Welcome to Sysco's fourth quarter fiscal year 2025 conference call. As a reminder, today's call is being recorded. We will begin with opening remarks and introductions. I would now like to turn the call over to Kevin Kim, Vice President of Investor Relations. Sir, you may begin. Good morning, everyone, and welcome to Sysco's fourth quarter fiscal year 2025 earnings call. On today's call, we have Kevin Hourican, our Chair of the Board and CEO, and Kenny Cheung, our CFO. Before we begin, please note that statements made during this presentation that state the company's or management's intentions, beliefs, expectations, or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act, and actual results could differ in a material manner. Additional information about factors that could cause results to differ from those in the forward-looking statements is contained in the company's SEC filings. This includes, but is not limited to, risk factors contained in our annual report on Form 10-K for the year ended June 29, 2024, subsequent SEC filings, and in the news release issued earlier this morning. A copy of these materials can be found in the investor section at sysco.com. Non-GAAP financial measures are included in our comments today and on our presentation slides. The reconciliation of these non-GAAP measures to the corresponding GAAP measures is included at the end of the presentation slides and can be found in the investor section of our website. During the discussion today, unless otherwise stated, all results are compared to the same quarter in the prior year. To ensure we have sufficient time to answer all questions, we'd like to ask each participant to limit their time today to one question. If you have a follow-up question, we ask that you re-enter the queue. At this time, I'd like to turn the call over to Kevin Hourican. Good morning, everyone. We appreciate your joining our call this morning. Today, we will recap our fourth quarter performance, highlight our full year 2025 outcomes, provide an update on key initiatives that will drive our momentum in the new fiscal year, and finally, Kenny will share our view on our guidance for fiscal year 2026. Let's get started with a highlight of our fourth quarter financial outcomes. We are pleased to report that our fourth quarter adjusted results exceeded our expectations. Traffic to restaurants improved throughout the quarter, and Sysco-specific initiatives delivered improved financial outcomes top to bottom. The progress accelerated throughout the quarter and has continued into July for Sysco. All considered, Q4 was a relatively steady quarter from the perspective of restaurant foot traffic. On a monthly basis, April traffic trends for the industry were down 1.5%. May was down 1%, and June was down approximately 0.9%. The quarter overall was down 1.1%, which represented approximately 190 basis points of improvement versus Q3's traffic level of down 3%. It is good to see the industry stabilizing after a rocky start to the calendar year. I'll now pivot to Sysco's results for the quarter. As you can see on slide four, we delivered sales results of $21.1 billion, up 2.8% on a reported basis, and up 3.7% to last year when excluding the divestiture of our Mexican business. We delivered adjusted operating income of $1.1 billion, up 1.1% to last year, and adjusted EPS growth of $1.48, up 6.5% relative to last year. Importantly, we made solid progress on our $100 million profit improvement target with a strong contribution in Q4 from our strategic sourcing efforts. Our international segment posted another compelling quarter with 3.6% top-line growth on a reported basis and up 8.3% to last year when excluding the divestiture of Mexico. International posted strong local case growth of plus 4% in the quarter. Adjusted operating income increased 20.1%, representing the seventh consecutive quarter of double-digit profit growth. Strength was delivered from across all international geographies with notable strong performances from Canada, Great Britain, Ireland, and Latin America. We expect a continuation of strong international financial performance in fiscal 2026. Within USFS, our national sales business delivered 1.3% volume growth for the quarter. Unpacking those results further, our non-commercial national business continues to perform at a very high level with strength in food service management, education, and travel and leisure. Most importantly, gross profit within national sales grew almost three times faster than volume due to the excellent efforts by the team to improve profitability of the national business. The strong profit improvement was delivered through customer optimization and the creation of win-win provisions in our contracts that motivate customers to partner with Sysco to optimize efficiency. Our Sigma segment delivered sales growth of 5.9% for the quarter, driven by strong customer wins versus prior year. For the year, Sigma grew top-line 8.3% and bottom-line 12.5%. It was a record year for our Sigma business from top and a bottom-line perspective. It is important to note that the Sigma top-line growth rates will begin to moderate in the coming year as we begin to lap large customer wins earned in 2025. On the local side of our business, we delivered negative 1.5% case volume within our U.S. F ood service segment during the quarter. As shown on slide eight, this was a meaningful 200 basis point step up versus our Q3 outcomes. U.S. Foodservice volume reporting included impact from exiting a business within FreshPoint that did not meet our profit thresholds, which negatively impacted our total local performance by over 50 basis points. When excluding this intentional business exit, our USFS local business performed at a negative 1% rate, again a meaningful step up versus Q3 and a strong improvement relative to our full year results. More importantly, as I mentioned, we had a strong exit velocity in the quarter, with June performance being the highlight of the quarter. It is important to call out that the positive momentum has carried into July as Sysco-specific initiatives to improve our local performance are taking root. I'll discuss these efforts in more detail in a moment. Now that we have reviewed our business results for the quarter, I'd like to discuss the key initiatives that are going to drive our performance and local case volume growth for fiscal 2026. Let's start with our international segment. We are very pleased with our international business and have strong confidence that the compelling top and bottom-line results will continue into fiscal 2026. We are advancing selling initiatives like Sysco Your Way across the globe. Additionally, we have improved our customer and colleague-facing technology in the international segment, making it easier to do business with Sysco. We are adding incremental local sales resources in key international geographies, primarily metro areas like Toronto, Dublin, and London, to drive new customer wins and improved customer engagement. Lastly, our international supply chain capacity expansion efforts continue, with our newest facility outside of London on track to open later this calendar year. Our national sales business continues to perform well, with exceptionally high customer retention rates and continued new wins on the selling circuit. We expect Sysco's national sales growth in 2026 will be driven by our food service management sector, travel and leisure, and increases in our healthcare business. To further unlock growth, we are allocating our national sales resources to the highest potential segments of the business that are making technology investments to deepen our connectivity with our largest customers. Lastly, total team selling is beginning to gain traction amongst our largest customers, with an increasing percentage of national customers purchasing from at least one of our specialty platforms. Lastly, I'd like to discuss our improvement efforts and strategic growth drivers for our local business. Let me start by saying that we are very confident that we will deliver profitable local volume growth in 2026 within every country we operate, especially in the United States. We have addressed the key challenge of 2025 head-on, and we have growth activation initiatives launching this summer. First off, I want to start by discussing our sales colleague population. We have fully stabilized our sales colleague retention and are now fully focused on improving sales colleague training, productivity, and effectiveness. The stabilized colleague retention is important because it will drive significantly improved customer retention in 2026. As we enter 2026, we will be lapping last year's excessive colleague turnover and will replace that condition with strong in-year retention. A headwind in 2025 will be converted into a tailwind in 2026. We are seeing the beginning positive impact of this equation in our July results. That positive impact will grow throughout 2026. As I mentioned a moment ago, now that we have stabilized retention, our leadership focus turns to driving improved productivity of the sales force through training and upskilling of our sales colleagues. Additionally, our initial cohorts of sales consultant hires from calendar 2024 are beginning to eclipse their 12 to 18-month anniversary with Sysco. As Kenny has said many times, this time horizon is important, as it is when the productivity of a sales consultant significantly improves. As each quarter progresses, an increased number of our sales consultants will eclipse their 12 to 18-month mark, increasing their positive impact on Sysco's results. As sales colleague tenure improves, our results improve. Lower turnover in 2026 means higher customer retention, and higher retention means more productive colleagues. These two factors will be powerful drivers of improved outcomes for Sysco in 2026. To complement the strength and productivity of our sales professionals and further improve our business results, we are launching select growth initiatives this summer and fall. First up is a rewiring of our Perks customer loyalty program. Perks will evolve from a marketing and rewards platform into a hard-hitting, exceptional customer service program targeting our most important customers. The why is clear. These customers buy the most, buy the most often, and they deserve the absolute best from Sysco. We have trained our operations, inventory, merchandising, and sales teams on the key tenets of Perks 2.0, and we are ready to launch this summer. The program will improve customer retention and will improve penetration of business with existing customers. Next up is an AI-empowered sales tool to help improve the productivity of our sales colleagues. As you know, we leverage a CRM platform to guide the work of our sales teams. Our technology teams have been hard at work to supercharge our CRM capabilities by leveraging AI to help our sales consultants succeed. The enhanced capabilities will reside in the palm of the colleague's hand on their smartphone. The features of the tool will help our team to drive increased levels of selling effectiveness, increase close rates on sales suggestions, and deliver higher rates of customer satisfaction. To say that we are excited about this capability would be an understatement. Our newer sales colleagues will benefit the most from the powerful capabilities of our AI-powered CRM. Last up is price agility. As we have previously communicated, we are piloting improvements to our pricing architecture that improve sales colleague engagement with customers by providing the sales force the ability to be more agile in responding to pricing requests. Our sales reps will be enabled to make decisions in the moment, leveraging the science of our pricing software. In July, we are expanding our pilot to additional geographies to learn more about the change management process required for a national rollout. As I wrap up my prepared remarks, we are pleased with our strong performance in Q4 and the progress that we are making in local volume. Most importantly, we are excited about the exit velocity of the quarter and that the momentum has carried into July. We are confident that improved sales consultant retention, increased sales consultant tenure, and the three growth programs I just covered will drive profitable and positive case growth for Sysco in fiscal 2026. We expect that positive local case growth will, in turn, support our financial targets. With that, I'd now like to turn the call over to Kenny. Kenny, over to you. Thank you, Kevin, and good morning, everyone. I plan to start with high-level thoughts on our performance, detail our financials, and then introduce our full year 2026 guidance. As we outlined before, business plans don't always materialize the exact way you draw them up on paper. This year was no different. However, our teams remain both nimble and focused as we leverage our leadership position within the industry to successfully apply the Sysco playbook. The operational rigor of our organization provides us a high degree of confidence for delivering our 2026 guidance across the P&L and our capital allocation commitments. To start, financial results this quarter included sales growth of 2.8% and adjusted EPS growth of 6.5%, representing strong year-over-year performance and noteworthy sequential improvements compared to the prior quarter. This sequential acceleration is visible across sales, including both national and local volume performance, but also across gross margins, adjusted operating income, and adjusted EPS. This is an important proof point as we enter FY 2026. Q4 adjusted EPS growth included benefits from our disciplined strategic sourcing efforts, aiding in the delivery of 3.9% growth in gross profit, translating to 19 basis points of gross margin expansion. These results include an increase in both dollars and rates of performance and reflect structural improvements that we expect to carry into the next fiscal year. Our investments in sales headcount and capacity expansion continued this quarter alongside benefits from ongoing efforts to optimize cost and prudent tax planning. This ultimately rendered outsized profit growth with adjusted EPS growth of 6.5%, accounting for the strongest rate of growth for the year. During fiscal 2025, we remain committed to rewarding our shareholders by repurchasing $1.3 billion in shares and paying out $1 billion in dividends. Now, let's discuss our performance and financial drivers for the quarter, starting on slide 12. For the fourth quarter, our enterprise sales grew 2.8% on an as-reported basis, driven by U.S. Foodservice, International, and Sigma. Excluding the impact of our divested Mexico business, sales grew 3.7%. Volumes across the enterprise sequentially improved, with total U.S. Foodservice volumes decreasing 0.3% and local volume decreasing 1.5% in the quarter. This represents a 200 basis points improvement in local case performance and 170 basis points improvement in total food service on a sequential basis quarter over quarter. The sequential improvement was consistent with the industry traffic for the quarter, but importantly, our performance accelerated in the quarter with a strong June exit rate. We are seeing stronger contributions from newer sales professionals as they work up the productivity curve and the benefits from the stabilization of colleague retention. These factors directly contributed to an acceleration in new account growth for the quarter. We expect an acceleration in sales productivity to continue in FY 2026. These sequential volume improvements also benefited our USFS segment results. Top and bottom-line results for the quarter represent a sequential improvement, and we expect our investment actions in 2025 to deliver financial tailwinds for 2026 and beyond. International segment results included continued top-line momentum and double-digit operating income growth. This was across all markets and marked our seventh consecutive quarter of double-digit operating income growth, adding to our impressive multi-year track record. These results reflect ongoing success as we apply the Sysco playbook to generate local volume growth of 4% and broad-based operating income growth across our international portfolio. Sysco produced $4 billion in gross profit, up 3.9%, and gross margins of 18.9%, with improved gross profit per case performance. This notable margin improvement includes a mentality of continual improvement, with cost savings driven by our strategic sourcing initiatives. Inflation rates in USBL were approximately 2.4%. International inflation was slightly higher for the quarter at 3.4%. Overall, adjusted operating expenses were $2.9 billion for the quarter, or 13.7% of sales, a 28 basis points increase from the prior year. The increase was driven by planned investments in higher growth areas of the business, with fleets, building expansion, and sales headcount. Corporate adjusted expenses were up 9.8% from the prior year, driven by insurance, investments, and other costs, partially offset by accretive productivity costs out. For the full year, corporate adjusted expenses were down 6%, reflecting solid progress on our existing cost savings program. Overall, adjusted operating income grew to $1.1 billion for the quarter, reflecting continued strong growth in our international segment, Sigma, and more stable results in our USFS segment. For the quarter, adjusted EBITDA of $1.3 billion was up 1.8% versus the prior year. Fourth quarter results also include a non-cash goodwill impairment charge of $92 million related to our Guest's Worldwide business, as reflected in our other segment. Let's now turn to balance sheet and cash flow. Our balance sheet remains robust and reflects a healthy financial profile. This includes flexibility and optionality from approximately $3.8 billion in total liquidity, well above our minimum threshold. We ended the year at a 2.85 times net debt leverage ratio, with plans to return to our target ratio in FY 2026. Turning to our cash flow, we generated approximately $2.5 billion in operating cash flow and $1.8 billion in free cash flow. Free cash flow, compared to the prior year, was impacted by higher cash taxes, interest, and working capital timing. Now, I would like to share with you our expectations for FY 2026, as seen on slide 22. During FY 2026, we expect reported net sales growth of approximately 3%-5% to approximately $84 billion-$85 billion. These assumptions include inflation of approximately 2%, which we are seeing now, volume growth, and contributions from M&A. We expect full year 2026 adjusted EPS of $4.50-$4.60, representing growth of 1%-3%, which includes an approximate $100 million of headwind from lacking lower incentive compensation in FY 2025, an impact of roughly $0.16 per share. With FY 2025 behind us, we wanted to provide full visibility to the carryover impact from incentive comp for the year and by quarter, as outlined on slide 23. This impacts year-over-year comparability for expenses. Our compensation structure rewards for business performance. As such, this carryover impact reflects challenges this past year in 2025. Importantly, our incentive comp structure is focused on core business drivers and aligned with long-term interests of our shareholders. Excluding this impact, our outlook reflects adjusted EPS growth of approximately 5%-7%, with the midpoint in line with a long-term growth algorithm. To help with phasing for Q1, we expect to grow our adjusted EPS consistent with the annual growth rate of 1%-3%, driven by part of carryover benefit from strategic sourcing to gross margins and the impact from lacking incentive compensation. Q1 and Q2 sales growth rates will be impacted by the divestiture of our Mexico JV in December 2024. We plan to provide additional modeling updates as the year progresses. This financial guidance assumes improvements to be driven by our Sysco-specific initiatives, with industry foot traffic and macro environment similar to current conditions. It also includes carryover impact related to sourcing benefits from our $100 million of cost savings program. As mentioned on prior calls, this muscle memory is built across the organization, leveraging a stronger operating model that positions us to grow share profitably. We remain on target for shareholder returns through approximately $1 billion in dividends and approximately $1 billion in share repurchases planned for FY 2026. This is all based on our current expectation and economic conditions and could flex based on M&A activity for the year. Specific to our dividend, our expected payout for FY 2026 equates to a 6% year-over-year increase on a per-share basis, highlighting our commitment to our standing as a dividend aristocrat. In terms of leverage, we expect to end the year within our stated target of 2.5-2.75 times net leverage ratio and maintain our investment-grade balance sheet. Now, turning to a few other modeling items. For FY 2026, we expect a tax rate of approximately 23.5%-24% and adjusted depreciation and amortization of approximately $870 million. Interest expense is now expected to be approximately $700 million, while other expense is expected to be approximately $45 million. The elevated D&A levels will be driven by continued capacity expansion, such as the expansion outside of London this coming year, as Kevin highlighted. CapEx is expected to be approximately $700 million, representing less than 1% of sales. This includes growth and maintenance CapEx and an eye towards optimizing spend levels across the enterprise as the organization further sharpens our collective efforts around driving ROIC. Looking ahead, we like our position, and we remain focused on leveraging our position as the industry leader to support the growth of our customer while also continuing to unlock value for our shareholders. With that, we'll turn the call back to Kevin for closing remarks. Thank you, Kenny. We are pleased with the strong performance in Q4 and, more importantly, the strong exit velocity of the quarter. Our leadership team placed tremendous focus on improving our local business, strengthening our gross profit through strategic sourcing, and tightly managing our expenses through productivity improvement. The team stepped up and delivered a beat performance versus what we expected 90 days ago, and I'm proud of their efforts. As we look toward 2026, we expect to build upon the Q4 momentum and deliver improved financial results for Sysco and our investors. Our top-line results will strengthen based on the sequential improvement of our local business throughout 2026. The improvement starts and ends with our colleague population. We have stabilized colleague retention. As a result, our customer loss rate will improve greatly in 2026 versus 2025. Stabilizing colleague retention will also enable us to improve colleague productivity in 2026. We will measure our improvement through the continued expansion of our gap between new customer wins and reducing customer losses. The spread between new customer wins and customer losses improved greatly in our Q4. In fact, the gap between new and loss doubled in Q4 versus the year-to-date results in Q1 through Q3. We see the positive spread between new and loss expanding further in 2026 through the growth initiatives that I covered on today's call. Our future is bright at Sysco, and we are excited for the year ahead. We head into this next fiscal year with positive momentum, and we are well-positioned for continued improvements. We plan to leverage our competitive advantages as the industry leader. This includes strong diversification across our diverse customer types, our wide product assortment, and our geographic diversity as the only global player in the food-away-from-home landscape. Food-away-from-home is a good business. It takes share from the grocery channel every year. As I've said before, the pie is getting bigger, and Sysco intends to take a bigger slice of that expanding pie. We are confident shareholders are positioned to benefit from our industry-leading dividend, compelling ROIC, intentional share buybacks, and improving financial results. Q4 displays the beginning of improving our local business, and the momentum will accelerate throughout 2026. I am thankful for our leadership team and our entire 75,000 colleague population for the strong efforts in 2025. The team leaned into some stiff challenges in the macro and at Sysco specifically. The hard work of the past year is poised to have a positive impact in 2026. With that, operator, we're now ready for questions. At this time, if you'd like to ask a question, please press the star and one keys on your telephone keypad. Keep in mind you can remove yourself from the question queue at any time by pressing star and two. We do again ask that you limit yourself to one question. If you have any follow-up questions, you may re-enter the queue. Again, it is star and one to ask a question today. We'll take our first question from Jake Bartlett with Truist Securities. Please go ahead. Your line is open. Great. Thank you for taking the question. Mine was on the momentum in the local. Case growth, and you saw it in the fourth quarter and improvement from the third. That was roughly in line with what industry traffic trends were. You mentioned an improvement in June and July. The question is whether you're gaining share within June and July. Are you seeing that acceleration that should be that you expect to come with the better, with the sales force getting more productive? Just trying to gauge the inflection that you're seeing there, the impact that that's having on your market share gains. Morning, Jake. It's Kevin. Thanks for the question. Yes, we're really pleased with Q4's progress versus Q3, but more importantly, that exit velocity. It's in the data that we shared. June versus May was flat from an industry traffic perspective. Our performance in June was considerably better than May, which obviously conveys progress that we're making, and that progress has continued into July. It's important to note the drivers. Yes, traffic improvement helped, and we're pleased that the industry overall is seeing some strength relative to the tough start to the year. It's the colleague retention piece that is the most notable. We stabilized our colleague retention in Q4, and that will have a meaningful positive impact as we enter 2026. Because the 2025 story is about customer loss that occurred tied to colleague separation or colleague departure, and we're not going to be lapping those losses until we're in Q1. That's the point. The strength of that, the headwind of 2025 being replaced by a tailwind in 2026, will be evident as we enter our Q1. We wouldn't have expected that positive impact to be in Q4 because these are losses that have already occurred, and you carry that loss into your at month 13. We've stabilized retention. That is an important key point. As Kenny says many times, the new hires from the past year to a year and a half are hitting their month 12, month 13, month 14, where their contribution positive significantly increases. An important data point I put in my prepared remarks, I just want to make sure it came through clearly. The gap between new and lost in Q4 was double the gap that we experienced in Q1 through Q3. That strength will be visible and evident in fiscal 2026 as that loss rate comes down significantly. When I add on top of that, the three growth initiatives that I referenced on today's call that launched this summer and into early fall, we have significant confidence in our ability to deliver positive and profitable local case growth to take share, and that gives us the confidence in the guide that we put out there. It starts and ends with the colleague population stability, which we have achieved, and the tools that we are providing to our colleagues that help them increase their productivity. I'll toss to Kenny if he wants to add anything. Sure. I agree with Kevin. Three things for me. The first is we are encouraged by the fact that we continue to see select geographies already hitting our growth expectations driven by SC additions and improved retention, as Kevin just mentioned, and that's carrying over into Q1 2026. That's point number one. Point number two is Kevin talked about this. The 12 to 18 months is really important for us as the SC jumps on their productivity curve. We're also seeing our retention playbook work across experienced SCs as well. You have your year twos go to year three, three to four, four to five years as well. That helps on the overall sales pool, which actually drives our new customer accounts. This past quarter, we opened more new accounts than any other period this year. Jake, as you know, new accounts are tomorrow's penetration opportunities. Last but not least, we're seeing our service levels go up as well. Bill rates are up, on-time delivery is up as well, and this is the leading indicator for future business generation. Thank you. We'll take the next question from Jeffrey Bernstein with Barclays. Please go ahead. Your line is open. Great. Thank you very much. Just following on the top-line trends, encouraged to see the improvement in recent months. I'm just wondering, to what do you attribute in terms of the broader industry that gives you confidence in sustaining the momentum over the next 12 months? Just to clarify, within Sysco's expectations, again, not looking at the industry, but specific to your momentum, just wondering if you could share any color in terms of the local case volume growth within the 3%-5% sales. I think you mentioned positive. Any maybe thoughts on M&A, whether for yourself or perhaps related to headlines that we've seen recently about consolidation among some of your larger peers. Just hoping to get a little bit more perspective on that. Thank you. Okay. Good morning, Jeff. I'll start with broad industries. Foot traffic to restaurants down approximately 1% in the quarter. Certainly better than Q3. We believe Q3 was a bit of an anomaly. That's when the external news was quite negative. Consumer confidence dropped. The conversations about tariffs and the impact on consumer confidence that was happening. In our Q3 calendar, Q1, the industry took a pretty significant step back. It's good to see in the most recent quarter an improvement against that. We think the anomaly was actually the start to the year, and what we just saw as an industry in our Q4 is more reflective of the operating environment. Kenny said it in his prepared remarks. We're expecting the current conditions to continue for 2026, read down slight traffic to the industry overall for this next fiscal year. The growth that we will deliver will come from taking share. We're confident in our ability to do that. As I mentioned a few moments ago, we're not going to repeat the customer loss rate that we experienced in 2025. We will be lapping those customer losses. We've been doing great with new customer wins over the past three quarters. I've shared that pretty openly on earnings calls. We will sustain our new customer win rate. We will significantly improve our customer loss rate. When we layer on top of that the Perks 2.0 program I mentioned, which is going to significantly improve the service experience that our top customers will benefit from, that's going to drive penetration improvement. That will drive improved customer retention as well. The AI360 capability, which is our name internally for the AI-empowered CRM, is going to be meaningfully helpful. I'll talk more about that, I'm sure, as a part of this call. We put all those things together. We are confident, even in a flat to down overall macro, that we can grow local, that we will grow it profitably, and that will occur in fiscal 2026. Kenny, I toss to you for additional comments about the guide. Over to you. Yeah. Sure. Absolutely. In terms of foot traffic, Kevin's right. One thing to put things in perspective, though, foot traffic, while it's a good proxy as a whole for Sysco, if you think about our business, we have two-thirds of our business is restaurant, and one-third of our business is recession-resilient categories such as education, healthcare, travel, and the like. Even within restaurants, our customer ranges from QSRs to casual dining to fine dining. Let's not forget that 20% of our business is international segment, which serves as, in our view, a strategic counterbalance and enhances the resiliency and stability of our overall business. In terms of the guide itself, Jeff, on the 3%-5%, let me unpack that a little bit for you. Top line 3%-5%, which is $84 billion-$85 billion. Remember, on a year-on-year standpoint, there is a lapping impact here from the divestiture of Mexico. That is roughly 50 basis points on a year-on-year standpoint. If you decouple between volume and inflation, inflation is roughly assumed at 2% inflation. Right now, Jeff, we are operating right around that ballpark right now. USBL this quarter was 2.4%, and international was roughly 3.4%. The majority of the spread between U.S. and international was FX-driven. Again, long story short, 2%, it's where we're operating right now, and it bodes well for the industry. On volume and M&A contributions, those two combined, you can probably model in 2-3% growth, and that's what you tie back to the 3-5%. Okay. The third part of your question, which was the speculation on industry news, we're not going to speculate on M&A rumors in the industry for Sysco. We're focused on driving profitable growth within our strategic capabilities. What we are very pleased with is that Q4 was better than the entire year. June was better than Q4. July, that momentum has continued. As we progress into 2026, we will be lapping an accelerated or elevated loss rate last year that will not be repeated. When we layer on top of that condition, the growth initiatives that I just referenced, we have strong confidence in our ability to take share, profitably grow the business, and deliver upon the guidance that was just communicated by Kenny. We're positioned, therefore, to have compounding improvement to the overall financial health of the company. We have confidence in our ability to succeed in the marketplace. Thank you. Thanks, Jeff. We'll take our next question from Alex Slagel with Jefferies. Please go ahead. Your line is open. All right. Thanks. Morning. Question on international. Just given the recent strength in this business, do you expect the year-over-year growth momentum we've seen to moderate a bit as you lap this growth? Maybe you can just kind of call out some of the specific drivers that give you the visibility for that growth to continue as we roll through the year. Yeah. Good morning, Alex. This is Kevin. We expect the success in our international segment to continue in 2026, not to moderate or slow down. The why is the health is coming from all geographies. It's coming in the top, the middle, and on the bottom of the P&L. I'll just highlight a few of the examples. The success we're having on the top line, which is volume strength, especially in local, we're driving a 4-plus% case growth in local. We expect for that level of performance to continue into 2026 for the following reasons. We're adding sales resource headcount into the street sales side of the business, the local side of the business, in major metros. Toronto has an opportunity to see increased headcount, boots on the ground, boots on the street, increasing our ability to serve local restaurant customers. We are doing that play in Dublin. We are doing that play in London. We are doing that play in Stockholm. When we do that in international, we are increasing our physical presence on the ground, and we are seeing market share capture coming from that. We have improved our website in each of those countries. We have improved our ability to have relevant pricing in each of those countries. Each of those three vectors is driving volume capture. Examples like Sysco Your Way are enabling that success. In the middle of the P&L, we have launched strategic sourcing in every country. We did that first in the United States. We have carried that playbook to each international geography. Food is inherently purchased local, but that capability of strategic sourcing exists and that opportunity exists in every country. We are expanding our profit margins because of that excellent work done by our merchandising and buying teams. On the bottom line, deploying enterprise technology, improved warehouse technology, improved routing technology, improved back-end software to increase efficiency in businesses that were more manual than Sysco is used to and accustomed to has driven significant bottom-line growth, seventh consecutive quarter of double-digit profit growth. Alex, we are really bullish on international, and this is just within the countries that we compete within today. Our opportunities are bright in international, and we are very bullish on our long-term future internationally. Kenny, anything to add? Yeah. Alex, as we think about the margin profile of this business, there is nothing structural that impedes our ability to achieve the same profit levels in the U.S. There is a lot of upside here. Just think back a few years ago, the margin of the business was roughly 2%. Since then, we have doubled the margins to 4% now. That trend will continue. The last thing I would say is that it is a place that we will continue to invest for growth as part of our working capital strategy and the two capital application strategy. The two recent acquisitions, Reddy, Chef, and Campbell, sitting in Ireland and Great Britain, they are doing really well, off to a great start, and ahead of our own deal model from both a commercial go-to-market standpoint as well as a cost synergy standpoint. Great. Thank you. Thanks, Alex. We'll take the next question from John Heinbockel with Guggenheim. Please go ahead. Your line is open. Hey. So, Kevin, I wanted to drill down right on the sort of the Salesforce local case growth relationship. So, I assume with your commentary that local case growth is, maybe this is a wrong assumption, that it's positive today or it's crossed into positive territory. What's your current thinking on how you want to grow the Salesforce versus that seven goal that you had originally? And then what do you think, what's the right number? If the effort is working, what's the right number that local case growth should grow at, in your mind? Yeah. Good morning, John. Thanks for the question. I'll start with our expectations of colleague growth for fiscal 2026. We anticipate adding approximately 4% incremental sales professional headcount in fiscal 2026. As we look back on fiscal 2025, one of the reasons the headcount investments that we have already made are not showing up in the outcomes of the year just completed is the excess or excessive colleague turnover that we had, which resulted in an increased customer loss ratio, which was masking the incremental benefit that was coming from the new hires. It's incredibly important to note that we track every single new hire in a cohort or class that they join with. We're able to model where should they be from a productivity perspective in month three, month six, month nine, month twelve. Every one of the hiring classes that we have done, those colleagues are hitting those productivity targets. Kenny has said many times, month 13 matters. It's when they break through to begin to be productive. And eclipsing month 18 matters even more because there's a turbocharge of their productivity between month 12 and month 18. For fiscal 2026, it's very important to do the understanding of the math of increased headcount each and every quarter is hitting that incredibly pivotal 12 to 18-month period. And we're not going to be repeating the customer loss rate. Therefore, we will inflect to positive case growth in fiscal 2026 from local and profitable case growth year to boot. So, Kenny, any additional comments you'd like to make about guidance for 2026? Yeah. So if you think about the headcount, just putting it in numbers context. So in 2024, we hired 450. In 2025, we hired 300. And then, as Kevin said, 4% increase in 2026. If you add that all together, the CAGR of the growth rate of sales headcount is roughly mid-single digits. On the forward, we do believe we will render a return from this investment. That's point number one. Number two, I think we talked about this analogy before. The faucet is turning on right now. On the forward, from a long-term stability standpoint, we do expect headcount growth to be in line with volume growth, therefore driving positive leverage in our P&L. Thanks. Thanks. Thanks, John. We'll take our next question from Kelly Bania with BMO Capital. Please go ahead. Your line is open. Hi. Good morning. I was wondering if we could go back to the price agility initiative and what are the financial implications of that initiative. I believe it's intended to drive growth, but is there any sort of trade-off between margin and case growth? You mentioned maybe the desire to learn more about the change management required to support a broader rollout. Wondering if you can elaborate on that. Is it in your plan for this fiscal year that that does broadly roll out to more regions, or does this remain kind of a pilot and regional test? Yeah. Kelly, good question. Thank you. It's Kevin. I'll start. The stated financial objectives would be to improve volume, but to do so profitably. Maintaining margin percentage, but driving increased volume through the pipe. That's the stated objective. The objective is not to lower margin rate to drive volume. We could do that centrally if that was something that we wanted to do. It's to give that sales colleague the opportunity to be responsive in the spot moment to the needs of the customer. That sales colleague understands even better than a computer does the emotional items that a customer has within their menu, within their book of business. If that customer presents themselves with, "Hey, I think I can do $2 better elsewhere," we need to give that colleague the opportunity to respond in the moment. The change management I'm referring to is the need for that colleague to then be able to do something we call sell around the room, which is, "I'm going to give you that price that you just asked for, but I know you're buying produce from someone else. I have the best produce program in town. Can we talk about having my FreshPoint colleague join me next week when I visit you to get that product put onto the Sysco truck?" That's the change management. That's the selling skills development that is necessary as a part of giving more decision-making authority into the hands of that sales colleague. Kenny always makes the point that compensation for that colleague will reward them if they do the right things, which is, "If I'm going to make an investment in price, I offset it elsewhere." It will punish them if they make an investment in price and they do not succeed in offsetting that elsewhere. Again, responsibly rolling this out. We do not want to roll it out until the colleagues are prepared to be successful in that environment. We do not, to answer your question, have meaningful growth tied to this program in fiscal 2026, a.k.a. if we did not move it nationwide, we do not have risks on delivering our numbers. This is a program we intend to roll out, but we are going to roll it out at the pace of the skills development of the organization. In contrast, the other two programs that I talked about on today's program are full speed ahead. Perks 2.0, as I mentioned on my prepared remarks, up until now, Perks has been a very successful program for us. Think about it as a marketing points, loyalty, rewards-type program. It is converting to the customers that are eligible to be in Perks, which are our best customers, receiving a step-changed, differentiated, better level of service than the average customer. Think about the hotel that you prefer. Think about the airline that you prefer. Yes, you get points from those entities. If you are in their top tier, what you are really getting is a substantially better service experience. Whatever that thing is that is important to you. You get to board first. You get to put your bag in the overhead. If there is a cancellation, they are taking care of you first. That is an example only from a different industry. In our industry, we know exactly what these key tenets are that matter to our customers. These Perks customers are going to get a substantially elevated service program. We do not need to test that. We are rolling that out nationwide, and we are rolling it out this summer. It is going to make a difference. It is going to make a difference on our customer retention. It will make a difference on our penetration. We are confident, because we have been testing this in a spot market, that it will have an impact. We have accounted for that in our guidance, and we are confident in its ability to move the needle. The other program I announced today, this AI CRM, is a really big deal. As I said in my prepared remarks, to say we are excited about this would be an understatement. In the palm of the hand of our colleague, on their smartphone, they have all the tools that they need to better understand that customer, to know what things could be offered to that customer, pre-approved from a pricing perspective. If they want to learn more about that product because they're not comfortable selling the item, they can quickly ask for input on how to sell that product in a freeform, AI-based language model that gives them really good suggestions on how to sell that product. We will be rolling out AI360 coast to coast. In the places that we are piloting that tool, the response rate from our colleagues, both tenured and new, has been remarkable. As I said in my prepared remarks, where we are incredibly bullish is that newer, lower-tenured colleague who has a lot to learn about the product range we have, about the selling process that we have. This tool helps accelerate their skills development and makes them a more effective sales rep, which will increase overall productivity. Thank you. That's very helpful. Kevin, just to follow up with the Perks 2.0, can you size up what that looks like? Is it as successful as you hope in fiscal 2026 and maybe in the years to come? What is the potential there as you focus on that penetration? Yeah. For us, it's an enabler of delivering the guidance that we just provided. On today's call, I'm not going to parse out its contribution, but it's meaningful. It is absolutely meaningful. Think about Pareto. A percentage of your customers driving a disproportionate percentage of your sales and profit, that's exactly who these customers are. The customer doesn't get to opt in. We get to choose. We are specifically choosing. It's an invite only into the program club. Our sales colleagues have the opportunity to actually motivate customers who are right on the cusp. "Hey, with an extra $1,000 a week, I can get you into this program." We are bullish about this, Kelly. We will share more, let's say it this way, at upcoming investor events about this program and the expected impact we intend for it to have. Hey, Kelly. I mean, this is Kenny. Just put a bow around this one. The major driver of our growth year-on-year and local case growth in 2026 will be the stability, the retention around our sales colleagues. That's the reason why Kevin and I are so confident with the growth number, because we're seeing that right now, spot moment, right? These three things that Kevin talked about, these are added enablers that will help us as well to help for this year, but more importantly, for periods after to come. Thank you. Thanks. Bye. We'll take our next question from Edward Kelly with Wells Fargo. Please go ahead. Your line is open. Hi. Good morning, everyone. Kevin, I wanted to ask you just a brief follow-up on all this local stuff. Customer losses are improving. Is there any concern about the Salesforce turnover that you've seen over the last year, those non-competes rolling off, and potentially impacting the momentum that's coming back into the business? And then, Kenny, just one for you. I'm curious as to how you're thinking about cost per case growth in the US. If you look at this past quarter, it looks like dollars are up about 5% on flat cases, right? So call it 5% cost per case growth. What's the driver of that? And then how does that look in 2026? Is there opportunity to bring that lower next year? Thanks. Yeah. Good morning. And thank you for the question. Understood completely your question about the sales rep who departed 12 months ago when they hit month 13 and their non-compete agreement expires. Is there an echo or a ripple effect from prior year? The facts are the vast majority of the customer loss, customer departure occurs almost immediately. The why is the following. Let's say Kenny's been calling on an account for 10 years. Kenny departs. While Kenny is not able to call upon that customer, what happens is that we Sysco assign a new sales rep to that account. Right then and there, that immediate moment is where the disruption occurs. That customer then has to make a choice. Do I want to work with the new colleague? Hey, maybe I should look around. The looking around is what causes an alternative distributor to tend to get into the account. The vast majority of the loss happens immediately. There is the possible impact of the ripple 13 months later. What we can see in our data, though, is that not repeating the initial loss is a far greater positive impact on the avoidance of that negative than the ripple. Obviously, through the service improvement that we're making, Kenny mentioned this, our fill rates are improving, our on-time delivery is improving, our sales colleagues' capabilities are improving through training, skill development, and the tools that I just mentioned. We're confident that the ripple effect, the echo, is more than offset by the goodness of the programs that I just referenced and the stability of the Salesforce at Sysco and therefore the confidence in the guide in the year ahead. I'll toss to Kenny for the comments that he'd like to make about the cost question that you asked. Kenny, over to you. Yeah. Hey, Kenny. On the cost per case, I would like to bifurcate and talk about it from a COGS standpoint and also a base cost standpoint because they're a bit different here at Dynamics. You're right. Volume was flattish around USFS, but with that, our GP grew 4%. The good work that we've been doing around strategic sourcing, that's flowing through the P&L, and that's the reason why you're seeing nice leverage between volume to sales and sales to GP. Where the increased cost that you called out earlier is really driven by two main things, mostly on the base cost side of the house SG&A. Number one is our investment in SCs. These are what we call deliberate planned investments that are ROIC positive, and the return will be rendered, call it 12 to 18 months down the road from day one. That's point number one. As the local case grows within our business, that cost per piece will have a corresponding revenue tied to it. Therefore, you'll see leverage in the P&L. The second biggest piece of the cost increase is the planned and deliberate investment around capacity. You may remember we have 10 buildings going live right now around the world. Seven of them are sitting in the U.S. Think about Allentown. Think about Tampa, East Wisconsin, Braco, Los Angeles, Las Vegas, right? You can go on and on. Same dynamic. You have the cost of those buildings, mainly depreciation hitting the P&L. Then as time progresses, with the initiatives kicking in, the confidence that Kevin and I have, local case growth in particular. You will see that scale down to the P&L because that cost will be welcomed by volume. Overall, we do expect a stronger leverage in the P&L on the forward. Great. Thank you. Thanks, Ed. We'll take our next question from John Ivankoe with JP Morgan. Please go ahead. Your line is open. Hi. Thank you. Not just in food service distribution, but at least from what I hear, many industries broadly are considering consolidation at this point, whether it's AI investments or automation investments or maybe some concern or uncertainty related to tariffs. I mean, it does, again, seem that we're more primed for consolidation and deconsolidation across a lot of industries. The question that I would ask you is, how does Sysco kind of view that within food service distribution? Obviously, not making a specific comment, but just generally in terms of the opportunity to consolidate and how might the company and where might the company be able to take advantage of some opportunities to further drive efficiency and consolidation both globally, but more specifically and importantly, at least for me, within the U.S.? Thank you. Good morning, John. It's Kevin. Thank you for the question. Let me start with the AI impact on our business and the part of your question that's tied to that. Then secondarily, I'll talk about just more macro, bigger chessboard strategy. On the AI side, we got to bifurcate it into front-of-house, back-of-house, or front-end selling, back-office management. AI absolutely is and will increase our efficiency in the back-office side of the business. Kenny manages that for the company. We've centralized that activity. We offshored that activity. Now we're automating that activity. AI can help turbocharge those efforts. Our merchandising division answers a tremendous number of questions from both customers and from our own sales colleagues. The amount of volume that flows through that pipe would stagger you. We can use AI to answer intelligently, accurately, many, many, many of those questions, which can make us more efficient. We think about the back end, attack the cost, attack the cost, attack the cost. We've done a good job of taking out structural costs at our company over the past years, simultaneously taking that cost out to invest for growth. See Tampa that we just grand opened last week and the other examples that Kenny gave around the world. To be relentlessly zealot-like focused on taking structural cost out to invest in growth is the more macro strategy. On the Salesforce side, this is where I will delineate. We don't view it as a reduction in the future selling occupation in any way, shape, or form. This is a relationships-based business, and John, I know you know that. This is a relationships business. We want the technology to increase even further that sales colleague's relationship with that customer. Help do the administrative stuff. Again, the number of questions that our colleagues answer about, "Does this product have gluten? Is this allergen-free? What's the country of origin? Will I or will I not be able to substitute this for something else if we're out of stock? What substitutions would you recommend if this is out of stock? These are questions that are happening all throughout the day, every day. Hundreds of questions they're facing every day. To enable that sales colleague to answer those types of questions proactively, more efficiently, reduces substantially their administrative burden. Then guess what they get to do at that time? They get to sell. They get to look around the kitchen and see product that's not on the Sysco truck to talk about introducing our capabilities, introducing our specialty capabilities, go prospect net new customers because you have more time on your hands. We will grow our Salesforce, as we mentioned on this call, 4% approximately this coming year. We believe AI is going to turbocharge that effectiveness. As it relates to your question about consolidation in the industry, here's what we would say. We know that size and scale matter in this industry. Purchasing scale, supply chain scale, the trucking last-mile delivery, as you've heard me say before, is the most expensive part of what we do. Therefore, being efficient in that manner is important. We will continue to survey our landscape for M&A opportunities, tuck-ins, specialty purchases, because we have tremendous white space existing still in specialty. I know you didn't ask about international, but we have compelling opportunities internationally. We will be very strategic and thoughtful about our approach in the US. Obviously, we can't comment, as I said earlier, about any other companies' strategies and actions. Thank you very much. Thanks, John. We'll take our next question from Mark Carden with UBS. Please go ahead. Your line is open. Good morning. Thanks so much for taking the question. You guys called out improving industry traffic throughout the period, still not all the way back. I'm curious, are you seeing any uptick in promotional activity or upfront to the distributor level? Then related, are independent restaurants showing much in the way of incremental stress? Do you see any risk of closures sticking up there? Are they weathering it quite well? Thank you. Mark, thank you for the question. I'll start, toss to Kenny for any additional comments. Let me start with the restaurant. Operator first. We are seeing restaurants that have a strong value prop for their end customer succeeding. That's across the board, from fine dining to fast casual to QSR. Those concepts that are providing a good value to their customer are succeeding. Value could be quantity of food for price. Value could be a promotional program that they are doing. Value could be within their tier, they're perceived by the customer as providing more for the dollar than who they compete against. Those names that are having some struggles, and you know who they are, are out of tilt with their end consumer on that equation. Our job in that equation is the following. We need to provide value to the restaurant operators across from fine dining to QSR. That's our relentless focus on improving strategic sourcing to bring our cost down so we can share in that value creation with the end consumer so that they can be successful and profitable. We're doing a good job on that. In the quarter that we just ended, we had a very strong performance from a gross profit perspective. We are able to invest in our customers from a price perspective when we have that equation. As Kenny said, the goodness of what we delivered in Q4 is going to have rapid value positive into fiscal 2026. Those are our perspectives on the end restaurant consumer, on what we at Sysco are doing about it. Kenny, I'll toss to you if there's any additional comment that you'd like to make on Mark's question. Yeah. In terms of restaurant closures, from our standpoint, there's always churn in the marketplace. One thing from our side is bad debt, right? When you think about closure, you think about bad debt. The majority of our bad debt is current. Bad debt as percent of sales is less than 0.1%. We have automation tools in place to manage that one. No risk, no service to our company in terms of restaurant closures. We are not seeing, specific to your question, pain in the local mom-and-pop restaurant sector to be higher than large customers. We're not seeing that. Thanks so much. Good luck, guys. Thank you, Mark. Thanks. Thanks. That does end the Q&A portion of today's call. I'll hand the program back to Kevin and Kenny for any additional or closing remarks. Great. Thank you, everybody, for joining us. If you have any follow-up calls or questions, please feel free to reach out to the investor relations team here at Sysco. Have a great day. Thank you. This does conclude today's program. Thank you for your participation, and you may now disconnect.