CAVA GROUP, INC. (CAVA) Q1 2025 Earnings Summary

Executive Summary

Q1 2025 delivered strong top-line and traffic-led comp growth: consolidated revenue rose 28.1% YoY to $331.8M and diluted EPS was $0.22; same-restaurant sales grew 10.8% with 7.5% traffic, and restaurant-level margin was 25.1% .
Versus S&P Global consensus, CAVA beat on EPS ($0.22 vs $0.15*) and revenue ($331.8M vs $327.7M*), with EBITDA essentially in-line on an apples-to-apples basis given definitional differences (reported Adjusted EBITDA $44.9M vs consensus EBITDA $43.9M*; S&P “EBITDA” is standardized and not the company’s non-GAAP Adjusted EBITDA) .
Values retrieved from S&P Global.*
FY25 guidance raised: net new openings to 64–68 (from 62–66) and Adjusted EBITDA to $152–$159M (from $150–$157M); same-store sales and margin ranges maintained; pre-opening costs modestly increased .
Catalysts: ongoing traffic momentum and loyalty engagement approaching 8M members, connected kitchen rollouts (KDS to 250 restaurants by year-end), and an innovation pipeline (new protein tentpole later in 2025), offset by steak-related COGS pressure and fluid macro/tariff backdrop .

What Went Well and What Went Wrong

What Went Well

Traffic-led comps: same-restaurant sales +10.8% with 7.5% traffic; restaurant-level margin held solid at 25.1% despite input cost pressures, demonstrating operational leverage and strong unit economics .
Loyalty and engagement: sales through loyalty up 340 bps since relaunch; membership approaching 8M, with ~50k registrations/week; management plans tiered rewards to deepen relationships .
Strategic expansion and tech enablement: 15 net new restaurants (382 total), entry into Indiana, KDS live in 42 locations (target 250 by YE), AI video in 4 restaurants improving accuracy and productivity .

What Went Wrong

Food basket cost pressure: food/beverage/packaging at 29.3% (+110 bps YoY) largely from steak mix; management expects ~100 bps YoY impact to roll off by June .
Wage investments: ongoing incremental wage investments (e.g., ~3% in Q1) partially offset labor leverage, though labor cost improved 30 bps to 25.7% of revenue .
Macro/tariff fluidity: management flagged evolving macro and tariff dynamics; limited exposure given domestic sourcing and contracts, but pre-opening costs raised modestly and vigilance required .

Financial Results

Consolidated Performance vs Prior Periods and Consensus

Metric	Q1 2024	Q4 2024	Q1 2025	Consensus (Q1 2025)
Revenue ($USD Millions)	$259.0	$227.4	$331.8	$327.7*
Diluted EPS (GAAP) ($)	$0.12	$0.66	$0.22	$0.15*
Adjusted Diluted EPS ($)	$0.10	$0.05	$0.22	N/A
Net Income Margin (%)	5.4%	34.6% (VA Release impact)	7.7%	N/A
Adjusted EBITDA ($USD Millions)	$33.3	$25.1	$44.9	$43.9*
Adjusted EBITDA Margin (%)	12.9%	11.0%	13.5%	N/A

Values retrieved from S&P Global.*

Notes:

Company reports non-GAAP Adjusted EBITDA; S&P’s standardized “EBITDA” may not be strictly comparable; use Adjusted EBITDA for internal trend .
Q4 2024 EPS/Net Income margin benefited from the $80.1M valuation allowance release (VA Release); adjusted diluted EPS was $0.05 .

Segment (CAVA Restaurants) and Cost Structure

Metric	Q1 2024	Q1 2025
CAVA Restaurant Revenue ($USD Millions)	$256.3	$328.5
Food, Beverage, Packaging (% of Revenue)	28.2%	29.3%
Labor (% of Revenue)	26.0%	25.7%
Occupancy (% of Revenue)	8.0%	7.4%
Other Operating (% of Revenue)	12.7%	12.5%
Restaurant-Level Profit ($USD Millions)	$64.6	$82.3
Restaurant-Level Profit Margin (%)	25.2%	25.1%

KPIs and Operating Metrics (Quarterly Trajectory)

KPI	Q1 2024	Q2 2024	Q3 2024	Q4 2024	Q1 2025
Net New CAVA Openings	14	18	11	15	15
Restaurants (end of period)	323	341	352	367	382
Same-Restaurant Sales Growth (%)	2.3%	14.4%	18.1%	21.2%	10.8%
AUV ($USD Millions)	$2.608	$2.689	$2.784	$2.865	$2.933
Restaurant-Level Profit ($USD Millions)	$64.6	$61.3	$61.8	$50.4	$82.3
Restaurant-Level Profit Margin (%)	25.2%	26.5%	25.6%	22.4%	25.1%
Digital Revenue Mix (%)	36.4% FY24	—	—	36.8%	38.0%
Restaurant Operating Weeks	5,086	3,963	4,159	4,299	5,935

Balance Sheet Highlights

Metric ($USD Thousands)	Dec 29, 2024	Apr 20, 2025
Cash & Equivalents	$366,120	$289,350
Investments at Fair Value	—	$79,917
Total Assets	$1,169,669	$1,228,363
Total Liabilities	$474,103	$502,189
Total Stockholders’ Equity	$695,566	$726,174

Guidance Changes

Metric	Period	Previous Guidance (Feb 25, 2025)	Current Guidance (May 15, 2025)	Change
Net New CAVA Restaurant Openings	FY 2025	62–66	64–68	Raised
CAVA Same-Restaurant Sales Growth	FY 2025	6.0%–8.0%	6.0%–8.0%	Maintained
CAVA Restaurant-Level Profit Margin	FY 2025	24.8%–25.2%	24.8%–25.2%	Maintained
Pre-opening Costs ($M)	FY 2025	$14.0–$15.0	$14.5–$15.5	Raised
Adjusted EBITDA ($M)	FY 2025	$150–$157	$152–$159	Raised

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
AI/Technology initiatives (KDS, AI vision)	KDS test expanded to 25; AI vision live in 4; plan for 250 KDS in 2025	KDS live in 42; target 250 by YE; AI video live in 4; early improvements in accuracy/productivity	Scaling, positive early results
Supply chain/tariffs	Value pricing vs CPI/fast food; steak raised COGS; macro/tariff vigilance	Limited tariff exposure; majority domestic sourcing; mitigation tactics in place	Monitored, contained
Product performance/innovation	Steak strong; garlic ranch pita chips; tentpole cadence planned	Spice World campaign; new chef bowls; tentpole later in fall likely new protein	Ongoing cadence; new protein pending
Regional trends/expansion	Entering South Florida, Detroit, Indianapolis, Pittsburgh; strong greenfield openings	Entered Indiana; expanding to Detroit and Pittsburgh; strong performance across geographies	Broad-based strength
Loyalty & engagement	230 bps increase; multi-phase roadmap	+340 bps; approaching 8M members; tiered structure testing in 2025	Strengthening
Labor & throughput	New labor deployment model rolled out; early speed/service gains	Productivity improvements across dayparts; refinement opportunities	Improving
Regulatory/legal	AB 1228 wage investments acknowledged	Continued wage investments (~3% Q1)	Managed

Management Commentary

“First quarter same restaurant sales grew 10.8%, including traffic growth of 7.5%...with our entry into Indiana we are now in 26 states...we have now surpassed a billion dollars in revenue on a trailing twelve-month basis” — Brett Schulman, CEO .
“CAVA’s food, beverage and packaging costs were 29.3% of revenue...higher by 110 bps due to the impact of steak. We continue to expect the ~100 bps impact to roll off by June.” — Tricia Tolivar, CFO .
“We plan to roll out our new kitchen display system to 250 restaurants by year-end...currently live in 42 locations...improvements in guest satisfaction scores driven by better digital accuracy.” — Brett Schulman, CEO .
“Sales through [loyalty] up 340 basis points...total membership now approaching 8 million...testing a new tiered structure later this year.” — Brett Schulman, CEO .
“Our guidance reflects both the evolving macroeconomic landscape and the strength we’re seeing...Adjusted EBITDA between $152M and $159M.” — Tricia Tolivar, CFO .

Q&A Highlights

Loyalty program momentum and roadmap: 340 bps sales lift, ~8M members, tiered structure testing; heavy weekly registrations sustain acquisition .
Operations and tech: KDS improving throughput and accuracy; throttling and dynamic status updates enhance digital experience; AI video supports prep and grill forecasting .
Menu innovation: Tentpole likely new protein later in 2025; chicken shawarma testing with premium pricing; low operational lift; strong consumer reception .
Cost structure and steak mix: Steak contracted through year-end; ~100 bps YoY COGS headwind expected to roll off by summer; rest of basket relatively stable .
Macro/tariffs and value: Limited tariff exposure due to domestic sourcing/contracts; continued disciplined pricing (+1.7% in January) to reinforce value proposition .

Estimates Context

EPS: $0.22 actual vs $0.15* consensus — significant beat driven by stronger operations and a $10.7M equity-based compensation tax benefit in Q1 . Values retrieved from S&P Global.*
Revenue: $331.8M actual vs $327.7M* consensus — beat by ~$4.1M (+1.3%). Values retrieved from S&P Global.*
EBITDA: Reported Adjusted EBITDA $44.9M vs S&P standardized EBITDA consensus $43.9M*; note definitions differ, but directional performance in line-to-better . Values retrieved from S&P Global.*

Implications: Consensus likely to revise upward for FY25 Adjusted EBITDA and unit growth given raised guidance; steak-related COGS pressures appear transient into summer, supporting margin trajectory .

Key Takeaways for Investors

Traffic is the engine: 7.5% traffic drove +10.8% SSS; loyalty and operations investments sustain momentum across geographies and dayparts .
Guidance raised on units and EBITDA: FY25 net new openings to 64–68 and Adjusted EBITDA to $152–$159M; supports multi-year unit growth algorithm and margin durability .
Near-term COGS headwinds are time-bound: ~100 bps steak impact expected to roll off by June; basket otherwise stable under contracts .
Technology-supported execution: KDS/AI deployments improving accuracy and productivity; scale to 250 KDS by YE enhances digital channel experience .
Innovation cadence intact: tentpole new protein planned for fall, with complementary LTOs (e.g., shawarma) and pita chip flavor platform; revenue mix supports premium attachments .
Value positioning remains a differentiator: disciplined pricing (+1.7% Jan) vs CPI/peers reinforces value/traffic strategy amid macro fluidity .
Trading lens: Near-term upside from consensus beats and raised FY guide; watch steak roll-off timing, sequential comp trajectory, and speed-of-service gains as potential catalysts .