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    Home - E-commerce & Retail - US Foods touts digital tools as key to Q1 growth
    E-commerce & Retail

    US Foods touts digital tools as key to Q1 growth

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    US Foods touts digital tools as key to Q1 growth
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    US Foods Holding Corp. is crediting its expanding suite of digital tools and ecommerce capabilities as a central factor in its strong Q1 fiscal 2025 sales growth.

    The distributor reported $9.35 billion in net sales, up 4.5% from US Foods’ Q1 2024. It also posted net income of $115 million, a 40.2% increase from the prior year.

    Although the company does not disclose specific digital revenue figures, executives pointed to tech-enabled services such as AI-based menu management, personalized order guides, and real-time inventory tools as major drivers of share gains in independent restaurants and health care — its two most profitable customer segments.

    “Our investments in digital solutions are paying off in both customer growth and operational efficiency,” CEO Dave Flitman said during US Foods’ Q1 earnings call. “These tools are resonating strongly with independent operators, where we’ve now recorded 16 consecutive quarters of growth, and with health care clients who need reliable, scalable procurement systems.”

    Gross profit for the quarter climbed 8.0% to $1.61 billion, with a boost from pricing optimization and reduced last-in, first-out (LIFO) impacts. Operating income rose to $224 million, up from $165 million a year earlier.

    Ecommerce’s role in US Foods Q1 sales growth

    Chief financial officer Dirk Locascio emphasized that ecommerce adoption is contributing to margin expansion.

    “We’re seeing real returns on digital engagement,” Locascio said. “It drives both top-line volume and cost efficiency by automating manual processes,” he said.

    Adjusted EBITDA grew 9.3% year over year to $389 million, and adjusted diluted EPS rose 25.9% to $0.68.

    Total case volume increased 1.1%, with a 2.5% rise in independent restaurant cases and 6.1% growth in health care. US Foods’ ecommerce tools are increasingly embedded in ordering workflows across these sectors. They support rapid product discovery, procurement planning, and reordering, according to the company.

    “Digital transformation is not a buzzword here,” said Chuck Grom, analyst at Gordon Haskett. “It’s embedded in how US Foods executes day to day. Their ability to combine a national scale with customized, tech-enabled support for small and midsize customers sets them apart.”

    US Foods reaffirmed full-year 2025 guidance. It includes 4%–6% sales growth, 8%–12% adjusted EBITDA growth, and 17%–23% adjusted EPS growth. The company also announced a new $1 billion share repurchase program, signaling confidence in its cash flow outlook after generating $391 million in operating cash during the quarter.

    In January, US Foods also acquired Jake’s Finer Foods, a Houston-based regional distributor, for $92 million. That deal expands the company’s reach in the South and provides another testbed for deploying US Foods’ ecommerce platform and culinary consulting tools with independent customers.

    As US Foods continues to scale its digital ecosystem alongside its national footprint, Flitman said the company remains focused on customer experience.

    “Our strategy is clear,” Flitman said. “Combine innovative food offerings with smart, intuitive digital tools that help our customers succeed.”

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