Stock Decline of Cava Today
Cava Struggles in Second Quarter, But Long-Term Outlook Remains Promising
In a recent earnings report, fast-casual chain Cava posted disappointing results for the second quarter of 2025. The company's adjusted earnings per share improved slightly, beating expectations, but its revenue fell short of the consensus.
Cava's adjusted earnings per share improved from $0.14 to $0.16, beating expectations at $0.13. However, the consensus for Cava's revenue was $285.2 million, which was not met. As a result, the company's adjusted EBITDA guidance remains the same at $152 million-$159 million for the full year.
The slowdown in sales and the guidance cut have led to a sell-off in Cava's shares. As of 10:35 a.m. ET, Cava's shares are down 16.7% due to the news.
Despite the short-term challenges, CEO Brett Schulman stated that Cava continued to grow market share during the second quarter of 2025. The restaurant industry is struggling, with discretionary spending pulling back due to fears around trade tensions. However, Cava's continued growth is aimed at firmly establishing its category-defining leadership position.
Cava's growth significantly slowed in the second quarter, with same-store sales rising only 2.1%. However, the restaurant-level profit margin was 26.3% in the second quarter, down slightly from 26.5% in the same quarter last year. The average unit volume for Cava improved from $2.7 million to $2.9 million.
Cava has cut its guidance for full-year same-store sales growth, now expecting a rise of 4%-6%, down from a previous range of 6%-8%. Despite the sell-off in Cava's shares, the long-term outlook for the company remains promising. Cava aims to grow from around 400 restaurants to more than 1,000 by 2032.
It is important to note that as of now, there is no publicly available detailed information regarding Cava's long-term expansion or strategic plans past 2032. For the most accurate and up-to-date insights on Cava's future growth strategy beyond that year, it would be best to consult official Cava corporate communications, investor relations releases, or recent industry reports directly.
In conclusion, while Cava's second-quarter results were disappointing, the company's long-term outlook remains promising. The sell-off in Cava's shares should not be surprising due to the slowdown in sales and the guidance cut, but the company's continued growth is aimed at firmly establishing its category-defining leadership position in the fast-casual industry.
Investors may want to reconsider their finance decisions regarding Cava's stock-market performance due to the disappointing second-quarter results. Despite the current money challenges, Cava aims to grow from around 400 restaurants to more than 1,000 by 2032, providing a promising long-term investment opportunity. However, more detailed information about Cava's long-term expansion and strategic plans past 2032 can be found in official corporate communications and industry reports.
