Q2 2026 US Foods Holding Corp. Earnings Call Transcript
Key Points
- Record adjusted EBITDA of $604 million and record adjusted EBITDA margin of 5.7%, with 10.2% EBITDA growth and 21% adjusted EPS growth.
- Independent restaurant case growth of 5.1%, the strongest since Q4 2023, marking the fifth consecutive quarter of acceleration and 21st consecutive quarter of share gains.
- Pronto program expanding rapidly, now in 52 markets, with sales expected to reach $1.3 billion in 2026 and over $1.7 billion in 2027, up from prior estimates.
- Strong cash flow generation of $725 million year-to-date, enabling $500 million in share repurchases and maintaining net leverage at 2.6x within target range.
- Self-help initiatives delivering significant savings, including over $50 million in cost of goods savings in H1 2026 and over $20 million in indirect spend savings year-to-date.
- AI and technology investments, such as Visit Assistant and autonomous inventory scanning, are improving sales productivity and warehouse efficiency, with early results showing promise.
- Health care and hospitality segments grew 3.5% and 4.4% respectively, with strong pipelines and continued share gains.
- Persistent pressure on restaurant industry foot traffic, which continues to impact same-store penetration and cases per line.
- Higher fuel costs negatively impacted adjusted operating expenses, with roughly one-third of the increase in OpEx per case attributed to fuel.
- Elevated selling costs due to the sales compensation plan transition, expected to continue for the next couple of quarters.
- Chain restaurant volume declined 1.5%, though it was 30 basis points better than industry traffic.
- The sales compensation plan transition may take 2-3 years to fully realize benefits, with potential for increased seller attrition or productivity dips during the transition.
- M&A contribution to growth is expected to be minimal in the second half of 2026, limiting potential for inorganic volume acceleration.
- Food cost inflation and mix impact of 2.6% could pressure customer demand and margins if inflation persists.
Good morning, and welcome to US Foods' second-quarter 2026 earnings conference call. (Operator Instructions)
I will now turn the conference over to Mike Neese, Senior Vice President, Investor Relations. Please go ahead.
Thank you. Good morning, everyone, and welcome to US Foods' second-quarter fiscal 2026 earnings call. On today's call, we have Dave Flitman, Chair of the Board and CEO; and Dirk Locascio, our CFO. We will take your questions after our prepared remarks conclude. (Event Instructions)
Our earnings release issued earlier this morning and today's presentation can be found on the Investor Relations page of our website at ir.usfoods.com. During today's call, and unless otherwise stated, we're comparing our second-quarter fiscal 2026 results to the same period in fiscal year 2025.
In addition to historical information, certain statements made during today's call are considered forward-looking statements. Please review the risk factors in our
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