Darden misses Q1 profit estimates, partners with Uber to expand deliveries

Darden Restaurants, Inc.. (NYSE:DRI) shares are trading higher. The company reported first-quarter financial results today.

The company reported adjusted earnings per share of $1.75, which missed analysts’ consensus of $1.83. Quarterly sales of $2.76 billion fell short of market expectations of $2.80 billion.

“While we fell short of our expectations in the first quarter, I have great confidence in the strength of our business,” said Rick Cardenas, Darden’s chairman and CEO.

Darden’s directors have approved a quarterly cash dividend of $1.40 per share on the company’s outstanding common stock. This dividend will be paid to shareholders on November 1, as recorded at the close of business on October 10.

During the quarter, the company repurchased approximately 1.2 million shares of common stock for a total of $172 million. The company had $743 million remaining under its existing $1 billion repurchase authorization at the end of the fiscal first quarter.

Also Read: Darden Restaurants Reports Q1 Results, Joins Tesla, Nvidia, XPeng and Other Big Stocks Rising on Thursday

The company has established an exclusive, long-term cooperation in the field of supply Uber Technologies, Inc. (NYSE:UBER), starting with Olive Garden in late 2024.

The agreement will allow restaurant guests to place on-demand delivery orders through Darden channels, with deliveries handled by Uber Direct as part of Uber’s national delivery network.

A direct delivery pilot program from select Olive Garden locations will launch in late 2024.

If the pilot is successful, Olive Garden’s nationwide expansion should be completed by May 2025.

Perspectives: The Company reiterated all aspects of its full-year fiscal 2025 financial guidance, which resulted in diluted net earnings per share from continuing operations of $9.40 to $9.60, compared to an estimate of $9.50, which excludes any impact of Chuy’s operations, transaction, financing and integration costs related to the pending acquisition.

“A significant decline in traffic in July led to lower-than-expected first-quarter earnings,” said Darden CFO Raj Vennam. “Following July’s weakness, our sales trend continues to improve. Given this recovery, as well as planned initiatives to support the remainder of the fiscal year, we reiterate our fiscal 2025 guidance.”

Price action: DRI shares were up 7.39% to $170.90, as of last check on Thursday.

Photo via Wikimedia Commons

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