Darden Restaurants’ (NYSE:DRI) quarterly earnings and revenue beat analysts’ expectations, shaking off inflationary pressures as diners returned to LongHorn Steakhouse and The Capital Grille.
In the face of higher costs and economic uncertainty, Olive Garden’s parent company issued a mixed forecast for fiscal 2023.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
Darden reported fiscal fourth-quarter net income of $281.7 million, or $2.24 per share, down from $368.5 million, or $2.78 per share, a year earlier. Earnings per share came in at $2.24.
Analysts were expecting EPS of $2.21, on revenue of $2.6 billion, compared to an expected $2.54 billion
Net sales rose 14.2% to $2.6 billion, topping expectations for $2.54 billion. Across the company’s chains, same-store sales climbed 11.7%, fueled by the rebound of its fine-dining business.
Its fine-dining restaurants, which include The Capital Grille and Eddie V’s, reported same-store sales growth of 34.5%. The segment was hardest hit by the pandemic but its sales surpassed 2019 levels in the fiscal fourth quarter.
Olive Garden, which accounts for nearly half of Darden’s revenue, saw its same-store sales rise just 6.5% in the quarter. Wall Street was expecting same-store sales growth of 7.2% for the Italian-inspired chain, according to StreetAccount estimates.
Strong demand for LongHorn Steakhouse helped make up the difference. The steak restaurant chain reported same-store sales growth of 10.6%, beating analysts’ estimates of 5.6%.
DRI shares surged $1.44, or 1.3%, to $116.56 Thursday morning.
