on a variety of factors, including the results of our collective bargaining efforts, investment returns on the assets held in the plans, actions taken by the trustees who manage the plans and requirements under the Pension Protection Act of 2006, the Multiemployer Pension Reform Act and Section 412 of the Internal Revenue Code.

Furthermore, if we were to significantly reduce contributions, exit certain markets or otherwise cease making contributions to these plans, we could trigger a partial or complete withdrawal that could require us to record a withdrawal liability obligation and make withdrawal liability payments to the fund.

Expense is recognized in connection with these plans as contributions are funded, in accordance with GAAP.

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In fiscal 2026, we expect to contribute approximately $50 million to multiemployer plans, subject to the outcome of collective bargaining and capital market conditions.

If we were to significantly reduce contributions, exit certain markets or otherwise cease making contributions to these plans, we could trigger a partial or complete withdrawal that could require us to record a withdrawal liability obligation and make withdrawal liability payments to the fund.

We expect required cash payments to fund multiemployer pension plans from which we have withdrawn to be insignificant in any one fiscal year, which would exclude any payments that may be agreed to on a lump sum basis to satisfy existing withdrawal liabilities.

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In September 2022, our Board of Directors authorized a repurchase program for up to $200 million of our common stock over a term of four years (the “2022 Repurchase Program”).

We did not repurchase any shares of our common stock in fiscal 2025 year-to-date.

As of May 3, 2025, we had $138 million remaining authorized under the 2022 Repurchase Program.

As of November 1, 2025, we had $138 million remaining authorized under the 2022 Repurchase Program.

We did not repurchase any shares of our common stock in the first quarter of fiscal 2026.

We will manage the timing of any repurchases of our common stock in response to market conditions and other relevant factors, including any limitations on our ability to make repurchases under the terms of our ABL Credit Facility, Term Loan Facility and Senior Notes.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis