Darden Restaurants beats earnings estimates, as Olive Garden parent predicts growth in 2026
Darden Restaurants on Friday beat Wall Street's earnings and revenue estimates, while the Olive Garden parent predicted solid growth for fiscal year 2026.
Shares of Darden rose more than 2% in premarket trading Friday.
Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
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 fiscal fourth-quarter 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 year 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 in March during the company's third-quarter earnings call that dining out has remained a category where consumers continue to treat themselves and splurge.
"Our strategy remains the right one for the company, and we will continue to execute it to drive growth and long-term shareholder value," he said in a release Friday.
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%.
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% decline expected.
The company's remaining segment, which includes Cheddar's Scratch Kitchen and Yard House, saw same-store sales growth of 1.2%, compared to 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. At that time, Darden said Cheddar's was conducting the pilot in 10 of its restaurants.
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 is up about 19% year-to-date.
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