Cintas (CTAS 3.69%) announced its fiscal 2025 fourth-quarter results on Thursday, July 17, with revenue up 8% year over year to $2.67 billion and diluted EPS up 9% to $1.09, with record full-year revenue of $10.34 billion and EPS growth of 16.1%. The company projects fiscal 2026 revenue of $11 billion–$11.15 billion (6.4%–7.8% growth) and EPS of $4.71–$4.85 (7%–10.2% growth), while highlighting robust recurring business performance, disciplined capital allocation, and technology-driven productivity initiatives.
The following insights examine differentiated growth, margin drivers, and capital deployment shaping long-term value creation.
Cintas’ 2025 Margin Expansion Was Driven by Technology and Supply Chain Optimization
Gross margin for the Uniform Rental and Facility Services segment increased by 40 basis points to 49%, while First Aid and Safety Services delivered a 140 basis point margin increase to 56.8%. Productivity improvements stem from continued adoption of SAP enterprise systems, auto sortation in plants, and the SmartTruck platform, which together enable both cost efficiencies and improved service delivery.
“Our progress year over year reflects the positive impacts made by our excellent supply chain team, as well as cost savings initiatives such as our garment sharing, technology enhancements like our auto sortation systems in our plants, and our proprietary Smart Truck solution that makes our routes more efficient.”
— Jim Rozakis, Executive Vice President and Chief Operating Officer
Ongoing technology and process investments are structurally lifting margins and generating durable cost advantages, improving the quality of earnings and positioning Cintas to maintain margin leadership regardless of macro volatility.
Cintas Saw Record Capital Deployment and Transformative M&A in Fiscal 2025
The company generated $1.6 billion in free cash flow during FY2025 and deployed $2.23 billion toward acquisitions. It was the largest year of M&A activity in nearly two decades outside of the 2017 G&K acquisition, and it deepened customer penetration and unlocking synergy value across all three route-based businesses. Additional capital priorities included $409 million in capex (4% of revenue), $612 million in dividends (forty-first consecutive annual increase), and $935 million in share repurchases.
“We invested $2.2329 billion in acquisitions in fiscal 2025 representing our largest year of M&A activity in almost 20 years, excluding our 2017 acquisition of G&K. These acquisitions span across each of our three route-based segments adding new customers, extending capacity, and delivering compelling synergies.”
— Scott Garula, Executive Vice President and Chief Financial Officer
This aggressive yet balanced capital allocation strategy, anchored by substantive bolt-on acquisitions, accelerates route density, market penetration, and service breadth, creating a structural foundation for enhanced recurring revenue.
Exceptional Growth in First Aid and Safety Segment Highlights Cintas’ Diversification
The First Aid and Safety segment outperformed with 18.5% organic growth, further supported by uptake in recurring revenue products such as AED rentals, eye wash stations, and water break, alongside a discrete training-related surge. Management expects this business to maintain low double-digit growth rates, demonstrating consistent end-market demand and expanding the company’s reach beyond its traditional uniform rental core.
“Our first aid business was propelled by a great performance in our training area, which tends to be more discrete and one-time in nature. Our uniform direct sale business grew 9% in the quarter, which was a really strong close to what was a bumpy year. So, a little bit more one-time in nature there.”
— Todd Schneider, President and Chief Executive Officer
The strong recurring revenue growth in first aid, supported by ongoing product innovation and broad customer adoption, reinforces the company’s diversification and resilience.
Looking Ahead
For FY2026, management expects revenue of $11 billion–$11.15 billion (6.4%–7.8% growth) and diluted EPS of $4.71–$4.85 (7%–10.2% growth), with operating margin forecast to exceed 23% and incrementals in the high twenties. The outlook assumes no material acquisitions or share repurchases, a 20% effective tax rate, and unchanged macro conditions. Management reiterates its commitment to mid–high single-digit organic revenue growth, double-digit expansion in first aid and fire, and disciplined capital expenditure of 3.5%–4% of revenue.
This article was created using Large Language Models (LLMs) based on The Motley Fool’s insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool recommends Cintas. The Motley Fool has a disclosure policy.
