Cintas (CTAS) Q1 2027 earnings summary

Executive summary

• Achieved record first quarter revenue of $3.01 billion, up 10.9% year-over-year, with organic growth of 8.9%.

• Diluted EPS rose 13.3% to $1.36; adjusted diluted EPS (excluding UniFirst transaction costs) increased 15.8% to $1.39.

• Gross margin reached an all-time high of 51.5%, up 120 basis points year-over-year.

• Strong demand across all business segments, driven by new business, customer retention, and cross-sell initiatives.

• Updated fiscal 2027 guidance reflects increased confidence, raising both revenue and adjusted EPS targets.

Financial highlights

• Operating income grew 15.2% to $711.9 million; operating margin improved to 23.6%.

• Net income for the quarter was $551.7 million, up 12.3% year-over-year.

• Free cash flow for the quarter was $464.8 million, up from $312.5 million year-over-year.

• Segment gross margins: Uniform Rental 50.8%, First Aid 57.6%, Fire Protection 52.8%, Uniform Direct Sale 38.9%.

• Selling and administrative expenses improved to 27.4% of revenue, a 10 basis point improvement.

Outlook and guidance

• Fiscal 2027 revenue guidance raised to $12.15–$12.27 billion (7.9%–8.9% growth).

• Adjusted diluted EPS guidance increased to $5.45–$5.54 (10.3%–12.1% growth).

• Incremental margins expected at 32%–34%, with double-digit operating margin expansion.

• Guidance assumes one extra workday for the year, no future acquisitions, and constant FX rates.

• Effective tax rate for FY27 expected at 20.4%.