United Natural Foods, Inc. Reports Second Quarter Fiscal 2026 Results; Sandy Douglas Comments

PROVIDENCE, RI - United Natural Foods, Inc. reported financial results for the second quarter of fiscal 2026 (13 weeks) ended January 31, 2026.

Second Quarter Fiscal 2026 Performance (comparisons to second quarter fiscal 2025)

• Net sales decreased 2.6% to $7.9 billion, including a nearly 500 basis point impact from optimization actions
• Net income of $20 million; Net income per diluted share (EPS) of $0.31
• Adjusted EBITDA increased 23.4% to $179 million
• Adjusted EPS increased to $0.62
• Net cash provided by operating activities was $283 million; Free cash flow was $243 million

Recent Financial and Operational Summary

• Updating outlook to increase all profitability metrics and raise free cash flow, while reducing net sales
• Improving effectiveness and efficiency driven by network optimization, continued adoption of lean processes and high impact technology implementation
• On-time deliveries and productivity increased compared to prior year quarter
• Operating expenses declined nearly 6% and operating expense rate declined approximately 40 basis points
• Net leverage ratio declined sequentially to 2.7x, lowest since fiscal 2023; now expect to be ~2.3x by year-end, meaningfully lower than prior target of ≤ 2.5x by year-end fiscal 2026
• Repurchased nearly 750,000 shares for approximately $25 million

“In the second quarter, disciplined execution of our value creation strategy delivered growth in profitability and free cash flow ahead of our projections, which enabled us to further strengthen our balance sheet and increase our financial flexibility. With a sharpened focus on our growing $90 billion target addressable market, we are working to help differentiating retailers continue to accelerate profitable growth in a dynamic marketplace,” said Sandy Douglas, UNFI’s CEO, in the recent release.

Douglas continued, “Looking ahead, our new business pipeline is strong. And we remain committed to continuously improving our effectiveness and efficiency, delivering our updated outlook and strengthening our capabilities to create long-term value for our customers, suppliers, associates, and shareholders.”

Second Quarter Fiscal 2026 Summary

Net sales decreased 2.6% in the second quarter of fiscal 2026 compared to the same period in the prior year, and includes a nearly 500 basis point impact from accretive optimization during the quarter. This was largely driven by an anticipated decrease in conventional sales primarily due to the transition out of the Allentown, Pennsylvania distribution center in the first quarter of fiscal 2026.

Gross profit in the second quarter of fiscal 2026 was $1.0 billion, a decrease of $26 million, or 2.4%, compared to the second quarter of fiscal 2025. The gross profit rate in the second quarter of fiscal 2026 was 13.2% of net sales compared to 13.1% of net sales in the second quarter of fiscal 2025. The gross profit rate was benefitted by network optimization and customer mix as well as higher levels of procurement gains, partially offset by a lower gross margin rate in the Retail segment.

Operating expenses in the second quarter of fiscal 2026 were $972 million, or 12.2% of net sales, compared to $1,031 million, or 12.6% of net sales, in the second quarter of fiscal 2025. The decrease in operating expenses as a percentage of net sales was driven by the benefits from cost saving initiatives, including network optimization and higher levels of distribution center productivity.

See the full release here.