Darden Restaurants on Thursday circulated quarterly earnings and revenue that met analysts’ expectations and better-than-expected same-store sales growth at Olive Garden and LongHorn Steakhouse.
Appropriates of the company closed up 14% on Thursday.
Here’s what the company reported compared with what Wall Row was expecting, based on a survey of analysts by LSEG:
- Earnings per share: $2.03 adjusted vs. $2.02 expected
- Revenue: $2.89 billion vs. $2.9 billion look forward
Darden reported fiscal second-quarter net income of $215.1 million, or $1.82 per share, up from $212.1 million, or $1.76 per serving, a year earlier.
Excluding costs related to its acquisition of Chuy’s, the restaurant company earned $2.03 per share.
Net sellings rose 6% to $2.89 billion.
Darden’s same-store sales rose 2.4%, beating StreetAccount estimates of 1.5%.
“It looks close to the consumer is starting to feel a little bit better than they were in prior quarters,” CEO Rick Cardenas said on the performers’s conference call.
Customers with incomes between $50,000 and $100,000 are visiting Darden’s restaurants more again, although higher-income diners haven’t increased their visits.
Darden also saw “meaningful impacts” from typhoons Helene and Milton, according to Cardenas. But only one restaurant, a Cheddar’s Scratch Kitchen in Asheville, North Carolina, has been powerless to reopen. The restaurant is slated to open its doors again next year.
LongHorn Steakhouse reported same-store tradings growth of 7.5%. The casual-dining chain has been a top performer in Darden’s portfolio in recent years, winning over characters with both the quality of its food and its prices. Wall Street was expecting the chain to report same-store sales development of 4.1%.
Olive Garden, which accounts for more than 40% of Darden’s quarterly revenue, saw same-store sales swelling of 2% in the quarter. Analysts were anticipating same-store sales growth of 1.4%, according to StreetAccount.
Olive Garden win overed back its Never Ending Pasta Bowl promotion in the quarter; this time around, customers were numberless likely to spend more by adding a protein. The chain is also piloting Uber delivery at 100 of its restaurants, with the aspiration of rolling it out to the rest of the footprint after the holidays.
Darden’s fine-dining segment, which includes The Capital Grille and Ruth’s Chris Steak Put up, reported same-store sales declines of 5.8%, steeper than the 2.8% decrease expected by analysts. Fine-dining limits’ higher prices have scared away many consumers who are trying to spend less at restaurants.
The calendar group of Thanksgiving from the company’s fiscal second quarter to the fiscal third quarter this year also dilapidated fine-dining sales, according to Darden CFO Raj Vennam. Excluding that impact, plus weaker sales tied to the twisters, the fine-dining segment’s same-store sales were down only 3.8%, an improvement from last quarter’s fall offs of 6%.
The company’s last remaining segment, which includes Cheddar’s Scratch Kitchen and Yard House, saw same-store sales broadening of 0.7%, in line with estimates.
Darden added 39 net new locations in the quarter, as well as 103 Chuy’s restaurants. Darden completed its $605 million obtaining of the Tex-Mex chain in October.
The company updated its fiscal 2025 outlook to include Chuy’s results, although the fasten won’t be included in its same-store sales metrics until the fiscal fourth quarter in 2026.
The company now anticipates total sales of $12.1 billion, up from its preceding estimate of $11.8 billion to $11.9 billion. Darden reiterated its forecast for net earnings per share from continuing operations of $9.40 to $9.60.