A substantial +7.1% increase in the quarterly dividend, alongside a new $1 billion share repurchase authorization, signals Darden Restaurants, Inc.'s (DRI unwavering commitment to shareholder returns, even as the company navigates a dynamic casual dining landscape. This aggressive capital allocation strategy comes on the heels of a solid fiscal year 2025 performance, underpinned by resilient brand strength and strategic expansion initiatives.
FY25 Performance: A Deep Dive into Growth Drivers#
Darden Restaurants concluded fiscal year 2025 with a notable financial performance, reporting revenue of $12.08 billion and net income of $1.05 billion (Monexa AI. This represents a +6.03% increase in revenue and a +2.14% rise in net income compared to the previous fiscal year, demonstrating consistent top-line expansion and solid profitability. The company's EPS for FY25 stood at $8.87, contributing to a TTM EPS of $8.96 (Monexa AI.
One striking aspect of the FY2025 income statement data is the reported gross profit of $8.42 billion on $12.08 billion in revenue, yielding a gross profit ratio of approximately 69.70% (Monexa AI. This figure stands in stark contrast to previous fiscal years, where gross profit ratios hovered around 20-21% (e.g., 21.16% in FY2024, 19.86% in FY2023, and 20.72% in FY2022) (Monexa AI. While the provided data consistently shows this high ratio for FY2025, it suggests a significant shift in cost of revenue classification or an extraordinary improvement in operational efficiency that warrants further detailed scrutiny by investors. Despite this, the operating income ratio remained relatively stable at 11.28% in FY2025, only a slight decrease from 11.54% in FY2024, indicating effective management of operating expenses even with the notable change in gross profit reporting (Monexa AI.
Same-Store Sales: Olive Garden and LongHorn Leading the Charge#
In the fourth quarter of fiscal year 2025, Darden's portfolio demonstrated impressive same-store sales growth, a key metric for gauging organic performance in the restaurant sector. Olive Garden, the company's flagship brand, led the charge with a +6.9% increase in same-store sales, closely followed by LongHorn Steakhouse at +6.7% (Research Findings from the Data Team. This robust performance underscores the enduring appeal of these casual dining giants, even in an environment where consumer spending patterns are under scrutiny. The growth at Olive Garden was partly attributed to the strategic expansion of its Uber Direct delivery service, which not only boosted incremental sales by approximately 2% but also attracted a younger, higher-income demographic, broadening the brand's customer base (Research Findings from the Data Team.
Operational Excellence and Customer Engagement#
Management emphasized their