Darden Restaurants on Thursday reported weaker-than-expected sales as Olive Garden and LongHorn Steakhouse underperformed analysts’ projections.
Shares of the company were up in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
Darden reported fiscal third-quarter net income of $323.4 million, or $2.74 per share, up from $312.9 million, or $2.60 per share, a year earlier.
Excluding costs related to its acquisition of Chuy’s, Darden earned $2.80 per share.
Net sales rose 6.2% to $3.16 billion, fueled largely by the addition of Chuy’s restaurants to its portfolio.
Darden’s same-store sales rose 0.7%, less than the 1.7% increase expected by analysts, according to StreetAccount estimates.
Both Olive Garden and LongHorn Steakhouse, which are typically the two standouts of Darden’s portfolio, reported underwhelming same-store sales growth. Olive Garden’s same-store sales rose 0.6%. Analysts were anticipating same-store sales growth of 1.5%. And LongHorn’s same-store sales increased 2.6%, missing analysts’ expectations of 5% growth.
Darden’s fine dining segment, which includes The Capital Grille and Ruth’s Chris Steak House, reported same-store sales declines of 0.8%.
The last segment of Darden’s business, which includes Cheddar’s Scratch Kitchen and Yard House, saw same-store sales shrink 0.4% in the quarter.
For the full year, Darden reiterated its forecast for revenue of $12.1 billion. It narrowed its outlook for adjusted earnings from continuing operations to a range of $9.45 to $9.52 per share. Its prior forecast was $9.40 to $9.60 per share.
Darden’s fiscal 2025 outlook includes Chuy’s results, but the Tex-Mex chain won’t be included in its same-store sales metrics until the fiscal fourth quarter in 2026.
