United Natural Foods (UNFI) Q3 2026 earnings summary

Executive summary

• Achieved strong profitability and free cash flow in Q3 2026, with Adjusted EBITDA up 16.6% to $183 million and Adjusted EPS up 75% to $0.77, driven by disciplined execution of value creation and network optimization strategies.

• Net sales declined 4.2% year-over-year to $7.72 billion, mainly due to optimization actions and declines in Conventional and Retail segments, partially offset by growth in the Natural segment.

• Net income reached $33 million, reversing a net loss of $7 million in the prior year quarter.

• Continued investment in supply chain, technology, and talent to support long-term growth and differentiation for retail partners.

• Marked 50th anniversary, emphasizing commitment to supporting retailer differentiation and growth.

Financial highlights

• Q3 sales were $7.7 billion, down 4.2% year-over-year, with a 450 basis point impact from optimization actions.

• Adjusted EBITDA rose 16.6% to $183 million; YTD Adjusted EBITDA was $529 million, up from $436 million.

• Adjusted EPS increased 75% to $0.77 in Q3 FY26; YTD Adjusted EPS up 137.8% to $1.95.

• Free cash flow for Q3 was $54 million, with YTD total at $243 million, up $90 million year-over-year.

• Net leverage ratio improved to 2.5x, with net debt at $1.63 billion, the lowest since fiscal 2018.

Outlook and guidance

• Fiscal 2026 net sales expected between $31.1–$31.3 billion; Adjusted EBITDA forecasted at $685–$705 million; Adjusted EPS range $2.40–$2.60.

• Capital and cloud implementation expenditures expected at $250–$330 million; free cash flow outlook at $250–$330 million.

• Narrowed guidance ranges while maintaining midpoints for key metrics.

• Expect investment spend to ramp in Q4 to support ongoing supply chain and technology enhancements.

• Anticipate a return to sales growth in fiscal 2027 as optimization actions are fully cycled.