Mediterranean restaurant chain Cava swings to a profit in first report since IPO

Cava on Tuesday posted a profitable quarter for its first earnings report since its initial public offering in June.

Cava's stock whipsawed on the report, rising as much as 7% and falling as much as 3% in extended trading. Shares have more than doubled in value since its IPO, fueled largely by its blockbuster public market debut.

The Mediterranean restaurant company has a market value of $5.27 billion, as of Tuesday's close.

Here's what the company reported for the quarter ended July 9:

Cava reported second-quarter net income of $6.5 million, or 21 cents per share, swinging from a net loss of $8.2 million, or $6.23 per share, a year earlier.

Net sales soared 62% to $172.9 million, fueled by new restaurant openings. The chain said it opened 16 net new Cava restaurants during the period, for a total of 279.

Cava's same-store sales climbed 18.2% in the quarter. The chain said its traffic grew 10.3%, making it an outlier in the broader restaurant industry, which has seen customer visits shrink in recent months.

More than a third of Cava's quarterly sales came from digital orders.

Looking ahead to 2023, Cava expects to report same-store sales growth for the full year of between 13% and 15%. The company plans to open between 65 to 70 new locations. It's also forecasting adjusted earnings before interest, taxes, depreciation and amortization of $62 million to $67 million.

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