Latest CAVA Earnings Report Q4 2024

Company Overview

Cava Group, Inc. (NYSE: CAVA) is a leading Mediterranean fast-casual restaurant chain in the United States. Founded in 2006 by Ted Xenohristos, Ike Grigoropoulos, and Dimitri Moshovitis, the company is headquartered in Washington, D.C. Cava offers a customizable menu featuring over 38 ingredients, allowing for a variety of bowl or pita combinations. In addition to its restaurant operations, Cava produces a line of Mediterranean dips, spreads, and dressings available in grocery stores nationwide. In August 2018, Cava acquired Zoës Kitchen for $300 million, expanding its footprint and becoming the largest operator in the U.S. Mediterranean restaurant category. The company went public on June 15, 2023, debuting on the NYSE under the ticker symbol CAVA. As of February 26, 2025, Cava operates over 360 locations across the country. The company reported a 39% increase in total revenue for the third quarter of 2024, reaching $241.5 million, with same-restaurant sales growing by 18.1%. This growth is attributed to the opening of 73 new restaurants within the year and a significant rise in guest traffic. Cava's stock has experienced substantial growth since its IPO, with shares quadrupling in 2024. Despite this rapid appreciation, analysts advise caution due to high valuations compared to industry peers.

Latest CAVA Earnings Comparison (Q4 2024)

Historical CAVA Earnings Data

CAVA Earnings Call Summary Q4 2024

Highlights

• Strong Revenue Growth: Q4 revenue grew 36.8% YoY to $225.1M, driven by 21.2% same-restaurant sales growth, including a 15.6% increase in traffic.

• Expansion Milestone: Opened 15 new restaurants in Q4, bringing the total to 367 locations (+18.8% YoY). Full-year 2024 saw 58 net new openings.

• Profitability Growth:

  • Adjusted EBITDA for Q4: $25.1M (+60% YoY).

  • Full-year 2024 Adjusted EBITDA: $126.2M (+71% YoY).

  • Net income for Q4: $78.6M; Full-year net income: $130.3M (+278% YoY).

• Loyalty Program Success: The reimagined loyalty program increased engagement, leading to a 230bps rise in loyalty-driven sales.

• New Market Expansions: Entering Detroit, Indianapolis, Pittsburgh, and South Florida in 2025.

• Tech & AI Investments: AI-driven kitchen display systems (KDS) rolled out to 25 locations, with plans for 250 by year-end, improving order accuracy and productivity.

• Culinary Innovation: Strong demand for grilled steak (launched in 2024); continued investment in new flavors like garlic ranch pita chips.

• Free Cash Flow Strength: Generated $52.9M in free cash flow in 2024, supported by strong operations and cost management.

Risks

• Food Cost Pressures: Higher food, beverage, and packaging costs (29.9% of revenue, +110bps YoY) due to national steak rollout.

• Labor Cost Inflation: Wages increased 4% YoY, including compliance with California's AB 1228 wage law.

• Margin Pressure: Restaurant-level profit margin at 22.4%, with temporary cost headwinds from menu innovations like steak.

• Competitive Landscape: QSR and fast-casual competitors are intensifying pricing and discounting strategies.

• Macroeconomic Uncertainty: Consumer spending trends and inflation could impact discretionary dining habits.

Opportunities

• Aggressive Expansion Plan: 2025 target of 62–66 net new restaurants, maintaining 17% unit growth.

• AI-Driven Efficiency: Kitchen display system rollout aims to increase speed of service, accuracy, and guest experience.

• Catering Business Potential: Expanding tests in major metro markets to refine packaging, fulfillment, and digital ordering.

• Menu & Seasonal Innovations: Continued investment in high-margin premium proteins, Mediterranean-inspired flavors, and snackable items.

• Loyalty Program Optimization: Enhancing personalized rewards, tiered benefits, and non-food incentives to drive repeat visits.

• Pricing Power & Value Perception: Despite only a 1.7% price increase in 2025, CAVA maintains a strong value advantage versus QSR and casual dining competitors.

Outlook

• Revenue Growth: Same-restaurant sales expected to grow 6–8% YoY.

• Profitability Expansion: Restaurant-level margins to improve to 24.8–25.2%.

• Adjusted EBITDA Growth: Projected at $150M–$157M, reflecting up to 25% YoY increase.

• No Further Price Increases Planned: Strategy focuses on driving traffic through value perception rather than aggressive pricing.

• Stronger Unit Economics: New restaurant AUV projections raised to $2.3M (Year 1) and $2.5M (Year 2), supporting higher ROI on new openings.

The information is provided for educational purposes only and does not constitute financial advice or recommendation and should not be considered as such. Do your own research.