Darden Restaurants Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 18 December 2025: press release. Guidance figures: 6 raised, 2 lowered, 3 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Sales rose 7.3% on comparable and new units: Total sales were $3.1 billion, up 7.3%, driven by a blended same-restaurant sales increase of 4.3% and sales from 30 net new restaurants. Source
• Adjusted EPS rose 2.5% to $2.08: Reported diluted EPS from continuing operations was $2.03, against $1.82 a year earlier. Adjusted figure excludes $0.03 of Chuy's costs and $0.02 of closed restaurant costs. Source
• LongHorn sales up, segment profit down: LongHorn sales were $775.9 million, against $710.1 million, with same-restaurant sales up 5.9%. Segment profit was $126.0 million, against $135.1 million. Source
• Every segment posted positive comparable sales: Same-restaurant sales were positive in every segment, from 0.8% in Fine Dining to 5.9% in LongHorn, with the consolidated figure at 4.3%. Source
• Commodity costs were a headwind: Management said the company faced significant commodity headwinds and used its four competitive advantages to provide value to guests. Source
• Buybacks of $222 million in quarter: The company repurchased about 1.1 million shares for $222 million and had $643 million remaining under its $1 billion authorization. Source
• Sales and comparable-sales ranges raised: Full-year total sales growth range and same-restaurant sales growth range were both raised. The 53rd week adds about 2% to sales growth. Source

“The second quarter exceeded our top-line expectations as every segment delivered positive same-restaurant sales,”

Darden President & CEO Rick Cardenas

Guidance

What changed from last quarter

• Guidance raised: Full-year total sales growth range raised to 8.5% to 9.3% from 7.5% to 8.5%. Source
• Guidance raised: Full-year same-restaurant sales growth range raised to 3.5% to 4.3% from 2.5% to 3.5%. Source
• Guidance raised: Planned new restaurant openings raised to 65 to 70 from approximately 65. Source
• Guidance raised: Total capital spending range raised to $750 to $775 million from $700 to $750 million. Source
• Guidance raised: Total inflation estimate is approximately 3.5%, against a prior range of 3.0% to 3.5%. Source
• Guidance raised: Closed restaurant adjustment per share is 0.08, against 0.06 previously. Source
• Guidance lowered: Reported diluted EPS range moved to $10.62 to $10.82 from $10.64 to $10.84. Source
• Guidance lowered: Weighted average diluted share estimate is approximately 116.5 million, against approximately 117 million previously. Source
• Guidance kept: Adjusted diluted EPS from continuing operations range remained $10.50 to $10.70. Source

Quarter results and growth drivers

• Sales rose 7.3% on comparable and new units: Total sales were $3.1 billion, up 7.3%, driven by a blended same-restaurant sales increase of 4.3% and sales from 30 net new restaurants. Source
• Adjusted EPS rose 2.5% to $2.08: Reported diluted EPS from continuing operations was $2.03, against $1.82 a year earlier. Adjusted figure excludes $0.03 of Chuy's costs and $0.02 of closed restaurant costs. Source
• Year-to-date sales and sales growth: Six-month sales were $6,146.8 million, against $5,647.0 million a year earlier. Six-month reported diluted EPS from continuing operations was $4.23, against $3.57. Source
• Operating income and interest expense rose: Operating income was $320.4 million, against $292.1 million. Interest, net was $48.0 million, against $46.2 million. Source

Segment and brand performance

• Olive Garden sales and profit grew: Olive Garden sales were $1,362.7 million, against $1,292.5 million. Segment profit was $297.3 million, against $277.8 million. Source
• LongHorn sales up, segment profit down: LongHorn sales were $775.9 million, against $710.1 million, with same-restaurant sales up 5.9%. Segment profit was $126.0 million, against $135.1 million. Source
• Fine Dining sales up, profit lower: Fine Dining sales were $316.2 million, against $306.0 million, with same-restaurant sales up 0.8%. Segment profit was $46.9 million, against $53.9 million. Source
• Other Business sales include Chuy's: Other Business sales were $647.3 million, against $581.4 million. Segment profit was $86.7 million, against $81.2 million, including Chuy's from acquisition forward. Source

“I’m proud of the results we continue to deliver for our shareholders, and we remain committed to executing our strategy to drive long-term growth and shareholder value.”

Darden President & CEO Rick Cardenas

Guest scores and same-restaurant sales

• Every segment posted positive comparable sales: Same-restaurant sales were positive in every segment, from 0.8% in Fine Dining to 5.9% in LongHorn, with the consolidated figure at 4.3%. Source
• Guest satisfaction scores near record: Management said restaurant teams drove record, or near-record, guest satisfaction scores across all brands, through focus on basic execution. Source
• Annual comparable sales definition: Annual same-restaurant sales is a 52-week metric and excludes Chuy's until it has been owned and operated for a 16-month period. Source

Costs, commodities and pricing

• Commodity costs were a headwind: Management said the company faced significant commodity headwinds and used its four competitive advantages to provide value to guests. Source
• Food and labor costs rose with sales: Food and beverage costs were $963.7 million, against $872.8 million. Restaurant labor was $1,000.1 million, against $926.8 million. Source
• Restaurant expenses rose, marketing flat: Restaurant expenses were $508.3 million, against $472.2 million. Marketing expenses were $48.7 million, against $48.8 million. Source
• General and administrative expense fell: General and administrative expenses were $117.8 million, against $144.1 million. Pre-opening costs were $8.1 million, against $5.5 million. Source
• Asset gains in the quarter: Impairments and gain on disposal of assets was a $2.9 million gain, against no amount a year earlier. Source

Restaurant footprint and openings

• Continuing operations restaurant count rose: Darden continuing operations had 2,182 restaurants at 11/23/25, against 2,152 a year earlier. Source
• Brand unit counts up year over year: Olive Garden had 936 restaurants, against 925. LongHorn had 601, against 580. Chuy's had 109, against 104. Source
• Bahama Breeze not expected to run full year: Bahama Breeze had 28 restaurants, against 43. It is excluded from annual same-restaurant sales because it is not expected to be operated by Darden for the full fiscal year. Source

Capital, cash and shareholder returns

• Buybacks of $222 million in quarter: The company repurchased about 1.1 million shares for $222 million and had $643 million remaining under its $1 billion authorization. Source
• Quarterly dividend held at $1.50: The board declared a quarterly cash dividend of $1.50 per share, the same amount as in the prior quarter's release. Source
• Operating cash flow steady year over year: Six-month net cash from operating activities of continuing operations was $663.2 million, against $661.8 million. Capital purchases were $375.0 million, against $314.5 million. Source
• Short-term debt now $438.0 million: Short-term debt was $438.0 million at 11/23/25, against no balance at fiscal year-end. Cash and cash equivalents were $224.1 million. Source

Fiscal 2026 guidance update

• Sales and comparable-sales ranges raised: Full-year total sales growth range and same-restaurant sales growth range were both raised. The 53rd week adds about 2% to sales growth. Source
• Adjusted EPS range held: Adjusted diluted EPS range was unchanged. Reported diluted EPS range moved down $0.02 at each end. Source
• Capital spending range raised: Total capital spending range was raised to $750 to $775 million. Source

Strategy, investment and portfolio

• Management reaffirmed its strategy: Management said the company remains committed to executing its strategy to drive long-term growth and shareholder value. Source
• Investment in the business continued: Management said the company made appropriate investments in the business to ensure long-term success. Source
• Olive Garden Canada sale excluded from adjusted results: The prior quarter's adjusted results excluded the gain on the sale of Olive Garden Canada restaurants.

Coming up, as management said on 18 December 2025

• Quarterly dividend payment date: The $1.50 dividend is payable February 2, 2026, to holders of record at the close of business January 9, 2026. Source
• Chuy's enters same-restaurant base in Q4: Chuy's will be included in annual same-restaurant sales once owned and operated for a 16-month period, which management places in Q4 fiscal 2026. Source

Figures management reported

Risks management discussed

• External: Management cited significant commodity headwinds as a cost pressure in the quarter. Source

Earlier plans management reported on

• Ahead: Management said second-quarter sales exceeded its top-line expectations, with every segment positive on same-restaurant sales. Source
• Met: Costs related to closing 22 underperforming restaurants, permanently closed in Q4 fiscal 2025, were primarily reported in the quarter at $2.8 million. Source

Other quarters

• Q1 FY2027 earnings call
• Q4 FY2026 earnings call
• Q3 FY2026 earnings call
• Q1 FY2026 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.