Darden Restaurants Inc. has raised its full-year sales forecast, indicating that its value-oriented menu strategy is boosting demand in a tightening consumer environment, though profits remain under pressure, impacting stock performance.
The company expects same-store sales to grow by 4.5% in the fiscal year 2026, up from the previous guidance of 3.5% to 4.3%. According to LSEG data, its third-quarter revenue was $3.34 billion, slightly above the market expectation of $3.33 billion.
During the quarter ended February 22, sales at LongHorn Steakhouse grew by 7.2% year-on-year, and Olive Garden sales increased by 3.2%, both showing significant improvement from the same period last year.
However, the company's third-quarter earnings per share were $2.68, falling short of the market expectation of $2.94. Rising costs of key raw materials like beef continue to squeeze profit margins.
Darden stated that amidst consumer price sensitivity, the company has chosen to absorb part of the cost pressures rather than fully passing them on to end prices. As a result, its stock price fell nearly 3% in pre-market trading.
