Darden Restaurants (DRI) FY2027 Q1 Earnings Call: Sales Rise 5.1%, Outlook Reaffirmed
Source Tradingkey
Key Takeaways
- Darden Restaurants (NYSE: DRI) generated fiscal 2027 first-quarter sales of $3.2 billion, up 5.1% year over year, supported by positive same-restaurant sales and 53 net new restaurants.
- Comparable-calendar same-restaurant sales rose 3.2%. Diluted earnings per share from continuing operations increased 4.1% to $2.05 compared with adjusted EPS a year earlier.
- LongHorn Steakhouse led the major brands with 6.8% same-restaurant sales growth, while Yard House grew 10%. Olive Garden increased 1% despite World Cup disruption and consumer concerns about lettuce.
- Restaurant-level EBITDA margin remained flat at 18.8%. Higher food and beverage costs were offset by labor productivity and the portfolio sales mix.
- Darden reaffirmed its fiscal 2027 outlook, including diluted EPS of $11.10 to $11.35.
- Management said traffic improved sequentially during the quarter and accelerated further in September, while early results from Olive Garden’s Never Ending Pasta Bowl exceeded its initial expectations.
Core Financial Data
| Metric | FY2027 Q1 result | Year-over-year change / context |
|---|---|---|
| Total sales | $3.2 billion | Up 5.1% |
| Comparable-calendar same-restaurant sales | 3.2% | All segments were positive |
| Diluted EPS from continuing operations | $2.05 | Up 4.1% versus prior-year adjusted EPS |
| Earnings from continuing operations | $234 million | Equal to 7.3% of sales |
| EBITDA | $464 million | — |
| Restaurant-level EBITDA margin | 18.8% | Flat year over year |
| Food and beverage expense rate | — | Up 30 basis points |
| Restaurant labor expense rate | — | Down 30 basis points |
| Effective tax rate | 12.9% | — |
| Capital returned to shareholders | $406 million | $184 million in dividends and $222 million in share repurchases |
| Net new restaurants | 53 | Contributed to sales growth |
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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