Cava says diners are doing better this year - and could be getting tired of chasing meal deals

MW Cava says diners are doing better this year - and could be getting tired of chasing meal deals

By Bill Peters

Restaurant chain's CEO says industry backdrop 'may be getting a little less deal-driven'

Cava reported fourth-quarter earnings on Tuesday.

Cava Group on Tuesday issued an upbeat sales forecast for this year, after cautious customers shook off the effects of snowstorms and last year's government shutdown to hit the Mediterranean fast-casual chain for bowls and salads.

Shares $(CAVA)$ jumped 7.9% after hours on Tuesday.

CEO Brett Schulman told MarketWatch that he expects this year to be better than last year, even as consumers stay selective on spending. Last year, fast-casual restaurants like Cava and Chipotle faced more competition from sit-down dining chains offering their own deals and faced some sense of "slop-bowl" fatigue.

He said that following last year's government shutdown, customers started to feel better about shopping again. And he said that as economists worry about the "K-shaped" economic recovery - where things get better for wealthier shoppers but worse for everyone else - trends improved across income levels at Cava, including lower-income diners hit harder by inflation.

"We're bridging the gap of that K," he said.

Schulman added that people were going back to the food that they liked, despite a weaker job market. He said the current backdrop for restaurants "may be getting a little less deal-driven," and added that people could be "getting fatigued with going for every discount and deal."

The chain said it expects same-store sales growth of 3% to 5% this year. The midpoint of that range was above Wall Street's expectations for 3.2%.

For the fourth quarter, Cava's sales were $274.9 million, with same-store sales up 0.5% and earnings per share coming in at 4 cents. All were above Wall Street's estimates.

Data from Placer.ai showed that Cava's foot traffic jumped nearly 17% during the fourth quarter. The company, which analyzes retail foot traffic, said efforts to refine Cava's loyalty program and holiday promotions may have helped the increase in visits.

Still, other restaurants have said that consumers remain cautious. Fast-food chains have been discounting more aggressively to reclaim customers they lost after raising menu prices over recent years. McDonald's $(MCD)$ this month said its value deals were bringing back customers, but forecast a bumpy ride ahead this year.

Results earlier this month from Chipotle $(CMG)$, one of Cava's fast-casual rivals, also suggested the year ahead would bring challenges similar to last year.

Shares of Cava are still down 31.6% over the past 12 months.

-Bill Peters

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February 24, 2026 16:51 ET (21:51 GMT)

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