Aramark’s fourth-quarter results were well received by the market, reflecting strong underlying business momentum and broad-based revenue growth across its core segments. Management attributed the solid top-line performance to unprecedented client retention and successful new business wins, particularly in the healthcare, education, and corrections sectors in the U.S., as well as sports and mining internationally. CEO John J. Zillmer emphasized the importance of new contract launches like Penn Medicine and the company’s ability to maintain high retention rates, describing client loyalty as “the number one driver of our ultimate success.”
Is now the time to buy ARMK? Find out in our full research report (it’s free for active Edge members).
Aramark (ARMK) Q4 CY2025 Highlights:
- Revenue: $4.83 billion vs analyst estimates of $4.75 billion (6.1% year-on-year growth, 1.8% beat)
- EPS (GAAP): $0.36 vs analyst expectations of $0.45 (19.9% miss)
- Adjusted EBITDA: $356.9 million vs analyst estimates of $361.4 million (7.4% margin, 1.2% miss)
- The company reconfirmed its revenue guidance for the full year of $19.75 billion at the midpoint
- EPS (GAAP) guidance for the full year is $2.23 at the midpoint, beating analyst estimates by 16.4%
- Operating Margin: 4.5%, in line with the same quarter last year
- Market Capitalization: $10.25 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Aramark’s Q4 Earnings Call
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Ian Alton Zaffino (Oppenheimer) asked about the sustainability of competitive new business wins and exceptional retention. CEO John J. Zillmer attributed success to Aramark’s robust systems and noted continued focus on retention as a compensation driver for teams.
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Neil Christopher Tyler (Redburn Atlantic) inquired about the relative contributions of the Sports and Leisure and Refreshment segments to overall growth. Zillmer explained that while these segments had standout quarters, revenue growth is broad-based across business lines and geographies.
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Leo Carrington (Citi) questioned how long net new growth could persist and the impact of AI on both revenues and costs. Zillmer described AI as a long-term opportunity for both cost savings and new business, while CFO James J. Tarangelo reported net new is currently ahead of expectations.
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Jaafar Mestari (BNP Paribas) sought clarification on the contributions of pricing and volume to organic growth. Tarangelo indicated that pricing tracked with inflation at 3%, with volumes stable and net new business on track to slightly exceed guidance.
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Stephanie Benjamin Moore (Jefferies) asked if recent large contract wins reflected a strategic shift. Zillmer said client consolidation is driving demand for integrated solutions, and Tarangelo noted that healthcare contracts now reach profitability faster due to cost-plus structures.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will be watching (1) the pace at which Aramark onboards and ramps large new healthcare contracts, (2) evidence that AI-driven supply chain and back-office efficiencies are translating into higher margins, and (3) whether international momentum, especially in Europe and Latin America, can be sustained. Progress on capital allocation, normalized investment spending, and further share repurchases will also be key signposts for execution.
Aramark currently trades at $38.98, in line with $38.80 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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