UNFI Updates Fiscal 2025 Guidance, Maintains Long-Term Growth Focus

United Natural Foods (UNFI) has revised its 2025 guidance due to a cyber incident in Q4. The company now expects net sales of $31.6-$31.8 billion, adjusted EBITDA between $535-$565 million, and free cash flow of approximately $200 million. Despite the disruption, UNFI remains committed to its long-term strategic goals, including advancing its partner-first strategy and improving efficiency.

United Natural Foods (UNFI) has revised its 2025 financial guidance in response to a significant cyber incident that impacted its operations in Q4. The grocery distributor now expects net sales to range between $31.6 billion and $31.8 billion, a slight increase from its previous estimates of $31.3 billion to $31.7 billion [1]. Despite the disruption, UNFI remains committed to its long-term strategic goals, including advancing its partner-first strategy and improving efficiency.

The company reported that the unauthorized activity on its internal networks, discovered on June 5, resulted in a $350 million to $400 million hit to its fiscal 2025 net sales [2]. UNFI expects the anticipated insurance proceeds to be adequate for the incident, which temporarily disrupted its ability to fulfill and distribute customer orders [3]. The company has also slightly raised its annual forecast for net sales to reflect strong performance year-to-date, sending its shares up nearly 8% in premarket trade [1].

UNFI's adjusted EBITDA is now projected to be between $535 million and $565 million, down from its previous estimates of $550 million to $580 million [2]. The company expects a net loss of $90 million to $115 million for fiscal 2025, compared to the prior outlook of $55 million to $80 million loss [2]. Free cash flow is expected to be approximately $200 million, a robust figure despite the setback [3].

The company's response to the cyber incident highlights its operational resilience and strategic focus. UNFI's decentralized distribution network allowed it to reroute supplies and prioritize critical clients, while its swift recovery of core IT systems and electronic ordering processes demonstrated its ability to adapt to unexpected challenges [3]. Additionally, UNFI's commitment to cybersecurity upgrades, including multi-factor authentication and third-party vendor audits, positions it as a leader in an increasingly volatile industry [3].

Despite the disruption, UNFI remains confident in its ability to achieve its long-term financial targets. The company expects to achieve its multi-year financial targets at an accelerated pace, projecting net leverage reduction to nearly 2.5 times by fiscal year-end 2026, approximately one year earlier than initially projected [3].

For investors, UNFI's stock has faced volatility since the cyberattack, but its July updates suggest stabilization. Investors should weigh three factors: insurance recovery timing, competitor vulnerability, and sustainability trends [3]. The company's focus on cybersecurity, customer relationships, and debt reduction positions it to capitalize on a growing market for natural and organic foods.

References:

[1] https://www.reuters.com/markets/europe/united-natural-foods-projects-up-400-million-annual-sales-hit-after-cyber-breach-2025-07-16/
[2] https://za.investing.com/news/stock-market-news/united-natural-foods-stock-surges-despite-cyber-incident-impact-on-outlook-93CH-3792079
[3] https://www.ainvest.com/news/united-natural-foods-navigating-cyber-crisis-reinvent-supply-chain-resilience-2507/