Shares of Darden Restaurants Inc. slipped in premarket trading Thursday even after the casual-dining operator delivered an adjusted earnings beat for the fiscal fourth quarter and provided fiscal 2027 guidance that exceeded Wall Street estimates.
Darden, which operates 2,202 company-owned restaurants including Olive Garden and LongHorn Steakhouse, reported adjusted diluted earnings per share of $3.66 for the quarter ended May 31, versus the analyst consensus of $3.63. Reported revenue for the period was $3.72 billion, slightly below the expected $3.73 billion.
The quarterly results were influenced by an additional 53rd week of operations in the fiscal period - compared with 52 weeks in the prior year - which the company said contributed $0.25 to both reported and adjusted diluted EPS figures.
Sales and same-restaurant performance
Total sales for the quarter rose 13.7% year-over-year. Management attributed that increase to the extra week of operation, a blended same-restaurant sales gain of 4.6%, and the opening of 43 net new restaurants during the period.
- LongHorn Steakhouse same-restaurant sales: +9.5%
- Other Business same-restaurant sales: +4.6%
- Olive Garden same-restaurant sales: +2.4%
- Fine Dining same-restaurant sales: +1.9%
Adjusted diluted EPS increased 22.8% from the prior year for the quarter.
Full fiscal year results
For the full fiscal year, Darden reported total sales of $13.21 billion, a 9.4% increase versus the prior year, with blended same-restaurant sales up 4.5%. Adjusted diluted EPS for the full year was $10.64, representing an 11.4% increase year-over-year.
Guidance and capital allocation
Looking ahead to fiscal 2027, the company projected total sales between $13.60 billion and $13.75 billion and diluted EPS from continuing operations of $11.10 to $11.35. Those ranges sit above consensus estimates cited by the company of $13.22 billion in revenue and $10.62 in EPS.
Darden also provided additional operating guidance: same-restaurant sales growth of 2.5% to 3.5%, 75 to 80 new restaurant openings in fiscal 2027, and EBITDA in a range of $2.26 billion to $2.29 billion. The company expects total capital spending of approximately $875 million and total inflation of approximately 3.0%.
On capital returns, the board declared a quarterly cash dividend of $1.62 per share, an 8.0% increase from the prior quarter, payable Aug. 3, 2026, to shareholders of record as of July 10, 2026. Directors also authorized a new share repurchase program of up to $1.5 billion with no expiration date, replacing the prior authorization. During the fiscal quarter, Darden repurchased roughly 0.7 million shares for $138 million.
Market reaction and context
Despite the beat on adjusted EPS and guidance that topped consensus, shares moved lower in premarket trade. The mixed reception reflects investor focus on both near-term measures - including the unusual contribution from the extra week - and forward-looking metrics such as projected openings, same-restaurant sales growth, EBITDA guidance, and capital allocation decisions.
Overall, the results show year-over-year sales and earnings growth for Darden and management expects continued expansion and shareholder returns in fiscal 2027.