Darden Sales Rise 5.1% to $3.2 Billion as Restaurant Group Reaffirms Outlook

Darden Restaurants reported fiscal first-quarter sales of $3.2003 billion for the 13 weeks ended August 30, 2026, up 5.1% from $3.0447 billion a year earlier. Blended same-restaurant sales rose 3.1% on Darden’s fiscal-calendar basis, and the company reaffirmed its full-year fiscal 2027 outlook, including diluted net earnings per share from continuing operations of $11.10 to $11.35.

The quarter showed positive same-restaurant sales across each of Darden’s reporting segments, but the pace varied sharply by brand. LongHorn Steakhouse led with a 6.2% increase on the fiscal calendar, while Olive Garden rose 1.1%. Fine Dining increased 1.6%, and the Other Business segment, which includes brands such as Cheddar’s Scratch Kitchen, Chuy’s and Yard House, gained 3.8%.

LongHorn remained the strongest growth driver

In its fiscal first-quarter results, Darden also provided a comparable-calendar view because the company moved from a 53-week fiscal year to a 52-week year. That change shifts the year-over-year fiscal periods by one week. On the comparable-calendar basis, consolidated same-restaurant sales rose 3.2%, LongHorn increased 6.8%, Olive Garden gained 1.0%, Fine Dining rose 1.0% and Other Business increased 4.5%.

LongHorn’s sales reached $860.9 million, up from $776.4 million in the prior-year quarter, while segment profit increased to $154.6 million from $134.9 million. Olive Garden remained Darden’s largest business by sales at $1.3298 billion, compared with $1.3011 billion a year earlier, and segment profit edged up to $270.8 million from $267.6 million.

Fine Dining generated $304.2 million in sales, compared with $286.5 million, while Other Business sales increased to $705.4 million from $680.7 million. Both segments also reported higher segment profit. The figures reinforce a mixed brand-level picture inside an overall positive quarter: LongHorn continued to expand at a much faster rate than Olive Garden, even though every reporting segment remained in positive same-restaurant sales territory.

Darden’s company-owned restaurant count rose to 2,218 at August 30 from 2,165 a year earlier. Olive Garden increased to 953 locations from 933, and LongHorn expanded to 624 from 595. Bahama Breeze moved in the opposite direction, falling to 10 locations from 28 as Darden continued its plan to close or convert the remaining restaurants. Bahama Breeze is excluded from the quarter’s same-restaurant sales calculation because those locations are expected to be closed or converted to other Darden brands by the fourth quarter of fiscal 2027.

Earnings comparisons require an adjustment for last year’s special items

Darden reported diluted net earnings per share from continuing operations of $2.05. That was below the $2.19 reported in the year-earlier quarter, but Darden said the current figure represented a 4.1% increase from last year’s adjusted $1.97 per share. The distinction matters because the prior-year period included a gain tied to the sale of Olive Garden restaurants in Canada along with restaurant-closing and other one-time costs, so the company uses the adjusted figure for its stated year-over-year earnings comparison.

Earnings from continuing operations were $234.3 million, compared with $257.9 million a year earlier. Operating income was $319.3 million versus $339.2 million. The prior-year income statement included a larger net gain on asset disposals, which makes the reported operating-income comparison less directly aligned with the underlying sales growth.

Several major expense lines rose alongside the larger sales base. Food and beverage costs increased to $984.9 million from $929.1 million, restaurant labor rose to $1.0289 billion from $988.0 million, and restaurant expenses increased to $530.5 million from $504.2 million. General and administrative expense, by contrast, declined slightly to $134.8 million from $136.1 million.

Cash generation was lower than in the prior-year period. Net cash provided by continuing operations was $279.0 million, compared with $342.5 million, while purchases of land, buildings and equipment were $175.3 million, close to the $174.1 million spent a year earlier. Darden ended the quarter with $220.5 million in cash and cash equivalents, nearly unchanged from $219.5 million at the end of fiscal 2026.

Full-year guidance stays unchanged as Darden returns capital

By reaffirming all aspects of its fiscal 2027 outlook, Darden kept the framework it issued in June. The company continues to expect full-year sales of $13.60 billion to $13.75 billion and same-restaurant sales growth of 2.5% to 3.5%. It also continues to plan for 75 to 80 new restaurant openings, about $875 million of capital spending and diluted net earnings per share from continuing operations of $11.10 to $11.35.

The first quarter also included substantial capital returns. Darden repurchased about 1.1 million shares for $222.3 million, including the applicable excise tax on net repurchases. At quarter-end, $1.3 billion remained under the company’s current $1.5 billion share-repurchase authorization.

The board declared a quarterly dividend of $1.62 per share, payable November 2 to shareholders of record at the close of business on October 9. That payout is unchanged from the dividend Darden declared in June after raising the quarterly rate for fiscal 2027.

Darden enters the remainder of the fiscal year with its annual targets intact, a larger restaurant base and a sizable performance gap between its two biggest brands. The operational timetable is also concrete: the company expects the remaining Bahama Breeze locations to be closed or converted by the fourth quarter of fiscal 2027 while it pursues the broader plan for 75 to 80 new restaurant openings across the portfolio.