Company: SYY
Filing Date: 2025-10-29
Form Type: 10-Q
Source: 0000096021-25-000157
Chunk: 8

Company: SYSCO CORP
Filing Date: 2025-10-29
Form: 10-Q
Item: Item 2
Chunk 8
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, primarily driven by the growth of new customers. We expect SYGMA’s sales growth rates to moderate in fiscal 2026 as we reach the one-year anniversary mark of fiscal 2025’s substantial customer additions. Operating income increased $7 million in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, primarily due to the growth of new customers and operating efficiencies.

For the operations that are grouped within Other, operating income decreased $5 million in the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. The operations of this group primarily consist of our hospitality business, Guest Worldwide.

Global Support Center Expenses

Our Global Support Center generally includes all expenses of the corporate office and Sysco’s shared service operations. These expenses in the first quarter of fiscal 2026 increased $12 million, or 5.3%, as compared to the first quarter of fiscal 2025, primarily due to increases in colleague-related costs and higher incentive compensation, partially offset by decreases in insurance costs. 

Included in Global Support Center expenses are Certain Items that totaled $29 million in the first quarter of fiscal 2026, as compared to $19 million in the first quarter of fiscal 2025. Certain Items impacting the first quarter of fiscal 2026 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions. Certain Items impacting the first quarter of fiscal 2025 were primarily expenses associated with our business technology transformation initiatives and expenses associated with acquisitions.

Interest Expense

Interest expense increased $12 million for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025. The increase was primarily due to interest on new senior notes that were issued in the third quarter of fiscal 2025.

Other Income and Expense

Other expense increased $22 million for the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, primarily due to foreign exchange losses incurred in the first quarter of fiscal 2026. We expect other expense to approximate $65 million for fiscal year 2026.

Net Earnings

Net earnings decreased 2.9% in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, primarily due to the items noted above for operating income, and interest expense, as well as items impacting our income taxes that are discussed in Note 11, “Income Taxes,” in the Notes to Consolidated Financial Statements in Item 1