Sysco Sours Its Outlook: Weak Restaurant Traffic Cuts Into Annual Forecast

Food distributor Sysco cut its fiscal 2025 sales growth forecast to 3% (from 4–5%) and adjusted EPS guidance to 1%+ (vs. 6–7%) amid declining restaurant demand, worsened by California wildfires and tariff-related cost pressures. Q3 sales rose just 1.1% to $19.6B, missing estimates, as consumer sentiment dampened foot traffic at chains like KFC and Applebee’s. The company cited Trump-era tariffs and retaliatory measures impacting its Canadian operations (8% of sales), alongside efforts to source cheaper raw materials to offset inflation. Analysts note sustained challenges in local case volumes, with restaurant operators projecting further traffic declines in 2025. Sources: Reuters, Sysco Investors, Coleman Report