Workplace uniform provider UniFirst (NYSE: UNF) reported Q4 CY2025 results exceeding the market’s revenue expectations, with sales up 2.7% year on year to $621.3 million. The company expects the full year’s revenue to be around $2.49 billion, close to analysts’ estimates. Its GAAP profit of $1.89 per share was 5.1% below analysts’ consensus estimates.

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“Our first quarter performance was consistent with our expectations and reflects the impact of planned investments designed to accelerate growth and enhance operational efficiency,” said Steven Sintros, UniFirst President and Chief Executive Officer.

Company Overview

With a fleet of trucks making weekly deliveries to over 300,000 customer locations, UniFirst (NYSE: UNF) provides, rents, cleans, and maintains workplace uniforms and protective clothing for businesses across various industries.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.

With $2.45 billion in revenue over the past 12 months, UniFirst is a mid-sized business services company, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.

As you can see below, UniFirst’s sales grew at a decent 6.5% compounded annual growth rate over the last five years. This shows its offerings generated slightly more demand than the average business services company, a useful starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. UniFirst’s recent performance shows its demand has slowed as its annualized revenue growth of 3.5% over the last two years was below its five-year trend.

This quarter, UniFirst reported modest year-on-year revenue growth of 2.7% but beat Wall Street’s estimates by 1%.

Looking ahead, sell-side analysts expect revenue to grow 2.4% over the next 12 months, similar to its two-year rate. This projection is underwhelming and indicates its products and services will see some demand headwinds.

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Operating Margin

UniFirst was profitable over the last five years but held back by its large cost base. Its average operating margin of 7.4% was weak for a business services business.

Analyzing the trend in its profitability, UniFirst’s operating margin decreased by 2.8 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. UniFirst’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.

In Q4, UniFirst generated an operating margin profit margin of 7.3%, down 1.9 percentage points year on year. This reduction is quite minuscule and indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

UniFirst’s EPS grew at a weak 2.1% compounded annual growth rate over the last five years, lower than its 6.5% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

We can take a deeper look into UniFirst’s earnings to better understand the drivers of its performance. As we mentioned earlier, UniFirst’s operating margin declined by 2.8 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For UniFirst, its two-year annual EPS growth of 12.5% was higher than its five-year trend. This acceleration made it one of the faster-growing business services companies in recent history.

In Q4, UniFirst reported EPS of $1.89, down from $2.31 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects UniFirst’s full-year EPS of $7.56 to shrink by 5.1%.

Key Takeaways from UniFirst’s Q4 Results

It was good to see UniFirst narrowly top analysts’ revenue expectations this quarter. On the other hand, its EPS missed. Looking ahead, full-year EPS guidance roughly met expectations. Overall, this was a mixed quarter. The stock traded down 2.4% to $198 immediately following the results.

The latest quarter from UniFirst’s wasn’t that good. One earnings report doesn’t define a company’s quality, though, so let’s explore whether the stock is a buy at the current price. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.