Vestis Corporation
Q4 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +0.91%.
Did VSTS Beat Earnings? Q4 2025 Results
Vestis Corporation delivered a sharply disappointing fiscal Q4 2025, posting adjusted EPS of just $0.03 against a consensus estimate of $0.39, a miss of 92.31%, even as revenue of $712.01 million edged 3.60% above analyst expectations and rose 4.0% year over year. The headline revenue figure, however, was flattered by a 53rd operating week worth roughly $51.60 million; strip that out and normalized revenue actually declined 3.5%, a reflection of persistent customer losses that dragged rental revenue down $18.10 million on a comparable basis. Adjusted EBITDA fell to $64.66 million from $80.55 million a year earlier, with margins compressing 269 basis points to 9.1%, while net leverage climbed to 4.72x as free cash flow shrank to just $5.77 million for the full year. In response, CEO Jim Barber unveiled a multi-year transformation plan targeting at least $75.00 million in annual cost savings by end of fiscal 2026, with the company guiding full-year adjusted EBITDA of $285.00 million to $315.00 million despite flat to down 2% revenue expectations, a cautious outlook that nonetheless sent shares up roughly 8.6% as investors bet on eventual execution.
- Extra 53rd operating week added approximately $51.6 million in Q4 revenue
- Net impact of lost business drove rental revenue decline of $18.1 million on a normalized basis
- Direct sales declined $5.0 million or 13.6% on a normalized basis
- SG&A cost reductions of $13.3 million including lower selling and administrative costs
- Higher variable plant costs due to adverse product mix shifts
- Foreign exchange negative impact of $0.8 million from Canadian business
“We ended fiscal 2025 in a good position to advance our strategic priorities as we enter fiscal 2026. Over the past several months, we have taken a close look at our commercial strategy as well as our operations and identified the actions needed to strengthen performance, unlock operating leverage, and better serve our customers. As a result, we have launched a comprehensive business transformation plan anchored on three strategic pillars: Commercial Excellence, Operational Excellence, and Asset & Network Optimization. We have already begun executing initiatives under the plan, and we anticipate these improvements will be progressively realized throughout fiscal 2026 as we advance our multi-year transformation.”
Vestis CEO, on the earnings call
Forward Guidance & Outlook
For fiscal year 2026, Vestis expects revenue to be flat to down 2% compared to normalized fiscal 2025 revenue. Adjusted EBITDA is expected to be in the range of $285 million to $315 million. Free cash flow is expected to be in the range of $50 million to $60 million. The company anticipates quarterly sequential Adjusted EBITDA growth of approximately 5% starting with Q2 FY2026, with Q1 FY2026 expected to increase approximately 7% to 10% over Q4 FY2025. The multi-year strategic transformation plan is expected to generate annual operating cost savings of at least $75 million by the end of fiscal 2026, with total restructuring costs estimated at $25 million to $30 million. The plan is expected to be substantially complete by the end of 2027.
VSTS YoY Financials
VSTS Revenue by Segment
VSTS Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.