Dive Brief:
- United Natural Foods, Inc. reported Tuesday net sales of $7.8 billion for the first quarter of fiscal 2026, down less than half a percentage point from a year ago.
- Net sales results were primarily driven by positive sales in the wholesaler’s natural product segment, which offset declines in its conventional grocery segment, UNFI CEO Sandy Douglas said during a Tuesday investors call.
- UNFI’s efforts to improve its supply chain efficiency are paying off as the company saw its operating expense rate drop slightly compared to the year prior.
Dive Insight:
Based on Q1 results, UNFI is “firmly on track” to achieve its full-year outlook for fiscal year 2026, Douglas told investors. This despite the fact that this quarter marks its second consecutive quarter with a drop in net sales.
Net sales for UNFI’s natural segment increased 11%, “reflecting strong, unique growth which outperformed the market,” Douglas said. Meanwhile, conventional sales declined 12% as expected due to UNFI shuttering its Allentown, Pennsylvania, distribution center.
UNFI is continuing to deploy supply chain solutions. It’s accelerating the implementation of a daily management program that’s now in use in 34 of the company’s distribution centers to “drive benefits across safety, quality, delivery and cost, according to UNFI President and CFO Matteo Tarditi.
Tarditi noted that UNFI’s operating expense rate was 12.7% of net sales this quarter compared to 12.9% the year prior. This improvement shows the benefit of the wholesaler’s “effectiveness and efficiency initiatives,” including network optimization and continuous strategic automation investment.
As the company looks to boost its supply chain productivity, Tarditi also noted that the number of cases moving through the distribution centers over an hour increased by 2% year-over-year and by nearly 10% on a two-year stack.
UNFI’s full-year outlook forecasts net sales between $31.6 billion and $32 billion, net income of up to $50 million and adjusted EBITDA between $630 million and $700 million.
