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Darden Restaurants, known for its diverse portfolio including Olive Garden and LongHorn Steakhouse, recently released its fiscal fourth-quarter earnings report, revealing a nuanced financial performance. Despite a 6.8% surge in net sales driven by acquisitions like Ruth’s Chris Steak House, Darden faced challenges with its same-store sales, particularly at Olive Garden and its fine-dining establishments. The company reported earnings per share of $2.65, slightly exceeding Wall Street’s expectations of $2.61, but fell short on revenue, reporting $2.96 billion against an anticipated $2.97 billion. This mixed performance reflects broader industry pressures, including heightened competition and economic uncertainties impacting consumer spending habits.

CEO Rick Cardenas highlighted persistent challenges within the consumer environment, exacerbated by competitive discounting and marketing strategies. Darden’s strategy, focused on sustainable profit growth rather than short-term sales boosts, aims to navigate these challenges effectively. Despite flat overall same-store sales, LongHorn Steakhouse emerged as a standout performer with a 4% increase in same-store sales, outshining Olive Garden which experienced a 1.5% decline. The company’s fine-dining segment, encompassing brands like The Capital Grille and Eddie V’s, saw a 2.6% decrease in same-store sales, further highlighting sector-specific difficulties.

Looking ahead to fiscal 2025, Darden anticipates modest growth, projecting earnings per share between $9.40 and $9.60 and net sales ranging from $11.8 billion to $11.9 billion. These forecasts align closely with analysts’ expectations, albeit at the lower end of the spectrum for net sales. The company anticipates contending with a 3% inflation rate and expects a gradual improvement in traffic throughout the fiscal year. Strategic pricing adjustments, aimed at offsetting inflationary pressures while maintaining consumer affordability, are integral to Darden’s operational plans.