Aramark (ARMK) Business Profile

What it does

Aramark provides food, hospitality, procurement and facilities services at locations operated by its clients. Founded in 1959 and headquartered in Philadelphia, the company is led by Chief Executive Officer John J. Zillmer.

Its clients include schools and universities, hospitals and senior living facilities, businesses, sports and entertainment venues, parks, and correctional institutions. At many of these locations, Aramark hires and supervises food-service staff and orders, prepares and serves food and drinks. It is the exclusive food and beverage provider at most locations it serves.

The work varies by setting. At a college, it can manage dining, catering and retail food outlets; at a hospital, it can provide patient meals and non-clinical support. At stadiums and recreational sites, its services can include concessions, merchandise, lodging and facility management. Facilities work also includes housekeeping, maintenance, energy management and groundskeeping.

Aramark organizes its operations into United States and international food and support services segments. It also provides procurement services to clients through Avendra and other businesses. Aramark Nexus extends its services to workforce communities supporting data center development, with offerings that include food, retail, housekeeping and facilities management. Aramark subcontracts the unarmed security included in that service offering.

As of October 3, 2025, the company employed approximately 278,390 people, most of them in frontline or hourly roles.

How it makes money

Fiscal 2025 revenue was $18.5 billion; third-quarter fiscal 2026 revenue was $5 billion.

Aramark is paid by a client or directly by the people using its services, depending on the location and contract. For example, a client can pay the company to manage food operations, while customers at a venue can buy food and beverages from Aramark. Its United States and international segments provide similar categories of food and support services across client sectors.

The company uses two main contract structures. Under profit and loss contracts, Aramark receives the revenue and pays the expenses of providing services at a location. It may also pay the client a fixed or variable share of revenue, sometimes subject to a minimum guarantee. These contracts accounted for approximately two-thirds of fiscal 2025 revenue.

Client interest contracts include management arrangements in which clients reimburse operating costs and pay a fee. The fee can be fixed or based on revenue or operating costs, and some contracts provide incentives tied to measures such as revenue, costs or client satisfaction. Other client interest arrangements give Aramark a share of profits, generally with no payment if the operation loses money. These contracts accounted for approximately one-third of fiscal 2025 revenue.

Contracts generally have fixed terms, and many run for more than a year. Education and sports and leisure contracts usually run from five to fifteen years and may require investments in facilities or equipment. Some contracts require client consent before Aramark raises prices. Nexus contracts are primarily cost-reimbursable.

Customers and how it sells

Aramark serves institutions and businesses under contracts at their locations, as well as the students, patients, employees, fans and guests who use those sites. Schools and hospitals provide access to people already on site, while sports and entertainment clients attract visitors for events. Contracts can be won or renewed through competitive processes or negotiation; public-sector work is frequently awarded through competitive bids.

No individual client represented more than 2% of total revenue in fiscal 2025, other than a number of United States government agencies considered collectively. Aramark serves thousands of clients across education, healthcare, business, sports, leisure, corrections and facilities services.

The United States is its main market. In fiscal 2025, the FSS United States segment generated $13.2 billion in revenue, or 71.4% of total revenue; FSS International generated $5.3 billion, or 28.6%. These are segment figures rather than a breakdown of revenue by the country where it originated.

International operations include Canada, Chile, China, Germany, Spain, Ireland and the United Kingdom. Aramark also provides services on a more limited basis in other countries and offshore locations.

Suppliers and costs

Aramark negotiates prices and other terms for most food and related products directly with manufacturers and suppliers, then generally buys through distributors. In the United States and Canada, those distributors include Sysco, US Foods and Performance Food Group. Local managers also buy products such as bread, dairy and alcoholic beverages from local suppliers, and the company purchases some items directly from manufacturers.

Sysco distributed approximately 43% of Aramark’s food and non-food products in the United States and Canada by purchase dollars in fiscal 2025. Aramark believes products obtained through Sysco can, in significant cases, be purchased elsewhere and that a disruption to the relationship would cause only short-term operational disruption. Outside Canada, international purchasing is organized country by country.

Direct operating costs include food, wages, other labor expenses, insurance, fuel, utilities, clothing and equipment. Rebates, vendor allowances and volume discounts offset food costs. Aramark typically retains supplier discounts and credits unless its contract or applicable law requires it to pass them to a client.

Some client agreements require investments in improvements, equipment or grants. Equipment and leasehold improvements typically become the client’s property when a contract ends, although the client generally must reimburse any undepreciated or unamortized investment.

Competitive position

Aramark competes for contracts against food and support-service providers and against institutions that choose to run their own operations. Clients can also move services to another provider when a contract expires or is terminated.

In the United States, named competitors include Compass Group plc, Delaware North Companies Inc. and Sodexo SA. Internationally, Aramark names Compass Group plc, Elior SA, ISS and Sodexo SA, alongside regional and local providers. The company cites service quality and breadth, management talent, innovation, reputation, pricing, financial strength and purchasing scale as competitive factors.

Aramark’s contracts can establish it as the exclusive food and beverage provider at a location, and education and sports and leisure agreements often have longer terms. The company also negotiates with suppliers across its operations and receives volume discounts, rebates and credits. It reported client retention of approximately 98% entering the fourth quarter of fiscal 2026.

Our reading: Contract duration and exclusive access can support client relationships, but renewals remain contestable and clients can take services in-house. Our reading: Purchasing scale can help Aramark negotiate supplier terms, although price and service quality also matter when contracts are awarded. Our reading: Its breadth of services gives it several ways to serve an institution, but the named rivals also compete across food and support services.

Growth opportunities

Aramark’s fiscal 2025 revenue increased by 6.4% from fiscal 2024, primarily through growth in existing business, net new business and the estimated impact of the additional week in fiscal 2025. The company estimated that the additional week contributed approximately 2% to the increase. Revenue growth was partly offset by exits from some lower-margin accounts and foreign currency translation.

In the third quarter of fiscal 2026, the company reported organic revenue growth of 9%. New client wins totaled more than $1.6 billion fiscal year-to-date. Aramark has also won work in collegiate hospitality, healthcare, mining and other sectors, and provides procurement services to clients across regions.

Nexus is another area of expansion. Aramark began operations at a Texas site supporting a global hyperscaler and was mobilizing a second site. It also secured a multiyear engagement to serve workforce communities for an AI data center colocation provider. The company expects the first hyperscaler site to generate approximately $140 million per year and the second around $160 million a year, based on its expected size. Those are site estimates, not reported revenue.

Aramark expects other large companies to enter this market. It is still refining its estimate of the market’s size and believes it is in the many billions of dollars. The company says site ramp-ups depend on how quickly clients bring employees to their locations.

Structural risks

• Contract retention and terms: Failure to retain clients, renew contracts on comparable terms or win new contracts on expected terms could adversely affect the business. Clients may bring services in-house or switch providers when agreements end.
• Operating costs and pricing: Food and labor are direct costs, and some contracts require client consent before prices can rise. Profit and loss contracts leave Aramark responsible for the expenses of serving a location and can include minimum payments to clients.
• Debt and interest rates: Leverage can limit access to capital and flexibility, while variable-rate borrowings expose the company to rising interest rates. Debt agreements also restrict certain transactions, investments and additional borrowing.
• Food, safety and regulation: Food and beverage laws can expose Aramark to liability and reputational harm. Compliance failures can lead to penalties, loss of licenses or exclusion from government contracts; additional regulations can also increase compliance costs.
• Timing and external conditions: Economic conditions, foreign currency movements and inflation can affect results. Aramark also says evolving regulation could defer data center project rollouts, while Nexus site ramp-ups depend on client staffing.

Bottom line

Our reading

Our reading: Aramark is a contract-services business built around operating food and facilities programs at institutions and venues, with purchasing scale and client relationships supporting its model. [item1] Its exposure includes the cost and revenue risk it assumes under profit and loss contracts, contested renewals and debt, while Nexus adds a newer, primarily cost-reimbursable source of growth whose timing depends on client projects. [item1, item1a, call_qa, facts]