Cintas (CTAS) Q3 2026 earnings summary

Executive summary

• Third quarter revenue reached $2.84 billion, up 8.9% year-over-year, with organic growth of 8.2%.

• Net income for the quarter was $502.5 million, up 8.4%, and diluted EPS increased 9.7% to $1.24.

• Achieved record gross margin of 51% and strong operating margins across all route-based businesses.

• Announced agreement to acquire UniFirst Corporation for $5.5 billion, expected to close in the second half of calendar 2026, pending regulatory and shareholder approval.

• Returned $1.45 billion to shareholders via dividends and buybacks in the first nine months of fiscal 2026.

Financial highlights

• Operating income for the quarter was $659.9 million (23.2% of revenue), up 8.2% year-over-year.

• Gross margin for Q3 reached $1.45 billion, up 9.8% year-over-year; consolidated gross margin at 51%, up 40 basis points.

• Effective tax rate for the quarter was 20.6%, slightly down from 21% a year ago.

• Cash flow from operations for the nine months was $1.57 billion, with free cash flow at $1.27 billion.

• Selling and administrative expenses were 27.8% of revenue, up 60 basis points due to a prior-year one-time gain.

Outlook and guidance

• Fiscal 2026 revenue guidance raised to $11.21–$11.24 billion, representing 8.4%–8.7% growth.

• Adjusted diluted EPS guidance increased to $4.86–$4.90, up 10.5%–11.4%.

• Guidance assumes constant FX, no future acquisitions, and a 20% effective tax rate.

• Transaction costs related to UniFirst expected to impact EPS by $0.03–$0.04 in fiscal 2026, to be broken out separately starting Q4.

• Management expects continued sufficient liquidity and strong cash flows to support operations, acquisitions, share repurchases, and dividends.