Chefs' Warehouse (CHEF) Q2 Revenue Up 8%
Earnings per share (Non-GAAP) rose to $0.52, beating the analyst estimate by 13.0 %.
Revenue (GAAP) grew 8.4% to $1,034.9 million, topping expectations and led by strength in specialty categories.
Profitability expanded with higher gross margins
These 10 stocks could mint the next wave of millionaires ›
Chefs' Warehouse (NASDAQ:CHEF), a specialty food distributor with a focus on high-end restaurants and culinary professionals, released results on July 30, 2025. It reported GAAP revenue of $1,034.9 million and earnings per share (Non-GAAP) of $0.52. These figures surpassed analyst expectations, which had projected $1,013.5 million in GAAP revenue. The period showed notable strength in gross profit and operating leverage. Overall, the quarter reflected strong execution on key initiatives and cautious optimism as the company modestly raised its full-year financial guidance.
Metric Q2 2025 Q2 2025 Estimate Q2 2024 Y/Y Change
EPS (Non-GAAP) $0.52 $0.46 $0.40 30.0 %
Revenue $1,034.9 million $1,013.5 million $954.7 million 8.4 %
Net Income $21.2 million $15.5 million 36.8 %
Adjusted EBITDA $65.4 million $56.2 million 16.4 %
Gross Profit $254.3 million $229.0 million 11.1 %
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Understanding Chefs' Warehouse: Business Model and Strategic Focus
Chefs' Warehouse is a distributor of specialty foods, center-of-the-plate proteins (such as meat and seafood), and staple kitchen ingredients. Its customers include independent and fine-dining restaurants, hotels, country clubs, and gourmet food retailers. The company differentiates itself by offering over 88,000 unique products, sourced from more than 4,000 suppliers globally, including artisan producers and family-owned businesses.
Recent strategic focus has centered on broadening its product catalog, investing in digital ordering systems, and deepening supplier partnerships. It also has a disciplined approach to shedding lower-margin, non-core business—such as commodity poultry—which provides more room to grow higher-margin specialty offerings. Expansion into new geographies, both within the US and internationally, supports ongoing growth. Key success factors include maintaining exclusive supplier connections, understanding culinary trends, and supporting chefs through a skilled and specialized sales force.
Quarterly Highlights: Growth Drivers and Notable Changes
The company saw organic revenue growth powered by increased demand for specialty foods. The specialty food category posted an organic case count increase of 3.5%, while unique customer relationships and product placements rose by 3.6% and 8.7%, respectively.
A deliberate exit from a low-margin commodity poultry program in the center-of-the-plate segment led to a 4.0% decline in organic pounds sold in that category. This was an anticipated shift, outlined by management as part of its ongoing effort to prioritize profitability, resulting in improved average margin per unit sold despite lower overall volume.
Profitability improved at multiple levels. Gross profit margin expanded by 59 basis points from the prior year period, reaching 24.6%. Operating income as a percentage of revenue (GAAP) also improved. While selling, general, and administrative (SG&A) expenses (GAAP) rose 9.7%, outpacing revenue growth, higher profits from product mix and pricing contributed to stronger overall margins. Investments in compensation and facility upgrades drove the rise in SG&A expenses, but management stated these costs are in support of future scalability.
The company accelerated adoption of its online ordering system, which now handles roughly 58% of specialty customer orders in the US as of Q1 FY2025, up from 48% at the end of FY2023. This investment in the digital channel supports operational efficiency. Internationally, the Middle East segment displayed better-than-expected performance, supported by a new facility.
Looking Ahead: Guidance and What to Watch
Management moderately raised its full-year FY2025 guidance, with revenue expectations now between $4.0 billion and $4.06 billion. Gross profit (GAAP) outlook increased to a range of $964 million to $979 million, and Adjusted EBITDA—an earnings metric excluding interest, taxes, depreciation, and amortization—was guided to $240 million to $250 million. These updates reflect ongoing strength in core categories and digital initiatives, while also indicating a measured approach given economic uncertainties such as potential tariff adjustments and input cost swings.
For the quarters ahead, investors will want to watch Margin trends, SG&A expense ratios, and management of the company's debt load—$690 million in long-term obligations as of June 27, 2025—remain important markers to watch. Chefs' Warehouse does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
Where to invest $1,000 right now
When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor's total average return is 1,049%* — a market-crushing outperformance compared to 182% for the S&P 500.
They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.
See the stocks »
*Stock Advisor returns as of July 29, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
27 minutes ago
- Globe and Mail
Trump raises tariffs on Canadian goods, BoC keeps rate steady and Telus' new network deal: Business and investing stories for the week of Aug. 3
Getting caught up on a week that got away? Here's your weekly digest of The Globe's most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more. U.S. President Donald Trump signed an executive order Thursday evening increasing tariffs on some Canadian goods. The order, effective at midnight on Aug. 1, raises the tariffs that Mr. Trump imposed on Canadian goods in March to 35 per cent from 25 per cent — it does not, however, apply to products that meet the rules outlined in the United States-Mexico-Canada free trade agreement, known as USMCA. Prime Minister Mark Carney, in a statement early Friday morning, said the Canadian government is disappointed by Mr. Trump's actions but remains committed to the free-trade agreement. The Prime Minister disputed Mr. Trump's justification for the 35-per-cent tariff – namely that Canada is a significant source of the deadly opioid fentanyl smuggled into the United States. While the Canadian economy has mostly avoided the impact of the tariffs because the USMCA carve-out, certain industries — such as steel and aluminium, cars, and copper — will be hit harder by the changes. The Bank of Canada held its policy interest rate at 2.75 per cent for the third consecutive time as U.S. trade policy continues to muddy the economic outlook. The central bank is operating amid massive levels of uncertainty created by U.S. President Donald Trump's barrage of tariffs and attempt to rewrite the rules of global trade. Governor Tiff Macklem said there was a 'clear consensus' to hold the rate steady, but suggested the door remained open to additional rate cuts if needed, Mark Rendell reports. The bank also held off again on publishing a central forecast in its quarterly Monetary Policy Report. Instead, it detailed three potential paths for the Canadian economy that depend on the trajectory of U.S. tariffs, ranging from a mild downturn to an extended recession. Even before Mr. Trump's tariff threads, the vibrancy of Canada's business sector was already weak, but the trade war has only deepened the rut. Statistics Canada reported this week that the number of active businesses was effectively flat in April on a month-over-month basis, increasing by just 0.1 per cent. Sectors that are dependent on U.S. demand, such as mining, oil and gas extraction, experienced a sharper decline in the number of active businesses from the start of last year than other sectors, and the gap has widened since Mr. Trump returned to the White House. Statscan noted this decline began before that, and suggested other factors could be at play. Jason Kirby takes a closer look at the numbers in this week's Decoder series. After a months-long search for buyers, Telus Corp. T-T has entered a definitive agreement with the Caisse de dépôt et placement du Québec to sell a minority stake in its nationwide cellphone tower network for $1.26-billion. The Caisse, Canada's second-largest pension fund, will acquire a 49.9-per-cent stake in the infrastructure asset, which is being spun out as a new company called Terrion. The business is worth $2.5-billion, including Telus's 50.1-per-cent equity interest. Telus had $25-billion in long-term debt as of March, and intends to use all proceeds from the sale to pay some of it down. Drumeo is the brainchild of Jared Falk, an Abbotsford-born music teacher, performer and entrepreneur who first started giving drum lessons by video in the pre-streaming era of the early 2000s. Now Mr. Falk's company – Musora Media Inc. – boasts more than 100,000 paid subscribers, with offerings for piano, vocals and guitar as well. Armed with a roster of drumming legends — including Chad Smith of the Red Hot Chili Peppers, Stewart Copeland of The Police, the internet sensation known as El Estepario Siberiano, and The Rolling Stones veteran session man Steve Jordan — Drumeo appears all over the internet with viral clips of musicians showing off their signature grooves and testing themselves on unfamiliar tunes. Jeffrey Jones spoke with Mr. Falk about how he built his music lesson empire, and how Drumeo sets itself apart from the competition. Get the rest of the questions from the weekly business and investing news quiz here, and prepare for the week ahead with The Globe's investing calendar.
CBC
28 minutes ago
- CBC
Trump fires U.S. Bureau of Labour Statistics head after weak jobs report
U.S. President Donald Trump fired Erika McEntarfer, commissioner of the Bureau of Labor Statistics, after a report showed hiring slowed in July and was much weaker in May and June than previously reported.
CTV News
an hour ago
- CTV News
From Laos to Brazil, Trump's tariffs leave a lot of losers. But even the winners will pay a price
The President Bush, a container vessel operating under the American President Lines (APL) fleet, is moored at the APL Terminal, also known as Global Gateway South, at the port of Los Angeles, Calif., Friday, Aug. 1, 2025. (AP Photo/Damian Dovarganes) WASHINGTON — WASHINGTON (AP) — U.S. President Donald Trump's tariff onslaught this week left a lot of losers – from small, poor countries like Laos and Algeria to wealthy U.S. trading partners like Canada and Switzerland. They're now facing especially hefty taxes – tariffs – on the products they export to the United States starting Aug. 7. The closest thing to winners may be the countries that caved to Trump's demands — and avoided even more pain. But it's unclear whether anyone will be able to claim victory in the long run — even the United States, the intended beneficiary of Trump's protectionist policies. 'In many respects, everybody's a loser here,'' said Barry Appleton, co-director of the Center for International Law at the New York Law School. Barely six months after he returned to the White House, Trump has demolished the old global economic order. Gone is one built on agreed-upon rules. In its place is a system in which Trump himself sets the rules, using America's enormous economic power to punish countries that won't agree to one-sided trade deals and extracting huge concessions from the ones that do. 'The biggest winner is Trump,' said Alan Wolff, a former U.S. trade official and deputy director-general at the World Trade Organization. 'He bet that he could get other countries to the table on the basis of threats, and he succeeded – dramatically.'' Everything goes back to what Trump calls 'Liberation Day'' – April 2 – when the president announced 'reciprocal'' taxes of up to 50% on imports from countries with which the United States ran trade deficits and 10% 'baseline'' taxes on almost everyone else. He invoked a 1977 law to declare the trade deficit a national emergency that justified his sweeping import taxes. That allowed him to bypass Congress, which traditionally has had authority over taxes, including tariffs — all of which is now being challenged in court. Winners will still pay higher tariffs than before Trump took office Trump retreated temporarily after his Liberation Day announcement triggered a rout in financial markets and suspended the reciprocal tariffs for 90 days to give countries a chance to negotiate. Eventually, some of them did, caving to Trump's demands to pay what four months ago would have seemed unthinkably high tariffs for the privilege of continuing to sell into the vast American market. The United Kingdom agreed to 10% tariffs on its exports to the United States — up from 1.3% before Trump amped up his trade war with the world. The U.S. demanded concessions even though it had run a trade surplus, not a deficit, with the UK for 19 straight years. The European Union and Japan accepted U.S. tariffs of 15%. Those are much higher than the low single-digit rates they paid last year — but lower than the tariffs he was threatening (30% on the EU and 25% on Japan). Also cutting deals with Trump and agreeing to hefty tariffs were Pakistan, South Korea, Vietnam, Indonesia and the Philippines. Even countries that saw their tariffs lowered from April without reaching a deal are still paying much higher tariffs than before Trump took office. Angola's tariff, for instance, dropped to 15% from 32% in April, but in 2022 it was less than 1.5%. And while Trump administration cut Taiwan's tariff to 20% from 32% in April, the pain will still be felt. '20% from the beginning has not been our goal, we hope that in further negotiations we will get a more beneficial and more reasonable tax rate,' Taiwan's president Lai Ching-te told reporters in Taipei Friday. Trump also agreed to reduce the tariff on the tiny southern African kingdom of Lesotho to 15% from the 50% he'd announced in April, but the damage may already have been done there. Bashing Brazil, clobbering Canada, shellacking the Swiss Countries that didn't knuckle under — and those that found other ways to incur Trump's wrath — got hit harder. Even some poorer countries were not spared. Laos' annual economic output comes to US$2,100 per person and Algeria's $5,600 — versus America's $75,000. Nonetheless, Laos got rocked with a 40% tariff and Algeria with a 30% levy. Trump slammed Brazil with a 50% import tax largely because he didn't like the way it was treating former Brazilian President Jair Bolsonaro, who is facing trial for trying to lose his electoral defeat in 2022. Never mind that the U.S. has exported more to Brazil than it's imported every year since 2007. Trump's decision to plaster a 35% tariff on longstanding U.S. ally Canada was partly designed to threaten Ottawa for saying it would recognize a Palestinian state. Trump is a staunch supporter of Israeli Prime Minister Benjamin Netanyahu. Switzerland was clobbered with a 39% import tax — even higher than the 31% Trump originally announced on April 2. 'The Swiss probably wish that they had camped in Washington'' to make a deal, said Wolff, now senior fellow at the Peterson Institute for International Economics. 'They're clearly not at all happy.'' Fortunes may change if Trump's tariffs are upended in court. Five American businesses and 12 states are suing the president, arguing that his Liberation Day tariffs exceeded his authority under the 1977 law. In May, the U.S. Court of International Trade, a specialized court in New York, agreed and blocked the tariffs, although the government was allowed to continue collecting them while its appeal wend its way through the legal system, and may likely end up at the U.S. Supreme Court. In a hearing Thursday, the judges on the U.S. Court of Appeals for the Federal Circuit sounded skeptical about Trump's justifications for the tariffs. 'If (the tariffs) get struck down, then maybe Brazil's a winner and not a loser,'' Appleton said. Paying more for knapsacks and video games Trump portrays his tariffs as a tax on foreign countries. But they are actually paid by import companies in the U.S. who try to pass along the cost to their customers via higher prices. True, tariffs can hurt other countries by forcing their exporters to cut prices and sacrifice profits — or risk losing market share in the United States. But economists at Goldman Sachs estimate that overseas exporters have absorbed just one-fifth of the rising costs from tariffs, while Americans and U.S. businesses have picked up the most of the tab. Walmart, Procter & Gamble, Ford, Best Buy, Adidas, Nike, Mattel and Stanley Black & Decker, have all hiked prices due to U.S. tariffs 'This is a consumption tax, so it disproportionately affects those who have lower incomes,'' Appleton said. 'Sneakers, knapsacks ... your appliances are going to go up. Your TV and electronics are going to go up. Your video game devices, consoles are going to up because none of those are made in America.'' Trump's trade war has pushed the average U.S. tariff from 2.5% at the start of 2025 to 18.3% now, the highest since 1934, according to the Budget Lab at Yale University. And that will impose a $2,400 cost on the average household, the lab estimates. 'The U.S. consumer's a big loser,″ Wolff said. AP Economics Writer Christopher Rugaber contributed to this story. Paul Wiseman, The Associated Press
