With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Industries included in the sector are food services and hotels and casinos.

Fortune Sector Leaders: Hotels, Restaurants, and Leisure

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

This year’s Fortune 500 marks the 68th running of the list.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-377-Darden Restaurants

Operating out of Orlando, Fla., the group's dine-in restaurant portfolio includes some of the country's most-recognized franchises including Olive Garden, Cheddar's, and Longhorn Steakhouse.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-372-Darden-Restaurants

The multi-brand restaurant operator is the parent of international dining chains including Olive Garden, LongHorn Steakhouse, Bahama Breeze, the Capital Grille, Eddie V's, and Yard House.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune 500 marks the 62nd running of the list.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Google tops the list once again, marking its eighth appearance and fifth time as No. 1.

Fortune 100 Best Companies to Work For

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Key Financials (last Fiscal Year)

Revenues ($M)

Profits ($M)

Assets ($M)

Total Stockholder Equity ($M)

Profit Ratios

Profit as % of Revenues

Profits as % of Assets

Profits as % of Stockholder Equity

Earnings Per Share (last Fiscal Year)

Earnings Per Share ($)

EPS % Change (from prior fiscal year)

EPS % Change (5 year annual rate)

EPS % Change (10 year annual rate)

Total Return

Total Return to Investors (last year)

Total Return to Investors (5 year, annualized)

Total Return to Investors (10 year, annualized)

Darden Restaurants owns and operates a portfolio of full-service restaurants in the U.S. and Canada. Its well-known brands include Olive Garden, LongHorn Steakhouse, Ruth’s Chris Steak House, the Capital Grille, and Eddie V’s Prime Seafood, among others. Darden is also the former owner of Red Lobster, which the company sold to Golden Gate Capital in 2014 for $2.1 billion. The company was founded in 1968 when William Darden opened the first Red Lobster restaurant in Lakeland, Fla.

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Q2 2025

Darden Restaurants (DRI): Company Profile, Stock Price, News, Rankings

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Darden Restaurants

darden restaurants

a reminder, this conference is being recorded.

It's now my pleasure to turn the call over to your host, Phil MacLean, Vice President, Finance and Investor Relations. Please go ahead, Phil.

Thank you, Kevin. Good morning, everyone, and thank you for participating on today's call. Joining me are Rick Cardenas, Darden's President and CEO and Raj Vanam, CFO. As a reminder, comments made during this call will include forward looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections.

Those risks are described in the company's press release, which was distributed this morning and its filings with the Securities and Exchange Commission. We are simultaneously broadcasting a presentation during this call, which is posted in the Investor Relations section of our website at darden.com. Today's discussion and presentation include certain non GAAP measurements and reconciliations of these measurements are included in the presentation. Looking ahead, we plan to release fiscal 2025 Q3 earnings on Thursday, March 20, before the market opens, followed by a conference call. During today's call, all references to industry results refer to the Black Box Intelligence casual dining benchmark, excluding Darden.

During our fiscal Q2, industry same restaurant sales grew by 1% and industry same restaurant guest counts decreased 1.8%. This morning, Rick will share some brief remarks on the quarter and Raj will provide details on our financial results and an update to our fiscal 2025 financial outlook. Now I will turn the call over to Rick.

Thank you, Phil, and good morning, everyone. We had a strong quarter that met our expectations. Same restaurant sales at 3 of our 4 segments were positive and all of our brands remained intensely focused on our back to basics operating philosophy anchored in food, service and atmosphere. I was pleased that our 4 largest brands Olive Garden, LongHorn Steakhouse, Yard House and Cheddar Scratch Kitchen all generated positive same restaurant sales for the quarter. During the quarter, the Olive Garden team's ongoing focus on being brewing with the basics combined with great execution of an extended Never Ending Pasta Bowl drove a positive sales gap to the industry.

Never Ending Pasta Bowl featured a starting at price point of $13.99 marking the 3rd consecutive year at that price point and making it an even more compelling value for our guests. NEPB was once again well received as evidenced by the highest refill rate ever and higher protein add ons compared to last year. In October, Olive Garden launched its Uber Direct pilot in approximately 100 restaurants. They are not promoting it yet in order to focus on the technology integration and operational execution. The pilot has gone very well, thanks to the operators in the pilot restaurants, the Olive Garden Operations Excellence team and the Darden IT team.

Olive Garden is on track to begin rolling it out to the rest of the system after the holidays with potential completion by the end of Q3. Olive Garden is a brand that is well positioned to leverage news to drive traffic and the team has been working on several initiatives to continue appealing to core guests as well as value seekers. One of these initiatives is an updated menu that launched 2 weeks ago featuring the return of 2 fan favorites, steak gorgonzola and stuffed chicken marsala. These dishes were the most requested entrees that fans asked Olive Garden to bring back and the initial response from guests is encouraging. Starting in January, Olive Garden's advertising will feature the return of these fan favorites and an additional guest driving news at compelling price point.

LongHorn continues to exceed expectations driven by great guest value and strong operational execution. The LongHorn team is extremely passionate about serving the highest quality steaks in casual dining, which not only requires grilling each steak perfectly, but also having the highest quality product. During the quarter, Longhorn hosted their 1st State Cutter Summit with their suppliers from across the country to review their custom specifications and immerse their partners in the Longhorn business and culture. The summit ended with 1 supplier receiving the Golden Steak Award for the best adherence to Longhorn standards. And all of the partners left the event more aligned and better positioned to consistently meet the brand's expectations.

After receiving stakes that meet their stringent quality specifications, it's up to Longhorn team members to grill them to perfection. That's why the Longhorn team validates their grill masters expertise each year, regularly retrains on how to correctly season their steaks and ensures their managers verify that each steak is grilled to the right temperature. This focus continues to pay off and resulted in an all time high Steaks Grow Correctly score during the quarter. The performance of Yard House and Cheddar's drove positive comps within our other segment. Yard House has built a competitive advantage of distinctive culinary offerings with broad appeal through a range of approachable and trend forward items.

One example of how they bring this to life is the bratwurst sliders that were featured during Oktoberfest, which helped drive further sales momentum for the brand during the quarter. The Yard House team is well positioned to build on their momentum with new food news during the Q3. The Cheddar's team leverages efficiency and Darden's purchasing power to provide great food, serve with speed at a wow price. One way they achieve this is by capitalizing on lower cost opportunity buys to create limited time offers. During the quarter, 2 LTOs returned to their menu.

Their Texas T Bone for $21.49 which was followed by their bone in rib eye for $22.49 And each of these entrees also include honey butter croissants and two sides for that price. I'm proud of the momentum the Cheddar's team is building. During the quarter they achieved their best ever retention level already exceeding their annual goal. Also in Technomic's most recent survey, their value score once again outperformed the casual dining category and Cheddar's ranked 1st among casual dining brands for affordability. Now let me provide a brief update on Chuy's.

We successfully closed the transaction during the quarter and the leadership team including Chuy's President, Steve Hislop and their operations leader, John Corman is in place. The integration process has just begun and is being led by the same team that successfully directed the Ruth's Chris integration. They're focused on 3 key objectives preserving the employee experience and Chuy's unique culture, maintaining the guest experience and successfully migrating Chuy's onto the Darden platform with as few disruptions as possible. The timeline for this integration will likely be a little longer than the one for Ruth's Chris because we are about to begin rolling out the next generation of our point of sale system. This system currently supports 9 different brands and is the nerve center for our competitive advantage of extensive data and insights.

This is not an off the shelf product, rather it's a proprietary system that we first built more than 20 years ago and continued to maintain enhance ourselves. It's integrated with all of our key restaurant applications and also has a number of great features that are designed to make our managers' jobs easier, deliver key data to help enhance operations and ensure labor compliance. Our IT team has been working for some time to completely rewrite and modernize the application in order to provide an improved and more modern user interface, implement updated technology architecture, offer the ability to operate on different types of hardware and deliver near real time analytics.

this will reduce training time for our new team members, drive speed by reducing number of clicks required to enter orders as well as other tasks, enable our IT team to respond faster to requests for system enhancements and further strengthen our competitive advantages of significant scale and extensive data and insights. The learning we capture from rolling it out will help minimize disruptions when we bring it online at Chuy's. During the Q2, we also experienced meaningful impacts from hurricanes Helene and Milton. Our operations teams and our severe weather task force did an outstanding job ensuring our restaurants were prepared for the storms and able to reopen quickly. Only one restaurant, the Chatter's in Asheville, North Carolina has been unable to reopen due to the damages sustained.

We expect to reopen this restaurant next fiscal year. Hurricane Helene's impact was felt across multiple states, while Hurricane Milton left a path of destruction across Florida, each affecting our team members and guests. As a company that cares, one of the ways we nourish and delight everyone we serve is by responding to help others in times of need. That's why Darden is a proud partner of the American Red Cross. Each year the Darden Foundation provides a $500,000 grant to their annual disaster giving program.

The program enables the Red Cross to prepare communities for disasters like Helene and Milton and respond to help families during the recovery process. Our team members can count on us as well. Nothing represents the strength of our culture quite like Darden Dimes. Our signature employee giving program that enables team members across our family of restaurants and at the restaurant support center to support their fellow coworkers when the unexpected happens. We are grateful that all of our team members in the affected areas are safe and we move quickly to help those who were hardest hit.

Darden Dimes provided grants totaling $1,100,000 to more than 5,600 impacted team members. As I reflect on the quarter, I continue to believe in the power of our strategy and our brand's ability to compete effectively regardless of the environment. Each one of our brand leadership teams is focused on the long term and staying committed to our back to basics operating philosophy. I am proud of the way our teams performed throughout the Q2 and now we are in the midst of the busiest time of the year for our restaurants as they nourish and delight our guests and create lasting holiday memories. On behalf of our leadership team and the Board of Directors, I want to thank our 195,000 team members.

I wish you and your families a happy holiday season and hope to see you in our restaurants. Now I'll turn it over to Raj.

Thank you, Rick, and good morning, everyone. 2nd quarter earnings results were in line with our expectations with positive same restaurant sales at our 4 largest brands. The Thanksgiving shift to the Q3 this year caused the sales benefit for the casual dining brands and a headwind for our fine dining brands in the Q2. However, even when adjusting for the benefit of the Thanksgiving holiday shift at our 4 largest brands, same restaurant sales were still positive. In the Q2, we generated $2,900,000,000 of total sales, 6% higher than last year, driven by same restaurant sales of 2.4%, the acquisition of 103 Chuy's Restaurants on October 11 and the addition of 39 net new restaurants.

The Thanksgiving holiday shift contributed approximately 90 basis points to the same restaurant sales for the quarter, but was partially offset by a negative 30 basis points impact from Hurricanes Helene and Milton. We outperformed the industry benchmarks again this quarter. Same restaurant sales were 140 basis points better than the industry and same restaurant guest counts also exceeded the industry by 140 basis points. Adjusted diluted net earnings per share from continuing operations of $2.03 were 10% higher than last year. We generated $445,000,000 of adjusted EBITDA and returned $308,000,000 to our shareholders paying $166,000,000 in dividends and $142,000,000 in share repurchases.

Now looking at our adjusted margin analysis compared to last year, food and beverage expenses were 80 basis points lower, driven by the pricing leverage as commodities were slightly deflationary

they were better than our expectations. Restaurant labor was 20 basis points lower with productivity improvements and sales leverage from the Thanksgiving shift more than offsetting the total labor inflation of 3.7%, which was well above our pricing. Restaurant expenses were flat. Marketing expenses were 30 basis points higher, driven by increased media spending due to more weeks of never ending possible, which we remain while we remain disciplined in how we spend our marketing dollars. Our restaurant level EBITDA of 19.5 percent for the quarter was 70 basis points higher than last year.

Adjusted G and A expenses were 10 basis points higher than last year as unfavorable mark to market expense on our deferred compensation caused 20 basis points increase for the quarter. Due to the way we hedge mark to market expense, this unfavorability is largely offset in the tax line. Interest expense increased 20 basis points, driven by the financing expenses related to the Chuy's acquisition and other cash needs. Our adjusted effective tax rate was 12.3%, which includes the favorable impact from the mark to market hedge I referenced earlier. Our effective tax rate would have been approximately 14% without the impact of mark to market.

In total, our adjusted earnings from continuing operations were $240,000,000 which was 8.3 percent of sales and 20 basis points better than last year. Looking at our segments for the quarter, total sales for Olive Garden increased by 3.3%, driven by same restaurant sales of 2%, outperforming the industry benchmark by 100 basis points. Last year, Olive Garden same restaurant sales were 4.1% in the 2nd quarter. On a 2 year basis, Olive Garden has grown same restaurant sales by over 6%, exceeding the industry benchmark by 6 40 basis points over that period. Olive Garden continues to have strong segment profit margin, delivering 21.4% for the quarter, which is 40 basis points higher than last year.

At Longhorn, total sales increased 10.4%, driven mostly by same Russian sales growth of 7.5%, outperforming the industry benchmark by 6.50 basis points. These results build on strong results from Q2 last year, where they had same Russian sales of 4.9%. Leverage from strong from this strong sales growth resulted in segment profit margin of 18.9%, 150 basis points above last year. Total sales at the fine dining segment decreased 3.8 percent as same restaurant sales were negative at all of our fine dining brands for the quarter. Thanksgiving is a busy day for our fine dining brands and the shift of this holiday from the Q2 last year into the Q3 this year, combined with the hurricanes, resulted in an approximately 200 basis points of negative impact to same restaurant sales.

Adjusted for these impacts, Fine Dining same restaurant sales decreased approximately 3.8%, which was a sequential improvement from the Q1. The negative sales growth resulted in lower segment profit margin than last year. The other business segment sales increased by 12.9%, driven by the acquisition of Chewy's and positive same restaurant sales of 0.7%. Segment profit margin of 13.6% was 70 basis points better than last year. Turning to our financial outlook for fiscal 2025, we updated our guidance to reflect the acquisition of Chuy's, our year to date results and expectations for the back half of the year.

As a reminder, same restaurant sales for the year do not include Ruth's Chris Steakhouse or Chili's because they were not owned and operated by Darden for a 16 month period at the beginning of the fiscal year. So we now expect total sales of approximately $12,100,000,000 including approximately $300,000,000 from Chuy's, same restaurant sales growth of approximately 1.5%, 50 to 55 new restaurants, capital spending of approximately $650,000,000 total inflation of approximately 2.5%, including commodities inflation of approximately 1% and annual effective tax rate of approximately 12.5 percent, approximately 118,000,000 diluted average shares outstanding for the year. This results in no change to our adjusted diluted net earnings per share outlook of $9.40 to $9.60 which excludes approximately $47,000,000 of pretax transaction and integration related costs. Looking at the back half of the fiscal year, we expect sales and EPS growth rates to be lower in Q3 than the growth rates in Q4, given the impact of the Thanksgiving holiday shift into the Q3. Finally, as we expected, we closed in on the Chuy's deal in October, acquiring 103 Chuy's restaurants.

We're in the early stages, but the integration is going well and we now expect to realize run rate synergies of approximately $17,000,000 with approximately $2,000,000 realized in fiscal 2025 and the balance in fiscal 2026. As we mentioned previously, we anticipate the transaction will be neutral to our adjusted earnings per share for the fiscal year, not including transaction and integration related expenses. We're very pleased with the actions our brand teams are taking to address their guest needs and deliver strong results. We'll continue to adhere to our strategy and have confidence in the strength of our business model. Now we'll open it up for questions.

Thank you. We'll now be conducting a question and answer session. Our first question today is coming from David Palmer from Evercore ISI. Your line is now live.

Thanks. Good morning, guys. Wanted to ask a question on Olive Garden. I know you have a very good consumer insights team there. I wanted to ask you about what you're seeing with that brand.

Given the fact that the customer satisfaction levels are so high, sort of comparable to the leaders in any segment, Olive Garden seems to be equal to that superiority in the Italian segment. I was wondering why do you think the sales gap to the industry is not better? Is it and why is that not related to the advertising? I think a lot of people ask about that, the gap right now and your advertising spend to pre COVID, I think it's down about a half. So any comments on that would be helpful.

Hey, David, it's Rick. A couple of things about Olive Garden. 1, the gap to the industry, while it's a little bit narrower than it has been in the past, if you think about how much we've gapped over the last 5 years, it's been an exceptional gap. And so if you go back a few maybe a year ago in the call, we said we don't expect to keep the gap as high as it is now. And so and that happened.

We've also not gone after some significant discounting promotions like others have brought back. We kept our strategy to drive profitable same restaurant guest count growth, profitable sales growth. And so this quarter, we showed the power of doing some things. We added a few weeks to our Never Ending Possible promotion and those weeks that we were running Never Ending Possible against nothing, were great weeks for us. Just like others who are starting who have started running promotions against nothing, they've been doing it a little longer.

And so our gap, while smaller, we still feel confident we're doing the right things in the long term. And in terms of marketing, the amounts that you said, I don't think are exactly accurate. I'll let Raj kind of comment on that part.

Yes, David. On the marketing spend, it's really driven by essentially LongHorn spending very little, right. So LongHorn used to spend close to 3%. I think today they're spending probably maybe 0.3%, 0.4% of sales at best. So that's really the biggest driver of marketing decrease.

Olive Garden is spending less, but it's not half. It's more in the, call it, 25%, 30% less than what it used to spend.

So you don't believe that the you don't believe the scale of advertising is a problem. You're comfortable at these levels of advertising spending going forward?

Yes, David, I wouldn't say whether we're comfortable or not. I would say we can continue to look at ways to advertise Olive Garden. And there as we think about what we're going to do, we ticked up advertising this quarter. We could continue to do that. So it depends on what we're running and what kind of promotions we have, but we feel really good about what we have in our second half of the year.

And so there potentially could be a pickup in marketing in the second half, but we don't want to comment on that for competitive reasons.

Thank you. Next question is coming from Eric Gonzalez from KeyBanc Capital Markets. Your line is now live.

that last point about marketing, I think you mentioned in January, you're going to bring that to the fan favorites and to the menu and then your messaging will also include a compelling price point. So just putting the pieces together, does it sound like the next quarter might have a little bit of an uptick in advertising?

Well, if you think about the Q3 is already a really strong quarter for us. Usually, it's one of our highest volume quarters. So without kind of commenting on how much marketing will tick up or not, I would just tell you that our advertising will look different. We have, as I said, some exciting news with our 2 return fan favorites and another fan favorite that's coming with a compelling price point for a limited time. So our advertising will look different in the Q3.

I won't comment on if it's going to be higher or lower.

And then just also on the Never Impossible, I think you talked about the strong performance, particularly those weeks that didn't compare against the prior year. So I'm just curious how the promotion played out during the quarter, like how did it do once with the longer promo period, how did it do once those easy lap weeks kind of last year?

Yes. I'm going to start by saying how proud I am still of the work that Dan and the team at Olive Garden has done to improve the guest experience and react to what's going on in the marketplace. And one of those reactions was to add some weeks to never ending possible. And so we're pleased about those 4 extra weeks. We knew that we would have a trend change by adding those 4 extra weeks.

But then we knew in the last 8 weeks we'd be rapping against stronger media weight kind of looks and launch weights, etcetera. But what happened throughout the promotion, it was a good promotion for us. We kept our preference on never any possible throughout the entire thing. So there was no wear out on demand for the items. And as I said on my prepared remarks, we had record preference for refills and record preference for the buy up.

So the promotion did well. Now we expected it to be below prior year in the back half in the second part of the promotion, especially when we were wrapping on launch weights. What we did during that was add the new sauce, but a new sauce isn't going to be as powerful as a launch weight of a new promotion. So we feel really good at where we ended up with Never Ending Pawsable and we're looking at what that did for us and what we could do in the future with other promotions.

Thank you. Next question today is coming from Jim Solera from Stephens. Your line is now live.

Yes. Good morning. Thanks for taking our question. I wanted to drill down a little bit in Longhorn, in particular. Just given some of the commentary you guys had, marketing spend there is really low, but the engagement is very strong.

Can you just kind of parse out which is driving the continued strength there, maybe relative to some of the other trends we've seen in casual? And how should we think about that progressing through the years, especially as other competitors have very prominent marketing that focuses on dollar price points and like LongHorn is more of the experiential value?

Well, that's what LongHorn brand is. So they're not going to fight back or the price point promotion or a brand that's about quality and experience. So I'll start by saying LongHorn has made investments over the years even before COVID to improve the quality of their food, to improve the execution of that food. And so things that we've done over those times of making sure that our grill masters are well trained to cook the steaks exactly as the guests like it. And that showed up in our record guest record stakes were correctly scored this quarter, dramatically different than where it was just 3 or 4 years ago.

We continue to make investments in food. We have we put more dollars on the plate than anybody else in our space and guests noticed that value. And so they're willing to come to our restaurants and do that. And so what are the results? The results 7.5% comp for the quarter, up on a 4 plus percent comp last year and on a 7 plus percent comp the year before.

So those investments in quality have paid off. Guests know they're getting the highest quality stakes and expertly prepared at a great value. And then the last thing I'll say is steak brands that with strong operations that deliver on quality are winning. And so that's we think that LongHorn is working on the right things. And I can't comment on do I think they're going to continue to way outperform everybody else for the next few years, but we think they're doing the right things.

Great. And are you able to just break out that 7.5 traffic mix price for Longhorn?

Yes, the traffic was mid-4s, I think 4.3 ish 4.3 or 4.4 and the check was about 3 something and the price was like 2.8, 2.9. So they had a positive mix a little bit.

Thank you. Next question is coming from Peter Saleh from BTIG. Your line is now live.

Hey, good morning and congrats on a great quarter. I did want to ask maybe about the Uber Eats partnership and the accounting of how you guys are accounting for the delivery and the service charge in the Olive Garden comp. And what if anything was reflected in your guidance kind of going forward from the benefit of customers maybe switching from self pickup to delivery through Uber Eats? Is there anything there?

Yes, Peter, first of all, it's very small, right. When you think about the impact, let me start with the accounting part of it. The delivery fee and service fee are considered as part of sales. However, when you look at the impact, right now, we have it at 100 restaurants. We have had it for maybe less than half the quarter at fully throughout those 100 restaurants.

And when you take the dollars that come through, it's single basis points impact. So it's not it's very minuscule. And as we look forward to, yes, there may be could it be 5, 10 basis points maybe, but it's not going to be huge. I mean, it obviously depends on what percentage off premise or what percentage of sales delivery will be. So we'll share more when we actually have more information to share, but right now we expect it to be fairly minimal.

Great. And then just on the unit growth, it looks like it ticked up, at least your guidance ticked up by about 5 units. Any comments on where that's coming from? Is that the inclusion of Chuy's or is there something more? Just trying to understand where the incremental 5 are coming from.

It's really the inclusion of Chuy's. There's 5 additional openings related to Chuy's. And as we said, we're trying to continue to work towards getting as we look at next fiscal, we're trying to build a pipeline. And so that's some of them, there's some difference between the year to year, few weeks move could come in, but it's really driven by Chuy's.

Thank you. Next question is coming from Jeffrey Bernstein from Barclays. Your line is now live.

Great. Thank you very much. My first question is just on the fiscal 2025 comp guidance. It looks like for the system you tightened it to 1.5%. I think previously you were 1% to 2%.

So just two related questions on that. One, just why with 2 quarters remaining, would you tighten it to such a specific price point? I'm just wondering whether that demonstrates maybe increased confidence that there's going to be a lot less volatility. And the second question around that is just what does it assume directionally at least for Olive Garden and LongHorn? And I know with Olive Garden you have much easier compares, you got a new value LTO potentially on the come.

LongHorn obviously has very strong momentum. So I would have assumed maybe both of those brands would be above that 1.5%. Just trying to see if I'm interpreting that correctly? Thank you.

Hey, Jeff. Let's just start with the guidance on the same restaurant sales itself. We said, yes, we expect it to be approximately 1.5%. The way we're thinking about it is we're looking at the underlying trends on a multiyear basis and the actions we're taking in the back half. We're incorporating all of that.

And yes, you could say that implies that we have a little bit more increased confidence in the sales being more closer to that midpoint or better and that's in that range and that's why we've tightened it to be there. And as we get we have 2 quarters behind us, so we have the idea. We have those are actualized, so it makes it a little bit more the range is not as narrower when you take into consideration the fact that now we're looking at only 2 quarters and we're trying to calculate the full year.

Got it. And in terms of the assumption for Olive Garden and LongHorn within there, am I correct to assume that you would think Olive Garden would accelerate from here and obviously LongHorn has been running well above those ranges. So just trying to get a sense for whether that's the correct interpretation or whether there are some offsets that we're not fully appreciating?

No, I think that's probably a fair assumption given the mix of the brands we have in the portfolio.

Understood. And then my follow-up is just on the fine dining comps. I think you said they improved sequentially when you back out the Thanksgiving and hurricane shifts. I'm just wondering, are there any particular brands leading or lagging? I'm just getting a lot of questions around maybe the increasing GLP-one impact that might have an impact on kind of higher end brands.

I'm wondering whether you think that's having any noticeable impact at this point? Thank you.

Hey, Jeff. If you think about our fine dining brands, there's really no brands leading or lagging. Ruth Chris is just a little bit less than capital Grilling ADBs, but some of that is due to the fact that last year, if you recall, in the Q2, we eliminated lunch in a lot of the restaurants. We turned off third party delivery in a lot of their restaurants. And actually, we didn't take any price at Ruth's Chris where we had for the other brands.

In regards to GLP-1s, I think right now it's about 6% of the population are on GLP-1 drugs. It could be having an impact on the higher end brands and we'll continue to monitor that. That said, that's the benefit of a large portfolio like ours and having multiple brands in many different categories. But we will monitor the GLP-one and see if there's any actions that we have to take to help strengthen from that.

Thank you. Next question is coming from Sara Senatore from Bank of America. Your line is now live.

Thank you. I have a question actually I guess about the broader environment. You mentioned that fine dining, I mean, that the large casual dining brands were all positive. And then, I guess, polished casual and fine dining were a bit softer. And yet one of the things that you're seeing in Olive Garden, for example, is that pricing up through the protein add on.

So it seems like people are willing to pay up for protein specifically, but indulge a little bit. Are you seeing any trade do you think among your brands, Capital Grille to Longhorn or anything like that? Again, you just mentioned the value having the portfolio and I was just curious if you can draw any or extrapolate from some of the performance, which seems to be strongest at the sort of mid price points, but with a clear desire to for some indulgence and positive mix?

Yes, Sarah. A couple of things on the environment. First of all, it looks like the consumer is starting to feel a little bit better than they were in prior quarters. I'll give you a little bit of our research. Our external research shows that consumer sentiment is trending positive.

And there's a little bit of a feeling of optimism out there by the belief the labor market will improve. But then when you in the terms of the kind of more casual brands versus the fine dining brands, we're actually seeing optimism in our restaurants in contrast to seeing this optimism there in contrast to previous quarters, we're seeing growth in visits from our guests making between $50,000 $100,000 a year, which is really more of our casual dining brands. We're not seeing as much of an increase in visits yet on the consumers that are above that. And so the other thing in fine dining, just like we've said in the past, it appears that consumers who were splurging on fine dining for basically those who are making less than $150,000 have continued to pull back. So it's impacting fine dining a little bit.

The kind of more average income consumer is starting to feel a little bit better. In regards to trade down, there could be some trade down from Capital Grille to Longhorn or Ruth's Chris to Longhorn that might be benefiting them and maybe other state players. But frequency isn't super high. So to be able to vet that out quarter to quarter isn't necessarily the easiest thing to do, but there's probably a little trade down.

Yes, that's really helpful. Thank you. Just and the point about sort of maybe where the middle class is indulging itself is maybe it was briefly at fine dining and now it's more kind of trading up at casual.

It's probably trading back to where they were.

Right. Okay. Got it. Thank you. But then just a quick follow-up, this is one on Cheddar's.

Comping positively, seems like it's really hit its stride after maybe being a little slower off the mark after the acquisition. So I think at one point the expectation was for much faster growth, unit growth out of that brand. Is it at an inflection point now where we could see that?

Well, we think that they've actually done a lot to improve the operation. As I said earlier, John Wilkerson and his team have been amazing at bringing their turnover down, turnovers at their best ever levels and it helps on having team members that know the brand, understand the brand and can execute the brand. We've also done a little bit of testing with some ways to let the consumer know about Cheddar's. And so I would say inflection point, I don't want to use that word that would imply something significant change. When you think about unit growth, it takes a little while to build the pipeline.

That said, we've opened one restaurant in a new lower cost prototype that's doing very well for us and we're opening another one fairly soon and we would expect to start ramp building that pipeline up so that we can get towards that high end of our framework for new unit growth and Cheddar's will be part of that improvement. So we'll talk a little bit more about unit growth in the March call, which is what we normally do. But yes, inflection point might not be the right word, but confidence that we can continue to open these restaurants is maybe a better way to say it.

Thank you. Next question is coming from Andrew Charles from TD Cowen. Your line is now live.

Darden Restaurants (DRI) Q2 2025 Earnings Call Transcript

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