DRI · Q4 2026 Earnings

Cautious

Darden Restaurants

Reported June 25, 2026

30-second summary

Darden closed FY26 with Q4 non-GAAP EPS of $3.66 (at the high end of the $3.59–$3.69 guide) and consolidated SRS of +4.6%, validating the back-half pricing-catches-inflation thesis management staked the year on. But the FY27 setup is materially more conservative: SRS growth guided to 2.5–3.5% (vs FY26's 4.5% full-year), revenue growth of just 2.9–4.1% YoY (vs FY26's +9.4%), and GAAP EPS of $11.10–$11.35 (+6.3% to +8.7% vs FY26 GAAP $10.44). The signal: management is resetting expectations to a more normalized growth algorithm, with unit growth accelerating (75–80 openings vs ~70 in FY26) and capex stepping up to ~$875M to fund it.

Headline numbers

EPS

Q4 FY2026

$3.66

+0.5% vs est.

Revenue

Q4 FY2026

$3.72B

+13.7% YoY

-0.3% vs est.

Operating margin

Q4 FY2026

13.9%

Key financials

Q4 FY2026

Metric	Q4 FY2026	Q4 FY2025	YoY	Q3 FY2026	QoQ
Revenue	$3.72B	$3.30B	+12.7%	$3.35B	+11.2%
EPS	$3.66	$2.98	+22.8%	$2.95	+24.1%
Operating margin	13.9%	11.7%	+220bps	12.2%	+175bps

Guidance

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Diluted EPS (non-GAAP)	Q4 FY2026	$3.59 to $3.69	$3.66	in-line (at high end of guide)	Beat
Same-Restaurant Sales Growth	Q4 FY2026	3.5% to 5.0%	4.6%	in-line (mid-range)	Beat
Revenue	FY2026	approximately 9.5% growth	$13.21 billion (9.4% YoY)	in-line (-0.1 ppts vs. guide)	Met
Same-Restaurant Sales Growth	FY2026	approximately 4.5%	4.6% (consolidated Q4 FY2026)	+0.1 ppts above guide	Beat

New guidance

Metric	Period	Guide	YoY
Diluted EPS (GAAP)	FY2027	$11.10 to $11.35	—
Revenue	FY2027	$13.60 billion to $13.75 billion	+2.9% to +4.1% YoY
Same-Restaurant Sales Growth	FY2027	2.5% to 3.5%	—
New Restaurant Openings	FY2027	75 to 80	—
Total Capital Spending	FY2027	approximately $875 million	—
Total Inflation	FY2027	approximately 3.0%	—
Effective Tax Rate	FY2027	approximately 13.5%	—
EBITDA	FY2027	$2.26 billion to $2.29 billion	—

Segment performance

Q4 FY2026

Segment	Q4 FY2026	Q4 FY2025	YoY
Olive Garden	$1.538B	$1.381B	+11.4%
LongHorn Steakhouse	$1.017B	$0.834B	+21.9%
Fine Dining	$0.371B	$0.335B	+10.7%
Other Business	$0.793B	$0.722B	+9.8%

Platform metrics

Q4 FY2026

Segment	Q4 FY2026	Q4 FY2025	YoY
Same-Restaurant Sales Growth (Consolidated Darden)	4.6%	—	—
Same-Restaurant Sales Growth - Olive Garden	2.4%	—	—
Same-Restaurant Sales Growth - LongHorn Steakhouse	9.5%	—	—
Same-Restaurant Sales Growth - Fine Dining	1.9%	—	—
Net New Restaurant Openings	43	—	—

Profitability

Q4 FY2026

Segment	Q4 FY2026	Q4 FY2025	YoY
Operating Margin	13.9%	—	—
Adjusted EBITDA	$2.16 billion	—	—

Other KPIs

Q4 FY2026

Segment	Q4 FY2026	Q4 FY2025	YoY
Share Repurchases	$138 million	—	—

Management tone

Transcript was not available for this quarter; tone analysis is limited to press-release framing.

The Q4 FY26 print marks a clear transition in the FY26 arc. Three quarters ago management was raising the FY26 sales and SRS guide while reaffirming EPS, absorbing inflation to buy wallet share. Two quarters ago Raj asserted pricing power was greater than any peer. This quarter, the FY27 guide does the opposite: SRS guidance steps down vs the FY26 print, revenue growth steps down sharply, and management is shifting investment toward unit expansion rather than same-store reinvestment. The qualitative statements in the release — "strong operating model generates significant and durable cash flows" — are notably more conservative than the assertive pricing-power framing of Q3.

Without transcript commentary, it is impossible to confirm whether the FY27 setup represents conservatism, structural deceleration in the consumer, or a deliberate sandbag. But the combination of (1) the SRS step-down, (2) accelerating capex into units, and (3) Olive Garden's Q4 deceleration to +2.4% suggests management is calibrating expectations to a tougher consumer environment that hasn't fully surfaced in the FY26 print yet.

Answers to last quarter's watch list

Q4 non-GAAP EPS vs. the $3.59–$3.69 guide — Q4 non-GAAP EPS came in at $3.66, at the high end of the guided range, clearing consensus of $3.64 by 0.5%. The FY $10.57–$10.67 reaffirmation held; FY EPS of $10.64 landed within the band.

Resolved positively

Q4 SRS landing inside the 3.5–5% band — Q4 consolidated SRS printed +4.6%, mid-range. March exit momentum held through Q4.

Resolved positively

Q4 pricing actually closing the gap to inflation — Operating margin expanded from 12.2% in Q3 to 13.9% in Q4 — a 170bps sequential expansion that confirms the pricing-catches-inflation thesis. The Q3 pricing-power claim survived its real-time test.

Resolved positively

Olive Garden SRS — whether weather-adjusted +4.2% holds — Olive Garden printed +2.4%, a clear deceleration from Q3's headline +3.2% (weather-adjusted +4.2%). The wallet-share narrative at the flagship brand is visibly compressing, and the FY27 SRS guide of 2.5–3.5% appears built around this run rate.

Resolved negatively

LongHorn SRS sustainability above +5% — LongHorn Q4 SRS of +9.5% blew past the +5% bar, and FY LongHorn SRS of +7.2% confirms the beef-cycle traffic benefit is not fading.

Resolved positively

Bahama Breeze — fifth-quarter silence — The press release confirms all locations are expected to be closed or converted to other brands between Q3 FY26 and Q4 FY27, and Q4 impairment charges include Bahama Breeze closures. Strategic review is effectively resolved as a wind-down. Status: Resolved (wind-down underway)

Commodity inflation tracking against the ~4% FY guide — FY26 inflation appears to have landed at ~4% as guided, and the FY27 guide of ~3.0% signals material moderation ahead.

Resolved positively

What to watch into next quarter

Q1 FY27 SRS vs. the new 2.5–3.5% FY guide — A Q1 print below 2.5% would signal the FY27 guide is already at risk.

Olive Garden SRS — whether +2.4% is the new floor or further deceleration follows — Olive Garden is the largest brand and its Q4 SRS run rate has compressed to +2.4%; a sub-2% print at this brand would force a downward revision to the FY27 SRS midpoint.

GAAP-to-non-GAAP EPS reconciliation for FY27 — Management owes investors a non-GAAP bridge to assess whether the underlying earnings algorithm is consistent with the prior 10–15% TSR framework or has structurally compressed.

Q1 FY27 revenue against the +2.9–4.1% FY growth band — A miss in Q1 would reset the FY revenue range lower early.

LongHorn SRS sustainability — Q4 set a high bar at +9.5%; deceleration toward the FY +7.2% run rate would be normal, but a sharp drop would remove the offset to Olive Garden softness.

Capex pacing against the ~$875M FY27 guide — A 15% step-up in capex against a slower-growth revenue backdrop will compress FCF; Q1 capex pace and any commentary on unit-opening cadence (75–80 vs the 70 delivered in FY26) is the test of execution.

Bahama Breeze wind-down execution — With closures/conversions targeted between Q3 FY26 and Q4 FY27, watch for additional impairment charges and conversion pacing.

Sources

Darden Restaurants Q4 FY2026 press release (Exhibit 99.1), filed June 25, 2026 — https://www.sec.gov/Archives/edgar/data/940944/000094094426000016/exhibit991-q4fy26.htm
Tapebrief DRI Q3 FY2026 brief (March 2026) for prior-guidance and watch-list baseline
Tapebrief DRI Q2 FY2026 brief (December 2025) for multi-quarter trajectory context
Tapebrief DRI Q1 FY2026 brief (September 2025) for multi-quarter trajectory context
Tapebrief DRI Q4 FY2025 brief (June 2025) for FY26 initial guidance baseline

Get the next brief, free.

We publish analyst-grade earnings briefs the same day or morning after every call — headline numbers, segment KPIs, Q&A highlights, and tone analysis. Free during beta.

This is not investment advice.