Company: SYY
Filing Date: 2025-08-22
Form Type: 10-K
Source: 0000096021-25-000099
Chunk: 19

Company: SYSCO CORP
Filing Date: 2025-08-22
Form: 10-K
Item: Item 8
Chunk 19
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 is satisfied and, therefore, requires minimal judgment. The disclosure of disaggregated revenues is presented in Note 3, “Revenue.”Contract BalancesAfter completion of Sysco’s performance obligations, we have an unconditional right to consideration as outlined in its contracts with customers. We extend credit terms to some of our customers based on our assessment of each customer’s creditworthiness. Customer receivables included in accounts receivable, less allowances in the consolidated balance sheet, were $5.1 billion and $5.0 billion as of June 28, 2025 and June 29, 2024, respectively.Sysco has certain customer contracts in which upfront monies are paid to its customers. These payments have become industry practice and are not related to financing of the customer’s business. They are not associated with any distinct good or service to be received from the customer and therefore, are treated as a reduction of transaction prices. All upfront payments are capitalized in other assets and amortized over the life of the contract or the expected life of the relationship with the customer on a straight-line basis. As of June 28, 2025, Sysco’s contract assets were not material. We have no significant commissions paid that are directly attributable to obtaining a particular contract.Vendor ConsiderationSysco recognizes consideration received from vendors in the form of invoice deductions or cash, and are recorded as a reduction to cost of sales when the related product has been sold by us. In many instances, the vendor consideration is in the form of a specified amount per case or per pound. In these instances, we will recognize the vendor consideration as a reduction of cost of sales when the product is sold. Shipping and Handling CostsShipping and handling costs include costs associated with the selection of products and delivery to customers. Included in operating expenses are shipping and handling costs of approximately $4.6 billion, $4.3 billion and $4.0 billion in fiscal 2025, 2024 and 2023, respectively.Insurance ProgramSysco maintains a self-insurance program covering portions of workers’ compensation, general and vehicle liability and property insurance costs. The amounts in excess of the self-insured levels are fully insured by third party insurers. Sysco has a wholly owned captive insurance subsidiary (the Captive) with the primary purpose to enhance Sysco’s risk financing strategies by providing Sysco the opportunity to negotiate insurance premiums in the non-retail insurance market. The Captive must maintain a sufficient level of cash to fund future reserve payments and secure the