CAVA Group, Inc. (CAVA) Earnings & Analysis

Latest quarter

CAVA reported Q2 FY2026 revenue of $368.4 million, above the consensus estimate of $353.3 million. Adjusted earnings per share of $0.19 also exceeded the consensus estimate of $0.18.

Revenue rose from $280.6 million a year earlier. In its filing, CAVA attributed restaurant-segment revenue growth primarily to new openings and said same-restaurant sales increased 9.0%, including a 5.3% rise in guest traffic. The filing also attributed higher consumer packaged goods revenue to increased sales.

CAVA’s gross margin was 44.9%, compared with 45.7% a year earlier, while operating margin was 7.29%, compared with 7.00%. The filing said salmon launch costs increased food, beverage and packaging costs as a share of restaurant revenue, partly offset by improved mix. Diluted earnings per share rose to $0.19 from $0.16, and free cash flow increased to $29.3 million from $19.2 million.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CEO Brett Schulman said concerns about the Cyclospora outbreak affected sales as the quarter ended, although CAVA does not source leafy greens from Mexico or serve iceberg lettuce. He said same-restaurant sales had begun to rebound and CAVA had seen no immediate impact from the recent Salmonella outbreak.

CFO Tricia Tolivar said sales trends initially moderated to flat to positive before improving sequentially each week and recovering to mid-single digits. Asked about the sales assumptions behind guidance, she said the low end of the range implied slightly negative same-restaurant sales and the high end implied mid-single-digit growth. Tolivar added that current trends did not suggest the company would land at the low end.

On the menu, Schulman said the salmon launch increased the rate of new customers and purchase frequency among loyalty members who bought it. He said CAVA had completed a test of roasted garlic shrimp and would continue its evaluation before deciding what to do next. Tolivar said salmon demand was in line with expectations and that other premium additions also contributed to sales mix.

Tolivar said food, beverage and packaging costs were 30% of restaurant revenue in the quarter, with salmon input costs contributing to the increase from a year earlier. She expects those costs to rise as a share of revenue for the rest of the year because of fuel surcharges and pre-marinated chicken. Asked about margins and pricing, she said CAVA anticipated incremental fuel surcharges, though less than it had expected previously, and had no intention of changing prices in the near future.

Schulman said the pre-marinated chicken rollout is intended to simplify kitchen work and give teams more time for guest service. Asked about catering, he said CAVA would test it in a second market later in the fall to assess production capacity and demand.

Guidance

CFO Tricia Tolivar said CAVA reiterated its full-year outlook, incorporating sales pressure experienced to date, an assumption about its duration, and macroeconomic and geopolitical uncertainty. She said the restaurant-margin outlook also reflects fuel surcharges and the partial rollout of pre-marinated chicken.