Aramark (NYSE:ARMK) posted fourth-quarter results on Monday that came in below Wall Street expectations, with the company citing higher incentive-related compensation tied to strong new business activity. Shares slipped 1.87% after the report.
Adjusted earnings per share were $0.57, falling short of the consensus estimate of $0.64. Quarterly revenue reached $5.05 billion, missing analyst forecasts of $5.16 billion, though sales were still up 14% year over year on both a reported and organic basis.
Management pointed to roughly $25 million in additional incentive-based compensation during the quarter — reflecting record levels of net new business — which reduced adjusted EPS by $0.07. The company said net new business reached 5.6% of the prior year’s revenue base.
“Fiscal 2025 represented many consequential milestones for the Company, contributing to the strong growth trajectory ahead,” said CEO John Zillmer. “In addition to being awarded one of the most prestigious medical systems in the world, we delivered almost $1 billion in Annualized Net New business.”
Revenue momentum in Q4 was driven by new client wins, strong retention, and healthy base-volume trends. Some of this growth was tempered by onboarding timing for new contracts. The extra 53rd week in the fiscal year also added about 7% to quarterly revenue.
For fiscal 2026, Aramark issued guidance slightly below expectations. The company anticipates adjusted EPS of $2.18–$2.28, compared with analysts’ $2.29 consensus, and revenue between $19.55 billion and $19.95 billion, versus roughly $19.7 billion expected.
Aramark ended the year with a leverage ratio of 3.25x — its lowest in nearly two decades — and announced a 14% increase to its quarterly dividend, raising it to $0.12 per share.