CAVA Group Reports First Quarter 2025 Results

Year Over Year CAVA Revenue Growth of 28.2% Including CAVA Same Restaurant Sales Growth of 10.8%

15 Net New CAVA Restaurant Openings During Quarter

First Quarter 2025 CAVA Restaurant-Level Profit Margin of 25.1%

CAVA Group, Inc. (NYSE:CAVA) ("CAVA Group" or the "Company"), the category-defining Mediterranean fast-casual restaurant brand that brings heart, health, and humanity to food, today announced financial results for its fiscal first quarter ended April 20, 2025.

"In spite of economic uncertainty and challenging weather, CAVA's first quarter results demonstrate the continued strength of our category-defining brand," said Brett Schulman, Co-Founder and CEO. "First quarter same restaurant sales grew 10.8%, including traffic growth of 7.5%. We opened 15 net new restaurants during the quarter and with our entry into Indiana we are now in 26 states and the District of Columbia. In addition to these highlights, I'm proud to say that on a trailing twelve-month basis, we have now surpassed a billion dollars in revenue – a milestone that is a testament to Mediterranean becoming the next large scale cultural cuisine category, a category we have firmly established our leadership in."

Fiscal First Quarter 2025 Highlights:

• CAVA Revenue grew 28.2% to $328.5 million as compared to $256.3 million in the prior year quarter.
• Net New CAVA Restaurant Openings of 15, bringing total CAVA Restaurants to 382, an 18.3% increase in total CAVA Restaurants year over year.
• CAVA Same Restaurant Sales Growth of 10.8%, including guest traffic growth of 7.5%.
• CAVA AUV of $2.9 million as compared to $2.6 million in the prior year quarter excluding the 53rd week of fiscal 2023.
• CAVA Restaurant-Level Profit of $82.3 million or growth of 27.4% over the prior year quarter, with CAVA Restaurant-Level Profit Margin of 25.1%.
• CAVA Digital Revenue Mix was 38.0%.
• CAVA Group Net Income of $25.7 million compared to $14.0 million of net income and $11.9 million of Adjusted Net Income¹ in the prior year quarter.
• CAVA Group Adjusted EBITDA¹ of $44.9 million compared to $33.3 million in the prior year quarter.
• Net cash provided by operating activities of $38.6 million with Free Cash Flow¹ of $2.7 million.

CAVA Fiscal First Quarter 2025 Review:

CAVA Revenue was $328.5 million, an increase of 28.2% compared with the first quarter of fiscal 2024. The increase was primarily driven by 73 Net New CAVA Restaurant Openings during or subsequent to the first quarter of fiscal 2024, which are exceeding our performance expectations, and CAVA Same Restaurant Sales Growth of 10.8%. CAVA Same Restaurant Sales Growth consists of a 7.5% increase from guest traffic and a 3.3% increase from menu price and product mix.

CAVA Restaurant-Level Profit Margin was 25.1% compared with 25.2% in the first quarter of fiscal 2024. The decrease was due to input costs associated with the launch of grilled steak in the second quarter of fiscal 2024 and incremental wage investments, partially offset by leverage from higher sales.

CAVA Group Fiscal First Quarter 2025 Review:

General and administrative expenses were $41.4 million, or 12.5% of revenue, as compared to $33.8 million, or 13.1% of revenue, in the first quarter of fiscal 2024. General and administrative expenses, excluding equity-based compensation¹, were $34.7 million, or 10.5% of revenue, as compared to $28.7 million, or 11.1% of revenue, in the first quarter of fiscal 2024. The decrease of 60 basis points was primarily due to leverage from higher sales, partially offset by investments to support future growth.

Net income was $25.7 million, or 7.7% of revenue, an increase of $11.7 million as compared to $14.0 million in the first quarter of fiscal 2024 due to higher operating performance as noted below and an income tax benefit of $10.7 million related to equity-based compensation, partially offset by higher depreciation and amortization. In addition, income tax expense was immaterial in the prior year quarter. Assuming a consistent effective tax rate allocated to each fiscal quarter in the prior year (excluding the benefit from the release of the valuation allowance), Adjusted Net Income¹ in the prior year quarter was $11.9 million.

Adjusted EBITDA¹ was $44.9 million, or 13.5% of revenue, an increase of $11.5 million, or 34.6%, compared to the first quarter of fiscal 2024. The increase was primarily driven by the number of and continued strength in the performance of Net New CAVA Restaurant Openings during or subsequent to the first quarter of fiscal 2024, 10.8% CAVA Same Restaurant Sales Growth, and leverage in general and administrative expenses.

Fiscal Full-Year 2025 Outlook:

CAVA Group announced today that it updated fiscal full-year 2025 guidance, as follows:

Actual results may differ materially from CAVA Group's fiscal full-year 2025 guidance as a result of, among other things, the factors described under "Forward-Looking Statements" below.

A reconciliation of the forward-looking fiscal 2025 Adjusted EBITDA to net income cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted.

About CAVA Group:

CAVA is the category-defining Mediterranean fast-casual restaurant brand, bringing together healthful food and bold, satisfying flavors at scale. Our brand and our opportunity transcend the Mediterranean category to compete in the large and growing limited-service restaurant sector as well as the health and wellness food category. CAVA serves guests across age groups, genders, and income brackets and benefits from generational tailwinds created by consumer demand for healthy living and a demographic shift towards greater ethnic diversity. We meet consumers' desires to engage with convenient, authentic, purpose-driven brands that view food as a source of self-expression. The broad appeal of our food combined with these favorable industry trends drive our vast opportunity for continued growth.

Earnings Conference Call:

The Company will host a conference call on May 15, 2025, at 5:00 PM Eastern Time to discuss first quarter 2025 financial results as well as provide a business update. Investors will have the opportunity to listen to the conference call live through the webcast from the company's website on the investor relations page at investor.cava.com. A recorded webcast will be available on CAVA's investor relations website shortly after the call and available for up to one year.

Cautionary Statement Regarding Forward-Looking Statements:

This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that reflect our current views with respect to, among other things, our operations and financial performance. Forward-looking statements include all statements that are not historical facts. These forward-looking statements relate to matters such as our industry, business strategy, goals, expectations concerning our market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources, and other financial and operating information. These statements may include words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "future," "will," "seek," "foreseeable," "outlook," the negative version of these words or similar terms and phrases.

The forward-looking statements contained in this press release are based on management's current expectations and are not guarantees of future performance. The forward-looking statements are subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Our expectations, beliefs, and projections are expressed in good faith, and we believe there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs, and projections will result or be achieved. Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. Actual results may differ materially from these expectations due to changes in global, regional, or local economic, business, competitive, market, regulatory, and other factors, many of which are beyond our control. We believe that these factors include but are not limited to the following: we operate in a highly competitive industry; our future growth depends on our ability to open new restaurants while managing our growth effectively and maintaining our culture, and our historical growth may not be indicative of our future growth; we may not be able to successfully identify appropriate locations and develop and expand our operations in existing and new markets; new restaurants may not be profitable, and may negatively impact sales at our existing locations; negative changes in guest perception of our brand could negatively impact our business; our efforts to market our restaurants and brand may not be successful; food safety issues, and food-borne illness concerns may harm our business; if we are unable to maintain or increase prices, our margins may decrease; the growth of our business depends on our ability to accurately predict guest trends and demand and successfully introduce new menu offerings and improve our existing menu offerings; economic factors and guest behavior trends, which are uncertain and largely beyond our control, may adversely affect guests' behavior and our ability to maintain or increase sales at our restaurants; we are subject to risks associated with leasing property; we may not be able to successfully expand our digital and delivery business, which is subject to risks outside of our control; our inability or failure to utilize, recognize, respond to, and effectively manage the immediacy of social media could have a material adverse effect on our business; we may not realize the anticipated benefits from past and potential future acquisitions, investments, or other strategic initiatives; we may not be able to manage our manufacturing and supply chain effectively, which may adversely affect our results of operations; our reliance on third parties could have an adverse effect on our business, financial condition, and results of operations; we may experience shortages, delays, or interruptions in the delivery of food items and other products; we may not successfully optimize, operate, and manage our production facilities; we may face increases in food, commodity, energy, and other costs; we may face increases in labor costs, labor shortages, and difficulties in our ability to identify, hire, train, motivate and retain the right team members; our success depends on our ability to attract, develop, and retain our management team and key team members; security breaches of our electronic processing of credit and debit card transactions, the CAVA app, or confidential guest or team member information (including personal information) may adversely affect our business; our business is subject to complex and evolving laws and regulations regarding privacy, data protection, and cybersecurity; we rely heavily on information technology systems and failures of, or interruptions in, or not effectively scaling and adapting, our information technology systems could harm our business; we are subject to evolving rules and regulations with respect to environmental, social and governance matters; climate change and volatile adverse weather conditions could adversely affect our restaurant sales or results of operations; and each of the other factors set forth in "Part I—Item 1A. Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024, and in other reports filed with the United States Securities and Exchange Commission, all of which are available on the investor relations page of our website at investor.cava.com.

The forward-looking statements included in this press release are made only as of the date hereof. Any forward-looking statement made by us in this press release speaks only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included in this press release. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them.

Non-GAAP Financial Measures:

In addition to our consolidated financial statements, which are prepared in accordance with GAAP, we present Adjusted EBITDA, Adjusted EBITDA Margin, general and administrative expenses, excluding equity-based compensation, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Free Cash Flow in this press release as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. We believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our operating performance. Management believes Adjusted EBITDA, Adjusted EBITDA Margin, general and administrative expenses, excluding equity-based compensation, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Free Cash Flow are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate, and capital investments. Management uses Adjusted EBITDA, Adjusted EBITDA Margin, general and administrative expenses, excluding equity-based compensation, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Free Cash Flow to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone provide.

Adjusted EBITDA, Adjusted EBITDA Margin, general and administrative expenses, excluding equity-based compensation, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Free Cash Flow are not recognized terms under GAAP and should not be considered as alternatives to net income, net income margin, or general and administrative expenses, as applicable, as measures of financial performance or cash provided by operating activities as measures of liquidity, or any other performance measure derived in accordance with GAAP. Additionally, Adjusted EBITDA and Free Cash Flow are not intended to be measures of free cash flow available for management's discretionary use, as Adjusted EBITDA does not consider certain cash requirements such as tax payments and financing cash flows, and Free Cash Flow does not consider certain cash requirements such as financing cash flows. Our non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Some of these limitations are:

• Adjusted EBITDA and Adjusted Net Income do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
• Adjusted EBITDA and Adjusted Net Income do not reflect changes in, or cash requirements for, our working capital needs;
• Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow do not reflect cash flows from financing activities of our business;
• Adjusted EBITDA does not reflect period to period changes in taxes, income tax expense, or the cash necessary to pay income taxes;
• Adjusted EBITDA does not reflect the impact of earnings or cash charges resulting from matters we consider not to be indicative of our ongoing operations;
• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements; and
• other companies in our industry may calculate Adjusted EBITDA, Adjusted EBITDA Margin, general and administrative expenses, excluding equity-based compensation, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Free Cash Flow differently than we do, limiting their usefulness as comparative measures.

The following table summarizes the results of the CAVA segment:

The following table presents selected quarterly financial and other data:

The following table presents the Company's selected balance sheet data:

The following table shows the growth in our company-owned CAVA Restaurant base:

Non-GAAP Financial Measures

The following table reconciles net income to Adjusted EBITDA and net income margin to Adjusted EBITDA margin for the periods indicated:

The following table reconciles general and administrative expenses to general and administrative expenses, excluding equity-based compensation, for the periods indicated:

The following table reconciles net income to Adjusted Net Income and diluted earnings per share to Adjusted Diluted Earnings Per Share for the periods indicated:

The following table reconciles net cash provided by operating activities to Free Cash Flow for the periods indicated:

Glossary:

The following definitions apply to these terms as used in this press release:

"Adjusted Diluted Earnings Per Share" is defined as Adjusted Net Income divided by diluted weighted-average common shares outstanding;

"Adjusted EBITDA" is defined as net income adjusted to exclude interest income, net, (benefit from) provision for income taxes, and depreciation and amortization, further adjusted to exclude equity-based compensation, other income, net, impairment and asset disposal costs, and restructuring and other costs, in each case, to the extent applicable in a given fiscal period. See "Non-GAAP Financial Measures" for a reconciliation of net income to Adjusted EBITDA for the sixteen weeks ended April 20, 2025 and April 21, 2024;

"Adjusted EBITDA Margin" is defined as Adjusted EBITDA as a percentage of revenue;

"Adjusted Net Income" is defined as net income in the prior year fiscal 2024 periods adjusted to exclude the net benefit associated with the release of a valuation allowance previously recorded against deferred tax assets ("VA Release"). In addition, Adjusted Net Income includes an allocation of total fiscal 2024 income tax expense excluding the VA Release to each quarter assuming a consistent effective tax rate. See "Non-GAAP Financial Measures" for a reconciliation of net income to Adjusted Net Income for the sixteen weeks ended April 20, 2025 and April 21, 2024;

"Adjusted Net Income Margin" is defined as Adjusted Net Income as a percentage of revenue;

"CAVA Average Unit Volume" or "CAVA AUV" represents total revenue of operating CAVA Restaurants that were open for the entire trailing thirteen periods, and digital kitchens sales for such period, divided by the number of operating CAVA Restaurants that were open for the entire trailing thirteen periods;

"CAVA digital kitchen" is defined to include kitchens used for third-party marketplace and native delivery, digital order pickup, and/or centralized catering production and that has neither in-restaurant dining nor customer-facing make lines;

"CAVA Digital Revenue Mix" represents the portion of CAVA Revenue related to digital orders as a percentage of total CAVA Revenue;

"CAVA hybrid kitchen" is defined to include kitchens that have enhanced kitchen capabilities to support centralized catering production and that also have in-restaurant dining and customer-facing make lines;

"CAVA Restaurant Operating Weeks" represents the aggregate number of weeks each of our CAVA Restaurants has been open in a given period;

"CAVA Restaurant-Level Profit," a segment measure of profit and loss, represents CAVA Revenue less food, beverage, and packaging, labor, occupancy, and other operating expenses, excluding depreciation and amortization. CAVA Restaurant-Level Profit excludes pre-opening costs;

"CAVA Restaurant-Level Profit Margin" represents CAVA Restaurant-Level Profit as a percentage of CAVA Revenue;

"CAVA Restaurants" is defined to include all CAVA restaurants, including converted Zoes Kitchen locations and CAVA hybrid kitchens, that are open or temporarily closed as of the end of the specific period. CAVA Restaurants exclude restaurants operating under license agreements and CAVA digital kitchens;

"CAVA Revenue" is defined to include all revenue attributable to CAVA restaurants in the specified period, excluding restaurants operating under license agreements;

"CAVA Same Restaurant Sales Growth" is defined as the period-over-period sales comparison for CAVA restaurants that have been open for 365 days or longer (including converted Zoes Kitchen locations that have been open for 365 days or longer after the completion of the conversion to a CAVA restaurant);

"digital orders" means orders made through catering and digital channels, such as the CAVA app and the CAVA website. Digital orders include orders fulfilled through third-party marketplace and native delivery and digital order pick-up;

"Free Cash Flow" means net cash provided by operating activities less purchases of property and equipment;

"guest traffic" means the number of entrees ordered in-restaurant and through digital orders; and

"Net New CAVA Restaurant Openings" is defined as new CAVA restaurant openings (including CAVA restaurants converted from a Zoes Kitchen location) during a specified reporting period, net of any permanent CAVA restaurant closures during the same period.

We operate on a 52-week or 53-week fiscal year that ends on the last Sunday of the calendar year. In a 52-week fiscal year, the first fiscal quarter contains sixteen weeks and the second, third, and fourth fiscal quarters each contain twelve weeks. In a 53-week fiscal year, the first fiscal quarter contains sixteen weeks, the second and third fiscal quarters each contain twelve weeks, and the fourth fiscal quarter contains thirteen weeks. References to "thirteen periods" are to the 13 accounting periods we have in each fiscal year, with each accounting period being four weeks, except in a 53-week fiscal year which will contain one accounting period of five weeks.

Certain numerical figures have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them.

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Investor Relations:

Anisha Sutaria, Director, Corporate Development & IR

[email protected]



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