Food services company Aramark's Q3 revenue just short of estimates, Adjusted EPS meets expectations

Aramark

05/08/2025 11:54

Overview

Aramark fiscal Q3 revenue up 6% yr/yr to $4.626 bln, missing estimates

Adjusted EPS for fiscal Q3 meets analyst expectations, rising 29% yr/yr

Operating income increased 13% yr/yr, driven by supply chain expansion

The food service and facilities provider highlights significant client wins, retention rate exceeds 97%

Outlook

Aramark expects FY25 organic revenue growth of 7.5% to 9.5%

Company anticipates FY25 adjusted EPS growth of 23% to 28%

Aramark projects FY25 adjusted operating income growth of 15% to 18%

Company expects leverage ratio to reach ~3.0x by end of FY25

Result Drivers

REVENUE GROWTH - Driven by strong base business volume, new client wins, and high retention rates

SUPPLY CHAIN OPTIMIZATION - Expanded capabilities and AI-driven technology enhanced profitability

SEGMENT PERFORMANCE - FSS US growth from new client wins and expanded services; FSS International broad-based growth

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Miss
$4.626 bln
$4.66 bln (10 Analysts)
Q3 Adjusted EPS
Meet
$0.4
$0.4 (11 Analysts)
Q3 EPS
$0.27
Q3 Dividend
$0.105
Q3 Free Cash Flow
$34 mln
Q3 Operating income
$183 mln


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

The average consensus recommendation for the restaurants & bars peer group is "buy"

Wall Street's median 12-month price target for Aramark is $45.00, about 4.2% above its August 4 closing price of $43.11

The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 16 three months ago

Press Release: ID:nBw7NXKPVa

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)