Kelly Bania • BMO Capital Markets

Answer

Walmart US CEO & President John Furner credited the performance to strong inventory management, which created tailwinds from lower markdowns and shrinkage. He noted that with sales growing faster than inventory, inventory turns are increasing, putting them in a good position. He reiterated that they will continue to manage price gaps and deliver value to customers.

Ask Fintool Equity Research AI

Answer

CEO Doug McMillon stated that tariffs are managed as a normal course of business. CFO John David Rainey confirmed no explicit tariff assumption is in the guidance and that the outlook is prudent for the start of the year. He highlighted that newer, higher-margin businesses like advertising and membership contributed over half of Q4's operating income growth, and that U.S. e-commerce losses improved by 80% in the last year, driven by factors like expedited delivery fees.

Ask Fintool Equity Research AI

Answer

COO Scott McPherson stated that PFG is on pace to achieve its three-year procurement synergy goals, with the benefits expected to be spread evenly over the period. On the Convenience segment, McPherson noted that while the macro environment remains challenged, PFG is outperforming by gaining share and benefiting from return-to-office trends. CFO Patrick Hatcher clarified that the fiscal 2026 outlook for Convenience is based on new business wins rather than an assumed macro recovery.

Ask Fintool Equity Research AI

Answer

CEO George Holm stated that the market is more competitive than it has been since the Great Recession, which is typical when volume is scarce. He noted that data suggests large distributors continue to gain market share from smaller ones. On the talent front, he reported no change, citing a 'great pipeline' of experienced salespeople available, which supports the company's decision to continue hiring at an accelerated rate.

Ask Fintool Equity Research AI

Answer

COO Scott McPherson attributed the positive sales trend to strong independent restaurant growth, a rebound in national chain accounts, and continued market share gains in the convenience segment. CFO Patrick Hatcher noted that Vistar would likely be a laggard in sales growth. Regarding costs, McPherson explained that while cost optimization has always been a focus, increased collaboration across business segments has recently enhanced these efforts.

Ask Fintool Equity Research AI

Answer

CEO George Holm explained that PFG continues to gain market share, with strength in high-end QSR and independent restaurants offsetting weakness in some casual dining chains. He noted that Vistar faces challenges in its theater channel, while the Convenience segment is seeing same-store sales declines. Regarding the Cheney integration, Holm emphasized a focus on culture and people over rapid synergy extraction, stating that synergies, particularly from private brands, will likely develop in the second and third years, following the successful Reinhart acquisition model.

Ask Fintool Equity Research AI

Answer

CEO Dave Flitman expressed confidence that case growth will accelerate in the second half of the year and stated he is not concerned about aggressive cost-cutting, emphasizing that productivity gains are being achieved in a healthy and sustainable way. CFO Dirk Locascio added that margin expansion is broad-based, driven by gross profit initiatives like cost of goods management, customer mix, and private label growth, not just operating expense reduction.

Ask Fintool Equity Research AI

Answer

CEO Dave Flitman confirmed the $30 million in administrative cost actions is incremental to the $120 million from last year, with savings beginning in late Q1. Regarding workforce stability, Flitman stated that supply chain turnover has improved to its best level in five years, is no longer a significant issue, and that sales force turnover remains in line with historical norms with no issues attracting talent.

Ask Fintool Equity Research AI

Answer

CEO David Flitman noted that foot traffic pressure has been broad-based, but the company's strength in the bar and grill segment has been a relative positive. He confirmed that seller headcount growth is expected to remain in the 4-6% range for 2025 and that the company feels good about the current compensation plan, with no significant changes planned.

Ask Fintool Equity Research AI

Answer

CEO David Flitman expressed high confidence in achieving COGS savings targets, highlighting a collaborative "win-win" approach with vendors who value US Foods' market share growth. CFO Dirk Locascio noted the health care pipeline is strong and that onboarding new health care accounts is efficient as they typically purchase products already stocked in distribution centers.

Ask Fintool Equity Research AI

Answer

CFO Curtis Valentine expects the loyalty program to be a comp driver in 2026, noting it will take time to build the database due to Sprouts' shopping frequency. He anticipates benefits across frequency, basket, and retention, but the exact mix is yet to be determined. CEO Jack Sinclair added that customer feedback has been very positive, reinforcing their excitement for the 2026 impact.

Ask Fintool Equity Research AI

Answer

President and COO Nick Konat confirmed the strong 28% e-commerce growth was seen across all partners, including Instacart, DoorDash, and Uber Eats. He stated that while Instacart remains the largest partner, the primary driver of online sales is Sprouts' unique and differentiated product offering. He suggested that while lower delivery minimums might help slightly, Sprouts customers are typically more focused on finding specific products and attributes than on deals.

Ask Fintool Equity Research AI

Answer

CEO Jack Sinclair explained that the constant rotation of their ~20,000 SKUs is a key part of the customer's "treasure hunt" experience and brand strategy. CFO Curtis Valentine stated that while self-distribution of proteins will offer long-term gross margin benefits starting in 2026, 2025 will be a transition year with no material P&L impact anticipated.

Ask Fintool Equity Research AI

Answer

CFO James Leddy clarified that the guidance reflects tougher year-over-year comparisons from a very strong H2 2024, not a slowdown in business momentum. CEO Christopher Pappas explained that the Texas strategy is a long-term plan to transform Hardee's into a CW-style business, and the mix will be "muddy" in the near term. Regarding M&A, Pappas stated they are always opportunistic but valuations have been high, and they are currently focused on smaller, tuck-in acquisitions to leverage existing capacity.

Ask Fintool Equity Research AI

Answer

James Leddy, CFO, explained the center-of-the-plate margin change was due to a mix shift to higher-dollar products and managing price inflation to drive gross profit dollar growth. Christopher Pappas, Founder, Chairman and CEO, noted a definite rebalancing of business toward the suburbs since pre-COVID. Regarding guidance, he stated it's their standard practice not to make significant changes after Q1 and that it reflects conservatism due to macroeconomic uncertainty and tougher second-half comparisons.

Ask Fintool Equity Research AI

Answer

CFO James Leddy explained that high-growth markets (like Florida, Texas, Seattle) are growing double-digits (10-20%), while mature markets are growing in the mid-single digits. CEO Christopher Pappas described the Texas transformation as being in the 'second inning' of a multi-year plan to align it with the Chefs' Warehouse model. Regarding digital, Pappas noted tremendous upside as penetration grows towards 80-90%, which helps margins and placements by turning salespeople into consultants and allowing customers to discover more items from the company's long-tail inventory.

Ask Fintool Equity Research AI

Answer

CEO Chris Pappas described the margin drivers as 'Goldilocks,' coming from pricing, category management, and operational efficiencies like leveraging fixed costs in larger warehouses as volume grows. He also noted that they continue to shed non-core, low-margin business. On restaurant openings, he sees continued strong growth from opportunistic independent operators and believes great locations and economics are bigger drivers than interest rates.

Ask Fintool Equity Research AI

Answer

CEO Kevin Hourican explained that 'price agility' aims to grow volume profitably without hurting margin rates and is still in a pilot phase with no major impact assumed in FY26 guidance. He described 'Perks 2.0' as a significant shift to a superior service model for top customers, which is rolling out nationwide and is a meaningful enabler of the FY26 plan by driving retention and penetration. CFO Kenny Cheung emphasized that sales colleague stability remains the primary growth driver.

Ask Fintool Equity Research AI

Answer

CFO Kenny Cheung stated that Q2 EPS growth is expected to be slightly higher than Q1, with October traffic similar to September's. CEO Kevin Hourican added that confidence in the new sales compensation model stems from its pay-for-performance structure, which is successfully driving new customer acquisition and total team selling. He noted that while there was a transitory impact from turnover in Q1, the program is now stable and favored by top performers.

Ask Fintool Equity Research AI

Answer

Interim CEO & Chairman Ronald Sargent attributed the digital growth to broad-based execution and the new consolidated leadership structure under a single owner, which improves focus and accountability. EVP & CFO David Kennerly added that key metrics like households and order volume grew favorably. The executives did not provide a specific breakdown of the delivery mix but reiterated that the recent Ocado financial transaction was a standard contractual matter.

Ask Fintool Equity Research AI

Answer

Interim CEO & Chairman Ronald Sargent attributed the strong digital growth to broad-based execution and a key structural change: consolidating the entire e-commerce business under a single leader, which created clear ownership. EVP & CFO David Kennerly added that key metrics like households and order volume grew favorably. He also reiterated that the recent Ocado financial development was a standard contractual matter and not indicative of a strategic shift.

Ask Fintool Equity Research AI

Answer

Interim CFO Todd Foley attributed the strong 2024 margin performance in part to significant gains from shrink reduction initiatives, which he expects to begin cycling mid-year. He reiterated that margin gains are reinvested into price. For alternative profits, he stated that dollar growth in 2025 is expected to be better than in 2024, without providing a specific target.

Ask Fintool Equity Research AI

Answer

Interim CFO Todd Foley attributed the margin strength to robust sales in Our Brands and improved shrink. CEO Rodney McMullen added that digitally engaged customers are more loyal across all channels. He emphasized that the high-margin retail media business is a key driver of improving digital profitability.

Ask Fintool Equity Research AI

Answer

CEO Darren Rebelez explained the same-store sales range reflects reasonable conservatism given the economic environment but expressed confidence in current business momentum. He noted the wing test is small (225 stores) but showing strong early results. CFO Steve Bramlage confirmed the FICS deal was EBITDA accretive in Q4 and will be for each quarter of FY26, contributing a double-digit million amount quarterly, though less than the pro forma $80 million due to store maturity.

Ask Fintool Equity Research AI

Answer

President and CEO Darren Rebelez explained the guidance range reflects confidence but includes reasonable conservatism. He noted the wing test is encouraging but not a material contributor to the FY26 plan. CFO Steve Bramlage confirmed CEFCO was EBITDA accretive in Q4 and will be in FY26, contributing 'double-digit millions' each quarter, though below the initial pro forma figure due to store maturity assumptions.

Ask Fintool Equity Research AI

Answer

CFO Steve Bramlage clarified that the Fikes acquisition was EBITDA dilutive in Q3 due to $13 million in one-time integration costs. He noted it will be modestly EBITDA positive in Q4 but is not a significant driver of the raised annual guidance; the improved outlook is attributable to the strong performance of the core 'mothership' business.

Ask Fintool Equity Research AI

Answer

CFO Stewart Glendinning confirmed a significant impact from the temporary 145% tariff but noted the complexity of isolating the exact amount. He attributed the SG&A increase to investments in store hours and labor for strong execution, which are not expected to be permanent. He stated that second-half gross margin drivers will be similar to Q1, led by freight benefits partially offset by shrink and markdowns.

Ask Fintool Equity Research AI

Answer

CFO Gary Millerchip explained that their tariff strategy is item-by-item, holding prices on staples like bananas while allowing some increases on discretionary goods like flowers. On the Affirm partnership, he stated it addresses member demand for financing big-ticket purchases and allows Costco to provide exclusive rates, enhancing the overall value proposition for those items.

Ask Fintool Equity Research AI

Answer

Executive VP & CFO Gary Millerchip explained that the response to tariffs is handled item-by-item, with the company absorbing costs on key staples like bananas while passing some on for more discretionary items like flowers. He also noted a focus on sourcing more U.S.-made goods. Regarding Affirm, he stated the partnership provides members with more payment flexibility and exclusive rates for big-ticket purchases, a category where Costco is seeing strong growth.

Ask Fintool Equity Research AI

Answer

Executive Gary Millerchip confirmed recent or planned fee increases in Japan and Korea, which follow their own cadence separate from the U.S. He also noted that while Executive Membership exists in mature international markets, there remains a significant opportunity to increase its penetration to levels seen in the U.S. and Canada.

Ask Fintool Equity Research AI

Answer

Executive Ron Vachris described the partnerships as very strong, noting they drive great incrementality and increase member shop frequency, often for fill-in trips between larger brick-and-mortar visits. He highlighted the cost-effectiveness of using these services for rapid local delivery of smaller items. Executive Gary Millerchip added that the growth of these services continues to be very strong, growing at a pace slightly higher than Costco's overall e-commerce business.

Ask Fintool Equity Research AI

Answer

Gary Millerchip, an executive, stated that e-commerce has a compounded annual growth rate of over 20% for the last 10 years. He noted that penetration is in the high single-digit range as reported, but would be in the double-digit range if digitally-started sales like Instacart were included. On profitability, he said it remains marginally lower than in-warehouse sales but is on an improving trend due to sales leverage and better fulfillment efficiency.

Ask Fintool Equity Research AI

Answer

CEO James Alexander Douglas affirmed that the cross-selling opportunity remains significant, fueled by a broad consumer trend toward 'better-for-you' products. President & CFO Giorgio Tarditi added that Lean initiatives are being implemented in a balanced manner across both natural and conventional DCs with positive results. He clarified that the expected H2 sales deceleration is due to cycling strong new customer gains from the prior year.

Ask Fintool Equity Research AI

Answer

CEO Sandy Douglas described network optimization as a multi-year plan to improve efficiency and returns, primarily in the conventional business. He explained the new supplier fee structure simplifies charges and speeds products to shelf. He also noted that digital services penetration is growing, with new offerings like the retail media network being added.

Ask Fintool Equity Research AI

Answer

CEO Todd Vasos explained the pilot uses a third party to minimize store labor impact and is designed to be low-cost for both the customer and the company. He highlighted its potential to not only drive sales and loyalty but also to significantly enhance the DG Media Network, a key strategic priority.

Ask Fintool Equity Research AI

Answer

EVP and CFO Jason Monaco responded that the revenue profile and promotional intensity were relatively stable through the quarter, with a minor drag from fading SNAP benefits early on. He stated that promotions are delivering effectively and are back to pre-COVID levels, though the consumer environment remains challenging. For the second-half outlook, Mr. Monaco attributed the expected improvement to lapping the Amazon-driven sales decline and continued growth in the military business, with inflation projected to remain modest.

Ask Fintool Equity Research AI