What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-06 compared with 2026-05-07 · 101 added, 50 removed, 210 unchanged (42% of the section changed)

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Information regarding reconciliations of and the rationale for these measures is discussed under “Non-GAAP Reconciliations” below.

Results of operations for the 13 weeks ended March 28, 2026 are compared to the 13 weeks ended March 29, 2025, unless specifically noted otherwise.

Results of operations for the 13 weeks and 26 weeks ended June 27, 2026 are compared to the 13 weeks and 26 weeks ended June 28, 2025, unless specifically noted otherwise.

At US Foods, we strive to inspire and empower chefs and foodservice operators to bring great food experiences to consumers.

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Our Promise brings three key elements to the forefront for our customers:

(1) more quality products, like our large and diverse portfolio of Exclusive Brands that is based on consistency, freshness and innovation, (2) more tools, centering on our MOXē ® business platform, and lastly, (3) more deliveries, with options for on-time deliveries enabled by our traditional broadline services and our flexible and convenient Pronto ® program.

(1) more quality products, like our large and diverse portfolio of Exclusive Brands that is based on consistency, freshness and innovation;

(2) more tools, centering on our MOXē ® business platform, and lastly;

(3) more deliveries, with options for on-time deliveries enabled by our traditional broadline services and our flexible and convenient Pronto ® program.

We operate as one business with standardized business processes, shared systems infrastructure, and an organizational model that optimizes national scale with local execution, allowing us to manage our business as a single operating segment.

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Operating Metrics

Case growth —Case growth, by customer type (e.g., independent restaurants) is reported as of a point in time.

Case volume —Case volume, by customer type (e.g., independent restaurants) is reported as of a point in time.

Customers periodically are reclassified, based on changes in size or other characteristics, and when those changes occur, the respective customer’s historical volume is included within the new classification.

Organic growth —Organic growth includes growth from operating businesses that have been reflected in our results of operations for at least 12 months.

For the 13 weeks ended March 28, 2026, compared to the same period a year ago, total case volume increased 1.4%, driven by a 4.6% increase in independent restaurant case volume, a 3.7% increase in healthcare volume and a 5.0% increase in hospitality volume, partially offset by a 2.3% decrease in chain volume.

For the 13 weeks ended March 28, 2026, compared to the same period a year ago, total organic case volume increased 1.1%, which includes 4.4% organic independent restaurant case volume growth for the 13 weeks ended March 28, 2026.

Net sales increased $259 million, or 2.8%, for the 13 weeks ended March 28, 2026, driven by case volume growth and food cost inflation of 1.0% for the 13 weeks ended March 28, 2026.

Gross profit increased $39 million, or 2.4%, to $1,653 million for the 13 weeks ended March 28, 2026.

For the 13 weeks ended March 28, 2026, the increase was primarily a result of an increase in total case volume and improved cost of goods sold, partially offset by an unfavorable year-over-year LIFO adjustment.

Gross profit was negatively impacted by LIFO expense of $38 million for the 13 weeks ended March 28, 2026.

Gross profit was negatively impacted by LIFO expense of $5 million for the 13 weeks ended March 29, 2025.

As a percentage of net sales, gross profit was 17.2% and 17.3% for the 13 weeks ended March 28, 2026, and March 29, 2025, respectively.

Total operating expenses increased $47 million, or 3.4%, to $1,437 million for the 13 weeks ended March 28, 2026.

For the 13 weeks ended March 28, 2026, the increase was primarily a result of an increase in total case volume and higher distribution, selling and administrative costs, partially offset by continued distribution productivity improvement as well as actions to streamline administrative processes and costs.

As a percentage of net sales, operating expenses were 15.0% and 14.9% for the 13 weeks ended March 28, 2026 and March 29, 2025, respectively.

Organic volume —Organic volume includes volume from operating businesses that have been reflected in our results of operations for at least 12 months.

For the 13 weeks ended June 27, 2026, compared to the same period a year ago, total case volume increased 1.9%, driven by a 5.1% increase in independent restaurant case volume, a 3.5% increase in healthcare volume and a 4.4% increase in hospitality volume, partially offset by a 1.5% decrease in chain volume.

For the 26 weeks ended June 27, 2026, compared to the same period a year ago, total case volume increased 1.6%, driven by a 4.8% increase in independent restaurant case volume, a 3.6% increase in healthcare volume and a 4.8% increase in hospitality volume, partially offset by a 1.9% decrease in chain volume.

For the 13 weeks and 26 weeks ended June 27, 2026, compared to the same period a year ago, total organic case volume increased 1.7% and 1.4%, respectively, which includes 5.0% and 4.7% organic independent restaurant case volume growth for the 13 weeks and 26 weeks ended June 27, 2026, respectively.

Net sales increased $450 million, or 4.5%, and $709 million, or 3.6%, for the 13 weeks and 26 weeks ended June 27, 2026, respectively, driven by case volume growth and food cost inflation of 2.3% and 1.7% for the 13 weeks and 26 weeks ended June 27, 2026, respectively.

Gross profit increased $142 million, or 8.0%, to $1,919 million for the 13 weeks ended June 27, 2026, and increased $181 million or 5.3%, to $3,572 million for the 26 weeks ended June 27, 2026.

For the 13 weeks ended June 27, 2026, the increase was primarily a result of an increase in total case volume, improved cost of goods sold and a favorable year-over-year LIFO adjustment.

For the 26 weeks ended June 27, 2026, the increase was primarily a result of an increase in total case volume and improved cost of goods sold, partially offset by an unfavorable year-over-year LIFO adjustment.

Gross profit was positively impacted by a decrease to LIFO reserve of $5 million for the 13 weeks ended June 27, 2026 and negatively impacted by LIFO expense of $33 million for the 26 weeks ended June 27, 2026.

Gross profit was negatively impacted by LIFO expense of $14 million and $19 million for the 13 weeks and 26 weeks ended June 28, 2025, respectively.

As a percentage of net sales, gross profit was 18.2% and 17.6% for the 13 weeks ended June 27, 2026, and June 28, 2025, respectively, and 17.7% and 17.4% for the 26 weeks ended June 27, 2026 and June 28, 2025, respectively.

Total operating expenses increased $71 million, or 5.1%, to $1,476 million for the 13 weeks ended June 27, 2026, and increased $118 million, or 4.2%, to $2,913 million for the 26 weeks ended June 27, 2026.

For the 13 weeks and 26 weeks ended June 27, 2026, the increase was primarily a result of an increase in total case volume and higher distribution, selling and administrative costs, partially offset by actions to streamline administrative processes and costs.

As a percentage of net sales, operating expenses were 14.0% and 13.9% for the 13 weeks ended June 27, 2026 and June 28, 2025, respectively, and 14.5% and 14.4% for the 26 weeks ended June 27, 2026 and June 28, 2025, respectively.

Results of Operations

The following table presents selected historical results of operations for the periods indicated:

13 weeks ended

March 28, 2026 March 29, 2025

13 weeks ended 26 weeks ended

June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025

Consolidated Statements of Operations:

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Operating income

4.2 % 3.7 % 3.3 % 3.1 %

2.6 % 2.2 % 1.9 % 1.7 %

Adjusted EBITDA (1)

5.7 % 5.4 % 5.0 % 4.8 %

Cash flows—operating activities

$ 431 $ 334 $ 725 $ 725

Cash flows—investing activities

(78) (75) (175) (205)

Cash flows—financing activities

(346) (299) (535) (518)

Capital expenditures

76 77 174 161

564 489 900 826

Adjusted EBITDA (1)

604 548 1,017 937

Adjusted Net Income (1)

317 277 491 436

Free Cash Flow (2)

355 261 552 569

(1) EBITDA is defined as net income, plus interest expense—net, income tax provision, and depreciation and amortization.

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The following table reconciles EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Free Cash Flow to the most directly comparable GAAP financial performance and liquidity measures for the periods indicated:

13 weeks ended

March 28, 2026 March 29, 2025

13 weeks ended 26 weeks ended

June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025

Net income and Net income margin $ 275 2.6% $ 224 2.2% 391 1.9% 339 1.7%

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Income tax provision, as adjusted (6)

(106) (95) (165) (150)

Adjusted Net Income $ 317 $ 277 $ 491 $ 436

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These costs generally relate to third party consulting and non-capitalizable technology.

For both the 13 weeks ended March 28, 2026 and March 29, 2025, business transformation costs related to projects associated with information technology infrastructure initiatives and workforce efficiencies.

For both the 13 weeks and 26 weeks ended June 27, 2026 and June 28, 2025, business transformation costs related to projects associated with information technology infrastructure initiatives and workforce efficiencies.

(5) Includes:

(i) aggregate acquisition, integration related costs and divestiture costs of $1 million and $13 million for the 13 weeks ended March 28, 2026 and March 29, 2025, respectively;

(i) aggregate acquisition, integration related costs and divestiture costs of $1 million and $7 million for the 13 weeks and 26 weeks ended June 27, 2026 and June 28, 2025, respectively, and $2 million and $20 million for the 26 weeks ended June 27, 2026 and June 28, 2025, respectively;

and (ii) other gains, losses or costs that we are permitted to addback for purposes of calculating Adjusted EBITDA under certain agreements governing our indebtedness.

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A reconciliation between the GAAP income tax provision and the income tax provision, as adjusted, is as follows:

13 weeks ended

March 28, 2026 March 29, 2025

13 weeks ended 26 weeks ended

June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025

GAAP income tax provision $ 94 $ 76 $ 120 $ 109

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Comparison of Results

13 weeks ended March 28, 2026 and March 29, 2025

13 weeks ended June 27, 2026 and June 28, 2025

• Net sales increased $450 million, or 4.5%, to $10,532 million in 2026.

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• Total organic case volum e increased 1.7% and organic independent restaurant case volume increased 5.0%.

• Operating income decreased $8 million to $216 million in 2026.

• Operating income increased $71 million to $443 million in 2026.

• Net income increased $51 million to $275 million in 2026.

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Organic broadline cases of private brands represented approximately 35% of total cases in 2026 and 2025.

Gros s profit increased $142 million, or 8.0%, to $1,919 million in 2026, primarily as a result of an increase in total case volume, improved cost of goods sold, and a $19 million favorable year-over-year LIFO adjustment.

Our LIFO method of inventory costing resulted in a benefit of $5 million in 2026 compared to $14 million expense i n 2025 , driven by a reduction in inflation and an decrease in inventory values in multiple categories.

Gross profit as a percentage of net sales was 18.2% in 2026, compared to 17.6% in 2025.

Operating Expenses

Operating expenses, comprised of distribution, selling and administrative costs, increased $71 million, or 5.1%, to $1,476 million in 2026 .

Operating expenses increased primarily as a result of an increase in total case volume and higher distribution, selling and administrative costs, partially offset by actions to streamline administrative processes and costs.

Operating expenses as a per centage of net sales were 14.0% in 2026, compared to 13.9% in 2025.

Operating Income

Our operating income was $443 million in 2026, compared to operating income of $372 million in 2025.

The increase in operating income was due to the factors discussed in the relevant sections above.

Other Income—Net

Other income—net includes components of net periodic pension benefit credits, exclusive of the service cost component associated with our defined benefit and other postretirement plans.

We recognized other income—net of $3 million in 2026 and $2 million in 2025.

Interest Expense—Net

Interest expense—net increased $3 million to $77 million in 2026 primarily due to higher borrowings under the ABL Facility, partially offset by lower interest rates for our variable rate debt.

For the 13 weeks ended June 27, 2026, the Company’s effective income tax rate of 25% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

These discrete tax items included a tax benefit of $1 million, primarily related to excess tax benefits associated with share-based compensation.

For the 13 weeks ended June 28, 2025, the Company’s effective income tax rate of 25% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

These discrete tax items included a tax benefit of $2 million, primarily related to excess tax benefits associated with share-based compensation.

Our net income was $275 million in 2026, compared to a net income of $224 million in 2025.

The improvement in net income was due to the relevant factors discussed above.

26 weeks ended June 27, 2026 and June 28, 2025

• Net sales increased $709 million, or 3.6% to $20,142 million in 2026.

• Total case volume increased 1.6% and independent restaurant case volume increased 4.8% .

• Total organic case volum e increased 1.4% and organic independent restaurant case volume increased 4.7%.

• Operating income increased $63 million to $659 million in 2026.

• Net income increased $52 million to $391 million in 2026.

• Adjusted EBITDA increased $80 million, or 8.5% , to $1,017 million in 2026.

• Adjusted EBITDA as a percentage of net sales was 5.0% in 2026, compared to 4.8% in 2025.

Net sales increased $709 million or 3.6% , to $20,142 million in 2026, driven by case volume growth and food cost inflation of 1.7% .

Total case volume increased 1.6% driven by a 4.8% increase in independent restaurant case volume, a 3.6% increase in healthcare volume and a 4.8% increase in hospitality volume, partially offset by a 1.9% decrease in chain volume.

Total organic case volume increased 1.4% and organic independent restaurant case volume increased 4.7% .

Organic broadline cases of private brands represented approximately 35% of total cases in 2026 and 2025.

Gros s profit increased $181 million , or 5.3%, to $3,572 million in 2026, primarily as a result of an increase in total case volume and improved cost of goods sold, partially offset by a $14 million unfavorable year-over-year LIFO adjustment.

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Operating expenses, comprised of distribution, selling and administrative costs, increased $118 million, or 4.2% , to $2,913 million in 2026 .

Operating expenses increased primarily as a result of an increase in total case volume and higher distribution, selling and administrative costs, partially offset by continued distribution productivity improvement as well as actions to streamline administrative processes and costs.

Operating expenses as a per centage of net sales were 14.5% in 2026, compared to 14.4% in 2025.

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Our operating income was $659 million in 2026, compared to operating income of $596 million in 2025.

The decrease in operating income was due to the factors discussed in the relevant sections above.

The increase in operating income was due to the factors discussed in the relevant sections above.

Other Income—Net

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Interest Expense—Net

Interest expense—net decreased $2 million to $75 million in 2026 primarily due to lower borrowings under the ABL Facility revolver and lower interest rates for our variable rate debt.

For the 13 weeks ended March 28, 2026, the Company’s effective income tax rate of 18% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

These discrete tax items included a tax expense of $4 million related to an increase in an unrecognized tax benefit due to tax positions taken in prior years and a tax benefit of $15 million, primarily related to excess tax benefits associated with share-based compensation.

For the 13 weeks ended March 29, 2025, the Company’s effective income tax rate of 22% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

Interest expense—net increased $1 million to $152 million in 2026 primarily due to higher borrowings under the ABL Facility, partially offset by lower interest rates for our variable rate debt.

For the 26 weeks ended June 27, 2026, the Company’s effective income tax rate of 23% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

These discrete tax items included a tax expense of $4 million related to an unrecognized tax benefit due to tax positions taken in prior years and a tax benefit of $16 million, primarily related to excess tax benefits associated with share-based compensation.

For the 26 weeks ended June 28, 2025, the Company’s effective income tax rate of 24% differed from the 21% federal corporate income tax rate primarily as a result of state income taxes and the recognition of various discrete tax items.

These discrete tax items included a tax benefit of $8 million, primarily related to excess tax benefits associated with share-based compensation.

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Our primary sources of liquidity include cash provided by operations, as well as access to capital from bank borrowings and other types of debt and financing arrangements.

As of March 28, 2026, the Company had approximately $1.6 billion in cash and available liquidity.

Debt Description Maturity Interest Rate as of March 28, 2026

Carrying Value as of March 28, 2026

As of June 27, 2026, the Company had approximately $1.8 billion in cash and available liquidity.

Debt Description Maturity Interest Rate as of June 27, 2026

Carrying Value as of June 27, 2026

Carrying Value as of December 27, 2025

ABL Facility December 7, 2027 5.35% $ 388 $ 429

ABL Facility May 28, 2031 5.16% $ 433 $ 429

2021 Incremental Term Loan Facility (net of $1 and $1 of unamortized deferred financing costs, respectively)

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Long-term debt $ 5,087 $ 5,063

We had outstanding borrowings totaling $388 million and had issued letters of credit totaling $315 million under the ABL Facility as of March 28, 2026.

There was remaining capacity of $1,597 million under the ABL Facility as of March 28, 2026.

We had outstanding borrowings totaling $433 million and had issued letters of credit totaling $315 million under the ABL Facility as of June 27, 2026.

There was remaining capacity of $1,752 million under the ABL Facility as of June 27, 2026.

As economic conditions permit, we will consider opportunities to repurchase, refinance or otherwise reduce our debt obligations on favorable terms.

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These include, among other things, covenants that may restrict our ability to incur certain additional indebtedness, create or permit liens on our assets, pay dividends, or engage in mergers or consolidations.

The Company had approximately $2.9 billion of restricted payment capacity under these covenants and approximately $1.4 billion of its net assets were restricted after taking into consideration the net deferred tax assets and intercompany balances that eliminate in consolidation as of March 28, 2026.

The Company had approximately $3.1 billion of restricted payment capacity under these covenants and approximately $1.2 billion of its net assets were restricted after taking into consideration the net deferred tax assets and intercompany balances that eliminate in consolidation as of June 27, 2026.

We believe that the combination of cash generated from operations, together with borrowing capacity under the agreements governing our indebtedness and other financing arrangements, will be adequate to permit us to meet our debt service obligations, ongoing costs of operations, working capital needs, and capital expenditure requirements for the next 12 months.

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26 weeks ended

March 28, 2026 March 29, 2025

June 27, 2026 June 28, 2025

Net income $ 391 $ 339

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Operating Activities

Cash flows provided by operating activities was $294 million for the 13 weeks ended March 28, 2026, representing a decrease of $97 million as compared to cash flows provided by operating activities of $391 million for the 13 weeks ended March 29, 2025, driven by changes in operating assets and liabilities including an increase in tax payments f or the 13 weeks ended March 28, 2026 compared to the 13 weeks ended March 29, 2025.

Cash flows provided by operating activities was $725 million for both the 26 weeks ended June 27, 2026 and June 28, 2025.

Higher net income in the current period was offset by favorable changes in operating assets and liabilities in the prior comparative period.

Investing Activities

C ash flows used in investing activities in the 13 weeks ended March 28, 2026 and March 29, 2025 included cash expenditures of $98 million and $84 million, respectively, related to investments in information technology, property and equipment and construction of and improvements to distribution facilities.

During the 13 weeks ended March 29, 2025 , the Company completed the asset acquisition of Jake’s Finer Foods.

C ash flows used in investing activities in the 26 weeks ended June 27, 2026 and June 28, 2025 included cash expenditures of $174 million and $161 million, respectively, related to investments in information technology, property and equipment and construction of and improvements to distribution facilities.

During the 26 weeks ended June 28, 2025 , the Company completed the asset acquisition of Jake’s Finer Foods.

Cash paid for the acquisition of Jake’s Finer Foods was approximately $87 million.

Investing activities for the 13 weeks ended March 29, 2025, also included cash proceeds from the sale of Freshway of $38 million .

Investing activities for the 26 weeks ended June 28, 2025, also included cash proceeds from the sale of Freshway of $38 million .

We expect total cash capital expenditures in fisc al year 2026 to be between $400 million and $440 million.

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Financing Activities

Cash flows used in financing activities in the 13 weeks ended March 28, 2026 included $41 million in net payments under the ABL Facility and $35 million in scheduled payments under our financing leases.

Financing activities in the 13 weeks ended March 28, 2026 also included $75 million common stock repurchased under the May 2025 Repurchase Program, $7 million of proceeds received from stock purchases under our employee stock purchase plan, $7 million of proceeds from the exercise of employee stock options, which were offset by $51 million of employee tax withholdings paid in connection with the vesting of stock awards.

Cash flows used by financing activities in the 13 weeks ended March 29, 2025 included $147 million in net payments under the ABL Facility and $23 million in scheduled payments under our financing leases.

Financing activities in the 13 weeks ended March 29, 2025 also included $23 million common stock repurchased under the Amended Share Repurchase Program, $6 million of proceeds received from stock purchases under our employee stock purchase plan, $1 million of proceeds from the exercise of employee stock options, which were offset by $33 million of employee tax withholdings paid in connection with the vesting of stock awards.

Cash flows used in financing activities in the 26 weeks ended June 27, 2026 included $4 million in net borrowings under the ABL Facility and $63 million in scheduled payments under our financing leases.

The Company incurred approximately $4 million of lender fees and third-party costs in connection with the ABL Facility amendment, which were capitalized as deferred financing costs.

Financing activities in the 26 weeks ended June 27, 2026 also included $445 million common stock repurchased under the May 2025 Share Repurchase Program and the November 2025 Share Repurchase Program, $17 million of proceeds received from stock purchases under our employee stock purchase plan, $10 million of proceeds from the exercise of employee stock options, which were offset by $51 million of employee tax withholdings paid in connection with the vesting of stock awards.

Cash flows used by financing activities in the 26 weeks ended June 28, 2025 included $175 million in net payments under the ABL Facility and $77 million in scheduled payments under our financing leases.

Financing activities in the 26 weeks ended June 28, 2025 also included $270 million common stock repurchased under the Company’s prior and original share repurchase program initially approved in November 2022, $16 million of proceeds received from stock purchases under our employee stock purchase plan, $5 million of proceeds from the exercise of employee stock options, which were offset by $34 million of employee tax withholdings paid in connection with the vesting of stock awards.

Other Obligations and Commitments

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Off-Balance Sheet Arrangements

We had $315 million of letters of credit outstanding primarily securing the Company’s obligations with respect to certain real estate leases, under the ABL Facility as of March 28, 2026.

We held approximately $377 million of surety bonds, as of March 28, 2026 and $362 million as of December 27, 2025 , primarily in favor of certain commercial insurers to secure obligations with respect to our insurance programs.

We had $315 million of letters of credit outstanding primarily securing the Company’s obligations with respect to certain real estate leases, under the ABL Facility as of June 27, 2026.

We held approximately $354 million of surety bonds, as of June 27, 2026 and $362 million as of December 27, 2025 , primarily in favor of certain commercial insurers to secure obligations with respect to our insurance programs.

In certain cases, surety bonds may be used as an alternative to letters of credit.

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Part II, Item 7—“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2025 Annual Report includes a summary of the critical accounting policies we believe are the most important to aid in understanding our financial results.

There have been no changes to those critical accounting policies that have had a material impact on our reported amounts of assets, liabilities, revenue, or expenses during the 13 weeks ended March 28, 2026.

There have been no changes to those critical accounting policies that have had a material impact on our reported amounts of assets, liabilities, revenue, or expenses during the 26 weeks ended June 27, 2026.

Recent Accounting Pronouncements

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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