Aramark 2025 Q4 Earnings Misses Estimates Despite Record New Business Wins

Aramark (ARMK) reported Q4 2025 results that fell short of expectations, with revenue and EPS below forecasts. The company, however, outlined a strong 2026 outlook.

Revenue

Aramark’s Q4 2025 revenue surged 14.3% to $5.05 billion, driven by robust performance across its segments. The FSS United States segment led the growth with $3.61 billion in revenue, while the FSS International segment contributed $1.44 billion. The Corporate segment reported $0, and Total Revenue amounted to $5.05 billion.

Earnings/Net Income

Aramark’s EPS declined 28.3% to $0.33 in Q4 2025 from $0.46 in Q4 2024, while net income fell to $87.24 million, a 28.6% decrease from $122.25 million. Despite the revenue increase, the EPS decline of 28.3% to $0.33 indicates a challenging quarter for profitability.

Price Action

The stock price of Aramark edged up 0.59% during the latest trading day but dropped 4.15% during the most recent full trading week and 6.37% month-to-date.

Post-Earnings Price Action Review

The strategy of buying Aramark shares upon its revenue raise announcement and holding for 30 days showed favorable performance over the past three years. The initial 30-day period yielded a maximum return of 12.5%, with an average return of 8.2%. Cumulative returns over three years reached 46.3%, indicating a robust long-term holding strategy. The highest return occurred in the first year at 14.6%, followed by 6.9% in the second year and 8.1% in the third year. This suggests that investors could have gained significantly by adopting this strategy, especially during the initial 12 months.

CEO Commentary

John Zillmer, CEO, highlighted 14% organic revenue growth driven by $1.6B in annualized gross new wins and 96.3% client retention. He emphasized temporary revenue impacts from delayed new account openings and strategic priorities like AI-driven healthcare menus and collegiate sports expansion.

Guidance

Aramark provided 2026 guidance: $19.45B–$19.85B in organic revenue (7–9% growth), $1.1B–$1.15B in AOI (12–17% increase), and $2.18–$2.28 in adjusted EPS (20–25% growth). CFO Jim Tarangelo cited margin expansion targets via cost discipline and AI-driven supply chain efficiencies.

Additional News

Aramark’s 2026 guidance includes a 7–9% organic revenue target, driven by record new contract wins and strong client retention. The company also announced a 14% dividend increase to $0.12 per share, payable December 17, and plans to reduce leverage below 3x. Institutional ownership remains robust at 97.98%, reflecting confidence in the company’s strategic direction.