CAVA Group (NYSE:CAVA) outlined what management called a “milestone year” on its fourth-quarter and full-year 2025 earnings call, highlighting its first full fiscal year above $1 billion in revenue, continued restaurant expansion, and plans to accelerate growth while investing in operations, technology, and leadership development.
Fourth-quarter results and full-year highlights
Co-Founder and CEO Brett Schulman said 2025 marked a transition from being a newly public company to operating as a “large-scale, sustainable growth enterprise,” which management attributed to strong new restaurant performance and market share gains. For the fourth quarter, the company reported revenue growth of 21.2% and said revenue was up 55.5% over the past two years. Fourth-quarter same-restaurant sales increased 0.5% and restaurant-level profit margin was 21.4%.
President and CFO Tricia Tolivar said fourth-quarter 2025 revenue rose to $272.8 million and noted that on a two-year basis, same-restaurant sales accelerated 170 basis points to 21.7%, while the three-year stack held relatively stable at 33.1%.
Margins, cost drivers, and operating investments
In the fourth quarter, restaurant-level profit was $58.3 million versus $50.4 million a year earlier. Tolivar broke down key cost lines and cited several factors affecting quarterly profitability:
- Food, beverage, and packaging: 30.4% of revenue, up 50 basis points year-over-year, reflecting tariffs and a limited-time chicken shawarma offering.
- Labor and related: 27.1% of revenue, down about 20 basis points year-over-year due to sales leverage, partially offset by a 1.5% wage investment.
- Other operating expenses: 13.4% of revenue, up 60 basis points year-over-year due to a higher mix of third-party delivery and ongoing technology costs tied to the kitchen display system rollout.
- Pre-opening expenses: $4.6 million, up from $2.7 million a year earlier, driven by more units under construction and higher per-unit costs.
Adjusted EBITDA rose 2.6% year-over-year in the quarter, which management said was driven by the number and strength of new restaurant openings, partially offset by growth investments including higher pre-opening costs.
During Q&A, management addressed restaurant-level margins and the introduction of salmon. Tolivar said salmon will be a premium item and is expected to create an approximately 100 basis point headwind to restaurant-level margin rate beginning in the second quarter, while also being “penny profit neutral” overall.
Expansion, new restaurant performance, and long-term unit goals
CAVA opened 24 net new restaurants in the fourth quarter and 72 net new restaurants in 2025, ending the year with 439 locations across 28 states and Washington, D.C. Schulman said all new restaurants will open with the company’s “Project Soul” design and reiterated a long-term goal of at least 1,000 restaurants by 2032.
Management also discussed new market entries planned across the Midwest, including Cincinnati, St. Louis, Columbus, and Minneapolis. Tolivar said the company’s new restaurant openings in 2025 were record-setting, with new restaurant productivity remaining above 100% and 2025 new restaurant opening average annual volumes trending above $3 million.
For 2026, the company guided to 74 to 76 net new restaurant openings and said its new restaurant productivity assumption embedded in guidance is about 90%. Management added that it has seen strength across restaurant vintages and geographies, and across income cohorts.
Menu innovation, loyalty enhancements, and digital execution
Schulman highlighted recent menu updates including the return of Roasted White Sweet Potato and new items such as Sumac Slaw, Power Greens, Tangerine Aleppo Juice, and Sumac Sour Cream and Onion Pita Chips. He also said the company plans to launch pomegranate-glazed salmon toward the end of the first quarter, calling it CAVA’s first-ever seafood offering.
On the loyalty side, CAVA rolled out tiered status levels in the fall with “sea, sand, and sun” tiers and recently introduced “Oasis,” an invite-only tier for its most loyal guests, with enhanced earning, perks, exclusive merchandise, and events. Management said the tiered program is showing encouraging results, including modest increases in frequency, and noted that loyalty drives about one-third of overall sales. The company did not disclose active user counts.
On digital performance, management attributed rising digital mix to improved execution and accuracy, pointing to investments such as the kitchen display system (KDS). The company ended 2025 with KDS live in 370 locations and plans to complete the remaining 69 retrofits in 2026. Schulman also said TurboChef ovens have been rolled out across the entire restaurant base and will support menu execution, including the upcoming salmon launch.
2026 outlook: growth, comps, pricing, and financial assumptions
For full-year 2026, management guided to same-restaurant sales growth of 3% to 5%, restaurant-level profit margin of 23.7% to 24.2%, pre-opening costs of $19.5 million to $20 million, and adjusted EBITDA (including pre-opening costs) of $176 million to $184 million. Tolivar said first-quarter comp trends were tracking above full-year guidance exiting 2025, but the company’s outlook assumes low- to mid-single-digit same-restaurant sales for the remainder of the year due to macro uncertainty.
The company implemented an approximately 1.4% in-restaurant menu price adjustment in January 2026 and said it does not plan additional pricing in 2026. Tolivar added that the adjustment did not include price increases to the base bowl. Management expects low single-digit inflation in food, beverage, and packaging and low- to mid-single-digit labor inflation, inclusive of incremental investment to support its assistant general manager (AGM) program.
On equity and taxes, Tolivar said 2025 stock-based compensation was $18.1 million and the company expects $22 million to $24 million in 2026, including a new program providing equity grants to general managers. CAVA expects to adopt a performance-based long-term incentive program in 2026 that moves from a four-year to a three-year vesting period, accelerating expense recognition without changing total equity granted. The effective tax rate was 10% in 2025, and the company expects a 25% to 30% rate in 2026, while cash taxes are expected to remain immaterial until net operating losses are utilized.
CAVA ended the quarter with no debt, $393 million in cash and investments, and access to a $75 million undrawn revolver. Tolivar said the company expects to increase the size of the revolving facility and extend its maturity date in the first quarter.
About CAVA Group (NYSE:CAVA)
CAVA Group, Inc (NYSE: CAVA) is a leading fast-casual restaurant company specializing in Mediterranean-inspired cuisine. Operating under the CAVA brand, the company offers customizable bowls, pitas and salads built around a variety of proteins, grains, fresh vegetables and house-made spreads. With a focus on high-quality ingredients and made-to-order preparation, CAVA aims to deliver a casual yet elevated dining experience for dine-in, takeout and catering customers.
Founded in 2011 in the Washington, DC metro area by Ike Grigoropoulos, Dimitri Katsanis and Brett Schulman, CAVA has pursued an aggressive growth strategy that included the 2018 acquisition of Zoe’s Kitchen.
