Darden Restaurants, the parent company of Olive Garden and LongHorn Steakhouse, reported quarterly results on Friday that beat Wall Street’s expectations for both earnings and revenue, CNBC reports.
The company also issued a positive outlook for fiscal year 2026, projecting further growth despite mixed consumer spending trends.
For the fiscal fourth quarter, Darden posted adjusted earnings per share of $2.98, narrowly surpassing the $2.97 anticipated by analysts surveyed by LSEG. Revenue for the quarter reached $3.27 billion, slightly ahead of the $3.26 billion consensus estimate. Net sales increased by 10.6% to $3.3 billion, driven in part by the acquisition of 103 Chuy’s Tex Mex restaurants and the opening of 25 net new locations.
Same-store sales, a key industry measure, rose 4.6%—beating the 3.5% growth expected by analysts. Olive Garden, which accounts for roughly 40% of Darden’s revenue, saw same-store sales climb 6.9%, while LongHorn Steakhouse reported a 6.7% increase. Both results topped Wall Street’s projections.
Darden’s CEO, Rick Cardenas, attributed the quarter’s strong sales in part to the return of Olive Garden’s popular “Buy One Take One” deal, which had been paused for five years. Cardenas also noted that, while some consumers are cutting back on overall spending, casual dining is still attracting guests, potentially gaining market share from fast food and fast casual competitors.
The company’s fine dining brands, which include Ruth’s Chris Steak House and The Capital Grille, experienced a same-store sales decline of 3.3%, a slightly larger drop than analysts expected. However, Darden’s CFO Raj Vennam noted improvement in guest traffic from higher-income households in this segment. The company’s other brands, including Cheddar’s Scratch Kitchen and Yard House, reported same-store sales growth of 1.2%.
Looking ahead, Darden forecasts revenue growth of 7% to 8% for fiscal 2026, with 2% of that increase due to an extra week in the fiscal year. The company expects adjusted earnings per share in the range of $10.50 to $10.70, including a 20-cent boost from the additional week.
Darden also announced it is evaluating “strategic alternatives” for its Bahama Breeze brand, which may include a sale or converting those locations to other Darden concepts. The brand is no longer considered a strategic priority.
Additionally, Darden’s board of directors authorized a new $1 billion share repurchase program.
Following the earnings report, Darden’s stock rose nearly 2% on Friday. Year to date, shares have gained about 19%, reflecting investor confidence in the company’s growth strategy and performance.
