CAVA GROUP INC (CAVA) Q1 2026 Earnings Call Transcript
Bullish Restaurants 8.13B USA
Next Earnings
2026-05-13
CAVA Group, Inc. owns and operates a chain of Mediterranean restaurants. The company offers salads, dips, spreads, toppings, and dressings. It sells its products through whole food markets and grocery stores. The company also provides online food ordering services. Cava Group, Inc. was founded in 2006 and is based in Washington, District of Columbia.
CAVA delivered solid 2025 results with double-digit revenue growth, expanding footprint, and disciplined margin management, while guiding 2026 to 74–76 new openings and 3–5% same-store sales growth amid margin headwinds from salmon and investments in leadership and technology.
⭐ Key Highlights
Record 2025 performance
CAVA surpassed $1 billion in revenue for the first full fiscal year with 22.5% revenue growth and 439 restaurants by year-end.
Strong fourth quarter metrics
Q4 2025 revenue rose 21.2% YoY to $272.8 million, same-restaurant sales 0.5% (2-year stack +21.7%), restaurant-level profit $58.3 million (15.7% growth).
Operating momentum and profitability
Adjusted EBITDA for Q4 2025 was $25.8 million; full-year 2025 adjusted EBITDA rose 21% to $152.8 million; GAAP net income $63.7 million with diluted EPS $0.54.
Expansion and capital allocation
Opened 24 net new restaurants in Q4, bringing total to 439; 2026 guidance targets 74-76 openings, with a plan toward at least 1,000 restaurants by 2032.
Operational and leadership enhancements
Introduced 2 zone leaders, market leader roles, and a strengthened AGM program to deepen leadership bench and improve in-store execution; Doug Thompson named COO.
Menu and technology investments
Launch of salmon in Q1 2026 as a premium item with ~100 bps restaurant-level margin headwind; continued KDS and TurboChef rollouts; Project Soul design in roughly 100 locations.
✔Positive Signals
- Record revenue milestone (> $1 billion) in 2025 and strongest new-restaurant pipeline to date
- Healthy unit economics with 439 restaurants and high AUVs (> $3 million 2-year stack trends)
- Project Soul rollout showing improved guest experience and potential long-term margin benefits
- Strong leadership investments (new COO, AGM program) aimed at scalable growth
- Loyalty program evolution driving higher engagement and frequency
✖Negative Signals
- Salmon launch anticipated to blunt restaurant-level margins by ~100 bps in 2026
- Higher cost structure: anticipated 25–30% effective tax rate in 2026 and higher stock-based compensation
- Preopening costs and ongoing technology investments weigh on near-term profitability
- Macro-driven cautious same-store sales outlook (low to mid-single-digit trajectory assumed after Q1)
- Catering channel still in test phase with execution risk and capex needs
📊Financial Results
- Q4 2025 revenue $272.8 million, up 21.2% YoY; 24 net new restaurants opened; same-restaurant sales +0.5%; 2-year SRS +21.7%; 3-year SRS ~33.1%
- Full-year 2025 revenue up 22.5%; Adjusted EBITDA $152.8 million, +21% YoY; GAAP net income $63.7 million; diluted EPS $0.54; free cash flow $26.1 million
- Q4 restaurant-level profit $58.3 million, 15.7% growth; food/bev/pack costs 30.4% of revenue; labor 27.1% of revenue; occupancy 7.6% of revenue
- Cash position: zero debt, $393 million in cash/investments, $75 million undrawn revolver; expects to expand revolver size and extend maturity in Q1
- 2026 guidance includes 74–76 net new openings, 3–5% same-store sales, restaurant-level margin 23.7%–24.2%, preopening costs $19.5–$20.0 million, adjusted EBITDA $176–$184 million
🔮Future Guidance
- 2026 net new openings: 74–76
- 2026 same-store sales: 3%–5% (base case uses low-to-mid single-digit runway for rest of year)
- 2026 restaurant-level margin: 23.7%–24.2% (includes preopening costs)
- 2026 adjusted EBITDA: $176–$184 million (including preopening costs)
- Salmon launch expected to create ~100 bps margin headwind in 2026, with pricing helping to offset via pennies of profit-neutral impact
💡Interesting Insights
- Rising digital mix and improved execution via KDS and updated labor deployment suggest a durable shift toward higher efficiency without compromising hospitality
- Tiered loyalty and Oasis program are driving earlier guest engagement and frequency, potentially expanding lifetime value beyond traditional promotions
Detailed Analysis
AI-generated summary of CAVA GROUP INC earnings call transcript.
CAVA completed 2025 with record revenue above $1 billion, 439 restaurants, and double-digit growth across the year, supported by a 21.2% Q4 revenue increase and 0.5% same-store growth. The company strengthened its leadership and operating model, including the appointment of a COO and an enhanced AGM program, and advanced its Project Soul redesign across sites. Financial results reflected robust unit economics, with restaurant-level margin contributing to overall profitability, while investments in labor, technology (KDS, TurboChef), and perimeter costs kept margins under pressure in the near term. For 2026, CAVA guides 74–76 net new openings, 3–5% same-store sales growth, and adjusted EBITDA of $176–$184 million, recognizing a roughly 100 basis point margin headwind from the salmon launch but expecting pennies of profit-neutral impact through pricing and efficiency gains. The company remains focused on expanding Mediterranean offerings, loyalty enhancements (tiered program and Oasis), and a scalable leadership pipeline to sustain long-term growth, with a focus on operating excellence and value delivery for guests.
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