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Can Chefs' Warehouse Margin Expansion Continue Through 2026?
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Key Takeaways
Chefs' Warehouse posted Q2 gross margin of 25.1%, up about 49 basis points year over year.
Adjusted operating expenses fell to 17.5% of revenues as sales growth outpaced expense growth.
CHEF's 2026 outlook implies an adjusted EBITDA margin near 6.8%, about 70 basis points above 2025.
The Chefs' Warehouse, Inc. (CHEF - Free Report) is benefiting from stronger operating leverage as higher sales volumes move through its distribution network and prior investments generate greater efficiency. Margin expansion has come from both gross profit improvement and operating expense leverage, making execution across pricing, procurement, logistics and capacity utilization central to profitability through the remainder of 2026.
The improvement was clear in the second quarter. Gross profit increased 15.2% year over year to $292.9 million, ahead of the 12.9% jump in net sales. Gross margin expanded approximately 49 basis points to 25.1%. Specialty gross margin improved 47 basis points, while center-of-the-plate gross margin increased 75 basis points. Adjusted EBITDA rose 34.6% to $88.1 million, with adjusted EBITDA margin up about 120 basis points year over year.
Expense leverage was another contributor. Adjusted operating expenses increased 8.4%, below the pace of sales growth, and represented 17.5% of revenues compared with 18.3% a year earlier. Adjusted operating expenses as a percentage of gross profit improved to 73.1% from 76.5%. Gross profit per route increased 5.6% on a trailing-12-month basis versus 2025, while adjusted EBITDA per employee rose 9%.
Image Source: Zacks Investment Research
The company has linked its margin progress to better utilization of invested capacity, facility and route consolidation, improving logistics, maturing sales teams and investments in pricing and procurement capabilities. Technology is also helping teams operate more efficiently. However, gross margin can fluctuate from quarter to quarter depending on product mix and inflation, so improvement may not be uniform.
Image Source: Zacks Investment Research
For 2026, CHEF expects net sales of $4.50 billion to $4.60 billion and adjusted EBITDA of $305 million to $315 million. The full-year outlook implies an adjusted EBITDA margin of about 6.8%, roughly 70 basis points above the prior year. With operating leverage already evident, the current guidance framework points to continued margin expansion in 2026, though seasonality, product mix and inflation can influence quarterly results.
Mondelez International, Inc. (MDLZ - Free Report) , a global snacking company, currently carries a Zacks Rank #2 (Buy). MDLZ delivered a trailing four-quarter earnings surprise of 5.8%, on average.
The Zacks Consensus Estimate for Mondelez’s current fiscal-year sales and earnings per share (EPS) implies growth of 3.7% and 4.5%, respectively, from the year-ago figures.
Mama's Creations, Inc. (MAMA - Free Report) , a prepared-foods company focused on fresh, ready-to-eat and deli products, currently carries a Zacks Rank of 2. MAMA delivered a trailing four-quarter surprise of 121.7%, on average.
The Zacks Consensus Estimate for Mama's Creations’ current fiscal-year sales and EPS indicates respective increases of 30.3% and 66.7% from the year-ago period.
Laird Superfood, Inc. (LSF - Free Report) , a consumer product company that develops, manufactures and markets plant-based, natural and functional food and beverage products, currently carries a Zacks Rank #2. LSF delivered an earnings surprise of 100% in the last reported quarter.
The Zacks Consensus Estimate for Laird Superfood’s current fiscal-year sales and EPS calls for growth of 188.2% and 104%, respectively, from the year-ago figures.
View the Zacks #1 Rank List
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Can Chefs' Warehouse Margin Expansion Continue Through 2026?
Key Takeaways
The Chefs' Warehouse, Inc. (CHEF - Free Report) is benefiting from stronger operating leverage as higher sales volumes move through its distribution network and prior investments generate greater efficiency. Margin expansion has come from both gross profit improvement and operating expense leverage, making execution across pricing, procurement, logistics and capacity utilization central to profitability through the remainder of 2026.
The improvement was clear in the second quarter. Gross profit increased 15.2% year over year to $292.9 million, ahead of the 12.9% jump in net sales. Gross margin expanded approximately 49 basis points to 25.1%. Specialty gross margin improved 47 basis points, while center-of-the-plate gross margin increased 75 basis points. Adjusted EBITDA rose 34.6% to $88.1 million, with adjusted EBITDA margin up about 120 basis points year over year.
Expense leverage was another contributor. Adjusted operating expenses increased 8.4%, below the pace of sales growth, and represented 17.5% of revenues compared with 18.3% a year earlier. Adjusted operating expenses as a percentage of gross profit improved to 73.1% from 76.5%. Gross profit per route increased 5.6% on a trailing-12-month basis versus 2025, while adjusted EBITDA per employee rose 9%.
Image Source: Zacks Investment Research
The company has linked its margin progress to better utilization of invested capacity, facility and route consolidation, improving logistics, maturing sales teams and investments in pricing and procurement capabilities. Technology is also helping teams operate more efficiently. However, gross margin can fluctuate from quarter to quarter depending on product mix and inflation, so improvement may not be uniform.
Image Source: Zacks Investment Research
For 2026, CHEF expects net sales of $4.50 billion to $4.60 billion and adjusted EBITDA of $305 million to $315 million. The full-year outlook implies an adjusted EBITDA margin of about 6.8%, roughly 70 basis points above the prior year. With operating leverage already evident, the current guidance framework points to continued margin expansion in 2026, though seasonality, product mix and inflation can influence quarterly results.
This Zacks Rank #1 (Strong Buy) stock has surged 80% year to date against the industry’s decline of 4.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Other Stocks to Consider
Mondelez International, Inc. (MDLZ - Free Report) , a global snacking company, currently carries a Zacks Rank #2 (Buy). MDLZ delivered a trailing four-quarter earnings surprise of 5.8%, on average.
The Zacks Consensus Estimate for Mondelez’s current fiscal-year sales and earnings per share (EPS) implies growth of 3.7% and 4.5%, respectively, from the year-ago figures.
Mama's Creations, Inc. (MAMA - Free Report) , a prepared-foods company focused on fresh, ready-to-eat and deli products, currently carries a Zacks Rank of 2. MAMA delivered a trailing four-quarter surprise of 121.7%, on average.
The Zacks Consensus Estimate for Mama's Creations’ current fiscal-year sales and EPS indicates respective increases of 30.3% and 66.7% from the year-ago period.
Laird Superfood, Inc. (LSF - Free Report) , a consumer product company that develops, manufactures and markets plant-based, natural and functional food and beverage products, currently carries a Zacks Rank #2. LSF delivered an earnings surprise of 100% in the last reported quarter.
The Zacks Consensus Estimate for Laird Superfood’s current fiscal-year sales and EPS calls for growth of 188.2% and 104%, respectively, from the year-ago figures.