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What changed in Darden Restaurants's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Darden Restaurants's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+302 added−308 removedSource: 10-K (2025-07-18) vs 10-K (2024-07-19)

Top changes in Darden Restaurants's 2025 10-K

302 paragraphs added · 308 removed · 261 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

116 edited+23 added−18 removed52 unchanged
Biggest changeOur fiscal 2024 actual restaurant openings and closings, fiscal 2025 projected openings, and approximate capital investment, square footage and dining capacity, by brand (4) , are shown below: Actual - Fiscal 2024 Projected - Fiscal 2025 (4) Pro-Forma New Restaurants (4) Restaurant Openings Acquired Restaurant Closings New Restaurant Openings Capital Investment Range (1) (in millions) Approximate Square Feet (2) Approximate Dining Seats (3) Olive Garden 20 — 5 14-17 $4.5 - $6.2 7,700 250 LongHorn Steakhouse 17 — 4 14-17 $3.8 - $5.1 5,700 180 Cheddar’s Scratch Kitchen 4 — 3 2-3 $4.0 - $5.5 6,400 210 Yard House 2 — — 2-3 $7.5 - $9.7 9,000 330 Ruth’s Chris 3 78 1 3-4 $6.5 - $8.4 8,500 300 The Capital Grille 4 — — 6-7 $8.7 - $10.2 10,000 320 Seasons 52 — — — 1-2 $6.0 - $7.2 7,200 200 Bahama Breeze 1 — — 1-2 $5.8 - $7.1 7,700 210 Eddie V’s 2 — 1 1-2 $8.7 - $10.2 10,000 320 Totals 53 78 14 45-50 (1) Includes cash investments for building, equipment, furniture and other construction costs; excludes internal capitalized overhead, pre-opening expenses, tenant allowance and future lease obligations.
Biggest changeOur fiscal 2025 actual restaurant openings and closings, fiscal 2026 projected openings, and approximate capital investment, square footage and dining capacity, by brand, are shown below: Actual - Fiscal 2025 Projected - Fiscal 2026 (4) Pro-Forma New Restaurants (4) Restaurant Openings Acquired Restaurant Closings New Restaurant Openings Capital Investment Range (1) (in millions) Approximate Square Feet (2) Approximate Dining Seats (3) Olive Garden 15 — — 19-22 $4.5 - $6.2 7,700 250 LongHorn Steakhouse 16 — — 23-26 $3.8 - $5.1 5,800 180 Cheddar’s Scratch Kitchen 3 — 3 2-3 $4.2 - $5.5 6,300 210 Chuy’s 7 103 2 2-4 $4.0 - $4.9 5,700 160 Yard House 2 — 2 5-6 $7.8 - $9.8 9,000 330 Ruth’s Chris 3 — 1 1-2 $6.0 - $8.0 7,400 200 The Capital Grille 7 — 2 3-4 $7.0 - $9.7 9,000 260 Seasons 52 1 — 2 1-2 $6.0 - $7.2 7,400 230 Eddie V’s 1 — 2 2-3 $8.7 - $10.2 10,000 320 Bahama Breeze (5) 1 — 16 — $— - $— — — Totals 56 103 30 60-65 5 (1) Includes cash investments for building, equipment, furniture and other construction costs; excludes internal capitalized overhead, pre-opening expenses, tenant allowance and future lease obligations.
(2) Includes all space under the roof, including the coolers and freezers; based on primary prototypes. (3) Includes bar dining seats and patio seating, but excludes bar stools. (4) The Capital Burger is a development-stage concept with limited pro-forma information, and as such, it is excluded from this table.
(2) Includes all space under the roof, including coolers and freezers; based on primary prototypes. (3) Includes bar dining seats and patio seating, but excludes bar stools. (4) The Capital Burger is a development-stage concept with limited pro-forma information, and as such, it is excluded from this table.
Each Yard House, Ruth’s Chris and Bahama Breeze restaurant is led by a General Manager, and each The Capital Grille, Seasons 52, Eddie V’s and The Capital Burger restaurant is led by a Managing Partner. Each also has three to ten additional managers.
Each Yard House, Ruth’s Chris, The Capital Burger and Bahama Breeze restaurant is led by a General Manager, and each The Capital Grille, Seasons 52, Eddie V’s and The Capital Burger restaurant is led by a Managing Partner. Each also has three to ten additional managers.
We periodically engage third parties to perform cybersecurity audits utilizing the National Institute of Standards and Technology framework. We also engage third parties to conduct security reviews of our network, processes and systems on a regular basis. We use internally developed proprietary software, cloud-based software as a service (SaaS), as well as purchased software, with proven, non-proprietary hardware.
We periodically engage third parties to perform cybersecurity audits utilizing the National Institute of Standards and Technology Cybersecurity Framework. We also engage third parties to conduct security reviews of our network, processes and systems on a regular basis. We use internally developed proprietary software, cloud-based software as a service (SaaS), as well as purchased software, with proven, non-proprietary hardware.
Each of our restaurants must comply with licensing requirements and regulations by a number of governmental authorities, which include health, safety and fire agencies in the state or municipality in which the restaurant is located. The development and operation of restaurants depend on selecting and acquiring suitable sites, which are subject to zoning, land use, environmental, traffic and other regulations.
Each of our restaurants must comply with licensing requirements and regulations by a number of governmental authorities, which include health, safety and fire agencies in the state or municipality in which a restaurant is located. The development and operation of restaurants depend on selecting and acquiring suitable sites, which are subject to zoning, land use, environmental, traffic and other regulations.
Human Capital We prioritize our team members through our People Strategy that includes four strategic imperatives: • Hire - Attract and select diverse team members that reflect our values and are committed to our results-oriented culture; • Train - Teach team members to perform in today’s environment and develop the skills to meet tomorrow’s needs; • Reward - Invest in compelling programs that recognize team members when goals are achieved and further motivate our culture of winning; and 7 • Retain - Keep team members engaged and motivated, ready to deliver results and grow their careers.
Human Capital We prioritize our team members through our People Strategy that includes four strategic imperatives: • Hire - Attract and select diverse team members that reflect our values and are committed to our results-oriented culture; • Train - Teach team members to perform in today’s environment and develop the skills to meet tomorrow’s needs; • Reward - Invest in compelling programs that recognize team members when goals are achieved and further motivate our culture of winning; and • Retain - Keep team members engaged and motivated, ready to deliver results and grow their careers.
We have four reportable segments: 1) Olive Garden, 2) LongHorn Steakhouse, 3) Fine Dining (which includes Ruth’s Chris, The Capital Grille and Eddie V’s) and 4) Other Business (which includes Cheddar’s Scratch Kitchen, Yard House, Bahama Breeze, Seasons 52, The Capital Burger and ongoing royalties and other fees from our franchise operations and contractually managed locations).
We have four reportable segments: 1) Olive Garden, 2) LongHorn Steakhouse, 3) Fine Dining (which includes Ruth’s Chris, The Capital Grille and Eddie V’s) and 4) Other Business (which includes Cheddar’s Scratch Kitchen, Chuy’s, Yard House, Bahama Breeze, Seasons 52, The Capital Burger and ongoing royalties and other fees from our franchise operations and contractually managed locations).
Trademarks and Service Marks We regard our Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Yard House ® , Ruth’s Chris Steak House ®, The Capital Grille ® , Seasons 52 ® , Bahama Breeze ® , Eddie V’s Prime Seafood ® , The Capital Burger ® , Darden ® and Darden Restaurants ® service marks, and other service marks and trademarks related to our restaurant businesses, as having significant value and as being important to our marketing efforts.
Trademarks and Service Marks We regard our Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Chuy’s ® , Yard House ® , Ruth’s Chris Steak House ® , The Capital Grille ® , Seasons 52 ® , Eddie V’s Prime Seafood ®, Bahama Breeze ® , The Capital Burger ® , Darden ® and Darden Restaurants ® service marks, and other service marks and trademarks related to our restaurant businesses, as having significant value and as being important to our marketing efforts.
Each Yard House, Ruth’s Chris, The Capital Grille, Seasons 52 and Eddie V’s restaurant has one executive chef and most have one to two sous chefs. Each Bahama Breeze and The Capital Burger restaurant has one to three culinary managers. In addition, each restaurant typically employs between 50 to 200 hourly team members, most of whom work part-time.
Each Yard House, Ruth’s Chris, The Capital Grille, Seasons 52 and Eddie V’s restaurant has one executive chef, and some have one to two sous chefs. Each Bahama Breeze and The Capital Burger restaurant has one to three culinary managers. In addition, each restaurant typically employs between 50 to 200 hourly team members, most of whom work part-time.
Permanent closures are typically due to economic changes in trade areas, the expiration of lease agreements, or site concerns. Accordingly, we continue to evaluate our site locations in order to minimize the risk of future closures or asset impairment charges. 5 Restaurant Operations We believe that high-quality restaurant management is critical to our long-term success.
Permanent closures are typically due to economic changes in trade areas, the expiration of lease agreements, or site concerns. Accordingly, we continue to evaluate our site locations in order to minimize the risk of future closures or asset impairment charges. Restaurant Operations We believe that high-quality restaurant management is critical to our long-term success.
We license the sales and distribution of several items including Olive Garden salad dressings, salad croutons and seasoning through various channels including wholesale distribution chains and major grocery chains. The amount of income we derive from these licensing arrangements is not material to our consolidated financial statements. 10 Seasonality Our sales volumes have historically fluctuated seasonally.
We license the sales and distribution of several items including Olive Garden salad dressings, salad croutons and seasoning through various channels including wholesale distribution chains and major grocery chains. The amount of income we derive from these licensing arrangements is not material to our consolidated financial statements. Seasonality Our sales volumes have historically fluctuated seasonally.
Eddie V’s Eddie V’s is a fine dining restaurant brand with locations in major metropolitan cities in the United States, with a sophisticated and contemporary ambiance, featuring live music trios nightly in the V Lounge. Dishes are artistically prepared and feature seasonal seafood and critically acclaimed prime steaks, hand cut and broiled to perfection.
Eddie V’s Eddie V’s is a fine dining restaurant brand with locations in major metropolitan cities in the United States, with a sophisticated and contemporary ambiance, featuring live music nightly in the V Lounge. Dishes are artistically prepared and feature seasonal seafood and critically acclaimed prime steaks, hand cut and broiled to perfection.
More information about our sustainability strategy, our commitment to our guests on Food Principles and our progress to date is available at www.darden.com . 12 Darden Foundation and Community Affairs We are recognized for a culture that rewards caring for and responding to people. That defines service for Darden. The Darden Restaurants, Inc.
More information about our sustainability strategy, our commitment to our guests on Food Principles and our progress to date is available at www.darden.com . Darden Foundation and Community Affairs We are recognized for a culture that rewards caring for and responding to people. That defines service for Darden. The Darden Restaurants, Inc.
Because of the historical seasonality of our business and these other factors, results for any fiscal quarter are not necessarily indicative of the results that may be achieved for the full fiscal year. Government Regulation We are subject to various federal, state, local and international laws affecting our business.
Because of the historical seasonality of our business and these other factors, results for any fiscal quarter are not necessarily indicative of the results that may be achieved for the full fiscal year. 11 Government Regulation We are subject to various federal, state, local and international laws affecting our business.
All of our brands share a secure, robust digital platform with online ordering and other guest-facing capabilities. We also have deployed mobile applications with online ordering and other features for all of our casual dining brands and for most of our specialty restaurant brands. We successfully leverage these digital capabilities to address evolving guest needs.
Our brands share a secure, robust digital platform with online ordering and other guest-facing capabilities. We also have deployed mobile applications with online ordering and other features for most of our casual dining brands and specialty restaurant brands. We successfully leverage these digital capabilities to address evolving guest needs.
Additionally, our brands can capitalize on data driven insights to deliver customized one- 4 to-one customer relationship marketing. We hold ourselves accountable for operating our restaurants with a sense of urgency to achieve our commitments to all of our stakeholders.
Additionally, our brands can capitalize on data driven insights to deliver customized one-to-one customer relationship marketing. We hold ourselves accountable for operating our restaurants with a sense of urgency to achieve our commitments to all of our stakeholders.
Cheddar’s Scratch Kitchen opened its first restaurant in 1979 and we acquired Cheddar’s Scratch Kitchen in April 2017. 2 Most dinner menu entrée prices range from $10.00 to $23.00, and most lunch menu entrée prices range from $9.00 to $11.00.
Cheddar’s Scratch Kitchen opened its first restaurant in 1979, and we acquired Cheddar’s Scratch Kitchen in April 2017. Most dinner menu entrée prices range from $10.00 to $23.00, and most lunch menu entrée prices range from $9.00 to $11.00.
An increasing number of governments and industry groups worldwide have established data privacy laws and standards for the protection of personal information, including social security numbers, financial information (including credit card numbers), 11 and health information.
An increasing number of governments and industry groups worldwide have established data privacy laws and standards for the protection of personal information, including social security numbers, financial information (including credit card numbers), and health information.
These regulations relate to many aspects of restaurant operation, including the minimum age of patrons and employees, hours of operation, advertising, wholesale purchasing, inventory control and handling, and storage and dispensing of alcoholic beverages.
These regulations relate to many aspects of restaurant operations, including the minimum age of patrons and employees, hours of operation, advertising, wholesale purchasing, inventory control and handling, and storage and dispensing of alcoholic beverages.
While our objective is to continue to expand all of our restaurant brands, the actual number of openings for each of our brands for fiscal 2025 will depend on many factors, including our ability to recruit and train restaurant management and hourly personnel, locate appropriate sites, negotiate acceptable purchase or lease terms, obtain necessary local governmental permits, and complete construction.
While our objective is to continue to expand all of our restaurant brands, the actual number of openings for each of our brands for fiscal 2026 will depend on many factors, including our ability to recruit and train restaurant management and hourly personnel, locate appropriate sites, negotiate acceptable purchase or lease terms, obtain necessary local governmental permits, and complete construction.
The failure of a restaurant to obtain or retain these alcoholic beverage licenses or to comply with regulations governing the sale of alcoholic beverages would adversely affect the restaurant’s operations.
The failure of a restaurant to obtain or retain alcoholic beverage licenses or to comply with regulations governing the sale of alcoholic beverages would adversely affect a restaurant’s operations.
(4) APEX Companies, LLC. provided statements of third-party verification to a limited assurance level for the above stated values for the fiscal years ended 2024, 2023 and 2022 in accordance with ISO Standard 14064-3 Second edition 2019-4 on greenhouse gases- Part 3: Specification with guidance for the verification and validation of GHG statements.
(3) APEX Companies, LLC provided statements of third-party verification to a limited assurance level for the above stated values for the fiscal years ended 2025, 2024 and 2023 in accordance with ISO Standard 14064-3 Second edition 2019-4 on greenhouse gases- Part 3: Specification with guidance for the verification and validation of GHG statements.
We are also a proud member of the American Red Cross’ Annual Disaster Giving Program, which enables the Red Cross to respond to the needs of individuals and families impacted by disasters anywhere in the United States. In fiscal 2024, the Foundation provided $500,000 to the American Red Cross for the program.
We are also a proud member of the American Red Cross’ Annual Disaster Giving Program, which enables the Red Cross to respond to the needs of individuals and families impacted by disasters anywhere in the United States. In fiscal 2025, the Foundation provided $500,000 to the American Red Cross for the program.
During fiscal 2024, there were no material capital expenditures for environmental control facilities and no material expenditures for this purpose are anticipated. Our facilities must comply with the applicable requirements of the Americans with Disabilities Act of 1990 (ADA) and related state accessibility statutes.
During fiscal 2025, there were no material capital expenditures for environmental control facilities and [no material expenditures for this purpose are anticipated]. Our facilities must comply with the applicable requirements of the Americans with Disabilities Act of 1990 (ADA) and related state accessibility statutes.
The General Manager or Managing Partner of each restaurant reports directly to a Director of Operations, who has operational responsibility for approximately three to eleven restaurants. Restaurants are visited regularly by operations management, including officer level executives, to help ensure strict adherence to all aspects of our standards and to solicit feedback on opportunities for improvement.
The General Manager or Managing Partner of each restaurant reports directly to a Director of Operations, who has operational responsibility for approximately three to eleven restaurants. Restaurants are visited regularly by operations 6 management, including officer-level executives, to help ensure strict adherence to our standards and to solicit feedback on opportunities for improvement.
Typically, our average sales per restaurant are highest in the winter and spring, followed by the summer, and lowest in the fall. Holidays, changes in the economy, severe weather and similar conditions may impact sales volumes seasonally in some operating regions.
Our average sales per restaurant are highest in the winter and spring, followed by the fall and summer. Holidays, changes in the economy, severe weather and similar conditions may impact sales volumes seasonally in some operating regions.
In recent years, many states have modified their regulations to permit To Go sales of alcoholic beverages, and in some locations we now offer a variety of alcoholic beverages, including in bottles, from draft and mixed drinks To Go.
In recent years, many states have modified their regulations to permit “To Go” sales of alcoholic beverages, and in some locations we now offer a variety of alcoholic beverages to go, including in bottles, from draft and mixed drinks.
These and other terms of Darden Direct’s long-term supply agreements further enable our sourcing staff to integrate demand forecasts into our purchasing operations, driving efficiencies in our operations. Integrated Marketing Our restaurants appeal to a broad spectrum of consumers. To further strengthen our brands, we are focused on highlighting what makes each one unique.
These and other terms of Darden Direct’s long-term supply agreements further enable our sourcing staff to integrate demand forecasts into our purchasing operations, driving efficiencies in our operations. Integrated Marketing Our restaurants appeal to a broad spectrum of consumers. To further strengthen our brands, we focus on highlighting what makes each one unique.
The Foundation’s fiscal 2024 contribution of $250,000 also supports the Restaurant Ready program to engage and encourage disconnected young people to pursue a path to employment and improve their quality of life.
The Foundation’s fiscal 2025 contribution of $250,000 also supports the Restaurant Ready program to engage and encourage disconnected young people to pursue a path to employment and improve their quality of life.
These team members represent more than 90 different restaurants across eight of our brands and 34 states. More information about the Foundation and its efforts to enhance the quality of life in the communities where we do business is available on our website at www.darden.com . 13
These team members represent more than 90 different restaurants across eight of our brands and 31 states. More information about the Foundation and its efforts to enhance the quality of life in the communities where we do business is available on our website at www.darden.com .
In fiscal 2024, we continued a multi-year effort to implement new technology platforms that allow us to digitally engage with our guests and team members and strengthen our marketing and analytics capabilities. We also continued making improvements to our online and mobile ordering and payment systems across all of our brands.
In fiscal 2025, we continued a multi-year effort to implement new technology platforms that allow us to digitally engage with our guests and team members and strengthen our marketing and analytics capabilities. We also continued making improvements to our online and mobile ordering and payment systems across all our brands.
Olive Garden, LongHorn Steakhouse and Cheddar’s Scratch Kitchen capital investments are based on costs associated with land-only leases; Yard House, Ruth’s Chris, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V’s capital investments are based on ground and building leases. Actual costs can vary significantly depending on the specific location.
Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen and Chuy’s capital investments are based on costs associated with land-only leases; Yard House, Ruth’s Chris, The Capital Grille, Seasons 52 and Eddie V’s capital investments are based on ground and building leases. Actual costs can vary significantly depending on the specific location.
Restaurant hardware and software support for all of our restaurant brands is provided or coordinated from the restaurant support center facility in Orlando, Florida. Our data center contains sufficient computing power to process information from all restaurants quickly and efficiently. We leverage public cloud computing where appropriate to enhance our capabilities and to leverage scale.
Restaurant hardware and software support for our restaurant brands is provided or coordinated from our restaurant support center facility in Orlando, Florida. Our data center contains sufficient computing power to process information from restaurants quickly and efficiently. We leverage public cloud computing where appropriate to enhance our capabilities and to leverage scale.
We have area development, franchise and/or license agreements in place with unaffiliated operators to develop and operate Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, The Capital Grille, Ruth’s Chris and Bahama Breeze restaurants in the following regions: • United States (including Puerto Rico and Guam), • Canada, • Mexico, • Central and South America (Brazil, Costa Rica, Ecuador, El Salvador and Panama), • Asia (Philippines, China, Hong Kong, Taiwan, Indonesia, Singapore and Japan) • Caribbean (Aruba, Jamaica, Bahamas, Barbados and Cayman Islands), • Middle East (Saudi Arabia and Qatar).
We have area development, franchise and/or license agreements in place with unaffiliated operators to develop and operate Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Yard House, Ruth’s Chris, The Capital Grille and Bahama Breeze restaurants in the following regions: • United States (including Puerto Rico and Guam), • Canada, • Mexico, • Central and South America (Brazil, Costa Rica, Ecuador, El Salvador, Guatemala and Panama), • Asia (Philippines, China, Hong Kong, Taiwan, Indonesia, Singapore, Japan and India) • Caribbean (Aruba, Jamaica, Bahamas, Barbados and Cayman Islands), • Europe (Spain) • Middle East (Saudi Arabia and Qatar).
Each of our brands experienced a turnover rate during fiscal 2024 that was lower than the most recent relevant casual dining or fine dining turnover rate for their segment of the industry as reported in The People Report TM by Black Box Intelligence TM .
Each of our brands experienced a turnover rate during fiscal 2025 that was lower than the most recent relevant 9 casual dining or fine dining turnover rate for their segment of the industry as reported in The People Report TM by Black Box Intelligence TM .
Our operating philosophy remains focused on strengthening the core operational fundamentals of the business by providing an outstanding guest experience rooted in culinary innovation, attentive service, engaging atmosphere, and integrated marketing. Darden enables each brand to reach its full potential by leveraging its scale, insights, and experience in a way that protects uniqueness and competitive advantages.
Our operating philosophy remains focused on strengthening the core operational fundamentals of the business by providing an outstanding guest experience rooted in culinary innovation, attentive service, and engaging atmosphere enabled by our people. Darden enables each brand to reach its full potential by leveraging its scale, insights, and experience in a way that protects uniqueness and competitive advantages.
The atmosphere provides an alluring dining experience reminiscent of a modern day Gatsby, infusing an indulgent experience with an irresistible vibe. Eddie V’s opened its first restaurant in 2000 and we acquired Eddie V’s in November 2011. Most dinner menu entrée prices range from $40.00 to $114.00.
The atmosphere provides an alluring dining experience reminiscent of a modern day Gatsby, infusing an indulgent experience with an irresistible vibe. Eddie V’s opened its first restaurant in 2000, and we acquired Eddie V’s in November 2011. Most dinner menu entrée prices range from $41.00 to $116.00.
In 1982, Olive Garden opened its first restaurant in Orlando, Florida. Most dinner menu entrée prices range from $11.50 to $21.50, and most lunch menu entrée prices range from $9.50 to $11.50. The price of each entrée includes as much fresh salad or soup and breadsticks as a guest desires.
In 1982, Olive Garden opened its first restaurant in Orlando, Florida. Most dinner menu entrée prices range from $12.00 to $23.50, and most lunch menu entrée prices range from $9.50 to $11.50. The price of each entrée includes as much fresh salad or soup and breadsticks as a guest desires.
In addition, our geographic footprint often puts us in a position to offer our restaurant team members jobs in their current roles when personal circumstances require relocation. Darden’s consolidated turnover rate for hourly team members during fiscal 2024 was 80%, one of the lowest rates in the restaurant industry.
In addition, our geographic footprint often puts us in a position to offer our restaurant team members jobs in their current roles when personal circumstances require relocation. Darden’s consolidated turnover rate for hourly team members during fiscal 2025 was 67%, one of the lowest rates in the restaurant industry.
Darden’s consolidated restaurant management turnover rate of 16% was also significantly lower than the broader restaurant industry benchmark. Our executive leadership (vice president and above) has an average of over 19 years of experience with Darden, while our restaurant General Managers and Managing Partners have an average of 14 years of experience with us.
Darden’s consolidated restaurant management turnover rate of 16% was also significantly lower than the broader restaurant industry benchmark. Our executive leadership (vice president and above) has an average of over 20 years of experience with Darden, while our restaurant General Managers and Managing Partners have an average of 15 years of experience with us.
In addition to financial support, our restaurants donate meals to feed first responders and victims of natural disasters. In fiscal 2024, the Foundation supported the second annual Next Course Scholarship program to help the children or dependents of Darden team members reach their educational goals.
In addition to financial support, our restaurants donate meals to feed first responders and victims of natural disasters. In fiscal 2025, the Foundation supported the third annual Next Course Scholarship program to help the children or dependents of Darden team members reach their educational goals.
Participating team members 8 donate as little as 10 cents from each paycheck to the Darden Dimes fund, which raised over $2.0 million and granted $1.7 million in fiscal 2024. Retain. As a full-service restaurant company, food is always top of mind, but our team members make the difference: they are at the heart of everything we do.
Participating team members donate as little as 10 cents from each paycheck to the Darden Dimes fund, which raised over $2.6 million and granted $2.8 million in fiscal 2025. Retain. As a full-service restaurant company, food is always top of mind, but our team members make the difference: they are at the heart of everything we do.
BUSINESS Introduction Darden Restaurants, Inc. is a full-service restaurant company, and as of May 26, 2024, we owned and operated 2,031 restaurants through subsidiaries in the United States and Canada under the Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Yard House ® , Ruth’s Chris Steak House ® (“Ruth’s Chris”), The Capital Grille ® , Seasons 52 ® , Bahama Breeze ® , Eddie V’s Prime Seafood ® (“Eddie V’s”), and The Capital Burger ® trademarks.
BUSINESS Introduction Darden Restaurants, Inc. is a full-service restaurant company, and as of May 25, 2025, we owned and operated 2,159 restaurants through subsidiaries in the United States and Canada under the Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Chuy’s ® , Yard House ® , Ruth’s Chris Steak House ® (“Ruth’s Chris”), The Capital Grille ® , Seasons 52 ® , Eddie V’s Prime Seafood ® (“Eddie V’s”), Bahama Breeze ® , and The Capital Burger ® trademarks.
Above emissions are for owned and operated restaurants only. Franchises are accounted for in our Scope 3 inventory. (2) GHG Emissions per Restaurant Intensity Ratio includes only Scope 1 and 2 totals (as defined in the Corporate Accounting and Reporting Standard of the GHG Protocol) divided by the total number of restaurants.
Above emissions are for owned and operated restaurants only. Franchises are accounted for in our Scope 3 inventory. (2) GHG Emissions per Restaurant Intensity Ratio includes only Scope 1 and 2 totals (as defined in the Corporate Accounting and Reporting Standard of the GHG Protocol) divided by the total number of restaurants at the end of each fiscal year.
In its second year, the program awarded scholarships worth $3,000 each to more than 100 children or dependents of Darden team members. In January 2023, we introduced a new benefit for restaurant team members called Fast Fluency. For many of our team members, English is not their first language, and this program provides the opportunity to learn English for free.
In its third year, the program awarded scholarships worth $3,000 each to 98 children or dependents of Darden team members. In January 2023, we introduced a new benefit for restaurant team members called Fast Fluency. For many of our team members, English is not their first language, and this program provides the opportunity to learn English for free.
With thousands of leadership positions across our restaurants, we provide a pathway and training for thousands of individuals across the country to advance from entry-level jobs into management roles. In fiscal 2024, 65% of the participants in our restaurant Manager In Training program were internal promotions and 100% of the new General Managers or Managing Partners were internal promotions. Reward.
With thousands of leadership positions across our restaurants, we provide a pathway and training for thousands of individuals across the country to advance from entry-level jobs into management roles. In fiscal 2025, 61% of the participants in our restaurant Manager In Training program were internal promotions, and 99% of the new General Managers or Managing Partners were internal promotions. Reward.
Because of the rapid turnover of perishable food products, inventories in the restaurants have a modest aggregate dollar value in relation to sales. We continue to drive automation of our supply chain by collaborating with our suppliers, logistics partners and distributors to improve optimization with information visibility and other technological advances.
(Darden Direct), managed by third-party distribution partners. Because of the rapid turnover of perishable food products, inventories in the restaurants have a modest aggregate dollar value in relation to sales. We continue to drive automation of our supply chain by collaborating with our suppliers, logistics partners and distributors to improve optimization with information visibility and other technological advances.
Ruth’s Chris opened its first restaurant in 1965 and we acquired Ruth’s Chris in June 2023. Most dinner menu entrée prices range from $40.00 to $85.00 and most lunch menu entrée prices range from $16.00 to $65.00. During fiscal 2024, the average check per person was approximately $101.00, with alcoholic beverages accounting for 19.9 percent of Ruth’s Chris’ sales.
Ruth’s Chris opened its first restaurant in 1965, and we acquired Ruth’s Chris in June 2023. Most dinner menu entrée prices range from $40.00 to $85.00, and most lunch menu entrée prices range from $16.00 to $65.00. During fiscal 2025, the average check per person was approximately $104.50, with alcoholic beverages accounting for 19.3 percent of Ruth’s Chris’ sales.
Since fiscal 2022, we have maintained a policy that each hourly restaurant team member company-wide would earn a minimum hourly wage of at least $12 per hour, inclusive of tip income. For fiscal 2024, across all of our brands, our hourly team members earned, on average, more than $23 per hour, far exceeding that minimum wage.
Since fiscal 2022, we have maintained a policy that each hourly restaurant team member company-wide would earn a minimum hourly wage of at least $12 per hour, inclusive of tip income. For fiscal 2025, across all of our brands, our hourly team members earned, on average, $24 per hour, inclusive of tip income, far exceeding that minimum wage.
The Foundation has partnered with Scholarship America to administer the initiative, which provided scholarships for post-secondary education to children or dependents of eligible full-time and part-time Darden team members for the 2024-25 academic year. As a result, 102 children or dependents of Darden team members were awarded scholarships worth $3,000 each.
The Foundation has partnered with Scholarship America to administer the initiative, which provided scholarships for post-secondary education to children or dependents of eligible full-time and part-time Darden team members for the 2025-26 academic year. As a result, 98 children or dependents of Darden team members were awarded scholarships worth $3,000 each.
Finally, we have developed and consistently use sophisticated consumer marketing research techniques to monitor guest satisfaction and evolving food service trends and marketplace dynamics.
Finally, we have developed and consistently use sophisticated consumer marketing research to monitor guest satisfaction and evolving trends and marketplace dynamics.
We have a 52/53 week fiscal year ending the last Sunday in May. Our fiscal year 2024 ended May 26, 2024 and consisted of 52 weeks, fiscal 2023 ended May 28, 2023 and consisted of 52 weeks, and fiscal 2022 ended May 29, 2022 and consisted of 52 weeks.
We have a 52/53 week fiscal year ending the last Sunday in May. Our fiscal year 2025 ended May 25, 2025 and consisted of 52 weeks, fiscal 2024 ended May 26, 2024 and consisted of 52 weeks, and fiscal 2023 ended May 28, 2023 and consisted of 52 weeks.
During fiscal 2024, the average check per person was approximately $18.50, with alcoholic beverages accounting for 7.6 percent of Cheddar’s Scratch Kitchen’s sales. Cheddar’s Scratch Kitchen features different menus across its trade areas to reflect geographic differences in consumer preferences, prices and selections, as well as a smaller portioned, lower-priced children’s menu .
During fiscal 2025, the average check per person was approximately $19.00, with alcoholic beverages accounting for 7.0 percent of Cheddar’s Scratch Kitchen’s sales. Cheddar’s Scratch Kitchen features different menus across its trade areas to reflect geographic differences in consumer preferences, prices and selections, as well as a smaller portioned, lower-priced children’s menu .
In all instances, we maintain control over the use of our service marks and receive management fees, which are not material to our consolidated financial statements. As of May 26, 2024, franchisees operated 85 franchised restaurants in the United States and 61 franchised restaurants outside of the United States.
In all instances, we maintain control over the use of our service marks and receive management fees, which are not material to our consolidated financial statements. As of May 25, 2025, franchisees operated 85 franchised restaurants in the United States and 69 franchised restaurants outside of the United States.
Cheddar’s Scratch Kitchen Cheddar’s Scratch Kitchen is a full-service restaurant brand operating primarily in Texas and throughout the southern, mid-western and mid-Atlantic regions of the United States. The casual dining menu features modern classics and American favorites cooked from scratch.
Cheddar’s Scratch Kitchen Cheddar’s Scratch Kitchen is a full-service restaurant brand operating primarily in Texas and throughout the southern, mid-western and mid-Atlantic regions of the United States. The casual dining menu features modern classics and American favorites cooked from scratch. Each entree includes a honey butter croissant.
The following table shows our restaurant growth over the last five years and lists the number of restaurants owned and operated by each of our brands and concept as of the end of the fiscal years indicated. The table excludes our restaurants operated by independent third parties pursuant to area development, franchise, and contractual agreements.
The following table shows our restaurant growth over the last five years including the number of restaurants owned and operated by each brand and concept as of the end of the respective fiscal years. The table excludes our restaurants operated by independent third parties pursuant to area development, franchise, and contractual agreements.
Regulations governing their sale require licensure by each site (in most cases, on an annual basis), and licenses may be revoked or suspended for cause at any time.
Regulations governing the sale of alcoholic beverages require licensure by each site (in most cases, on an annual basis), and licenses may be revoked or suspended for cause at any time.
To date, we have not been significantly affected by any difficulty, delay or failure to obtain required licenses or approvals. During fiscal 2024, 11.0 percent of our sales were attributable to the sale of alcoholic beverages.
To date, we have not been significantly affected by any difficulty, delay or failure to obtain required licenses or approvals. During fiscal 2025, 10.6 percent of our sales were attributable to the sale of alcoholic beverages.
We provide our EEO-1 report and additional details about our inclusion and diversity programs on our website at www.darden.com. Train. We succeed because of our people, and with our success come rewards, recognition and great opportunities for our team members.
We provide our EEO-1 report on our website at www.darden.com. Train. We succeed because of our people, and with our success come rewards, recognition and great opportunities for our team members.
In addition, expanding product offerings at fast casual and quick-service restaurants and the convenience of home delivery services, together with negative economic conditions, could cause consumers to choose less expensive alternatives or reduce the frequency of their restaurant visits. We expect intense competition to continue in all of these areas.
In addition, expanding product offerings at fast casual and quick-service restaurants and the convenience of home delivery services, together with negative economic conditions, could cause consumers to choose less expensive alternatives or reduce the frequency of their restaurant visits.
In fiscal 2024, the Foundation awarded approximately $4.3 million in grants to national organizations as well as local nonprofits including Second Harvest Food Bank of Central Florida and the Heart of Florida United Way. These organizations provide service to the public through hunger relief, community engagement, financial assistance, and the promotion of career opportunities in the culinary industry.
In fiscal 2025, the Foundation awarded approximately $4.0 million in grants to national organizations as well as local nonprofits, including Second Harvest Food Bank of Central Florida and the Heart of Florida United Way. These organizations 13 provide service to the public through hunger relief, community investment, and the promotion of career opportunities in the culinary industry.
Greenhouse Gas (GHG) Emissions (1) Fiscal Year Ended (in metric tons CO2e) May 26, 2024 May 28, 2023 (3) May 29, 2022 Average Per Restaurant (2) 400 410 412 Total - Scope 1 and 2 818,117 (4) 785,862 769,811 (1) As of fiscal 2024, GHG reporting is for the same fiscal year for which current financial results are included in this report.
Greenhouse Gas (GHG) Emissions (1) Fiscal Year Ended (in metric tons CO2e) May 25, 2025 May 26, 2024 May 28, 2023 (3) Average Per Restaurant (2) 380 400 410 Total - Scope 1 and 2 833,462 (3) 818,117 785,862 (1) As of fiscal 2024, GHG reporting is for the same fiscal year for which current financial results are included in this report.
As of May 26, 2024, we also had 146 restaurants operated by independent third parties pursuant to area development and franchise agreements and 4 restaurants operating under contractual agreements.
As of May 25, 2025, we also had 154 restaurants operated by independent third parties pursuant to area development and franchise agreements and 4 restaurants operating under contractual agreements.
Department of Labor announced updates to the Fair Labor Standards Act overtime rules that, in two stages, one on July 1, 2024 and a second on January 1, 2025 increase the salary threshold above which non-exempt workers are required to be paid overtime.
Department of Labor (DOL) announced updates to the Fair Labor Standards Act overtime rules that, in two stages, one on July 1, 2024 and a second on January 1, 2025 increase the salary threshold above which non-exempt workers are required to be paid overtime. In November 2024, a federal judge in Texas struck down the DOL's proposed rule.
Fiscal Year Olive Garden LongHorn Steakhouse Cheddar’s Scratch Kitchen Yard House Ruth’s Chris The Capital Grille Seasons 52 Bahama Breeze Eddie V’s The Capital Burger Total Restaurants Total Sales ( in millions ) (1) 2020 868 522 165 81 — 58 44 41 23 2 1,804 $7,806.9 2021 875 533 170 81 — 60 44 42 26 3 1,834 $7,196.1 2022 884 546 172 85 — 62 45 42 28 3 1,867 $9,630.0 2023 905 562 180 86 — 62 44 42 29 4 1,914 $10,487.8 2024 920 575 181 88 80 66 44 43 30 4 2,031 $11,390.0 (1) During fiscal 2020 and 2021, many of our locations experienced restrictions on operations, including the ability to have dine-in operations and were subject to vaccine and/or mask mandates as a result of the COVID-19 pandemic.
The final column in the table lists our total sales from continuing operations for the fiscal years indicated. 4 Fiscal Year Olive Garden LongHorn Steakhouse Cheddar’s Scratch Kitchen Chuy’s Yard House Ruth’s Chris The Capital Grille Seasons 52 Eddie V’s Bahama Breeze The Capital Burger Total Restaurants Total Sales (in millions) (1) 2021 875 533 170 — 81 — 60 44 26 42 3 1,834 $7,196.1 2022 884 546 172 — 85 — 62 45 28 42 3 1,867 $9,630.0 2023 905 562 180 — 86 — 62 44 29 42 4 1,914 $10,487.8 2024 920 575 181 — 88 80 66 44 30 43 4 2,031 $11,390.0 2025 935 591 181 108 88 82 71 43 29 28 3 2,159 $12,076.7 (1) During fiscal 2021, many of our locations experienced restrictions on operations, including the ability to have dine-in operations and were subject to vaccine and/or mask mandates as a result of the COVID-19 pandemic.
Key team member statistics as of the end of fiscal 2024 included the following: Total team members (hourly and salaried) 191,105 Total number of hourly team members 180,207 Percent of hourly team members – female 58% Percent of hourly team members – members of racial or ethnic minority groups 56% Total number of new hires of hourly team members during fiscal 2024 137,038 Percent of hourly new hires – female 57% Percent of hourly new hires – members of racial or ethnic minority groups 56% In addition to the gender, racial and ethnic diversity of our workforce, our team members are also very diverse in age; we employ members of five generations of the United States population: Traditionalists, Baby Boomers, Generation X, Millennials and Centennials.
Key team member statistics as of the end of fiscal 2025 included the following: Total team members (hourly and salaried) 197,924 Total number of hourly team members 186,993 Percent of hourly team members – female 58% Percent of hourly team members – members of racial or ethnic minority groups 57% Total number of new hires of hourly team members during fiscal 2025 139,210 8 Percent of hourly new hires – female 57% Percent of hourly new hires – members of racial or ethnic minority groups 56% In addition to the gender, racial and ethnic diversity of our workforce, our team members are also very diverse in age; we employ members of five generations of the United States population: Traditionalists, Baby Boomers, Generation X, Millennials and Centennials.
Our total quality team verifies the application of preventative controls through on-site support visits ensuring an effective and robust food safety system. Total quality managers provide support to operations staff with education and training in food safety and sanitation.
Our total quality team verifies the application of preventative controls through on-site support visits ensuring an effective and robust food safety system. Total quality managers provide support to operations staff with education and training in food safety and sanitation. The team also serves as a liaison to regulatory agencies on issues relating to food safety.
Information on our website is not deemed to be incorporated by reference into this Form 10-K. Unless the context indicates otherwise, all references to “Darden,” “the Company,” “we,” “our” or “us” include Darden Restaurants, Inc., GMRI, Inc. and our respective subsidiaries.
Information on our website is not deemed to be incorporated by reference into this Form 10-K. Unless the context indicates otherwise, all references to “Darden,” “the Company,” “we,” “our” or “us” include Darden Restaurants, Inc., GMRI, Inc. and our respective subsidiaries. On October 11, 2024, we acquired 100 percent of the equity interest of Chuy’s Holdings, Inc.
Most lunch and dinner menu entrée prices range from $10.00 to $51.00. During fiscal 2024, the average check per person was approximately $35.00, with alcoholic beverages accounting for 31.3 percent of Yard House’s sales.
Most lunch and dinner menu entrée prices range from $10.00 to $54.00. During fiscal 2025, the average check per person was approximately $36.00, with alcoholic beverages accounting for 30.0 percent of Yard House’s sales.
Other factors pertaining to our competitive position in the industry are addressed under the sections entitled “Purchasing and Distribution,” “Advertising and Marketing” and “Information Technology and Cybersecurity” in this Item 1 and in our Risk Factors in Item 1A of this Form 10-K.
We expect intense competition to continue in all of these areas. 10 Other factors pertaining to our competitive position in the industry are addressed under the sections entitled “Sourcing and Distribution,” “Integrated Marketing” and “Information Technology and Cybersecurity” in this Item 1 and in our Risk Factors in Item 1A of this Form 10-K.
In fiscal 2024, the Foundation awarded a $2.0 million grant to help fund 10 additional refrigerated box trucks to help Feeding America increase access to nutritious food and address transportation needs at food banks that are under-resourced and serve communities with high percentages of food insecurity.
The Foundation continues to invest in mobile food pantry programs through its long-standing partnership with Feeding America. In fiscal 2025, the Foundation awarded a $2.0 million grant to provide refrigerated box trucks to help Feeding America increase access to nutritious food and address transportation needs at food banks that are under-resourced and serve communities with high percentages of food insecurity.
We contribute to Darden’s scale advantage, by directly sourcing product utilizing our supplier relationships, product expertise, dedicated distribution network, and food safety. Our staff travels routinely within the United States and internationally to source top-quality food and supplies at competitive prices. We actively engage with and monitor our suppliers, both in person and remotely, including hosting virtual visits and audits.
Our staff travels routinely within the United States and internationally to source top-quality food and supplies at competitive prices. We actively engage with and monitor our suppliers, both in person and remotely, including hosting virtual visits and audits.
Recent and Planned Restaurant Growth During fiscal 2024, we added 80 net company-owned Ruth's Chris restaurants and 37 other net new restaurants in the United States.
Recent and Planned Restaurant Growth During fiscal 2025, we added 103 company-owned Chuy’s restaurants and 25 other net new restaurants in the United States.
We require our suppliers to maintain sound manufacturing practices and operate with comprehensive Hazard Analysis and Critical Control Point (HACCP) food safety programs and risk-based preventative controls adopted by the U.S. Food and Drug Administration.
Suppliers that produce “high-risk” ready-to-eat products are subject to a food safety evaluation by Darden personnel at least annually. We require our suppliers to maintain sound manufacturing practices and operate with comprehensive Hazard Analysis and Critical Control Point (HACCP) food safety programs and risk-based preventative controls adopted by the U.S. Food and Drug Administration.
Information systems projects are prioritized based upon strategic, financial, regulatory, risk and other business advantage criteria. 9 Competition The restaurant industry is intensely competitive with respect to the type and quality of food, price, service, restaurant location, personnel, brand, attractiveness of facilities, availability of carryout and home delivery, internet and mobile ordering capabilities and effectiveness of advertising and marketing.
Competition The restaurant industry is intensely competitive with respect to the type and quality of food, price, service, restaurant location, personnel, brand, attractiveness of facilities, availability of carryout and home delivery, internet and mobile ordering capabilities and effectiveness of advertising and marketing.
Building on our Food Principles, Darden established an Animal Welfare Policy that adopts an outcomes-based approach to continue to ensure high level of care for farm animals in the food supply chain. To implement this policy, we established an Animal Welfare Council consisting of leading academics and thought leaders with expertise in the care of animals in food supply chains.
Building on our Food Principles, Darden established an Animal Welfare Policy that adopts an outcomes-based approach to continue to ensure a high level of care for farm animals in our food supply chain.
During fiscal 2024, the average check per person was approximately $120.50, with alcoholic beverages accounting for 28.1 percent of Eddie V’s sales. Eddie V’s maintains different menus for dinner and varies its wine list to reflect geographic differences in consumer preferences, prices and selections.
During fiscal 2025, the average check per person was approximately $104.00, with alcoholic beverages accounting for 26.3 percent of The Capital Grille’s sales. The Capital Grille offers different menus for dinner and lunch and varies its wine list to reflect geographic differences in consumer preferences, prices and selections.
During fiscal 2024, the average check per person was approximately $33.50, with alcoholic beverages accounting for 21.0 percent of Bahama Breeze’s sales. Bahama Breeze maintains different menus across its trade areas to reflect geographic differences in consumer preferences, prices and selections, as well as a smaller portioned, lower-priced children’s menu.
During fiscal 2025, the average check per person (defined as total sales divided by number of entrées sold) was approximately $24.00, with alcoholic beverages accounting for 4.7 percent of Olive Garden’s sales. Olive Garden maintains different menus across its trade areas to reflect geographic differences in consumer preferences, prices and selections, as well as a smaller portioned, lower-priced children’s menu.
During fiscal 2024, we remained focused on our climate strategy, restaurant sustainability metrics and Darden’s Animal Welfare Council. We will continue to adapt our sustainability approach with development or enhancement of integrated and strategic priorities in the near term across the enterprise, from the food we source to the operation of our restaurants.
We will continue to adapt our sustainability approach with development or enhancement of integrated and strategic priorities in the near term across our operations, from the food we source to the operation of our restaurants.
We make strategic investments to address these risks and compliance requirements to keep Company, guest and team member data secure. We monitor risks of sensitive information compromise at our business partners where relevant and reevaluate these risks on a periodic basis. We also perform annual and ongoing cybersecurity awareness training for our restaurant management and restaurant support center team members.
We make strategic investments to address these risks, including maintaining insurance coverage to mitigate the potential financial consequences of cybersecurity incidents, and compliance requirements to keep Company, guest and team member data secure. We monitor risks of sensitive information compromise at our business partners where relevant and reevaluate these risks on a periodic basis.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe also are subject to governmental regulations throughout the world that impact the way we do business with our international franchisees and vendors. These include antitrust and tax requirements, anti-boycott regulations, import/export/customs regulations and other international trade regulations, the USA Patriot Act, the Foreign Corrupt Practices Act, and applicable local law.
Biggest changeThese include antitrust and tax requirements, anti-boycott regulations, import/export/customs regulations and other international trade regulations, the USA Patriot Act, the Foreign Corrupt Practices Act, and applicable local law. Failure to comply with any such legal requirements could subject us to monetary liabilities and other sanctions, which could harm our business, results of operations and financial condition.
The restaurant industry is subject to extensive federal, state, local and international laws and regulations. The development and operation of restaurants depends to a significant extent on the selection and acquisition of suitable sites, which are subject to building, zoning, land use, environmental, traffic and other regulations and requirements.
The restaurant industry is subject to extensive federal, state, local and international laws and regulations. The development and operation of restaurants depends on the selection and acquisition of suitable sites to a significant extent, which are subject to building, zoning, land use, environmental, traffic and other regulations and requirements.
The ability to open and profitably operate restaurants is subject to various risks, such as the identification and availability of suitable and economically viable locations, the negotiation of acceptable lease or purchase terms for new locations, the need to obtain all required governmental permits (including zoning approvals and liquor licenses) on a timely basis, the need to comply with other regulatory requirements, the availability of necessary contractors and subcontractors, the ability to meet construction schedules and budgets, the ability to manage union activities such as picketing or hand billing which could delay construction, increases in labor and building material costs, supply chain disruptions, the availability of financing at acceptable rates and terms, changes in patterns or severity of weather or other acts of God that could result in construction delays and adversely affect the results of one or more restaurants for an indeterminate amount of time, our ability to hire and train qualified management personnel and general economic and business conditions.
The ability to open and profitably operate restaurants is subject to various risks, such as the identification and availability of suitable and economically viable locations; the negotiation of acceptable lease or purchase terms for new locations; the need to obtain all required governmental permits (including zoning approvals and liquor licenses) on a timely basis; the need to comply with other regulatory requirements; the availability of necessary contractors and subcontractors; the ability to meet construction schedules and budgets; the ability to manage union activities such as picketing or hand billing which could delay construction; increases in labor and building material costs; supply chain disruptions; the availability of financing at acceptable rates and terms; changes in patterns or severity of weather or other acts of God that could result in construction delays and adversely affect the 21 results of one or more restaurants for an indeterminate amount of time; and our ability to hire and train qualified management personnel and general economic and business conditions.
In addition, if gasoline, natural gas, electricity and other energy costs remain at the current elevated levels or increase further, and credit card, home mortgage and other borrowing costs increase with rising interest rates, our guests may have lower disposable income and 14 reduce the frequency of their dining occasions, may spend less on each dining occasion or may choose more inexpensive food options.
In addition, if gasoline, natural gas, electricity and other energy costs remain at the current elevated levels or increase further, and credit card, home mortgage and other borrowing costs increase with rising interest rates, our guests may have lower disposable income and reduce the frequency of their dining occasions, may spend less on each dining occasion or may choose more inexpensive food options.
These initiatives may not be successful, and pose a variety of other risks, as discussed above under the heading: “Our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media could have a material adverse impact on our business.” Climate change, adverse weather conditions and natural disasters could adversely affect our restaurant sales or results of operations.
These initiatives may not be successful, and pose a variety of other risks, as discussed above under the heading: “Our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media could have a material adverse impact on our business.” Climate change, adverse weather conditions and natural disasters could adversely affect our sales or results of operations.
Adverse weather conditions have in the past and may continue to impact guest traffic at our restaurants, cause the temporary underutilization of outdoor patio seating and, in more severe cases such as hurricanes, tornadoes, wildfires or other natural disasters, cause property damage and temporary closures, sometimes for prolonged periods, which could negatively impact our restaurant sales or costs.
Adverse weather conditions have in the past and may continue to impact guest traffic at our restaurants, cause the temporary underutilization of outdoor patio seating and, in more severe cases such as hurricanes, tornadoes, wildfires or other natural disasters, cause property damage and temporary closures, sometimes for prolonged periods, which could negatively impact our sales or costs.
Risks Relating to Information Technology and Privacy We rely heavily on information technology in our operations, and insufficient guest or employee facing technology or a failure to maintain a continuous and secure cyber network, free from material failure, interruption or security breach, could harm our ability to effectively operate our business and/or result in the loss of respected relationships with our guests or employees.
Risks Relating to Information Technology, Cybersecurity and Privacy We rely heavily on information technology in our operations, and insufficient guest or employee facing technology or a failure to maintain a continuous and secure cyber network, free from material failure, interruption or security breach, could harm our ability to effectively operate our business and/or result in the loss of respected relationships with our guests or employees.
We regard our Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Ruth’s Chris Steak House ® , Yard House ® , The Capital Grille ® , Seasons 52 ® , Bahama Breeze ® , Eddie V’s Prime Seafood ® , The Capital Burger ® , Darden ® and Darden Restaurants ® service marks, and other service marks and trademarks related to our restaurant businesses, as having significant value and being important to our marketing efforts.
We regard our Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Chuy’s ® , Yard House ® , Ruth’s Chris Steak House ® , The Capital Grille ® , Seasons 52 ® , Eddie V’s Prime Seafood ® , Bahama Breeze ® , The Capital Burger ® , Darden ® and Darden Restaurants ® service marks, and other service marks and trademarks related to our restaurant businesses, as having significant value and being important to our marketing efforts.
As information security laws and regulations change and cyber risks evolve, we may be required to make significant capital investments and other expenditures to comply with new legal requirements, investigate security incidents, remedy cybersecurity issues, recuperate lost data, prevent future compromises and adapt systems and practices to react to the changing threat environment.
As information security laws and regulations change and cyber risks evolve, we may be required to make significant capital 17 investments and other expenditures to comply with new legal requirements, investigate security incidents, remedy cybersecurity issues, recuperate lost data, prevent future compromises and adapt systems and practices to react to the changing threat environment.
Failure to comply with the laws and regulatory requirements of federal, state and local authorities could result in, among other things, revocation of required licenses, 18 administrative enforcement actions, fines and civil and criminal liability. Compliance with these laws and regulations can be costly and can increase our exposure to litigation or governmental investigations or proceedings.
Failure to comply with the laws and regulatory requirements of federal, state and local authorities could result in, among other things, revocation of required licenses, administrative enforcement actions, fines and civil and criminal liability. Compliance with these laws and regulations can be costly and can increase our exposure to litigation or governmental investigations or proceedings.
If our competitors increase their spending on advertising and promotions, if our advertising, media or marketing expenses increase, if our advertising and promotions become less effective than those of our competitors, or if we do not adequately leverage technology and data analytic capabilities needed to generate concise competitive insight, we could experience a material adverse effect on our results of operations.
If our competitors increase their spending on advertising and promotions, if our advertising, media or marketing expenses increase, if our advertising and promotions become less effective than those of our competitors, or if we do not adequately leverage technology and data analytic capabilities needed to generate concise competitive insight, we could experience a material adverse effect on our sales and our results of operations.
The outcome of litigation, particularly class action lawsuits and regulatory actions, is difficult to assess or quantify. Plaintiffs in these types of lawsuits may seek recovery of very large or indeterminate amounts, and the magnitude of the potential loss relating to such lawsuits may remain unknown for substantial periods of time. The cost to defend litigation may be significant.
The outcome of litigation, particularly class action lawsuits and regulatory actions, is difficult to assess or quantify. Plaintiffs in these types of lawsuits may seek recovery of very 23 large or indeterminate amounts, and the magnitude of the potential loss relating to such lawsuits may remain unknown for substantial periods of time. The cost to defend litigation may be significant.
However, we are aware of names and marks identical or similar to our service marks being used 22 from time to time by other persons. Although our policy is to oppose any such infringement, further or unknown unauthorized uses or other misappropriation of our trademarks or service marks could diminish the value of our brands and adversely affect our business.
However, we are aware of names and marks identical or similar to our service marks being used from time to time by other persons. Although our policy is to oppose any such infringement, further or unknown unauthorized uses or other misappropriation of our trademarks or service marks could diminish the value of our brands and adversely affect our business.
We incur substantial pre-opening expenses each time we open a new 21 restaurant and other expenses when we close, relocate or remodel existing restaurants and we have experienced higher than usual costs and expenses in recent years. The expenses of opening, closing, relocating or remodeling any of our restaurants may be higher than anticipated.
We incur substantial pre-opening expenses each time we open a new restaurant and other expenses when we close, relocate or remodel existing restaurants and we have experienced higher than usual costs and expenses in recent years. The expenses of opening, closing, relocating or remodeling any of our restaurants may be higher than anticipated.
If we fail to anticipate changing trends or other consumer preferences, our business, financial condition and results of operations could be adversely affected. Our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media could have a material adverse impact on our business.
If we fail to anticipate changing trends or other consumer preferences, our business, financial condition and results of operations could be adversely affected. 19 Our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media could have a material adverse impact on our business.
Certain economic and business factors and their impacts on the restaurant industry and other general macroeconomic factors, including unemployment, energy prices and interest rates that are largely beyond our control may adversely affect consumer behavior and our results of operations.
Certain economic and business factors and their impacts on the restaurant industry and other general macroeconomic factors, including unemployment, energy prices and interest rates that are largely beyond our control may adversely affect consumer behavior and our sales and results of operations.
Changes in the values of these derivatives may be recorded in earnings currently, resulting in volatility in both gross margin and net earnings. These gains and losses are reported as a component of cost of sales in our Consolidated Statements of Earnings included in our consolidated financial statements.
Changes in the values of these derivatives may be recorded in earnings currently, resulting in volatility in both gross margin and net earnings. These gains and 22 losses are reported as a component of cost of sales in our Consolidated Statements of Earnings included in our consolidated financial statements.
The primary areas of focus for successfully combining the business of Chuy’s with our operations may include, among others: retaining and integrating management and other key employees; integrating information, communications and other systems; and managing the growth of the combined company.
The primary areas of focus for successfully combining the business of Chuy’s with our operations include, among others: retaining and integrating management and other key employees; integrating information, communications and other systems; and managing the growth of the combined company.
Economic recession, a protracted economic slowdown, a worsening economy, increased unemployment, increased inflation, increased energy prices, rising interest rates, a downgrade of the U.S. government’s long-term credit rating, imposition of retaliatory tariffs on important U.S. imports and exports or other industry-wide cost pressures have affected and can continue to affect consumer behavior and spending for restaurant dining occasions and lead to a decline in sales and earnings.
Economic recession, a protracted economic slowdown, a worsening economy, political instability, increased unemployment, increased inflation, increased energy prices, rising interest rates, a downgrade of the U.S. government’s long-term credit rating, imposition of retaliatory tariffs on important U.S. imports and exports or other industry-wide cost pressures have affected and can continue to affect consumer behavior and spending for restaurant dining occasions and lead to a decline in sales and earnings.
Our business results depend on a number of industry-specific and general economic factors, many of which are beyond our control, and may adversely affect consumer behavior and our results of operations.
Our business results depend on a number of industry-specific and general economic factors, many of which are beyond our control, and may adversely affect consumer behavior and our sales and our results of operations.
Shortages, delays or interruptions in the supply of food items and other supplies to our restaurants may be caused by severe weather; natural disasters such as hurricanes, tornadoes, floods, droughts, wildfires and earthquakes; macroeconomic conditions resulting in disruptions to the shipping and transportation industries; labor issues such as increased costs or worker shortages or other operational disruptions 20 at our suppliers, vendors or other service providers; the inability of our vendors or service providers to manage adverse business conditions, obtain credit or remain solvent; or other conditions beyond our control.
Shortages, delays or interruptions in the supply of food items and other supplies to our restaurants may be caused by severe weather; natural disasters such as hurricanes, tornadoes, floods, droughts, wildfires and earthquakes; macroeconomic conditions (such as tariffs and trade disputes) resulting in disruptions to the shipping and transportation industries; labor issues such as increased costs or worker shortages or other operational disruptions at our suppliers, vendors or other service providers; the inability of our vendors or service providers to manage adverse business conditions, obtain credit or remain solvent; or other conditions beyond our control.
We expect that the Chuy’s Merger will result in various benefits for the combined company including, among others, business and growth opportunities and significant synergies from increased efficiency in purchasing, distribution and other restaurant and corporate support. Increased competition and/or deterioration in business conditions may limit or delay our ability to expand this business.
We expect that the acquisition of Chuy’s will result in various benefits for the combined company including, among others, business and growth opportunities and significant synergies from increased efficiency in purchasing, distribution and other restaurant and corporate support. Increased competition and/or deterioration in business conditions may limit or delay our ability to expand this business.
There also has been increasing focus by United States and overseas governmental authorities on other environmental matters, such as climate change, the reduction of greenhouse gases and water consumption. This increased focus may lead to new initiatives directed at regulating a yet to be specified array of environmental matters.
There also has been increasing focus by United States and overseas governmental authorities on other environmental matters, such as climate change, the reduction of greenhouse gas emissions and water consumption. This increased focus may lead to new initiatives directed at regulating a yet to be specified array of environmental matters.
Negative publicity also may result from health concerns including food safety and flu or virus outbreaks, publication of government or industry findings concerning food products, environmental disasters, crime 23 incidents, data security breaches, scandals involving our employees, or operational problems at our restaurants, all of which could make our brands and menu offerings less appealing to our guests and negatively impact our guest counts and sales.
Negative publicity, including through social media, also may result from health concerns including food safety and flu or virus outbreaks, publication of government or industry findings concerning food products, environmental disasters, crime incidents, data security breaches, scandals involving our employees, or operational problems at our restaurants, all of which could make our brands and menu offerings less appealing to our guests and negatively impact our guest counts and sales.
In addition, regardless of the source or cause, any report of food-borne illnesses such as E. coli, hepatitis A, norovirus or salmonella, or other food safety issues including food tampering or contamination at one of our restaurants could adversely affect the reputation of our brands and have a negative impact on our sales.
In addition, regardless of the source or cause, any report of food-borne illnesses caused by pathogens such as E. coli, hepatitis A, norovirus, listeria or salmonella, or other food safety issues including food tampering or contamination at one of our restaurants could adversely affect the reputation of our brands and have a negative impact on our sales.
As such, we may not be able to realize the synergies, goodwill, business opportunities and growth prospects anticipated in connection with the Chuy’s Merger.
As such, we may not be able to realize the synergies, goodwill, business opportunities and growth prospects anticipated in connection with the acquisition of Chuy’s.
Unauthorized access, theft, use, destruction or other compromises are becoming increasingly sophisticated and may occur through a variety of methods, including attacks using malicious code, vulnerabilities in software, hardware or other infrastructure (including systems used by our supply chain), system misconfigurations, phishing or social engineering.
Unauthorized access, theft, use, destruction or other compromises are becoming increasingly sophisticated, more difficult to detect, contain and mitigate, and may occur through a variety of methods, including attacks using malicious code, vulnerabilities in software, hardware or other infrastructure (including systems used by our supply chain), system misconfigurations, phishing or social engineering.
We have experienced and continue to experience higher than normal inflationary conditions with respect to most or all of these costs during fiscal 2024. Operating margins for our restaurants are subject to changes in the price and availability of food commodities, including beef, pork, chicken, seafood, cheese, butter and produce.
While inflationary conditions have somewhat abated in recent periods, we have experienced and continue to experience higher than normal inflationary conditions with respect to most or all of these costs during fiscal 2025. Operating margins for our restaurants are subject to changes in the price and availability of food commodities, including beef, pork, chicken, seafood, cheese, butter and produce.
Environmental, Social, and Governance (ESG) matters, including those related to climate change and inclusion and diversity matters, our reporting of such matters, or sustainability ratings could negatively impact our business, results of operations and financial condition. ESG related matters have received increased focus recently from investors, employees, ratings agencies, governmental agencies and other stakeholders.
Environmental, Social, and Governance (ESG) matters, our reporting of such matters, or sustainability ratings could negatively impact our business, results of operations and financial condition. ESG related matters have received increased focus recently from investors, employees, ratings agencies, governmental agencies and other stakeholders.
After the completion of the Chuy’s Merger, our integration of the Chuy’s business into our operations will be a complex, costly and time-consuming process that may not be successful.
The integration of the Chuy’s business into our operations is a complex, costly and time-consuming process that may not be successful.
At existing brands, we may not be able to maintain brand relevance and restaurant operating excellence to achieve sustainable same-restaurant sales growth and warrant new unit growth.
At existing brands, we may not be able to maintain brand relevance and restaurant operating excellence to achieve sustainable same-restaurant sales growth and warrant new unit growth. Failure to maintain such brand and operating excellence may also result in restaurant closures.
Our management is responsible for establishing and maintaining effective internal control over financial reporting. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States.
Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States.
The complexity of these privacy and data protection laws may result in significant costs arising from compliance and from any non-compliance, whether or not due to our negligence, and could affect our brand reputation and our results of operations.
The increasingly complex and evolving regulatory environment related to data privacy and data protection laws may result in significant costs arising from compliance and from any non-compliance, whether or not due to our negligence, and could affect our brand reputation and our results of operations.
The inability to successfully integrate the Chuy’s operations into our business could harm our ability to achieve the sales growth, cost savings and other benefits we expect to be able to realize in the Chuy’s operations.
Risks Related to the Integration of Chuy’s The inability to successfully integrate the Chuy’s brand’s operations into our business could harm our ability to achieve the sales growth, cost savings and other benefits we expect to be able to realize from Chuy’s operations.
If we increase menu prices as a result of increased food costs or remove menu items due to shortages, such responses may negatively impact our sales.
Consumers at our restaurants may be sensitive to price increases, and if we increase menu prices as a result of increased food costs or remove menu items due to shortages, such responses may negatively impact our sales.
As of May 26, 2024, 1,952 of our 2,031 restaurants operating in the United States and Canada operate in leased locations and the leases are generally non-cancellable for some period of time.
As of May 25, 2025, 2,065 of our 2,159 restaurants operating in the United States and Canada operate in leased locations, and the leases are generally non-cancellable for some period of time.
Our international operations are subject to all of the same risks associated with our domestic operations, as well as a number of additional risks. These include, among other things, international economic and political conditions, foreign currency fluctuations, and differing cultures and consumer preferences. In addition, expansion into international markets could create risks to our brands and reputation.
Our international operations are subject to all of the same risks associated with our domestic operations, as well as a number of additional risks. These include, among other things, international economic and political conditions, foreign currency fluctuations, trade disputes, potential increases in tariffs and differing cultures and consumer preferences.
The myriad of laws and regulations being passed at the state and local level creates unique challenges for a multi-state employer as different standards apply to different locations, sometimes with conflicting requirements. We must continue to monitor and adapt our employment practices to comply with these various laws and regulations.
The myriad of laws and regulations being passed at the state and local level creates unique challenges for a multi-state employer as different standards apply to different locations, sometimes with conflicting requirements.
Even instances of food-borne illness, food tampering or food contamination occurring solely at restaurants of our competitors could result in negative publicity about the food service industry generally and adversely impact our sales.
Even instances of food-borne illness, food tampering or food contamination occurring solely at our competitors’ restaurants, suppliers or distributors (even if we do not work with them) could result in negative publicity about the food service industry generally and adversely impact our sales.
The dollar amount of claims that we experience under our workers’ compensation and general liability insurance, for which we carry high per-claim deductibles, may also increase at any time, thereby further increasing our costs.
The dollar amount of claims that we experience under our workers’ compensation and general liability insurance, for which we carry high per-claim deductibles, may also increase at any time, thereby further increasing our costs. Further, the decreased availability of property and liability insurance has the potential to negatively impact the cost of premiums and the magnitude of uninsured losses.
Even if such measures are not implemented and a virus or other disease does not spread significantly, the perceived risk of infection or significant health risk may cause guests to choose other alternatives to dining out in our restaurants which may adversely affect our business.
Even if such measures are not implemented and a virus or other disease does not spread significantly, the perceived risk of infection or significant health risk may cause guests to choose other alternatives to dining out in our restaurants which may adversely affect our business. 16 A failure to maintain food safety throughout the supply chain and food-borne illness concerns may have an adverse effect on our business.
Should the value of goodwill or other intangible assets become impaired, there could be an adverse effect on our financial condition and results of operations. Changes in tax laws and unanticipated tax liabilities could adversely affect our financial results. We are primarily subject to income and other taxes in the United States.
We cannot accurately predict the amount and timing of any impairments of these or other assets. Should the value of goodwill or other intangible assets become impaired, there could be an adverse effect on our financial condition and results of operations. Changes in tax laws and unanticipated tax liabilities could adversely affect our financial results.
Reaching a determination on useful life requires significant judgments and assumptions regarding the future effects of obsolescence, demand, competition, other economic factors (such as the stability of the industry, legislative action that results in an uncertain or changing regulatory environment, and expected changes in distribution channels), the level of required maintenance expenditures, and the expected lives of other related groups of assets.
Reaching a determination on useful life requires significant judgments and assumptions regarding the future effects of obsolescence, demand, competition, other economic factors (such as the stability of the industry, legislative action that results in an uncertain or changing regulatory environment, and expected changes in distribution channels), the level of required maintenance expenditures, and the expected lives of other related groups of assets. 24 As with goodwill, we test our indefinite-lived intangible assets (primarily trademarks) for impairment annually and whenever events or changes in circumstances indicate that their carrying value may not be recoverable.
We also are subject to federal and state laws which prohibit discrimination and other laws regulating the design and operation of facilities, such as the ADA.
We must continue to monitor and adapt our employment practices to comply with these various laws and regulations. 18 We also are subject to federal and state laws which prohibit discrimination and other laws regulating the design and operation of facilities, such as the ADA.
Further, the decreased availability of property and liability insurance has the potential to negatively impact the cost of premiums and the magnitude of uninsured losses. 15 Risks Relating to Health and Safet y Health concerns arising from food-related pandemics, outbreaks of flu, viruses or other diseases may have an adverse effect on our business.
Risks Relating to Health and Safet y Health concerns arising from food-related pandemics, outbreaks of flu, viruses or other diseases may have an adverse effect on our business.
As a result, we may be required to close or relocate a restaurant, which could subject us to construction and other costs and risks that may have an adverse effect on our operating performance.
In addition, at the end of the lease term and expiration of all renewal periods, we may be unable to renew the lease without substantial additional cost, if at all. 20 As a result, we may be required to close or relocate a restaurant, which could subject us to construction and other costs and risks that may have an adverse effect on our operating performance.
The inappropriate use of social media vehicles by our guests or employees could increase our costs, lead to litigation or result in negative publicity that could damage our reputation. 19 A failure to identify and execute innovative marketing and guest relationship tactics, ineffective or improper use of other marketing initiatives, and increased advertising and marketing costs could adversely affect our results of operations.
A failure to identify and execute innovative marketing and guest relationship tactics, ineffective or improper use of other marketing initiatives, and increased advertising and marketing costs could adversely affect our sales and results of operations.
In addition, our effective income tax rate and our results may be impacted by our ability to realize deferred tax benefits and by any increases or decreases of our valuation allowances applied to our existing deferred tax assets. 24 Failure of our internal controls over financial reporting and future changes in accounting standards may cause adverse unexpected operating results, affect our reported results of operations or otherwise harm our business and financial results.
In addition, our effective income tax rate and our results may be impacted by our ability to realize deferred tax benefits and by any increases or decreases of our valuation allowances applied to our existing deferred tax assets.
Maintaining adequate staffing in our existing restaurants and hiring and training staff for our new restaurants requires precise workforce planning which has been complicated by the tight labor market in the United States and by the dynamics of changing consumer preferences.
Adequate staffing and retention of qualified restaurant team members is a critical factor impacting our 15 guests’ experience in our restaurants. Maintaining adequate staffing in our existing restaurants and hiring and training staff for our new restaurants require precise workforce planning which has been complicated by the competitive labor market in the United States.
While we make efforts to ensure that our providers are observing proper standards and controls, we cannot guarantee that breaches or failures caused by these outsourced providers will not occur. 16 From time-to-time, we and our third party service providers and suppliers experience unauthorized attempts to infiltrate and interrupt information systems.
Some of these essential business processes that are dependent on technology are outsourced to third parties. While we make efforts to ensure that our providers are observing proper standards and controls, we cannot guarantee that breaches or failures caused by these outsourced providers will not occur.
We cannot predict whether we will continue to be able to anticipate and react to changing food costs by adjusting our purchasing practices, menu offerings, and menu prices, and a failure to do so could adversely affect our operating results.
The introduction of or changes to tariffs or adverse impacts resulting from restrictive trade policies or trade disputes on imported food products, such as produce and seafood, could increase our costs and possibly impact the supply of those products. 14 We cannot predict whether we will continue to be able to anticipate and react to changing food costs by adjusting our purchasing practices, menu offerings, and menu prices, and a failure to do so could adversely affect our operating results.
To date, interruptions of these information systems as a result of unauthorized infiltration attempts have not had a material impact on our operations. However, because technology is increasingly complex and cyber-attacks are increasingly sophisticated and more frequent, there can be no assurance that such incidents will not have a material adverse effect on us in the future.
However, because technology is increasingly complex and cyber-attacks are increasingly sophisticated and more frequent, there can be no assurance that such incidents will not have a material adverse effect on us in the future. In addition, the rapid evolution and increased adoption of artificial intelligence technologies may intensify our and our service providers’ and key suppliers’ cybersecurity risks.
Failure to comply with any such legal requirements could subject us to monetary liabilities and other sanctions, which could harm our business, results of operations and financial condition. Volatility in the market value of derivatives we may use to hedge exposures to fluctuations in commodity and broader market prices may cause volatility in our gross margins and net earnings.
Volatility in the market value of derivatives we may use to hedge exposures to fluctuations in commodity and broader market prices may cause volatility in our gross margins and net earnings.
A failure to maintain food safety throughout the supply chain and food-borne illness concerns may have an adverse effect on our business. Food safety is a top priority, and we dedicate substantial resources to ensuring that our guests enjoy safe, quality food products.
Food safety is a top priority for us, and we dedicate substantial resources to ensuring that our guests enjoy safe, quality food products.
Additionally, we could be subject to litigation and government enforcement actions as a result of any such failure. Risks Relating to the Acquisition and Integration of Chuy’s Holdings The failure to complete our acquisition of Chuy’s Holdings in a timely fashion, or at all, may adversely affect our business and our stock price.
Additionally, we could be subject to litigation and government enforcement actions as a result of any such failure.
Removed
The introduction of or changes to tariffs on imported food products, such as produce and seafood, could increase our costs and possibly impact the supply of those products.
Added
Anticipated changes in immigration laws and regulations could decrease the pool of candidates with legal work authorizations, cause disruption in the workforce for all companies that rely on hourly workers and increase the costs, time and requirements to hire new employees.
Removed
Adequate staffing and retention of qualified restaurant team members is a critical factor impacting our guests’ experience in our restaurants.
Added
From time to time, we and our third party service providers and suppliers experience unauthorized attempts to infiltrate and interrupt information systems. To date, interruptions of these information systems as a result of unauthorized infiltration attempts have not had a material impact on our operations.
Removed
Some of these essential business processes that are dependent on technology are outsourced to third parties.
Added
The inappropriate use of social media vehicles by our guests or employees could increase our costs, lead to litigation or result in negative publicity that could damage our reputation.
Removed
For example, the rapid evolution and increased adoption of artificial intelligence technologies may intensify our and our service providers’ and key suppliers’ cybersecurity risks.
Added
In addition, expansion into international markets could create risks to our brands and reputation. We also are subject to governmental regulations throughout the world that impact the way we do business with our international franchisees and vendors.
Removed
Consummation of our planned acquisition of Chuy’s Holdings (the “Chuy’s Merger”) is subject to the satisfaction or waiver of customary closing conditions, including (i) the affirmative vote of a majority of the outstanding shares of Chuy’s Holdings common stock in favor of the Chuy’s Merger, (ii) the absence of an order or law prohibiting the Chuy’s Merger or making consummation of the Chuy’s Merger illegal or otherwise prohibited, (iii) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and (iv) the absence of a material adverse effect with respect to either us or Chuy’s Holdings.
Added
We are primarily subject to income and other taxes in the United States.
Removed
There can be no assurance that these or other closing conditions will be satisfied in a timely manner or at all. Any delay in completing the acquisition could cause us not to realize some or all of the anticipated benefits when expected, if at all.
Added
Failure of our internal controls over financial reporting and future changes in accounting standards may cause adverse unexpected operating results, affect our reported results of operations or otherwise harm our business and financial results. Our management is responsible for establishing and maintaining effective internal control over financial reporting.
Removed
If the Chuy’s Merger is not completed, our stock price could decline to the extent it reflects an assumption that we will complete the acquisition.
Removed
Furthermore, if the Chuy’s Merger is not completed, we may suffer other consequences that could 17 adversely affect our business, results of operations and stock price, including incurring significant acquisition costs that we would be unable to recover, negative publicity and a negative impression of us in the investment community.
Removed
In addition, at the end of the lease term and expiration of all renewal periods, we may be unable to renew the lease without substantial additional cost, if at all.
Removed
As with goodwill, we test our indefinite-lived intangible assets (primarily trademarks) for impairment annually and whenever events or changes in circumstances indicate that their carrying value may not be recoverable. We cannot accurately predict the amount and timing of any impairments of these or other assets.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Audit Committee receives periodic updates from the CIO, the director of our cybersecurity team and a senior attorney, the three most senior leaders with responsibility for oversight of our key cybersecurity program components.
Biggest changeOur global incident response plan sets forth a detailed security incident management and reporting protocol, with escalation timelines and responsibilities. 26 The Audit Committee receives periodic updates from the CIO, the director of our cybersecurity team and a senior attorney, the three most senior leaders with responsibility for oversight of our key cybersecurity program components.
We periodically engage third parties to perform cybersecurity audits to measure the maturity of our cybersecurity program against the National Institute of Standards and 25 Technology (NIST) Framework. We also engage third parties to conduct security reviews of our network, processes and systems on a regular basis to identify opportunities and enhancements to strengthen our policies and practices.
We periodically engage third parties to perform cybersecurity audits to measure the maturity of our cybersecurity program against the National Institute of Standards and Technology (NIST) Framework. We also engage third parties to conduct security reviews of our network, processes and systems on a regular basis to identify opportunities and enhancements to strengthen our policies and practices.
Our CIO also provides updates to the full Board of Directors on such topics at least annually. 26
Our CIO also provides updates to the full Board of Directors on such topics at least annually.
For further discussion of the risks related to cybersecurity, see the risk factors discussed under “Information Technology and Cybersecurity” in our Risk Factors in Item 1A of this Form 10-K. Governance Our Board of Directors has ultimate risk oversight responsibility for the Company and administers this responsibility both directly and with assistance from its committees.
For further discussion of the risks related to cybersecurity, see the risk factors discussed under “Risks Relating to Information Technology, Cybersecurity and Privacy” in our Risk Factors in Item 1A of this Form 10-K. Governance Our Board of Directors has ultimate risk oversight responsibility for the Company and administers this responsibility both directly and with assistance from its committees.
We make ongoing strategic investments to address these risks and compliance requirements and help keep Company, guest and team member data secure. We monitor risks of sensitive information compromise at our business partners, where relevant, and reevaluate these risks on a periodic basis.
We make ongoing strategic investments to address these risks, including maintaining insurance coverage to mitigate the potential financial consequences of cybersecurity incidents, and compliance requirements and help keep Company, guest and team member data secure. We monitor risks of sensitive information compromise at our business partners, where relevant, and reevaluate these risks on a periodic basis.
The incident response team is a cross-functional group that may be composed of both Company personnel and external service providers, and that is tailored to a particular incident so that individuals with appropriate experience and expertise are available. We conduct regular exercises to help ensure the plan’s effectiveness and our overall response preparedness.
The incident response team is a cross-functional group that may be composed of both Company personnel and external service providers, and that is tailored to a particular incident so that individuals with appropriate experience and expertise are available.
We have also invested in various tools to protect our data and information technology. We maintain a robust system of data protection and cybersecurity resources, technology and processes, and we regularly evaluate new and emerging risks and ever-changing legal and compliance requirements.
We conduct regular exercises to help ensure the plan’s effectiveness and our overall response preparedness. 25 We have also invested in various tools to protect our data and information technology. We maintain a robust system of data protection and cybersecurity resources, technology and processes, and we regularly evaluate new and emerging risks and ever-changing legal and compliance requirements.
The CIO meets regularly with leaders of our various information technology management teams to review and discuss our cybersecurity and other information technology risks and opportunities. Our global incident response plan sets forth a detailed security incident management and reporting protocol, with escalation timelines and responsibilities.
The CIO meets regularly with leaders of our various information technology management teams to review and discuss our cybersecurity and other information technology risks and opportunities.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. PROPERTIES Restaurant Properties – Continuing Operations As of May 26, 2024, we owned and operated 2,031 restaurants. Our company-owned restaurants are located in all 50 of the United States, Washington D.C. and Canada. Of the company-owned, 79 were located on owned sites and 1,952 were located on leased sites.
Biggest changeItem 2. PROPERTIES Restaurant Properties – Continuing Operations As of May 25, 2025, we owned and operated 2,159 restaurants. Our company-owned restaurants are located in all 50 of the United States, Washington D.C. and Canada. Of the company-owned restaurants, 94 were located on owned sites and 2,065 were located on leased sites.
The leases are classified as follows: Land-Only Leases (we own buildings and equipment) 1,014 Ground and Building Leases 654 Space/In-Line/Other Leases 284 Total 1,952 We also lease our Restaurant Support Center which is located in Orlando, Florida.
The leases are classified as follows: Land-Only Leases (we own buildings and equipment) 1,102 Ground and Building Leases 666 Space/In-Line/Other Leases 297 Total 2,065 We also lease our Restaurant Support Center which is located in Orlando, Florida.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe table below provides information concerning our repurchase of shares of our common stock during the quarter ended May 26, 2024: (Dollars in millions, except per share data) Total Number of Shares Purchased (1) (2) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (3) February 26, 2024 through March 31, 2024 110,861 $169.92 110,861 $994.0 April 1, 2024 through Apri1 28, 2024 314,262 $156.15 314,262 $944.9 April 29, 2024 through May 26, 2024 195,704 150.61 195,704 $915.5 Quarter-to-Date 620,827 $156.86 620,827 $915.5 (1) All of the shares purchased during the quarter ended May 26, 2024 were purchased as part of our repurchase program.
Biggest changeThe table below provides information concerning our repurchase of shares of our common stock during the quarter ended May 25, 2025: (Dollars in millions, except per share data) Total Number of Shares Purchased (1) (2) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (3) February 24, 2025 through March 30, 2025 157,368 $193.77 157,368 $517.7 March 31, 2025 through Apri1 27, 2025 53,445 $196.72 53,445 $507.2 April 28, 2025 through May 25, 2025 49,251 $203.32 49,251 $497.2 Quarter-to-Date 260,064 $196.19 260,064 $497.2 (1) All of the shares purchased during the quarter ended May 25, 2025 were purchased as part of our repurchase program.
As of June 30, 2024, there were approximately 7,800 holders of record of our common shares. The number of registered holders does not include holders who are beneficial owners but whose shares are held in street name by brokers and other nominees.
As of June 30, 2025, there were approximately 7,400 holders of record of our common shares. The number of registered holders does not include holders who are beneficial owners but whose shares are held in street name by brokers and other nominees.
Share Repurchases Since commencing our common share repurchase program in December 1995, we have repurchased a total of 210.7 million shares through May 26, 2024 under authorizations from our Board of Directors.
Share Repurchases Since commencing our common share repurchase program in December 1995, we have repurchased a total of 213.3 million shares through May 25, 2025 under authorizations from our Board of Directors.
On March 20, 2024, our Board of Directors authorized a new share repurchase program under which we may repurchase up to $1 billion of our outstanding common stock. This repurchase program, which was announced publicly in a press release issued on March 21, 2024, does not have an expiration date and replaced the prior share repurchase authorization.
On June 18, 2025, Darden's Board of Directors authorized a new share repurchase program under which the Company may repurchase up to $1 billion of its outstanding common stock. This repurchase program, which was announced publicly in a press release issued on June 20, 2025, does not have an expiration and replaces the previously existing share repurchase authorization.
There can be no assurance that we will repurchase any additional shares. 28 Comparison of Five-Year Total Return Indexed Returns Company/Index May 2019 May 2020 May 2021 May 2022 May 2023 May 2024 Darden Restaurants, Inc. $ 100.00 $ 91.92 $ 173.35 $ 157.33 $ 208.64 $ 197.51 S&P 500 Stock Index $ 100.00 $ 116.47 $ 163.42 $ 163.95 $ 168.68 $ 216.03 S&P Composite 1500 Restaurant Sub-Index $ 100.00 $ 126.09 $ 176.64 $ 160.94 $ 197.37 $ 202.44 The annual changes for the five-year period shown in the graph on this page are based on the assumption that $100 had been invested in Darden Restaurants, Inc. common stock, the S&P 500 Stock Index and the S&P Composite 1500 Restaurant Sub-Index on May 26, 2019, and that all dividends were reinvested.
There can be no assurance that we will repurchase any additional shares. 28 Comparison of Five-Year Total Return Indexed Returns Company/Index May 2020 May 2021 May 2022 May 2023 May 2024 May 2025 Darden Restaurants, Inc. $ 100.00 $ 188.58 $ 171.15 $ 226.97 $ 214.87 $ 307.28 S&P 500 Stock Index $ 100.00 $ 140.32 $ 140.77 $ 144.83 $ 185.48 $ 205.63 S&P Composite 1500 Restaurant Sub-Index $ 100.00 $ 140.09 $ 127.64 $ 156.53 $ 160.55 $ 179.37 The annual changes for the five-year period shown in the graph on this page are based on the assumption that $100 had been invested in Darden Restaurants, Inc. common stock, the S&P 500 Stock Index and the S&P Composite 1500 Restaurant Sub-Index on May 31, 2020, and that all dividends were reinvested.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeOther Information 82 PART III Item 10. Directors, Executive Officers and Corporate Governance 82 Item 11. Executive Compensation 82 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 83 Item 13. Certain Relationships and Related Transactions, and Director Independence 83 Item 14. Principal Accountant Fees and Services 83 PART IV Item 15.
Biggest changeOther Information 81 PART III Item 10. Directors, Executive Officers and Corporate Governance 81 Item 11. Executive Compensation 81 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 82 Item 13. Certain Relationships and Related Transactions, and Director Independence 82 Item 14. Principal Accountant Fees and Services 82 PART IV Item 15.
Exhibits and Financial Statement Schedules 83 Signatures 84 Cautionary Statement Regarding Forward-Looking Statements Statements set forth in or incorporated into this report regarding the expected increase in sales from continuing operations, same-restaurant sales, the number of our restaurants, our annual effective tax rate and capital expenditures in fiscal 2025, and all other statements that are not historical facts, including without limitation statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of Darden Restaurants, Inc. and its subsidiaries that are preceded by, followed by or that include words such as “may,” “will,” “expect,” “intend,” “anticipate,” “continue,” “estimate,” “project,” “believe,” “plan,” “outlook” or similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act.
Exhibits and Financial Statement Schedules 82 Signatures 83 Cautionary Statement Regarding Forward-Looking Statements Statements set forth in or incorporated into this report regarding the expected increase in sales from continuing operations, same-restaurant sales, the number of our restaurants, our annual effective tax rate and capital expenditures in fiscal 2026, and all other statements that are not historical facts, including without limitation statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of Darden Restaurants, Inc. and its subsidiaries that are preceded by, followed by or that include words such as “may,” “will,” “expect,” “intend,” “anticipate,” “continue,” “estimate,” “project,” “believe,” “plan,” “outlook” or similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act.
Item 6. Reserved 30 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 40 Item 8. Financial Statements and Supplementary Data 41 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 82 Item 9A. Controls and Procedures 82 Item 9B.
Item 6. Reserved 30 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 40 Item 8. Financial Statements and Supplementary Data 42 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 81 Item 9A. Controls and Procedures 81 Item 9B.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

69 edited+11 added−19 removed34 unchanged
Biggest changeAll information is derived from the consolidated statements of earnings for the fiscal years ended May 26, 2024 and May 28, 2023: Fiscal Year Ended Percent Change (in millions) May 26, 2024 May 28, 2023 2024 v. 2023 Sales $ 11,390.0 $ 10,487.8 8.6% Costs and expenses: Food and beverage 3,523.9 3,355.9 5.0% Restaurant labor 3,619.3 3,346.3 8.2% Restaurant expenses 1,836.6 1,702.2 7.9% Marketing expenses 144.5 118.3 22.1% General and administrative expenses 479.2 386.1 24.1% Depreciation and amortization 459.9 387.8 18.6% Impairments and disposal of assets, net 12.4 (10.6) NM Total operating costs and expenses $ 10,075.8 $ 9,286.0 8.5% Operating income $ 1,314.2 $ 1,201.8 9.4% Interest, net 138.7 81.3 70.6% Earnings before income taxes $ 1,175.5 $ 1,120.5 4.9% Income tax expense (1) 145.0 137.0 5.8% Earnings from continuing operations $ 1,030.5 $ 983.5 4.8% Losses from discontinued operations, net of tax (2.9) (1.6) 81.3% Net earnings $ 1,027.6 $ 981.9 4.7% (1) Effective tax rate 12.3 % 12.2 % NM- Percentage change not considered meaningful. 31 The following table details the number of company-owned restaurants currently reported in continuing operations, compared with the number open at the end of fiscal 2023: May 26, 2024 May 28, 2023 Olive Garden 920 905 LongHorn Steakhouse 575 562 Cheddar’s Scratch Kitchen 181 180 Yard House 88 86 Ruth’s Chris 80 — The Capital Grille 66 62 Seasons 52 44 44 Bahama Breeze 43 42 Eddie V’s 30 29 The Capital Burger 4 4 Total 2,031 1,914 SALES The following table presents our company-owned restaurant sales, U.S. same-restaurant sales (SRS) and average annual sales per restaurant by segment for the periods indicated: Sales Average Annual Sales per Restaurant (2) Fiscal Year Ended Percent Change Fiscal Year Ended (in millions) May 26, 2024 May 28, 2023 SRS (1) May 26, 2024 May 28, 2023 Olive Garden $ 5,067.0 $ 4,877.8 3.9 % 1.6 % $ 5.6 $ 5.5 LongHorn Steakhouse $ 2,806.2 $ 2,612.3 7.4 % 4.7 % $ 4.9 $ 4.7 Fine Dining $ 1,291.5 $ 830.8 55.5 % (2.4) % $ 7.6 $ 9.2 Other Business $ 2,225.3 $ 2,166.9 2.7 % (0.7) % $ 6.0 $ 6.0 $ 11,390.0 $ 10,487.8 (1) Same-restaurant sales is a year-over-year comparison of each period’s sales volumes for a 52-week year and is limited to restaurants that have been open, and operated by Darden, for at least 16 months.
Biggest changeAll information is derived from the consolidated statements of earnings for the fiscal years ended May 25, 2025 and May 26, 2024: Fiscal Year Ended Percent Change (in millions) May 25, 2025 May 26, 2024 2025 v. 2024 Sales $ 12,076.7 $ 11,390.0 6.0% Costs and expenses: Food and beverage 3,657.0 3,523.9 3.8% Restaurant labor 3,833.1 3,619.3 5.9% Restaurant expenses 1,944.0 1,812.3 7.3% Pre-opening costs 24.8 24.3 2.1% Marketing expenses 169.9 144.5 17.6% General and administrative expenses 520.3 479.2 8.6% Depreciation and amortization 516.1 459.9 12.2% Impairments and disposal of assets, net 49.2 12.4 NM Total operating costs and expenses $ 10,714.4 $ 10,075.8 6.3% Operating income $ 1,362.3 $ 1,314.2 3.7% Interest, net 175.1 138.7 26.2% Earnings before income taxes $ 1,187.2 $ 1,175.5 1.0% Income tax expense (1) 136.2 145.0 (6.1)% Earnings from continuing operations $ 1,051.0 $ 1,030.5 2.0% Losses from discontinued operations, net of tax (1.4) (2.9) (51.7)% Net earnings $ 1,049.6 $ 1,027.6 2.1% (1) Effective tax rate 11.5 % 12.3 % NM- Percentage change not considered meaningful. 31 The following table details the number of company-owned restaurants reported in continuing operations at the end of fiscal 2025, compared with the number open at the end of fiscal 2024: May 25, 2025 May 26, 2024 Olive Garden 935 920 LongHorn Steakhouse 591 575 Cheddar’s Scratch Kitchen 181 181 Chuy’s 108 — Yard House 88 88 Ruth’s Chris 82 80 The Capital Grille 71 66 Seasons 52 43 44 Eddie V’s 29 30 Bahama Breeze 28 43 The Capital Burger 3 4 Total 2,159 2,031 SALES The following table presents our company-owned restaurant sales, U.S. same-restaurant sales (SRS) and average annual sales per restaurant by segment for the periods indicated: Sales Average Annual Sales per Restaurant (2) Fiscal Year Ended Percent Change Fiscal Year Ended (in millions) May 25, 2025 May 26, 2024 SRS (1) May 25, 2025 May 26, 2024 Olive Garden $ 5,212.9 $ 5,067.0 2.9 % 1.7 % $ 5.6 $ 5.6 LongHorn Steakhouse $ 3,025.5 $ 2,806.2 7.8 % 5.1 % $ 5.2 $ 4.9 Fine Dining $ 1,304.8 $ 1,291.5 1.0 % (3.0) % $ 7.2 $ 7.6 Other Business $ 2,533.5 $ 2,225.3 13.8 % 0.2 % $ 5.8 $ 6.0 $ 12,076.7 $ 11,390.0 (1) Same-restaurant sales is a year-over-year comparison of each period’s sales volumes for a 52-week year and is limited to restaurants that have been open, and operated by Darden, for at least 16 months.
Some of the impacts of the inflation have been offset by menu price increases and other adjustments made during the year. Whether we are able and/or choose to continue to offset the effects of inflation will determine to what extent, if any, inflation affects our restaurant profitability in future periods.
Some of the impacts of inflation have been offset by menu price increases and other adjustments made during the year. Whether we are able and/or choose to continue to offset the effects of inflation will determine to what extent, if any, inflation affects our restaurant profitability in future periods.
The ratings are not a recommendation to buy, sell or hold our securities, may be changed, superseded or withdrawn at any time and should be evaluated independently of any other rating. On October 23, 2023, we entered into a $1.25 billion Revolving Credit Agreement (Revolving Credit Agreement) with Bank of America, N.A.
The ratings are not a recommendation to buy, sell or hold our securities, may be changed, superseded or withdrawn at any time and should be evaluated independently of any other rating. 36 On October 23, 2023, we entered into a $1.25 billion Revolving Credit Agreement (Revolving Credit Agreement) with Bank of America, N.A.
In considering the qualitative approach related to goodwill, we evaluated 35 factors including, but not limited to, macro-economic conditions, market and industry conditions, commodity cost fluctuations, competitive environment, share price performance, results of prior impairment tests, operational stability, the overall financial performance of the reporting units and the impacts of discount rates.
In considering the qualitative approach related to goodwill, we evaluated factors including, but not limited to, macro-economic conditions, market and industry conditions, commodity cost fluctuations, competitive environment, share price performance, results of prior impairment tests, operational stability, the overall financial performance of the reporting units and the impacts of discount rates.
The 2033 Notes were issued under the Company’s Indenture, dated as of January 1, 1996 (Base Indenture), between the Company and Computershare Trust Company, National Association (as successor to Wells Fargo Bank, National Association, successor to Wells Fargo Bank Minnesota, National Association, formerly known as Norwest Bank Minnesota, National Association), as trustee (Base Trustee), as amended and supplemented by the Second Supplemental Indenture, dated as of October 4, 2023 (Second Supplemental Indenture), among the Company, the Base Trustee and U.S.
The Notes were issued under the Company’s Indenture, dated as of January 1, 1996, between the Company and Computershare Trust Company, National Association (as successor to Wells Fargo Bank, National Association, successor to Wells Fargo Bank Minnesota, National Association, formerly known as Norwest Bank Minnesota, National Association), as trustee (Base Trustee), as amended and supplemented by the Second Supplemental Indenture, dated as of October 4, 2023, among the Company, the Base Trustee and U.S.
SEGMENT RESULTS We manage our restaurant brands, Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Yard House, Ruth’s Chris, The Capital Grille, Seasons 52, Bahama Breeze, Eddie V’s and The Capital Burger in the U.S. and Canada as operating segments.
SEGMENT RESULTS We manage our restaurant brands, Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Chuy’s, Yard House, Ruth’s Chris, The Capital Grille, Seasons 52, Eddie V’s, Bahama Breeze and The Capital Burger in the U.S. and Canada as operating segments.
(2) Average annual sales are calculated as sales divided by total restaurant operating weeks multiplied by 52 weeks; excludes franchise locations. Olive Garden’s sales increase for fiscal 2024 was primarily driven by a U.S. same-restaurant sales increase combined with revenue from new restaurants.
(2) Average annual sales are calculated as sales divided by total restaurant operating weeks multiplied by 52 weeks; excludes franchise locations. Olive Garden’s sales increase for fiscal 2025 was primarily driven by a U.S. same-restaurant sales increase combined with revenue from new restaurants.
We believe that our internal cash-generating capabilities, the potential issuance of equity or unsecured debt securities under our shelf registration statement and 39 short-term commercial paper or drawings under our Revolving Credit Agreement should be sufficient to finance our capital expenditures, debt maturities and other operating activities through fiscal 2025.
We believe that our internal cash-generating capabilities, the potential issuance of equity or unsecured debt securities under our shelf registration statement and short-term commercial paper or drawings under our Revolving Credit Agreement should be sufficient to finance our capital expenditures, debt maturities and other operating activities through fiscal 2026.
The Revolving Credit Agreement is a senior unsecured credit commitment to the Company and contains customary representations and affirmative and negative covenants (including limitations on liens and subsidiary debt and a maximum consolidated lease adjusted total debt to total capitalization ratio of 0.75 to 1.00) and events of default usual for credit facilities of this type, and consistent with our Prior Revolving Credit Agreement.
The Revolving Credit Agreement is a senior unsecured credit commitment to the Company and contains customary representations and affirmative and negative covenants (including limitations on liens and subsidiary debt and a maximum consolidated lease adjusted total debt to total capitalization ratio of 0.75 to 1.00) and events of default usual for credit facilities of this type.
We include the lease-debt equivalent and contractual lease guarantees in our adjusted debt to adjusted total capital ratio reported to shareholders, as we believe its inclusion better represents the optimal capital structure that we target from period to period and because it is consistent with the calculation of the covenant under our Revolving Credit Agreement.
We include the lease-debt equivalent and contractual lease guarantees in our ratios reported to shareholders, as we believe its inclusion better represents the optimal capital structure that we target from period to period and because it is consistent with the calculation of the covenant under our Revolving Credit Agreement.
The decrease in same-restaurant sales in fiscal 2024 resulted from a 3.3 percent decrease in same-restaurant guest counts offset by a 2.6 percent increase in average check. 32 COSTS AND EXPENSES The following table sets forth selected operating data as a percent of sales from continuing operations for the periods indicated.
The increase in same-restaurant sales in fiscal 2025 resulted from a 2.6 percent increase in average check offset by a 2.4 percent decrease in same-restaurant guest counts. 32 COSTS AND EXPENSES The following table sets forth selected operating data as a percent of sales from continuing operations for the periods indicated.
The decrease in the Fine Dining segment profit margin for fiscal 2024 was driven primarily by negative same-restaurant sales and higher restaurant labor, restaurant expenses and marketing costs, partially offset by lower food and beverage costs.
The decrease in the Fine Dining segment profit margin for fiscal 2025 was driven primarily by negative same-restaurant sales and higher restaurant labor and restaurant expenses, partially offset by lower food and beverage costs.
Net cash flows used in financing activities in fiscal 2024 included dividend payments of $628.4 million and share repurchases of $453.9 million, partially offset by net proceeds from issuance of short term debt of $86.8 million, net proceeds from the 2033 Notes of $500.0 million and proceeds from the exercise of employee stock options.
Net cash flows used in financing activities in fiscal 2024 included dividend payments of $628.4 million and share repurchases of $453.9 million, partially offset by the issuance of commercial paper of $86.8 million, net proceeds from the 2033 Notes of $500.0 million and proceeds from the exercise of employee stock options.
Changing our breakage-rate estimates by 50 basis points would have resulted in an adjustment in our breakage income of approximately $3.6 million for fiscal 2024. Income Taxes We estimate certain components of our provision for income taxes.
Changing our breakage-rate estimates by 50 basis points would have resulted in an adjustment in our breakage income of approximately $3.5 million for fiscal 2025. Income Taxes We estimate certain components of our provision for income taxes.
Valuation and Recoverability of Goodwill and Trademarks We have ten reporting units, seven of which have goodwill and eight of which have trademarks. Goodwill and trademarks are not subject to amortization and have been assigned to reporting units for purposes of impairment testing. The reporting units are our restaurant brands.
Valuation and Recoverability of Goodwill and Trademarks We have eleven reporting units, eight of which have goodwill and nine of which have trademarks. Goodwill and trademarks are not subject to amortization and have been assigned to reporting units for purposes of impairment testing. The reporting units are our restaurant brands.
We are currently operating in a period of higher than usual inflation, led by food and beverage cost and labor inflation. Food and beverage inflation is principally due to increased costs incurred by our vendors related to higher labor, transportation, packaging, and raw materials costs.
We recently operated in a period of higher than usual inflation, led by food and beverage cost and labor inflation. Food and beverage inflation is principally due to increased costs incurred by our vendors related to higher labor, transportation, packaging, and raw materials costs.
At May 26, 2024, we owned and operated 2,031 restaurants through subsidiaries in the United States and Canada under the Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Yard House ® , Ruth’s Chris Steak House ® (Ruth’s Chris), The Capital Grille ® , Seasons 52 ® , Bahama Breeze ® , Eddie V’s Prime Seafood ® (Eddie V’s) and The Capital Burger ® trademarks.
At May 25, 2025, we owned and operated 2,159 restaurants through subsidiaries in the United States and Canada under the Olive Garden ® , LongHorn Steakhouse ® , Cheddar’s Scratch Kitchen ® , Chuy’s ® , Yard House ® , Ruth’s Chris Steak House ® (Ruth’s Chris), The Capital Grille ® , Seasons 52 ® , Eddie V’s Prime Seafood ® (Eddie V’s), Bahama Breeze ® and The Capital Burger ® trademarks.
Fiscal Year Ended May 26, 2024 May 28, 2023 Sales 100.0 % 100.0 % Costs and expenses: Food and beverage 30.9 32.0 Restaurant labor 31.8 31.9 Restaurant expenses 16.1 16.2 Marketing expenses 1.3 1.1 General and administrative expenses 4.2 3.7 Depreciation and amortization 4.0 3.7 Impairments and disposal of assets, net 0.1 (0.1) Total operating costs and expenses 88.5 % 88.5 % Operating income 11.5 % 11.5 % Interest, net 1.2 0.8 Earnings before income taxes 10.3 % 10.7 % Income tax expense 1.3 1.3 Earnings from continuing operations 9.0 % 9.4 % Total operating costs and expenses from continuing operations were $10.08 billion in fiscal 2024 and $9.29 billion in fiscal 2023.
Fiscal Year Ended May 25, 2025 May 26, 2024 Sales 100.0 % 100.0 % Costs and expenses: Food and beverage 30.3 30.9 Restaurant labor 31.7 31.8 Restaurant expenses 16.1 15.9 Marketing expenses 1.4 1.3 Pre-opening costs 0.2 0.2 General and administrative expenses 4.3 4.2 Depreciation and amortization 4.3 4.0 Impairments and disposal of assets, net 0.4 0.1 Total operating costs and expenses 88.7 % 88.5 % Operating income 11.3 % 11.5 % Interest, net 1.4 1.2 Earnings before income taxes 9.8 % 10.3 % Income tax expense 1.1 1.3 Earnings from continuing operations 8.7 % 9.0 % Total operating costs and expenses from continuing operations were $10.71 billion in fiscal 2025 and $10.08 billion in fiscal 2024.
LOSS FROM DISCONTINUED OPERATIONS On an after-tax basis, results from discontinued operations for fiscal 2024 were a net loss of $2.9 million ($0.02 per diluted share) compared with a net loss for fiscal 2023 of $1.6 million ($0.01 per diluted share).
LOSS FROM DISCONTINUED OPERATIONS On an after-tax basis, results from discontinued operations for fiscal 2025 were a net loss of $1.4 million ($0.02 per diluted share) compared with a net loss for fiscal 2024 of $2.9 million ($0.02 per diluted share).
RESULTS OF OPERATIONS FOR FISCAL 2023 COMPARED TO FISCAL 2022 For a comparison of our results of operations for the fiscal years ended May 28, 2023 and May 29, 2022, see “Part II, Item 7.
RESULTS OF OPERATIONS FOR FISCAL 2024 COMPARED TO FISCAL 2023 For a comparison of our results of operations for the fiscal years ended May 26, 2024 and May 28, 2023, see “Part II, Item 7.
As described in Note 13 of the Notes to Consolidated Financial Statements (Part II, Item 8 of this report), the $22.7 million balance of unrecognized tax benefits at May 26, 2024, includes $6.1 million related to tax positions for which it is reasonably possible that the total amounts could change during the next 12 months based on the outcome of examinations.
As described in Note 13 of the Notes to Consolidated Financial Statements (Part II, Item 8 of this report), the $21.4 million balance of unrecognized tax benefits at May 25, 2025, includes $1.3 million related to tax positions for which it is reasonably possible that the total amounts could change during the next 12 months based on the outcome of examinations.
If actual redemption patterns vary from our estimates, actual gift card breakage income may differ from the amounts recorded. We update our estimates of our redemption period and our breakage rate periodically and apply that rate to gift card redemptions on a prospective basis.
Utilizing this method, we estimate both the amount of breakage and the time period of redemption. If actual redemption patterns vary from our estimates, actual gift card breakage income may differ from the amounts recorded. We update our estimates of our redemption period and our breakage rate periodically and apply that rate to gift card redemptions on a prospective basis.
In fiscal 2025, we expect our annual effective tax rate to be 13 percent and we expect capital expenditures incurred to build new restaurants, remodel and maintain existing restaurants and technology initiatives to be between $550 million and $600 million.
In fiscal 2026, we expect our annual effective tax rate to be 13 percent, and we expect capital expenditures incurred to build new restaurants, remodel and maintain existing restaurants and technology initiatives to be between $700 million and $750 million.
This information is derived from the consolidated statements of earnings for the fiscal years ended May 26, 2024 and May 28, 2023.
This information is derived from the consolidated statements of earnings for the fiscal years ended May 25, 2025 and May 26, 2024.
Our commercial paper has ratings of: • Moody’s Investors Service “P-2”; • Standard & Poor’s “A-2”; and • Fitch “F-2”. 36 These ratings are as of the date of the filing of this report and have been obtained with the understanding that Moody’s Investors Service, Standard & Poor’s and Fitch will continue to monitor our credit and make future adjustments to these ratings to the extent warranted.
These ratings are as of the date of the filing of this report and have been obtained with the understanding that Moody’s Investors Service, Standard & Poor’s and Fitch will continue to monitor our credit and make future adjustments to these ratings to the extent warranted.
When combined with results from continuing operations, our diluted net earnings per share was $8.51 for fiscal 2024 and $7.99 for fiscal 2023.
When combined with results from continuing operations, our diluted net earnings per share was $8.86 for fiscal 2025 and $8.51 for fiscal 2024.
The Revolving Credit Agreement matures on October 23, 2028, and the proceeds may be used for working capital and capital expenditures, the refinancing of certain indebtedness, certain acquisitions and general corporate purposes.
All other material terms and conditions of the Revolving Credit Agreement were unchanged. The Revolving Credit Agreement matures on October 23, 2028, and the proceeds may be used for working capital and capital expenditures, the refinancing of certain indebtedness, certain acquisitions and general corporate purposes.
The maximum adjustment is 2.000 percent above the initial interest rate and the interest rate cannot be reduced below the initial interest rate. As of May 26, 2024, no such adjustments are made to this rate.
The maximum adjustment is 2.000 percent above the initial interest rate and the interest rate cannot be reduced below the initial interest rate. As of May 25, 2025, no such adjustments have been made to this rate.
The increase in U.S. same-restaurant sales in fiscal 2024 resulted from a 3.3 percent increase in average check, partially offset by a 1.7 percent decrease in same-restaurant guest counts. LongHorn Steakhouse’s sales increase for fiscal 2024 was primarily driven by a same-restaurant sales increase combined with revenue from new restaurants.
The increase in U.S. same-restaurant sales in fiscal 2025 resulted from a 4.1 percent increase in average check, which includes a 0.7 increase in off-premise catering sales, partially offset by a 2.3 percent decrease in same-restaurant guest counts. LongHorn Steakhouse’s sales increase for fiscal 2025 was primarily driven by a same-restaurant sales increase combined with revenue from new restaurants.
INCOME TAXES The effective income tax rates for fiscal 2024 and 2023 for continuing operations were 12.3 percent and 12.2 percent, respectively.
INCOME TAXES The effective income tax rates for fiscal 2025 and 2024 for continuing operations were 11.5 percent and 12.3 percent, respectively.
Of the $6.1 million, $3.9 million relates to items that would impact our effective income tax rate.
All of such $1.3 million relates to items that would impact our effective income tax rate.
NET EARNINGS AND NET EARNINGS PER SHARE FROM CONTINUING OPERATIONS Net earnings from continuing operations for fiscal 2024 were $1.03 billion ($8.53 per diluted share) compared with net earnings from continuing operations for fiscal 2023 of $983.5 million ($8.00 per diluted share).
NET EARNINGS AND NET EARNINGS PER SHARE FROM CONTINUING OPERATIONS Net earnings from continuing operations for fiscal 2025 were $1.05 billion ($8.88 per diluted share) compared with net earnings from continuing operations for fiscal 2024 of $1.03 billion ($8.53 per diluted share).
Net earnings from continuing operations for fiscal 2024 increased 4.8 percent and diluted net earnings per share from continuing operations increased 6.6 percent compared with fiscal 2023.
Net earnings from continuing operations for fiscal 2025 increased 2.0 percent and diluted net earnings per share from continuing operations increased 4.1 percent compared with fiscal 2024.
We own and operate all of our restaurants in the United States and Canada, except for 2 joint venture restaurants managed by us, 4 restaurants managed by us under contractual agreements and 85 franchised restaurants. We also have 61 franchised restaurants in operation located in Canada, Latin America, the Caribbean, Asia and the Middle East.
We own and operate all of our restaurants in the United States and Canada, except for 5 restaurants we manage through joint venture or other contractual agreements and 85 franchised restaurants. We also have 69 franchised restaurants in operation located in Canada, Latin America, the Caribbean, Asia and the Middle East.
Fiscal 2024 Financial Highlights • Total sales increased 8.6 percent to $11.39 billion in fiscal 2024 from $10.49 billion in fiscal 2023 driven by a blended same-restaurant sales increase of 1.6 percent and sales from the addition of 80 net company-owned Ruth's Chris restaurants and 37 other net new restaurants. • Reported diluted net earnings per share from continuing operations increased to $8.53 in fiscal 2024 from $8.00 in fiscal 2023, a 6.6 percent increase. • Net earnings from continuing operations increased to $1.03 billion in fiscal 2024 from $983.5 million in fiscal 2023, a 4.8 percent increase. • Net loss from discontinued operations increased to $2.9 million ($0.02 per diluted share) in fiscal 2024, from $1.6 million ($0.01 per diluted share) in fiscal 2023.
Fiscal 2025 Financial Highlights • Total sales increased 6.0 percent to $12.08 billion in fiscal 2025 from $11.39 billion in fiscal 2024 driven by a blended same-restaurant sales increase of 2.0 percent and sales from the addition of 103 net company-owned Chuy’s restaurants and 25 other net new restaurants. • Diluted net earnings per share from continuing operations increased to $8.88 in fiscal 2025 from $8.53 in fiscal 2024, a 4.1 percent increase. • Net earnings from continuing operations increased to $1.05 billion in fiscal 2025 from $1.03 billion in fiscal 2024, a 2.0 percent increase. • Net loss from discontinued operations decreased to $1.4 million ($0.02 per diluted share) in fiscal 2025, from $2.9 million ($0.02 per diluted share) in fiscal 2024.
The following table presents segment profit margin for the periods indicated: Fiscal Year Ended Change Segment May 26, 2024 May 28, 2023 2024 vs 2023 Olive Garden 21.9% 21.0% 90 BP LongHorn Steakhouse 18.2% 16.5% 170 BP Fine Dining 18.7% 19.1% (40) BP Other Business 15.1% 13.9% 120 BP The increase in the Olive Garden segment profit margin for fiscal 2024 was driven primarily by positive same-restaurant sales and lower food and beverage costs and restaurant expenses, partially offset by higher marketing costs.
The following table presents segment profit margin for the periods indicated: Fiscal Year Ended Change Segment May 25, 2025 May 26, 2024 2025 vs 2024 Olive Garden 22.3% 22.1% 20 BP LongHorn Steakhouse 19.3% 18.4% 90 BP Fine Dining 18.6% 19.0% (40) BP Other Business 15.7% 15.3% 40 BP The increases in the Olive Garden and LongHorn Steakhouse segment profit margins for fiscal 2025 were both driven primarily by positive same-restaurant sales and lower food and beverage costs, partially offset by higher restaurant expenses and marketing costs.
Fiscal 2024, which ended May 26, 2024, and fiscal 2023, which ended May 28, 2023, each consisted of 52 weeks. OVERVIEW OF OPERATIONS Our business operates in the full-service dining segment of the restaurant industry.
Fiscal 2025, which ended May 25, 2025, and fiscal 2024, which ended May 26, 2024, each consisted of 52 weeks. Fiscal 2026, which ends on May 31, 2026, will consist of 53 weeks. OVERVIEW OF OPERATIONS Our business operates in the full-service dining segment of the restaurant industry.
As of May 26, 2024, we had no outstanding balances and were in compliance with all covenants under the Revolving Credit Agreement. As of May 26, 2024, $86.8 million of commercial paper was outstanding in addition to $0.6 million of letters of credit outstanding, which were both backed by this facility.
As of May 25, 2025, we had no outstanding balances and were in compliance with all covenants under the Revolving Credit Agreement. As of May 25, 2025, $0.2 million of letters of credit were outstanding, which was backed by this facility.
The decrease in same-restaurant sales in fiscal 2024 resulted from a 6.9 percent decrease in same-restaurant guest counts offset by a 4.9 percent increase in average check. Other Business’s sales increase for fiscal 2024 was driven by revenue from new restaurants offset by same-restaurant sales decreases.
The increase in same-restaurant sales in fiscal 2025 resulted from a 3.1 percent increase in average check and a 1.9 percent increase in same-restaurant guest counts. Fine Dining’s sales increase for fiscal 2025 was driven by revenue from new restaurants offset by same-restaurant sales decreases.
The increase in the Other Business segment profit margin for fiscal 2024 was driven primarily by increased franchise revenue with the addition of Ruth’s Chris and lower food and beverage costs, partially offset by negative same-restaurant sales and increased restaurant labor costs and marketing costs.
The increase in the Other Business segment profit margin for fiscal 2025 was driven primarily by positive same-restaurant sales and lower food and beverage costs, partially offset by increased restaurant expenses and marketing costs.
Excludes discount and issuance costs of $16.9 million. (2) Includes non-cancelable future operating lease and finance lease commitments. (3) Includes commitments for food and beverage items and supplies, capital projects, information technology and other miscellaneous items.
Excludes discount and issuance costs of $20.2 million. (2) Includes non-cancelable future operating lease and finance lease commitments. (3) Includes commitments for food and beverage items and supplies, capital projects, information technology and other miscellaneous items. (4) Primarily represents our non-qualified deferred compensation plan through fiscal 2035.
Loans under the Revolving Credit Agreement bear interest at a rate of (a) Term SOFR (which is defined, for the applicable interest period, as the Term SOFR Screen Rate two U.S.
After consideration of letters of credit backed by the Revolving Credit Agreement, as of May 25, 2025, we had $1.25 billion of credit available under the Revolving Credit Agreement. Loans under the Revolving Credit Agreement bear interest at a rate of (a) Term SOFR (which is defined, for the applicable interest period, as the Term SOFR Screen Rate two U.S.
During fiscal 2024, we had income tax expense of $145.0 million on earnings before income tax of $1.18 billion compared to income tax expense of $137.0 million on ear nings before income taxes of $1.12 billion in fiscal 2023. This change was primarily driven by the impact of state tax expense.
During fiscal 2025, we had income tax expense of $136.2 million on earnings before income tax of $1.19 billion 33 compared to income tax expense of $145.0 million on earnings before income taxes of $1.18 billion in fiscal 2024. This change was primarily driven by federal tax credits.
During fiscal 2024, we elected to perform a qualitative assessment for our annual review of goodwill and trademarks to determine whether or not indicators of impairment exist.
We review our goodwill and trademarks for impairment annually, as of the first day of our fourth fiscal quarter, or more frequently if indicators of impairment exist. 35 During fiscal 2025, we elected to perform a qualitative assessment for our annual review of goodwill and trademarks to determine whether or not indicators of impairment exist.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended May 28, 2023, filed with the SEC on July 21, 2023. SEASONALITY Our sales volumes have historically fluctuated seasonally.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual report on Form 10-K for the fiscal year ended May 26, 2024, filed with the SEC on July 19, 2024. SEASONALITY Our sales volumes have historically fluctuated seasonally. Our average sales per restaurant are highest in the winter and spring, followed by the fall and summer.
Net cash flows provided by operating activities include net earnings from continuing operations of $1.03 billion in fiscal 2024 and $983.5 million in fiscal 2023. Net cash flows provided by operating activities from continuing operations increased in fiscal 2024 primarily due to higher net earnings from continuing operations.
Net cash flows provided by operating activities from continuing operations increased in fiscal 2025 primarily due to higher net earnings from continuing operations. Net cash flows used in investing activities from continuing operations were $1.3 billion in fiscal 2025 and 2024.
The composition of our capital structure is shown in the following table: (in millions, except ratios) May 26, 2024 May 28, 2023 CAPITAL STRUCTURE Short-term debt $ 86.8 $ — Long-term debt, excluding unamortized discount and issuance costs and fair value hedge 1,439.1 939.1 Total debt $ 1,525.9 $ 939.1 Stockholders’ equity 2,242.5 2,201.5 Total capital $ 3,768.4 $ 3,140.6 CALCULATION OF ADJUSTED CAPITAL Total debt $ 1,525.9 $ 939.1 Lease-debt equivalent 2,786.4 2,545.8 Guarantees 71.0 82.0 Adjusted debt $ 4,383.3 $ 3,566.9 Stockholders’ equity 2,242.5 2,201.5 Adjusted total capital $ 6,625.8 $ 5,768.4 CAPITAL STRUCTURE RATIOS Debt to total capital ratio 40 % 30 % Adjusted debt to adjusted total capital ratio 66 % 62 % Net cash flows provided by operating activities from continuing operations were $1.62 billion and $1.55 billion in fiscal 2024 and 2023, respectively.
The composition of our capital structure is shown in the following table: (in millions, except ratios) May 26, 2024 Capital Structure Short-term debt $ 86.8 Long-term debt, excluding unamortized discount and issuance costs and fair value hedge 1,439.1 Total debt $ 1,525.9 Stockholders’ equity 2,242.5 Total capital $ 3,768.4 Calculation of Adjusted Capital Total debt $ 1,525.9 Lease-debt equivalent 2,786.4 Guarantees 71.0 Adjusted debt $ 4,383.3 Stockholders’ equity 2,242.5 Adjusted total capital $ 6,625.8 Capital Structure Ratios Debt to total capital ratio 40 % Adjusted debt to adjusted total capital ratio 66 % 39 Based on these ratios, we believe our financial condition is strong.
On May 31, 2023, the Company also entered into a senior unsecured $600 million 3-year Term Loan Credit Agreement (Term Loan) with Bank of America, N.A., as administrative agent, the lenders and other agents party thereto, the material terms of which are consistent with the Revolving Credit Agreement, as amended.
On September 16, 2024, we entered into a senior unsecured $600 million 2-year Term Loan Credit Agreement (Term Loan Agreement) with BOA, as administrative agent, the lenders and other agents party thereto, the material terms of which were consistent with the Revolving Credit Agreement.
Fiscal 2024 Compared to Fiscal 2023: • Food and beverage costs decreased as a percent of sales primarily due to a 1.3% impact from pricing leverage and a 0.2% impact from mix and other, partially offset by a 0.4% impact from inflation. • Restaurant labor costs decreased as a percent of sales primarily due to a 1.0% impact from sales leverage, a 0.4% impact from productivity improvement and a 0.2% impact from brand mix, including Ruth’s Chris, partially offset by a 1.5% impact from inflation. • Restaurant expenses decreased as a percent of sales primarily due to a 0.4% impact from sales leverage, and a 0.3% impact from other, partially offset by a 0.4% impact from inflation and a 0.2% impact from brand mix, including Ruth’s Chris. • Marketing expenses increased as a percent of sales primarily due to increased marketing and media. • General and administrative expenses increased as a percent of sales primarily due to a 0.4% impact from Ruth’s Chris acquisition and integration costs and 0.1% impacts from inflation, partially offset by a 0.1% impact from sales leverage. • Depreciation and amortization expenses increased as a percent of sales primarily due to the acquisition of Ruth’s Chris as well as depreciation on brand assets. • Impairments and disposal of assets, net increased as a percent of sales primarily due to restaurant closures, sale of properties and write offs of acquired Ruth’s Chris assets.
Fiscal 2025 Compared to Fiscal 2024: • Food and beverage costs decreased as a percent of sales primarily due to a 0.9 percent impact from pricing leverage and a 0.2 percent impact from cost savings, partially offset by a 0.3 percent impact from mix and other and a 0.2 percent impact from inflation. • Restaurant labor costs decreased as a percent of sales primarily due to a 0.8 percent impact from sales leverage, a 0.2 percent impact from productivity improvement and a 0.2 percent impact from lower benefits expense, partially offset by a 1.1 percent impact from inflation. • Restaurant expenses increased as a percent of sales primarily due to a 0.5 percent impact from inflation, a 0.2 percent impact from brand mix, including Chuy’s and a 0.1 percent impact from Uber Direct fees, partially offset by a 0.4 percent impact from sales leverage and a 0.2 percent impact from other expenses. • Marketing expenses increased as a percent of sales primarily due to increased marketing and media. • Pre-opening costs remained flat as a percent of sales. • General and administrative expenses increased as a percent of sales primarily due to a 0.4 percent impact from Chuy’s acquisition and integration costs, 0.1 percent impact from inflation, a 0.1 percent impact from mark to market adjustments and a 0.1 percent impact from restaurant closures, partially offset by a 0.4 percent impact from reduced Ruth’s Chris acquisition and integration costs and by a 0.2 percent impact from sales leverage. • Depreciation and amortization expenses increased as a percent of sales primarily due to the acquisition of Chuy’s as well as incremental depreciation on brand assets. • Impairments and disposal of assets, net increased as a percent of sales primarily due to the decision to close twenty-two underperforming restaurant locations during the fourth quarter of fiscal 2025.
We expect fiscal 2025 sales from continuing operations to increase between 3.5 percent and 4.5 percent, driven by same-restaurant sales growth (1) of 1.0 percent to 2.0 percent, and sales from 45 to 50 new restaurant openings.
Outlook We expect fiscal 2026 sales from continuing operations to increase between 7.0 to 8.0 percent, driven by growth of 2.0 percent related to the fifty-third week in fiscal 2026, same-restaurant sales growth (1) of 2.0 to 3.5 percent, and sales from 60 to 65 new restaurant openings.
On October 10, 2023, the Company issued $500 million aggregate principal amount of our 6.300 percent Senior Notes due 2033 (the 2033 Notes) pursuant to the provisions of the Underwriting Agreement, dated October 4, 2023 (Underwriting Agreement), among the Company and BofA Securities, Inc., Truist Securities, Inc., U.S.
On October 3, 2024, we issued and sold $400.0 million aggregate principal amount of 4.350 percent Senior Notes due 2027 (2027 Notes) and $350.0 million aggregate principal amount of 4.550 percent Senior Notes due 2029 (2029 Notes and, together with the 2027 Notes, the Notes), pursuant to the provisions of the Underwriting Agreement, dated September 30, 2024, among the Company and BofA Securities, Inc., Truist Securities, Inc., U.S.
(1) Excludes Ruth’s Chris as they will not be owned and operated by Darden for a 16-month period at the beginning of fiscal 2025. 30 RESULTS OF OPERATIONS FOR FISCAL 2024 AND 2023 To facilitate review of our results of operations, the following table sets forth our financial results for the periods indicated.
(1) Annual same-restaurant sales is a 52-week metric and excludes the impact of Chuy’s, which will not have been owned and operated by Darden for a 16-month period prior to the beginning of fiscal 2026, as well as any additional locations not expected to be operated by Darden for the entirety of the fiscal year. 30 RESULTS OF OPERATIONS FOR FISCAL 2025 AND 2024 To facilitate review of our results of operations, the following table sets forth our financial results for the periods indicated.
As of May 26, 2024, our outstanding long-term debt consisted principally of: • $500.0 million of unsecured 3.850 percent senior notes due in May 2027; • $500.0 million of unsecured 6.300 percent senior notes due October 2033; • $96.3 million of unsecured 6.000 percent senior notes due in August 2035; • $42.8 million of unsecured 6.800 percent senior notes due in October 2037; and • $300.0 million of unsecured 4.550 percent senior notes due in February 2048. 37 The interest rate on our $42.8 million 6.800 percent senior notes due October 2037 is subject to adjustment from time to time if the debt rating assigned to such series of notes is downgraded below a certain rating level (or subsequently upgraded).
The interest rate on our $42.8 million 6.800 percent senior notes due October 2037 is subject to adjustment from time to time if the debt rating assigned to such series of notes is downgraded below a certain rating level (or subsequently upgraded).
For fiscal 2024 and fiscal 2023, the lease-debt equivalent includes 6.00 times the total annual minimum rent for consolidated lease obligations of $464.4 million and $424.3 million, respectively.
As of May 26, 2024, our adjusted debt to adjusted capital ratio was 66 percent. For fiscal 2024, the lease-debt equivalent includes 6.00 times the total annual minimum rent for consolidated lease obligations of $464.4 million.
Typically, our average sales per restaurant are highest in the winter and spring, followed by the summer, and lowest in the fall. Holidays, changes in the economy, severe weather and similar conditions may impact sales volumes seasonally in some operating regions.
Holidays, changes in the economy, severe weather and similar conditions may impact sales volumes seasonally in some operating regions.
A summary of our contractual obligations and commercial commitments at May 26, 2024, is as follows: (in millions) Payments Due by Period Contractual Obligations Total Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Long-term debt (1) $ 2,229.4 $ 73.1 $ 646.2 $ 107.7 $ 1,402.4 Leases (2) 3,029.7 484.4 917.6 723.2 904.5 Purchase obligations (3) 577.6 552.7 24.9 — — Benefit obligations (4) 400.8 35.5 70.6 74.6 220.1 Unrecognized income tax benefits (5) 25.9 7.9 3.5 14.5 — Total contractual obligations $ 6,263.4 $ 1,153.6 $ 1,662.8 $ 920.0 $ 2,527.0 (in millions) Amount of Commitment Expiration per Period Other Commercial Commitments Total Amounts Committed Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Standby letters of credit (6) $ 96.3 $ 96.3 $ — $ — $ — Guarantees (7) 71.0 23.7 30.3 12.6 4.4 Total commercial commitments $ 167.3 $ 120.0 $ 30.3 $ 12.6 $ 4.4 (1) Includes interest payments associated with existing long-term debt.
A summary of our contractual obligations and commercial commitments at May 25, 2025, is as follows: (in millions) Payments Due by Period Contractual Obligations Total Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Long-term debt (1) $ 3,021.5 $ 106.4 $ 1,084.9 $ 481.6 $ 1,348.6 Leases (2) 3,066.0 527.8 982.7 712.9 842.6 Purchase obligations (3) 547.6 500.8 46.8 — — Benefit obligations (4) 321.3 32.4 64.6 64.4 159.9 Unrecognized income tax benefits (5) 23.7 1.6 4.6 17.5 — Total contractual obligations $ 6,980.1 $ 1,169.0 $ 2,183.6 $ 1,276.4 $ 2,351.1 (in millions) Amount of Commitment Expiration per Period Other Commercial Commitments Total Amounts Committed Less Than 1 Year 1-3 Years 3-5 Years More Than 5 Years Standby letters of credit (6) $ 96.7 $ 96.7 $ — $ — $ — Guarantees (7) 76.5 26.6 32.5 14.9 2.5 Total commercial commitments $ 173.2 $ 123.3 $ 32.5 $ 14.9 $ 2.5 (1) Includes interest payments associated with existing long-term debt.
Net cash used in the acquisition of Ruth’s Chris was $701.1 million during fiscal 2024. Net cash flows used in financing activities from continuing operations were $483.4 million and $1.03 billion in fiscal 2024 and 2023, respectively.
Net cash flows used in financing activities from continuing operations were $385.8 million and $483.4 million in fiscal 2025 and 2024, respectively.
Any adverse change in these factors could have a significant impact on the recoverability of these assets and could have a material impact on our consolidated financial statements. We review our goodwill and trademarks for impairment annually, as of the first day of our fourth fiscal quarter, or more frequently if indicators of impairment exist.
Any adverse change in these factors could have a significant impact on the recoverability of these assets and could have a material impact on our consolidated financial statements.
The increase in same-restaurant sales in fiscal 2024 resulted from a 5.2 percent increase in average check, partially offset by a 0.4 percent decrease in same-restaurant guest counts. Fine Dining’s sales increase for fiscal 2024 was driven by the acquisition of Ruth’s Chris, offset by same-restaurant sales decreases.
The decrease in same-restaurant sales in fiscal 2025 resulted from a 5.2 percent decrease in same-restaurant guest counts offset by a 2.3 percent increase in average check. Other Business’s sales increase for fiscal 2025 was driven by a U.S. same-restaurant sales increase combined with revenue from new restaurants including the acquisition of Chuy’s.
FINANCIAL CONDITION Our total current assets were $822.8 million at May 26, 2024, compared with $997.7 million at May 28, 2023. The decrease was primarily due to a decrease in cash and cash equivalents due to the use of cash to acquire Ruth’s Chris.
FINANCIAL CONDITION Our total current assets were $937.7 million at May 25, 2025, compared with $822.8 million at May 26, 2024. The increase was primarily due to an increase in cash and cash equivalents driven by cash from operations. Our total current liabilities were $2.25 billion at May 25, 2025 and $2.19 billion at May 26, 2024.
The estimated value of gift cards expected to remain unused is recognized over the expected period of redemption as the remaining gift card values are redeemed, generally over a period of 12 years. Utilizing this method, we estimate both the amount of breakage and the time period of redemption.
Unearned Revenues Unearned revenues primarily represent our liability for gift cards that have been sold but not yet redeemed. The estimated value of gift cards expected to remain unused is recognized over the expected period of redemption as the remaining gift card values are redeemed, generally over a period of 12 years.
Net cash flows used in investing activities from continuing operations were $1.3 billion and $568.4 million in fiscal 2024 and 2023, respectively. Capital expenditures incurred principally for building new restaurants, remodeling existing restaurants, replacing equipment, and technology initiatives were $601.2 million in fiscal 2024, compared to $564.9 million in fiscal 2023.
Capital expenditures incurred principally for building new restaurants, remodeling existing restaurants, replacing equipment, and technology initiatives were $644.6 million in fiscal 2025, compared to $601.2 million in fiscal 2024. Net cash used in the acquisition of Chuy’s was $613.7 million during fiscal 2025. Net cash used in the acquisition of Ruth’s Chris was $701.1 million during fiscal 2024.
(4) Includes expected contributions associated with our supplemental defined benefit pension plan and payments associated with our postretirement benefit plan and our non-qualified deferred compensation plan through fiscal 2034. (5) Includes interest on unrecognized income tax benefits of $3.2 million, $1.8 million of which relates to contingencies expected to be resolved within one year.
(5) Includes interest on unrecognized income tax benefits of $2.3 million, $0.3 million of which relates to contingencies expected to be resolved within one year.
Net cash flows used in financing activities in fiscal 2023 included dividend payments of $589.8 million and share repurchases of $458.7 million, partially offset by proceeds from the exercise of employee stock options. Dividends declared by our Board of Directors totaled $5.24 and $4.84 per share for fiscal 2024 and 2023, respectively.
Net cash flows used in financing activities in fiscal 2025 included dividend payments of $658.5 million, share repurchases of $418.2 million and repayment of commercial paper of $86.8 million, partially offset by net proceeds from the issuance of long-debt of $750.0 million and proceeds from the exercise of employee stock options.
(6) Includes letters of credit for $79.5 million of workers’ compensation and general liabilities accrued in our consolidated financial statements and letters of credit for $16.8 million of surety bonds related to other payments.
(6) Includes letters of credit for $80.0 million of workers’ compensation and general liabilities accrued in our consolidated financial statements and letters of credit for $16.7 million of surety bonds related to other payments. 38 (7) Consists solely of guarantees associated with leased properties that have been assigned to third parties and are primarily related to the disposition of Red Lobster in fiscal 2015.
Bank Trust Company, National Association, as successor trustee with respect to the 2033 Notes. The 2033 Notes will mature on October 10, 2033.
Bank Trust Company, National Association, as a successor trustee with respect to the Notes. We used the proceeds from our issuance of the Notes to finance our acquisition of Chuy’s and for general corporate purposes. The 2027 Notes will mature on October 15, 2027, and the 2029 Notes will mature on October 15, 2029.
All intercompany balances and transactions have been eliminated in consolidation. On June 14, 2023, we acquired 100 percent of the equity interest of Ruth’s Chris for $724.6 million in total consideration. As a result of the acquisition and related integration efforts, we incurred expenses of $51.8 million ($42.1 million, net of tax) during the twelve months ended May 26, 2024.
As a result of the acquisition and related integration efforts, we incurred expenses of $44.6 million ($36.7 million, net of tax) during the twelve months ended May 25, 2025.
Interest on the 2033 Notes will be paid semiannually in arrears on April 10 and October 10 of each year, commencing on April 10, 2024, to holders of record on the preceding March 26 or September 25, as the case may be.
Interest on the Notes will be paid semi-annually in arrears on April 15 and October 15 of each year, commencing on April 15, 2025, to holders of record on the preceding March 31 or September 30, as the case may be. 37 As of May 25, 2025, our outstanding long-term debt consisted principally of: • $500.0 million of unsecured 3.850 percent senior notes due in May 2027; • $400.0 million of unsecured 4.350 percent senior notes due in October 2027; • $350.0 millions of unsecured 4.550 percent senior notes due in October 2029; • $500.0 million of unsecured 6.300 percent senior notes due October 2033; • $96.3 million of unsecured 6.000 percent senior notes due in August 2035; • $42.8 million of unsecured 6.800 percent senior notes due in October 2037; and • $300.0 million of unsecured 4.550 percent senior notes due in February 2048.
(BOA), as administrative agent, and the lenders and other agents party thereto. The Revolving Credit Agreement replaced our prior $1.0 billion Revolving Credit Agreement (Prior Revolving Credit Agreement), dated as of September 10, 2021, and the Prior Revolving Credit Agreement was terminated concurrently with our entry into the Revolving Credit Agreement.
(BOA), as administrative agent, and the lenders and other agents party thereto.
Removed
As of May 26, 2024, all Ruth’s Chris operations have been fully integrated into Darden’s operations.
Added
All intercompany balances and transactions have been eliminated in consolidation. On October 11, 2024, we acquired 100 percent of the equity interest of Chuy’s Holdings Inc. (Chuy’s) in an all-cash transaction of $649.1 million in total consideration, $613.7 million in net cash consideration, inclusive of $35.4 million of cash on Chuy’s balance sheet at closing.
Removed
Outlook On July 17, 2024, we entered into an agreement to acquire all of the outstanding shares of Chuy’s Holdings, Inc.(Chuy’s Holdings), a Delaware corporation, for $37.50 per share in an all-cash transaction with an enterprise value of approximately $605 million. Chuy’s Holdings is the owner and operator of restaurants under the Chuy’s Fine Tex-Mex ® (Chuy’s) trademark.
Added
H.R. 1., also known as the One Big Beautiful Bill Act (OBBBA), was enacted on July 4, 2025. The legislation includes several provisions that may impact the timing and magnitude of certain tax deductions. Key provisions include the permanent extension of several business tax benefits originally introduced under the 2017 Tax Cuts and Jobs Act.
Removed
The transaction has been approved by our Board of Directors and is subject to the satisfaction of customary closing conditions, including, among others, the expiration or termination of the applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
Added
We are currently evaluating the provisions of the OBBBA to assess their potential impact on our financial position, results of operations and cash flows.
Removed
The acquisition is expected to be completed in the second quarter of fiscal 2025 and will be funded through one or more new debt issuances. The impacts of the planned acquisition of Chuy’s have not been included in our fiscal 2025 outlook below.
Added
Our commercial paper has ratings of: • Moody’s Investors Service “P-2”; • Standard & Poor’s “A-2”; and • Fitch “F-2”.
Removed
The Inflation Reduction Act (IRA) was enacted on August 16, 2022. The IRA includes provisions imposing a 1 percent excise tax on share repurchases that occur after December 31, 2022 and introduced a 15 percent corporate alternative minimum 33 tax (CAMT) on adjusted financial statement income.
Added
On September 16, 2024, we entered into Amendment No. 1 (Amendment) to the Revolving Credit Agreement, which replaced the prior financial covenant (which provided for a maximum consolidated total debt to total capitalization ratio) with a new financial covenant requiring us to maintain, measured as of the end of each fiscal quarter, a maximum consolidated leverage ratio of 3.50 to 1.00 (which may be temporarily increased to 4.00 to 1.00 upon the election as a result of a covered acquisition, subject to customary limitations set forth in the Revolving Credit Agreement).
Removed
The impact of the IRA excise tax and the CAMT are immaterial to our fiscal 2024 consolidated financial statements.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+1 added−0 removed2 unchanged
Biggest changeThe value at risk from an increase in the fair value of all of our long-term fixed-rate debt, over a period of one year, was approximately $105.5 million. The fair value of our long-term fixed-rate debt outstanding as of May 26, 2024, averaged $1.37 billion, with a high of $1.47 billion and a low of $858.8 million during fiscal 2024.
Biggest changeThe value at risk from an increase in the fair value of all of our long-term fixed-rate debt, 40 over a period of one year, was approximately $121.1 million.
Our interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows by targeting an appropriate mix of variable and fixed-rate debt. 40
Our interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows by targeting an appropriate mix of variable and fixed-rate debt. 41
At May 26, 2024, our potential losses in future net earnings resulting from changes in equity forwards, commodity instruments and floating rate and fixed rate debt interest rate exposures were approximately $60.3 million over a period of one year.
At May 25, 2025, our potential losses in future net earnings resulting from changes in equity forwards, commodity instruments, currencies and floating rate and fixed rate debt interest rate exposures were approximately $63.3 million over a period of one year.
Added
The fair value of our long-term fixed-rate debt outstanding as of May 25, 2025, averaged $1.89 billion, with a high of $2.17 billion and a low of $1.37 billion during fiscal 2025.