Financial Performance - Cava Group reported quarterly earnings of $0.16 per share, exceeding the Zacks Consensus Estimate of $0.13 per share, but down from $0.17 per share a year ago, representing an earnings surprise of +23.08% [1] - The company posted revenues of $280.62 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 2.07%, compared to year-ago revenues of $233.49 million [2] - Over the last four quarters, Cava has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - Cava shares have declined approximately 27% since the beginning of the year, while the S&P 500 has gained 8.4% [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimates at $0.16 for the coming quarter and $0.58 for the current fiscal year [4][7] - The estimate revisions trend for Cava was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Retail - Restaurants industry, to which Cava belongs, is currently in the bottom 24% of over 250 Zacks industries, suggesting that the industry's outlook can significantly impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Restaurant Operations - CAVA Group, Inc. operated 398 fast-casual restaurants as of July 13, 2025, an increase from 341 restaurants a year earlier, reflecting a net increase of 57 locations[66][73]. - The company opened 16 new CAVA restaurants during the twelve weeks ended July 13, 2025, compared to 18 openings in the same period last year[70][73]. - The company opened 89 net new CAVA restaurants during or subsequent to the twenty-eight weeks ended July 14, 2024[92]. Financial Performance - CAVA revenue for the twelve weeks ended July 13, 2025, was $278.2 million, a 20.3% increase from $231.4 million in the same period last year[70][76]. - Revenue for the twenty-eight weeks ended July 13, 2025, was $612.4 million, up 24.3% from $492.5 million for the same period in 2024[111]. - CAVA segment revenue for the twenty-eight weeks ended July 13, 2025, was $606,731, a 24.4% increase from $487,674[91]. - Adjusted EBITDA for the twelve weeks ended July 13, 2025, was $42.1 million, up from $34.3 million in the prior year, reflecting a margin of 15.0%[70][72]. - Adjusted EBITDA for the twelve weeks ended July 13, 2025, was $42.1 million, representing a 22.6% increase from $34.3 million for the same period in 2024[111]. - The Adjusted EBITDA margin for the twenty-eight weeks ended July 13, 2025, was 14.2%, an increase from 13.7% in the same period of 2024[111]. Profitability Metrics - CAVA's restaurant-level profit margin was 26.3% for the twelve weeks ended July 13, 2025, slightly down from 26.5% in the same period last year[70][76]. - Net income for the twelve weeks ended July 13, 2025, was $18.4 million, compared to $19.7 million in the same period last year, resulting in a net income margin of 6.5%[70][76]. - Net income decreased to $18,368, a decline of 7.0% from $19,741, with the net income margin at 6.5%[83]. - Adjusted Net Income for the twelve weeks ended July 13, 2025, was $18.4 million, compared to $16.8 million for the same period in 2024[111]. Cost and Expenses - Total restaurant operating expenses increased to $205,934, up 20.3% from $171,135, with food, beverage, and packaging costs rising by 20.5% to $82,950[83]. - CAVA's food, beverage, and packaging costs increased by $14.2 million due to new restaurant openings and input costs associated with new menu items[77][78]. - General and administrative expenses rose to $73,445, an 18.2% increase from $62,121, primarily due to investments for future growth[99]. - Depreciation and amortization increased by 21.2% to $37,626, driven by new restaurant openings and technology improvements[99]. Digital and Consumer Revenue - CAVA's digital revenue mix increased to 37.3% for the twelve weeks ended July 13, 2025, up from 35.8% in the prior year[70]. - CAVA's consumer-packaged goods revenue increased by 12.1% to $2.4 million for the twelve weeks ended July 13, 2025, driven by higher sales[82]. Cash Flow and Investments - Net cash provided by operating activities increased by $11.6 million, or 13.3%, to $98.9 million for the twenty-eight weeks ended July 13, 2025[116]. - Cash and cash equivalents decreased to $290.2 million as of July 13, 2025, from $366.1 million as of December 29, 2024[115]. - The company had net cash used in investing activities of $177.4 million for the twenty-eight weeks ended July 13, 2025, a significant increase of 196.3% compared to $59.9 million in the prior year[116]. - The increase in cash used in investing activities was primarily due to higher capital expenditures related to new CAVA restaurant openings[118]. Taxation - The effective tax rate for the twelve weeks ended July 13, 2025, was 22.5%, significantly higher than 1.4% in the prior year due to a reduction in income tax expense associated with equity-based compensation[90]. - The effective income tax rate for the twenty-eight weeks ended July 13, 2025, was insignificant due to a $12.4 million reduction in income tax expense related to equity-based compensation[107].

Financial Data and Key Metrics Changes - Revenue for Q2 2025 grew by 20.3% year-over-year to $278.2 million, and increased by 62.6% compared to Q2 2023 [8][26] - Same restaurant sales increased by 2.1%, primarily driven by menu price and product mix, with guest traffic approximately flat [26] - Adjusted EBITDA for Q2 was $42.1 million, a 22.6% increase compared to 2024 [32] - Net income for Q2 was $18.4 million, compared to $16.8 million in 2024, with diluted EPS of $0.16 [33] Business Line Data and Key Metrics Changes - The company opened 16 net new restaurants, bringing the total to 398 locations across 27 states and the District of Columbia [10][26] - Restaurant level profit margin was 26.3% of revenue, slightly down from 26.5% in 2024, but reflecting a 19.6% increase in dollar terms [28] Market Data and Key Metrics Changes - The Mediterranean category continues to show strength, with a three-year traffic growth of 19.7% and growing market share [35] - The company is experiencing strong demand in new markets, including Pittsburgh and Michigan, with positive guest reception [10] Company Strategy and Development Direction - The company aims to expand to at least 1,000 restaurants by 2032, focusing on the Mediterranean cuisine category [11][35] - The "Project Soul" initiative is designed to enhance the guest experience through inviting restaurant designs [11] - The culinary innovation pipeline includes new offerings like chicken shawarma and cinnamon sugar pita chips, aimed at enhancing menu variety [12][13] Management's Comments on Operating Environment and Future Outlook - Management acknowledges macroeconomic pressures but remains confident in the long-term trajectory and structural strength of the business [27][35] - There is optimism regarding the reacceleration of same restaurant sales as the company moves into Q3 [42][44] Other Important Information - The company has zero debt and $385.8 million in investments, with access to a $75 million undrawn revolver [34] - The effective tax rate for Q2 was 22.5%, with expectations for the full year to be between 12-15% [33] Q&A Session Summary Question: Could you elaborate on the same store sales side? - Management noted that macro pressures are present but the honeymoon effect from new restaurant classes has significantly influenced sales, with strong performance from the 2024 class [38][40] Question: Can you help level set where you're trending in the third quarter? - Management indicated that there has been an acceleration in same restaurant sales trends as they move into Q3 [44] Question: Has the company evaluated its marketing media mix? - Management confirmed that there is an opportunity to reallocate marketing spend, especially as they have not historically spent a high percentage of revenue on marketing [46] Question: Does the honeymoon period mean first year comps are negative or flat? - Management clarified that while some locations are experiencing negative comps, overall demand for the brand remains strong [50][54] Question: What do you attribute to the July improvement? - The improvement is attributed to the lapping of the steak launch and enhanced guest experience initiatives [67] Question: Can you talk about the assistant manager edition? - Management explained that the assistant manager role is aimed at providing additional support in high-volume restaurants and building a leadership pipeline [71][74] Question: Can you talk about the technology investments mentioned? - Management highlighted that technology investments like the kitchen display system and AI camera are aimed at improving operational efficiency and guest experience [90][91]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 increased by 20.3% year over year to $278.2 million, and by 62.6% compared to 2023 [5][24] - Same restaurant sales grew by 2.1%, primarily driven by menu price and product mix, with guest traffic remaining approximately flat [24] - Adjusted EBITDA for the quarter was $42.1 million, reflecting a 22.6% increase compared to 2024 [29] - Net income for the quarter was $18.4 million, compared to $16.8 million in 2024, with diluted EPS at $0.16 [30] Business Line Data and Key Metrics Changes - The company opened 16 net new restaurants, bringing the total to 398 locations across 27 states and the District of Columbia [5][24] - Restaurant level profit margin was 26.3%, slightly down from 26.5% in 2024, but reflecting a 19.6% increase in dollar terms [26] - New restaurant productivity was approximately 109%, exceeding the target of $2.3 million in average unit volumes [26] Market Data and Key Metrics Changes - The Mediterranean cuisine category continues to show strength, with a three-year traffic growth of 19.7% and increasing market share [32] - The company is expanding into new markets, including Pittsburgh and Michigan, with positive reception from customers [8][9] Company Strategy and Development Direction - The company aims to reach at least 1,000 restaurants by February 2032, focusing on expanding its Mediterranean concept [9][32] - The "Project Soul" initiative is designed to enhance the guest experience through inviting restaurant designs [9] - The company is committed to culinary innovation, with new menu items like chicken shawarma and cinnamon sugar pita chips being tested and rolled out [10][11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic pressures but expressed confidence in the long-term trajectory and structural strength of the business [5][32] - The company is seeing a reacceleration in same restaurant sales as it moves into Q3, driven by strong demand for Mediterranean cuisine [25][32] - Management emphasized the importance of maintaining operational excellence and enhancing guest experiences as the company scales [15][18] Other Important Information - The company has zero debt and $385.8 million in investments, with access to a $75 million undrawn revolver [31] - The effective tax rate for Q2 was 22.5%, with expectations for the full year to be between 12-15% [30] Q&A Session Summary Question: Could you elaborate on the same store sales side? - Management noted that macro pressures are present but emphasized the strong performance of the 2024 restaurant class, which exceeded expectations [35][38] Question: Can you help level set where you're trending in the third quarter? - Management indicated that the trend is continuing to improve, with acceleration in same restaurant sales [42] Question: Has the company evaluated its marketing media mix? - Management acknowledged the opportunity to increase marketing spend as awareness grows in new markets, while maintaining a long-term strategic focus [44][46] Question: Does the honeymoon period mean first year comps are negative? - Management confirmed that while some restaurants in the 2024 class are delivering strong results, they are impacting same restaurant sales due to the honeymoon effect [48][53] Question: What do you attribute to the July improvement? - Management attributed the improvement to the end of the steak launch lap and enhancements in guest experience [67][69] Question: Can you talk about the assistant manager edition? - Management explained that the rollout will begin in November, aimed at strengthening leadership and operational support in high-volume restaurants [72][75] Question: Can you talk about the 2Q mix? - Management stated that there were no significant changes in mix, and chicken shawarma will be priced at a premium compared to other chicken items [78][79] Question: What marketing opportunities could open now that you've crossed $1 billion in sales? - Management indicated that achieving this milestone allows for more effective marketing strategies and leveraging investments across scaled markets [82][85]

Q2 2025 Earnings Supplemental August 12th, 2025 Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that reflect our current views with respect to, among other things, our operations and financial performance. Forward-looking statements include all statements that are not historical facts. These forward-looking statements relate to matters such as our industry, business st ...

CAVA GROUP REPORTS SECOND QUARTER 2025 RESULTS YEAR OVER YEAR CAVA REVENUE GROWTH OF 20.3% INCLUDING CAVA SAME RESTAURANT SALES GROWTH OF 2.1% 16 NET NEW CAVA RESTAURANT OPENINGS DURING QUARTER SECOND QUARTER 2025 CAVA RESTAURANT-LEVEL PROFIT MARGIN OF 26.3% WASHINGTON, D.C. (August 12, 2025) - CAVA Group, Inc. (NYSE: CAVA) ("CAVA Group" or the "Company"), the category- defining Mediterranean fast-casual restaurant brand that brings heart, health, and humanity to food, today announced financial results for ...

Core Viewpoint - Cava has lowered its full-year forecast for same-store sales growth to 4% to 6% from a previous range of 6% to 8% following disappointing second-quarter results, leading to a significant drop in its stock price [1][2]. Financial Performance - Cava reported a second-quarter net income of $18.4 million, or 16 cents per share, down from $19.7 million, or 17 cents per share, a year earlier [2]. - Net restaurant sales increased by 20% to $278.2 million, primarily due to new restaurant openings [2]. - Same-store sales rose by 2.1% during the quarter, falling short of Wall Street's expectation of 6.1% growth [3]. - The company's quarterly traffic was described as "roughly flat," contrasting with a 14.4% increase in same-store sales a year earlier [4]. Market Context - Cava's performance reflects broader challenges in the fast-casual dining sector, with competitors like Chipotle and Sweetgreen also experiencing sales declines [6]. Future Projections - Despite lowering the same-store sales forecast, Cava maintained its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) projection of $152 million to $159 million and restaurant-level profit margins of 24.8% to 25.2% for the full year [7]. Strategic Initiatives - Cava participated in a $25 million Series B funding round for Hyphen, a company that automates plate and bowl portioning, aiming to enhance order accuracy and speed during peak hours [8].

Group 1 - CAVA Group, Inc. is set to release its second-quarter earnings results on August 12, with analysts expecting earnings of 13 cents per share, a decrease from 17 cents per share in the same period last year [1] - The projected quarterly revenue for CAVA Group is $285.23 million, up from $233.5 million a year earlier [1] - CAVA opened its first restaurant in Pittsburgh on August 8, located at 3619 Forbes Avenue [2] Group 2 - CAVA Group shares experienced a decline of 3.2%, closing at $82.30 on the previous Monday [2] - UBS analyst Dennis Geiger maintained a Neutral rating and reduced the price target from $112 to $96 [7] - Barclays analyst Jeffrey Bernstein kept an Equal-Weight rating and raised the price target from $90 to $91 [7] - Keybanc analyst Christopher Carril initiated coverage with an Overweight rating and a price target of $100 [7] - JP Morgan analyst John Ivankoe maintained an Overweight rating but lowered the price target from $115 to $95 [7] - Stifel analyst Chris O'Cull maintained a Buy rating and significantly cut the price target from $175 to $125 [7]

Core Viewpoint - CAVA Group, Inc. is set to report its second-quarter 2025 results on August 12, with expectations of revenue growth but a decline in earnings per share (EPS) compared to the previous year [1][8]. Financial Performance - In the last reported quarter, CAVA's earnings exceeded the Zacks Consensus Estimate by 57.1%, with an average surprise of 26.9% over the past four quarters [1][2]. - The Zacks Consensus Estimate for Q2 2025 EPS remains unchanged at 13 cents, reflecting a 23.5% decline from the year-ago EPS of 17 cents [3]. - Revenue is projected at $286.6 million, indicating a year-over-year growth of 22.7% [3]. Earnings Prediction Model - The current Earnings ESP for CAVA is +1.89%, but the company holds a Zacks Rank of 4 (Sell), suggesting a lower likelihood of an earnings beat this quarter [4]. Factors Influencing Performance - Strong same-restaurant sales trends and positive traffic are expected to support revenue growth, with a consensus estimate for same-restaurant sales at 5.9% [6][9]. - Marketing initiatives and product innovations, including new menu items and expansion into new markets, are aimed at enhancing customer engagement [7][9]. - The loyalty program has seen growth, nearing 8 million members, which may contribute to increased customer retention [9]. Cost Pressures - Rising costs in food, beverage, and packaging, particularly from steak, are impacting profitability [10]. - Increased labor expenses due to investments in wages and benefits, along with higher pre-opening costs, are also contributing to margin pressures [10][11]. - The company is taking a cautious approach to menu price increases amid inflation, which limits its ability to offset rising costs [11]. Stock Performance and Valuation - CAVA's stock has declined 1.6% over the past year, underperforming its industry peers [12]. - The company's forward 12-month price-to-sales ratio stands at 7.63, significantly higher than the industry average and the S&P 500's 5.21, raising concerns about overvaluation [16][17]. Investment Outlook - The upcoming earnings report presents a mix of growth potential and cost challenges, leading to an unfavorable risk-reward setup for investors [17][18]. - While the brand is expanding and driving traffic through innovation, rising input costs and a cautious pricing strategy may weigh on future performance [18].

Company Overview - Cava Group (CAVA) is expected to report a year-over-year decline in earnings of 23.5%, with quarterly earnings estimated at $0.13 per share, while revenues are projected to increase by 22.7% to $286.56 million [3][12]. Earnings Expectations - The consensus EPS estimate has been revised 0.9% lower in the last 30 days, indicating a reassessment by analysts [4]. - The upcoming earnings report is anticipated to be released on August 12, and the stock may react positively if actual results exceed expectations [2][12]. Earnings Surprise Prediction - Cava's Most Accurate Estimate is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +1.89%, suggesting a potential for an earnings beat [12]. - However, Cava currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat despite the positive Earnings ESP [12]. Historical Performance - In the last reported quarter, Cava exceeded expectations by delivering earnings of $0.22 per share against an expected $0.14, resulting in a surprise of +57.14% [13]. - Over the past four quarters, Cava has beaten consensus EPS estimates three times [14]. Industry Context - In the broader context of the Zacks Retail - Restaurants industry, Restaurant Brands (QSR) is expected to post earnings of $0.97 per share, reflecting a year-over-year increase of 12.8%, with revenues projected at $2.34 billion, up 12.6% [18][19].