On December 19th Darden Restaurants Inc. (DRI) posted the results for the second quarter of fiscal 2025 ending November 24th beating consensus estimates on the top and bottom lines. Darden Restaurants is a bellwether for both casual and fine dining, with the Company and competitors confronted with problems of reduced discretionary spending, availability and cost of labor and continued high prices for food ingredients.
For the most recent quarter, Darden earned $215 million on revenue of $2,890 million with an EPS of $1.82. Comparative values for the second quarter of fiscal 2024 were net earnings of $212 million on revenue of $2,449 million with an EPS of $1.76. Comparing the second quarter of 2025 with the corresponding quarter of previous fiscal year, revenue was up by 6.0 percent. Operating margin was down by 0.1 percent to 10.1 percent and profit margin down by 0.4 percent to 7.4 percent.
The Company reported the following sales and segment contributions:-
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Q2 Sales
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Q2 Segment Profit
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($ in millions)
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2025
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2024
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2025
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2024
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Consolidated Darden
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$2,890.0
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$2,727.3
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Olive Garden
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$1,292.5
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$1,251.4
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$277.1
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$262.5
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LongHorn Steakhouse
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$710.1
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$643.0
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$134.2
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$111.8
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Fine Dining
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$306.0
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$318.0
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$52.7
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$56.6
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Other Business
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$581.4
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$514.9
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$79.2
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$66.5
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On November 24th Darden Restaurants operated 2,152 locations including 925 Olive Garden locations, 580 LongHorn Steakhouses, 82 newly acquired Ruth’s Chris Steakhouses and 104 Chuy’s restaurants with 461 other units including both casual and fine dining restaurants under six brands.
For the quarter, Darden posted a composite 2.4 percent increase in same restaurant sales with the fine dining group posting a 5.8 percent decline, offset by a 2.0 percent gain by the Olive Garden and 7.5 percent by LongHorn.
In commenting on performance, Rick Cardenas, president & CEO stated, "We had a strong quarter and I am pleased that our four largest brands – Olive Garden, LongHorn Steakhouse, Yard House and Cheddar's Scratch Kitchen – generated positive same-restaurant sales, as did three of our four business segments," He added, "I continue to believe in the power of our strategy and our brands' ability to compete effectively regardless of the environment. Each of our brand leadership teams are focused on the long term and staying committed to executing at the highest level."
The Company increased guidance for FY 2025 with projected revenue of $12,100 million, a same-restaurant sales growth of 1.5 percent and diluted EPS in the range of $9.40 to $9.60.
Darden Restaurants posted total assets of $12,519 million of which $3,000 million comprised goodwill and trademarks. The company carries long-term debt and lease obligations of $7,756 million. Darden Restaurants had an intraday market capitalization of $22,040 million on December 23rd. The company has traded over the past fifty-two weeks in a range of $135.87 to $188.88 with a 50-day moving average of $166.50 and with a forward P/E of 19.8
Over the trailing twelve months, operating margin was 9.8 percent and profit margin 9.1 percent. Return on assets was 7.4 percent and on equity 48.6 percent.