PHILADELPHIA, PA — Aramark (NYSE: ARMK) delivered record third-quarter revenue and profitability, driven by strong base business performance, new client wins, and rising retention rates. The global food and facilities services provider reported consolidated revenue of $4.6 billion, up 6% from the prior year, with organic revenue growing more than 5%.
The quarter marked the highest revenue ever recorded in a single quarter for Aramark’s Global Food and Support Services (FSS) division. Growth was fueled by strong demand across multiple sectors, including Business & Industry, Education, and Sports & Entertainment. The company also benefited from favorable currency impacts totaling approximately $21 million.
Operating income increased 13% to $183 million, while adjusted operating income (AOI) rose 19% to $230 million. Profit margins also improved, with operating income margin expanding by 20 basis points and AOI margin rising by 60 basis points.
“Our third quarter performance, highlighted by record revenue for any quarter in Global FSS history, along with record profitability in a third quarter, demonstrates our commitment to sustainable growth and focused operational execution,” said John Zillmer, Aramark’s Chief Executive Officer. “I’m immensely grateful for our employees across the globe who are building this business momentum heading into the fourth quarter and beyond.”
Zillmer also emphasized recent wins and strategic improvements. “We’ve achieved a number of significant milestones at the Company since last reporting earnings, including being recently awarded one of the largest new client wins in our history, as well as experiencing record client retention levels now surpassing 97%.”
“Our Supply Chain optimization initiatives, which include introducing additional AI-driven technology, have driven significant incremental value for our clients and the Company. We continue to advance our disciplined capital allocation strategies, benefiting from a strong and flexible balance sheet designed to maximize shareholder returns. I’m extremely proud of what the teams have accomplished this quarter and firmly believe there is tremendous value-creating potential in the business going forward.”
Segment Highlights
- FSS United States: Revenue growth was led by increased participation in Business & Industry services, robust demand in collegiate meal plans, and higher per-capita spending at Major League Baseball stadiums. New business and expanded services, such as micro-markets and vending, also contributed.
- FSS International: Broad-based growth across key markets—including the UK, Chile, Canada, and Spain—drove international results. Currency translation further boosted revenue, while volume gains offset labor-related pressures.
Profitability gains were aided by improved sourcing visibility and more efficient purchasing decisions at client locations, supported by AI-enabled supply chain tools.
Capital and Cash Flow
Net cash from operating activities totaled $77 million for the quarter, while free cash flow was a use of $34 million—consistent with the seasonal nature of Aramark’s business. The company expects a significant cash inflow in the fourth quarter, largely from Collegiate Hospitality and Sports & Entertainment.
Aramark also repaid $62 million in debt and repurchased $31 million in common stock during the quarter. Since launching its repurchase program in late 2024, the company has bought back nearly 4 million shares for approximately $140 million. At quarter-end, Aramark held over $1.4 billion in cash availability.
The Board of Directors declared a quarterly dividend of 10.5 cents per share, payable on August 20 to shareholders of record as of August 6.
Looking Ahead
Aramark is on track to meet or potentially exceed the high end of its 4% to 5% net new business target for fiscal 2025. The company cited strong momentum from client acquisitions and consistent base business expansion. Profitability is expected to continue growing through improved supply chain execution, cost management, and maturation of new contracts.
With a leverage target of approximately 3.0x by fiscal year-end and additional reductions expected beyond, Aramark is positioning itself for long-term shareholder value creation.
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