Darden Restaurants reported a strong Q3 FY2026 with same-restaurant sales growth of 4.2% and EPS of $2.95, significantly outperforming the casual dining industry. Management raised full-year revenue and same-store sales guidance while maintaining EPS guidance at the higher end. Key themes include widening market share gains, successful lighter portion menu at Olive Garden, and strong beef demand at Longhorn. Commodity inflation is expected to moderate in Q4 with improved pricing coverage. Darden's same-restaurant sales growth of 4.2% beat the industry by 540 bps, with all major segments positive.
Darden Restaurants reported a strong Q3 FY2026 with same-restaurant sales growth of 4.2% and EPS of $2.95, significantly outperforming the casual dining industry. Management raised full-year revenue and same-store sales guidance while maintaining EPS guidance at the higher end. Key themes include widening market share gains, successful lighter portion menu at Olive Garden, and strong beef demand at Longhorn. Commodity inflation is expected to moderate in Q4 with improved pricing coverage. Darden's same-restaurant sales growth of 4.2% beat the industry by 540 bps, with all major segments positive.
Despite weather and beef cost challenges, management emphasized strong results, widened industry outperformance, and expressed confidence in meeting guidance and long-term framework.
Guidance · revenue to 9.5%
Same-restaurant sales beat industry by 540 basis points in Q3. Despite weather and beef cost challenges, management emphasized strong results, widened industry outperformance, and expressed confidence in meeting guidance and long-term framework.
Longhorn Steakhouse comps were +7.2%, benefiting from quality execution and relative value vs. retail beef prices.
Management discussed using AI and machine learning for forecasting, scheduling, and food ordering to improve operations, but emphasized it amplifies rather than replaces people. They are using AI in the support center for repetitive tasks and code writing, but have not taken jobs out because of it.
Same-restaurant sales beat industry by 540 basis points in Q3. Despite weather and beef cost challenges, management emphasized strong results, widened industry outperformance, and expressed confidence in meeting guidance and long-term framework.
For fiscal 2027, Darden expects to open 75-80 new restaurants plus convert 14 Bahama Breeze locations, with capex of approximately $850 million, including $475 million for new restaurants, $25 million for conversions, and $350 million for maintenance, refresh, and technology.
Despite weather and beef cost challenges, management emphasized strong results, widened industry outperformance, and expressed confidence in meeting guidance and long-term framework.
“For Q4, we have 85% fixed price coverage. So we have actually, this is, you know, really pretty strong coverage relative to recent past.”
| 지표 | 기간 | 범위 | 중간값 | 상태 |
|---|---|---|---|---|
| Capex | FY2027 | $850M | $850M | GUIDED |
| EPS | FY2026 | $10.57–$10.67 | $10.62 | MAINTAINED |
| EPS | FY2026 Q4 | $3.59–$3.69 | $3.64 | GUIDED |
| Revenue | FY2026 | 9.5% | 9.5% | RAISED |
| Revenue | FY2026 Q4 | 13%–14.5% | 13.75% | GUIDED |
| Units | FY2027 | $75–$80 | $77.5 | GUIDED |
| 제시 시점 | 지표 | 목표 기간 | 가이던스 | 실제 | 결과 |
|---|---|---|---|---|---|
| FY2026 Q2 | EPS | FY2026 | $10.50–$10.70 | $10.64 | Met / beat |
| FY2026 Q1 | EPS | FY2026 | $10.50–$10.70 | $10.64 | Met / beat |
Uber delivery mix for Olive Garden is growing (4.7% of sales) with management noting they may continue to market delivery as a secondary message, indicating a deepening partnership and incremental revenue for Uber.
“Uber was 4.7% of sales for Q3. Now, we did do some media support.”
Hey, thanks for taking the questions. Maybe starting, could you dig into the delivery at Olive Garden during the quarter? I think you've been running about 4% mix last period. Did much change? And going forward, how are you thinking about pulsing it as you're moving into the fourth quarter? Obviously, there's a different macro dynamic happening right now, and that's a higher price trend. Well, there's the delivery fees on top of it. So I'm just curious if there's going to be a brighter spotlight on that relative to previous quarters.
Yeah, John, a couple of things. Uber was 4.7% of sales for Q3. Now, we did do some media support. So when we took that four-week promotion out, so three weeks less price pointed, we took that one out in January. We replaced it with just a delivery message that had no offer. It was just, hey, Olive Garden delivers. And then in February, we added an offer to the Olive Garden delivery to pre-delivery like we did last year. And so, you know, last year in Q3, we were roughly 0.8 in delivery. Last year in Q4, we were 3.5. So you saw that big jump when we started marketing delivery in Q4. So I would say that in Q4 this year, I'm not going to tell you if we're going to do marketing for delivery, but if we do, it would be a secondary message. And I would think that the jump in delivery from Q3 this year to Q3 last year won't be the same in Q4 because that's when we had the big spike. But we still believe that delivery should be a little bit higher than last year.