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For some time now, Cava has been something of a fast-casual anomaly: As many other restaurants report traffic declines amid a consumer spending pullback, the Mediterranean restaurant chain keeps on trucking.
In its latest earnings report, the company reported $19.7 million in net income, up from $6.5 million in Q2 2023. Revenue jumped to $231 million in Q2 2024, a 35% YoY climb from $171 million in Q2 2023. And same-store sales rose 14.4%, alongside a 9.5% increase in traffic growth.
“Just across the board, [we] hit everything,” CFO Tricia Tolivar told CFO Brew. “Our new restaurant openings are performing incredibly well. We opened 18 net new restaurants in the quarter. And so [Q2 is] underscoring the powerful economic model that we have and the proven portability that we’ve been able to demonstrate.”
Cava also raised its full-year guidance. The company now projects it’ll open 54 to 57 new locations this year, up from 50 to 54 expected in Q1. Cava projects same-store sales growth of 8.5% to 9.5%, up from its previously expected 4.5% to 6.5%.
“That reflects a low double digit same restaurant sales growth in Q3 and Q4, and really that reflects the strength of the business and what we’re seeing, but also it incorporates a little bit of uncertainty around the macro economic environment…as well as the election that’s upcoming,” Tolivar said.
On broader economic uncertainty, she stressed that “nothing in the business is giving us any pause, but [we] want to make sure we’re being thoughtful about what may lie ahead and how consumers may respond, and reflect that in guidance.”
The presidential election, in particular, has brought food and grocery pricing into focus, as Democratic nominee Kamala Harris’s economic agenda includes a call to ban price gouging by food suppliers and grocers.
On pricing in the year ahead, Tolivar noted that Cava has “always been very thoughtful and mindful around pricing,” adding that “from the end of 2019 to the end of 2023, we raised our prices, on average, about 12%, and the CPI during that same time frame was up about 18% and fast food went up much, much higher than that overall.”
She continued: “We just want to continue on that path of being thoughtful around price increases,” noting that after “a modest price increase in the beginning of 2024,” the company doesn’t anticipate any additional price hikes for the rest of the year.