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Darden Restaurants, the parent company of Olive Garden and Ruth’s Chris Steakhouse, beat analysts expectations with its profit results in its quarterly earnings Thursday, but had less than expected revenue, according to Marketwatch and CNBC.
Darden reported a fourth quarter income of $308.1 million, down from $315.1 million a year ago, with adjusted earnings per share of $2.65, compared to analysts expectations of $2.61, according to Marketwatch. While sales rose 6.8% to 2.96 billion, analysts had expected $2.97 billion, Marketwatch and CNBC reported.
“We had a strong year by staying disciplined, being brilliant with the basics, and controlling what we could control,” Darden President & CEO Rick Cardenas said in a statement. “This enabled us to exceed the high end of the EPS range we provided at the beginning of the fiscal year despite weakening conditions that emerged in the back half of the year.”
While sales increased 4% at Longhorn Steakhouse, they decreased 1.5% at Olive Garden and 2.6% in the fine dining segment. Overall sales increased 6.8% to $11.4 billion through the addition of 80 company-owned Ruth’s Chris Steak House restaurants and 37 other net new restaurants, according to the company’s release.
For fiscal year 2025, Darden is forecasting same restaurant sales growth of 1% to 2%, and 45 to 50 new restaurant openings.
Darden Restaurants bought Ruth’s Chris Steakhouse for $715 million last year.
“We’re not going to do things to buy sales, even with the increased discounting our competitors are doing ... Our focus is on profitable sales growth,” Cardenas said, according to CNBC. Darden CFO Raj Vennam said the company expects to raise prices 2% to 3% in line with inflation, CNBC reported.
The company also missed revenue expectations in its last quarterly earnings report, with many lower income customers pulling back on spending.