Darden Restaurants on Friday beat Wall Street’s earnings and revenue estimates, while the Olive Garden parent predicted solid growth for fiscal 2026.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Earnings per share: $2.98 adjusted vs. $2.97 expected
- Revenue: $3.27 billion vs. $3.26 billion expected
Darden reported fiscal fourth-quarter net income of $303.8 million, or $2.58 per share, compared with $308.1 million, or $2.58 per share, a year earlier.
Excluding costs related to its Chuy’s Tex Mex acquisition, Darden earned $2.98 per share for the three-month period ended May 25.
Net sales rose 10.6% to $3.3 billion, fueled in part by acquiring 103 Chuy’s restaurants and 25 net new restaurants.
The Orlando, Florida-based company’s same-store sales rose 4.6%, beating StreetAccount estimates of 3.5%.
For the full fiscal 2026, Darden gave a forecast for revenue growth of 7% to 8%, including approximately 2% growth related to having an extra week in the year. It expects adjusted earnings to be in a range of $10.50 to $10.70 per share, including 20 cents related to the additional week.
Despite signs of consumers pulling back on spending, Darden Restaurants CEO Rick Cardenas said during a call Friday with analysts that consumers are continuing to spend on casual dining.
“Our consumers want to go out and spend their hard-earned money. And we think we’re taking some wallet share from fast food and fast casual,” he said.
Darden’s two standout brands, Olive Garden and LongHorn Steakhouse, reported same-store sales growth that beat expectations. Olive Garden, which accounts for roughly 40% of Dardan’s quarterly revenue, saw same-store sales rise 6.9%, beating analysts’ expectations of 4.6%. LongHorn’s same-store sales increased 6.7%, while analysts were anticipating growth of 5.3%.
Cardenas credited Darden’s sales during the quarter, in part, to the return of Olive Garden’s “Buy One Take One” deal after five years, which offers customers a meal to go along with their sit-down meal.
Darden’s fine dining segment, which includes Ruth’s Chris Steak House and The Capital Grille, reported a same-store sales decline of 3.3%, compared with the 0.2% drop expected.
CFO Raj Vennam told analysts on the call Friday that the fine dining category as a whole continues to be challenged, but the company is seeing improvement in guest traffic from households earning $150,000 and above.
The company’s remaining segment, which includes Cheddar’s Scratch Kitchen and Yard House, saw same-store sales growth of 1.2%, compared with estimates of 1.1%.
In March, Cheddar’s Scratch Kitchen became the next Darden brand, after Olive Garden, to pilot on-demand delivery through a partnership with Uber Direct. As of last week, delivery is available in all but eight Cheddar’s restaurants, Cardenas said on Friday’s call.
In addition to Darden closing 15 Bahama Breeze restaurants during the quarter, Cardenas said the company will be considering “strategic alternatives” for the entire Bahama Breeze brand, including a potential sale or converting the locations to other Darden brands.
He said during the call that the Bahama Breeze brand is not a “strategic priority” for Darden and that it has the potential to benefit from a new owner.
The company also announced that on Wednesday, its board of directors authorized a $1 billion share repurchase program, which does not have an expiration date and replaces the previously existing share repurchase authorization.
Darden Restaurants stock rose more than 1% in trading Friday. As of Wednesday’s close, the shares were up about 19% year to date.
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