United Natural Foods 2026 Q1 Earnings Narrowed Losses and 24.6% Adjusted EBITDA Growth

United Natural Foods (UNFI) reported its fiscal 2026 Q1 earnings on Dec 02nd, 2025, with a 96.50% return for investors following a revenue miss. The company narrowed losses to $0.06 per share, an 82.9% improvement, and reaffirmed its full-year guidance. Revenue fell 0.4% to $7.84 billion, slightly below estimates, but adjusted EBITDA surged 24.6% to $167 million, reflecting operational efficiency gains.

Revenue

The Natural segment generated $4.24 billion, the Conventional segment contributed $3.33 billion, while the Retail segment reported $554 million. The Eliminations segment recorded a negative $279 million, resulting in total net sales of $7.84 billion. This 0.4% year-over-year decline was attributed to network optimization efforts, including the Allentown facility exit.

Earnings/Net Income

United Natural Foods reduced its net loss to $-4 million in Q1 2026, an 80.0% improvement from $-20 million in the prior year. The non-GAAP EPS of $0.56 exceeded estimates by $0.16, driven by cost discipline and margin expansion. The EPS beat of $0.56, surpassing estimates by $0.17, underscores strong operational improvements despite a minor revenue decline.

Post-Earnings Price Action Review

The strategy of buying UNFI when revenues miss and holding for 30 days delivered a 96.50% return, outperforming the benchmark by 11.06 percentage points. With a Sharpe ratio of 0.27 and a maximum drawdown of 0.00%, the approach demonstrated robust risk-adjusted returns.

CEO Commentary

CEO James Alexander Douglas highlighted progress in adjusted EBITDA and free cash flow, with net leverage declining by ~1 turn. Strategic priorities include enhancing merchandising capabilities, private brands, and AI-driven supply chain technologies to boost efficiency and serve differentiated retailers in a $90 billion market.

Guidance

UNFI reaffirmed 2026 guidance: revenue of $31.6–$32.0 billion, adjusted EBITDA of $630–$700 million, and free cash flow of ~$300 million. The company aims to reduce net leverage to below 2.5x by year-end, leveraging EBITDA growth and working capital efficiency.

Additional News

Institutional activity in UNFI’s stock saw mixed revisions, with six upward EPS adjustments over three months. Insider Danielle Benedict sold 11,655 shares in September, reducing her ownership by 11.52%. The company’s supply chain investments, including the Relex AI platform, are expected to enhance procurement and demand forecasting, further supporting margin expansion.