Credit: Harrison Keely / Wikimedia Commons (CC BY 4.0)
Darden $DRI Restaurants showed a split performance in fourth-quarter earnings released Thursday, with Olive Garden missing same-store sales targets, LongHorn Steakhouse outpacing the field, and a fiscal 2027 forecast that disappointed investors expecting more.
Olive Garden posted same-store sales growth of 2.4% for the quarter ended May 31. Analysts had projected 3.2% growth. LongHorn Steakhouse, by contrast, reported same-store sales growth of 9.5%, beating analyst estimates of 7.1%, according to CNBC. Across all of Darden's brands, blended same-store sales rose 4.6%.
Adjusted earnings per share came in at $3.66, above the $3.63 analysts expected. The addition of an extra week in the fiscal calendar helped push total net sales up 13.7%, to $3.72 billion. Net income reached $404.9 million for the quarter, up from $303.8 million a year earlier, the company said.
Same-store sales at Darden's fine-dining division, home to The Capital Grille and Ruth's Chris Steak House, came in at 1.9% growth — below the 3.1% analysts had anticipated. Rounding out the portfolio, the segment housing smaller chains such as Yard House and Chuy's delivered 4.6% same-store sales growth, ahead of the 3% analysts had projected.
For full fiscal 2026, Olive Garden same-store sales grew 4.0% and LongHorn Steakhouse grew 7.2%, the company said. Total annual sales rose 9.4% to $13.21 billion.
For fiscal 2027, Darden set a revenue target of $13.60 billion to $13.75 billion, with net earnings per share from continuing operations expected between $11.10 and $11.35 — a range that fell short of the $13.72 billion in sales and $11.40 per share that analysts had anticipated. Darden also forecast same-store sales growth of 2.5% to 3.5% and between 75 and 80 new restaurant openings during the year.
Darden's board also declared a quarterly cash dividend of $1.62 per share, an 8.0% increase from the prior quarter, and authorized a new $1.5 billion share repurchase program, the company said.
Darden President and CEO Rick Cardenas called the fourth quarter "a strong finish to an excellent year" in a statement, saying the company "significantly outperformed the industry." Darden stock fell more than 3% in premarket trading.
