Vestis Q3 2026 slides: profitability rises as volume strategy shifts

Vestis Corporation reported its fiscal third quarter results for 2026 on August 11, 2026, indicating progress in its strategic transformation despite revenue and earnings falling short of Wall Street expectations. The company's adjusted earnings per share were $0.18, with revenue of $661.7 million, missing estimates of $0.50 per share and $834.2 million in revenue.

However, the stock only declined 0.36% to $13.82 in early trading. Investors appear more focused on operational improvements rather than the revenue miss, as the company continues its strategy to shed low-margin volume and enhance pricing discipline and profitability.

Revenue fell 1.8% year-over-year, primarily due to a 4.5% decrease in total volume measured in pounds processed. This intentional volume reduction was a strategy to exit low-quality business with a revenue per pound of $0.55, significantly lower than the company's cost per pound of $1.24. Adjusted EBITDA increased by 23% to $80.9 million, with the adjusted EBITDA margin expanding to 12.2% from 9.8%. Free cash flow grew to $47.0 million, a $39.0 million improvement compared to the previous year.