CAVA Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Revenue: $365.4 million, up 31.3% year-over-year.

Same Restaurant Sales: Increased by 9%, driven by a 5.3% increase in traffic.

Net New Restaurants: 17 openings, totaling 476 locations.

Adjusted EBITDA: $54.7 million, a 30% increase from Q2 2025.

Net Income: $23 million, compared to $18.4 million in Q2 2025; diluted EPS increased to $0.19 from $0.16.

Cash Flow: Year-to-date free cash flow of $44.8 million; cash and investments totaled $435.6 million with no debt.

Restaurant-Level Profit: $93.8 million, representing 25.7% of revenue, slightly down from 26.3% year-over-year.

2Strategic Updates and Business Highlights

Expansion: Continued restaurant openings with strong performance; new markets include Indiana, Ohio, and upcoming entries into Las Vegas and the Bay Area.

Culinary Innovation: Launched Pomegranate Glazed Salmon, with positive guest reception; testing roasted garlic shrimp for future menu expansion.

Loyalty Program: Growth in first-party audience and engagement through initiatives like Flavor Passport, enhancing customer experience.

Operational Improvements: Focus on team member development through the Flavor Your Future initiative and rollout of pre-marinated chicken to streamline operations.

3Forward Guidance and Outlook

Full Year 2026 Guidance:

Net new restaurant openings: 75 to 77.

Same restaurant sales growth: 4.5% to 6.5%.

Restaurant-level profit margin: 23.7% to 24.3%.

Adjusted EBITDA: $181 million to $191 million, including preopening costs.

Concerns: Ongoing macroeconomic uncertainties and food safety issues impacting sales, particularly due to the Cyclospora outbreak.

4Bad News, Challenges, or Points of Concern

Food Safety Issues: Recent concerns over food safety, particularly related to lettuce, led to temporary sales impacts, although recovery is noted.

Cost Pressures: Anticipated increases in food, beverage, and packaging costs as a percentage of revenue due to input costs and fuel surcharges.

Labor Costs: Continued investments in team member wages may pressure margins, although expected to be offset by sales leverage.

5Notable Q&A Insights

Sales Recovery: Same restaurant sales have rebounded to mid-single digits after initial impacts from food safety concerns.

Marketing Strategy: Potential to increase marketing spend to enhance brand visibility and customer engagement, particularly in light of low current spending levels.

AGM Role Impact: Positive early results from the Assistant General Manager role, leading to improved team member and guest satisfaction.

Catering Test: Expansion of catering market tests to better understand capacity management and demand.

Future Protein Offerings: Continued interest in seafood as a menu category, with plans for further testing and potential launches. Overall, CAVA reported strong financial performance in Q2 2026, driven by robust sales growth and strategic initiatives, while facing challenges related to food safety concerns and rising costs. The company remains optimistic about its growth trajectory and operational improvements moving forward.