Cintas Corporation (CTAS) Earnings & Analysis

Latest quarter

Cintas reported Q1 FY2027 revenue of $3.0 billion, up 10.9% from Q1 FY2026. The company reported revenue of $3.0 billion as the consensus counts it, exceeding the consensus by 1.58%. Cintas also reported adjusted EPS of $1.39, above the consensus adjusted EPS of $1.35 by 2.96%, while diluted EPS was $1.36, up 13.3% from a year earlier.

The filing says Uniform Rental and Facility Services revenue reached $2.3 billion, while First Aid and Safety Services revenue was $388.5 million. Cintas attributed revenue growth to new business, additional products and services sold to existing customers, price increases and customer retention. The company reported a gross margin of 51.5%, up 1.3 percentage points, and an operating margin of 23.6%, up 0.9 percentage points. The filing attributed operating-margin expansion to more efficient in-service inventory usage, sourcing initiatives, efficiency gains and fixed-cost leverage. Cintas reported free cash flow of $464.8 million, up 48.7% from Q1 FY2026.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Chief Executive Officer Todd Schneider said Cintas continued to see consistent demand as businesses considered outsourcing services. In response to questions about the sources of growth, President and Chief Operating Officer Jim Rozakis said new business remained the largest driver, with more than two-thirds of new business coming from businesses without existing programs. Rozakis said retention and cross-selling also improved, while pricing was consistent with prior years and was the least important of the company’s four rental-growth inputs.

Schneider said Cintas had not seen changes in sales cycles and described its customer base as broadly stable, while noting that conditions varied among customers. Rozakis said customers in a dynamic environment were seeking solutions, consistency and help operating their businesses. Schneider said the company operates in a competitive market and manages inflation by seeking operating efficiencies rather than simply passing costs through to customers. He also said Cintas does not use fuel surcharges; the company expects energy costs for the remainder of the year to be somewhat above Q1 levels and said those assumptions are included in its outlook.

Chief Financial Officer Scott Garula said the extra workday added 50 basis points to Q1 operating margin, which was offset by 50 basis points of transaction-related expenses. Garula said Cintas invested $107.5 million in capital expenditures, primarily in technology, automation, capacity expansion and infrastructure. He said the company increased its regular quarterly dividend by 15.6% and had made $545 million in share repurchases through the call date.

On margins for the year, Schneider said the updated outlook implies incremental margins of 32 to 34, and Garula said the workday benefit in Q1 would become a headwind in Q3. Schneider said the proposed acquisition remained subject to regulatory clearances in the U.S. and Canada, that Cintas expected it to close by the end of calendar 2026, and that the company would not provide additional commentary on the process.

Guidance

Cintas raised its FY2027 revenue guidance to $12.15 billion to $12.27 billion from $12.10 billion to $12.25 billion. The company also raised FY2027 adjusted diluted EPS guidance to $5.45 to $5.54 from $5.36 to $5.50. Garula said the outlook assumes no future acquisitions and constant foreign-currency exchange rates, and excludes future share buybacks, significant economic disruptions or downturns, and non-recurring transaction costs related to the proposed acquisition.