Cava Group, a fast-casual Mediterranean restaurant chain, beat fourth-quarter earnings estimates and reached over $1 billion in revenue for the first time. The news pushed shares up about 10 percent in after-hours trading.
Same-store sales rose 0.5 percent in the fiscal fourth quarter ending in December, beating analysts’ predictions of a 1.1 percent decline. Higher menu prices and changes in product mix helped boost sales, even though customer traffic fell by 1.4 percent.
Earnings were 4 cents a share on $275 million revenue, topping estimates of 3 cents and $268 million. Revenue rose nearly 21 percent year over year.
CFO Tricia Tolivar said the company’s business model helps keep price increases low, which supports customers’ sense of value as industry margins get tighter. Cava raised prices by about 1.7 percent at the start of 2025 and expects only small increases going forward.
After a drop in younger customers earlier, Cava saw a rebound last quarter, with gains across different income levels, age groups, and regions. Tolivar pointed out strong results in areas with lower median incomes, showing Cava’s wider appeal even as consumers face different economic pressures.
For the year, Cava reported record revenue of over $1 billion, an increase of more than 20 percent. Same-store sales grew by 4 percent. The company opened 72 new locations, bringing the total to 439 restaurants.
Management expects to open 74 to 76 new locations in fiscal 2026 and projects same-store sales growth of 3 to 5 percent. Cava also plans to introduce salmon as its first seafood menu item to attract more customers.
Net income for the fourth quarter was $4.9 million, down from $78.6 million a year ago. This drop reflects more typical results after the surge that followed the company’s IPO.
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