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Cava Shares Surge as Strong Sales and Revenue Beat Expectations

Prime Highlights

  • Cava’s shares surged over 25% after the company beat market expectations and reported a strong sales performance.
  • The company crossed $1 billion in annual revenue for the first time, showing strong growth and customer demand.

Key Facts

  • Same-store sales rose 0.5% in the fourth quarter, beating expectations of a decline.
  • Cava plans to open 74 to 76 new restaurants in 2026, continuing its expansion strategy.

Background:

Mediterranean fast-casual chain Cava reported stronger-than-expected fourth-quarter results, sending its shares up more than 25% as investors responded positively to its growth outlook and steady customer demand.

The company posted revenue of $275 million for the quarter ended December 28, beating analyst estimates of $268 million. Earnings also came in slightly ahead of expectations at 4 cents per share. Same-store sales rose 0.5%, defying forecasts of a 1.1% decline, supported mainly by menu pricing and product mix improvements.

For the full fiscal year 2025, Cava crossed $1 billion in revenue for the first time, marking over 20% annual growth. Same-store sales rose 4% during the year, showing steady performance across locations. The company also opened 72 new restaurants, bringing its total to 439.

Chief Financial Officer Tricia Tolivar said the company kept a balance between pricing and value despite economic pressure. She said a small price increase of about 1.7% in early 2025 helped sales without pushing customers away. Demand also improved across different age and income groups toward the end of the year, including younger customers.

She said some of the top-performing restaurants are in lower-income areas, showing the brand attracts many different customers. The company wants to keep prices reasonable while offering good quality.

Net income for the quarter stood at $4.9 million, down from $78.6 million a year earlier, though revenue growth remained strong at nearly 21% year over year.

Chief Executive Officer Brett Schulman said the company’s momentum reflects more than expansion, pointing to strong customer interest in its food, service, and overall value. He said customers are choosing brands that offer good quality food and a better dining experience.

For 2026, Cava expects same-store sales to grow by 3% to 5% and plans to open 74 to 76 new restaurants. It also plans to add new menu items, including seafood like salmon.