Cava Group Inc (NYSE:CAVA) reported second-quarter revenue above Wall Street forecasts as strong customer traffic and same-restaurant sales helped maintain growth momentum, sending the shares around 10% higher in U.S. premarket trading on Wednesday.
The Mediterranean fast-casual restaurant chain posted adjusted earnings per share of $0.19, in line with analyst expectations. Revenue reached $365.4 million, exceeding the consensus estimate of $360.1 million and rising 31.3% from $278.2 million in the same quarter a year earlier.
Same-restaurant sales rise 9%
Same-restaurant sales increased 9.0% during the quarter, supported by a 5.3% rise in guest traffic. Menu pricing and product mix contributed another 3.7% to the increase.
Cava continued expanding its restaurant network, opening 17 net new locations during the period. That brought its total restaurant count to 476, representing year-on-year growth of 19.6%.
“Our second quarter results underscore the continued strength of our category-defining brand and the resonance of our value proposition with today’s consumer,” said Brett Schulman, Co-Founder and CEO. “This strength, combined with the power of our unit economic model, gives us confidence not only in our momentum today, but in the long runway that lies ahead.”
Restaurant margins ease despite profit growth
Restaurant-level profit margin declined by 60 basis points to 25.7%, compared with 26.3% in the prior-year quarter.
The company attributed the contraction partly to input costs related to the April 20, 2026 launch of Pomegranate Glazed Salmon. A greater proportion of third-party delivery orders and additional investment in wages also weighed on margins, although stronger sales provided a partial offset.
Net income increased 25.3% to $23.0 million from $18.4 million in the second quarter of fiscal 2025.
Adjusted EBITDA climbed 30.0% year on year to $54.7 million, equivalent to 14.9% of revenue.
Cava maintains full-year 2026 guidance
Cava reaffirmed its outlook for fiscal 2026, continuing to forecast between 75 and 77 net new restaurant openings.
The company expects same-restaurant sales growth of 4.5% to 6.5%, while adjusted EBITDA is projected at between $181.0 million and $191.0 million. The midpoint of the EBITDA range stands at $186.0 million as Cava continues its expansion strategy.
Vital Knowledge analysts noted that the results were solid but suggested the modest margin pressure and unchanged guidance could limit enthusiasm in the near term.
“[T]his isn’t a bad report, but the (slight) margin softness, coupled with the fact that guidance was only reiterated, might be underwhelming in the near-term,” analysts at Vital Knowledge said in a note.
Cava Group stock price
