A sign is displayed in front of an Olive Garden restaurant on June 22, 2023 in Chicago, Illinois.
Scott Olsen | Getty Images
Darden Restaurant The company on Thursday reported weaker-than-expected quarterly profit and revenue due to weak sales at its Olive Garden and fine-dining restaurants.
“While the first quarter fell short of our expectations, I remain firm in the strength of our business,” CEO Rick Cardenas said in a statement. “I am confident in the steps all of our brand teams are taking to address our guests’ needs, and we will not sacrifice the long-term health of our business for short-term gains.”
The company’s shares rose about 10% in premarket trading despite the earnings report.
Here’s how what the company reported for the quarter ended August 25 compares to Wall Street expectations, based on an analyst survey by LSEG.
- Adjusted earnings per share: $1.75 (expected: $1.83)
- Revenue: $2.76 billion (predicted: $2.8 billion)
Darden said first-quarter net income was $207.2 million, or $1.74 per share, up from $194.5 million, or $1.59 per share, in the same period last year.
Excluding costs related to its acquisition of the Tex-Mex chain Chuy’s, the restaurant company earned $1.75 per share.
Sales Sales rose 1% to $2.76 billion, but the company’s same-store sales fell 1.1% for the quarter. Chief Financial Officer Raj Venham said customer traffic at its restaurants fell sharply in July but has since recovered.
Olive Garden’s same-store sales fell 2.9% during the quarter, and the chain plans to bring back its NeverEnding Pasta Bowl later this month in an effort to lure customers back.
Darden’s fine dining division, which includes Eddie V’s and Capital Grille, reported a 6% drop in same-store sales.
LongHorn Steakhouse was the company’s only division to report same-store sales growth: The chain, the best-performing in Darden’s portfolio since the pandemic began, saw same-store sales increase 3.7%.
Despite the dismal quarter, Darden reiterated its full-year outlook: It now expects earnings per share from continuing operations to be between $9.40 and $9.60, and net sales to be between $11.8 billion and $11.9 billion.
