The U.S. restaurant industry struggled throughout 2024, but restaurant operator Darden Restaurants closed out the year strong, reporting higher earnings year over year in its most recent fiscal quarter.
The Orlando, Florida, U.S.A.-based operator of such restaurant chains as Ruth’s Chris, LongHorn Steakhouse, and Olive Garden reported a 6 percent total sales increase in its fiscal second quarter of 2025.
The company largely attributed that increase to a blended same-restaurant sales increase of 2.4 percent in the quarter, along with sales from adding 103 Chuy's restaurants and 39 other net new restaurants to its portfolio.
Notably, same-restaurant sales surged 7.5 percent at LongHorn Steakhouse and rose 2 percent at Olive Garden.
One of the only bleak spots in the quarter for Darden was that sales in its fine-dining segment dropped 5.8 percent year over year.
"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," Darden President and CEO Rick Cardenas said.
Darden now expects same-restaurant sales to grow around 1.5 percent and plans to open 50 to 55 restaurants in its full 2025 fiscal year.
The positive report echoes recent findings from data firm Placer.ai, which showed that overall foot traffic at Darden Restaurants rose nearly 1 percent in the third quarter of 2024. The full-service restaurants segment overall realized a traffic decline of 1.9 percent.
Notably, LongHorn Steakhouse’s visits rose 9 percent during November, while Olive Garden’s visits jumped 2.1 percent in the month. Ruth’s Chris was the only Darden chain that saw a decline in visits that month, according to Placer.ai.
“As restaurant inflation finally begins to cool and the dining segment tiptoes cautiously toward recovery, Darden’s ability to stay ahead of the competition suggests that its brands are resonating with customers, even during periods of economic uncertainty,” Placer.ai said.
The Santa Cruz, California, U.S.A.-based data firm also said Darden should have had a positive 2024 holiday season, referencing previous years’ data to make that prediction.
Nearly all Darden brands had an increase in traffic during December in 2019, 2022, and 2023, according to Placer.ai’s analysis. Full-service chain Capital Grille saw the greatest increase in visits in December 2023, followed by Ruth’s Chris and Season’s 52.
“These consistent December traffic spikes coupled with November’s strong showing suggest that the company is well-positioned to sustain its current momentum into the holiday season and beyond,” the firm said.
