Dive Brief:
- Cava posted 9.7% same-store sales growth with a 5.3% bump in traffic in Q2, according to the brand’s earnings release.
- The traffic increase helped push the chain’s average unit volume to $3.1 million, and, when combined with new unit growth, resulted in a 31.3% jump in revenue, per the earnings release.
- CFO Tricia Tolivar said the results were a validation of the chain’s long-term strategies, including its efforts to underprice inflation, invest in labor and add to its menu.
Dive Insight:
Cava’s same-store sales performance was bolstered by the brand’s strength in lower-income trade areas, a relatively recent development for the fast casual brand.
“We're seeing tremendous performance in our markets with median household incomes that are lower than what we've seen historically,” Tolivar said. “That gives us the confidence in our white space and the opportunity that we have to bring Cava to many more locations.”
Tolivar said the chain was able to attract consumers in lower-income trade areas thanks to its differentiated menu and a reasonable value proposition. The brand’s value perception has held up across income cohorts, Tolivar said. Cava’s growing scale has helped it keep its pricing below inflation, Tolivar said, by making its supply chain more efficient and more resilient.
At the store level, Tolivar said, Cava is investing in labor by increasing wages and adding an assistant general manager role.
The chain undertook “a 3% incremental investment in wages,” William Blair analyst Sharon Zackfia said in a research note.
The brand first started adding the AGM role in late 2025 and has since added the post to about 70% of its stores. Those locations have seen improvements in customer satisfaction and labor turnover, Tolivar said.
The AGM position also helps Cava develop a deeper bench of managerial talent to help sustain the pace of its national expansion — the chain opened 17 net new units in the quarter — and its market-infill strategy.
“We'll continue to deliver on our long-term algorithm of at least 15% growth in new restaurants, and the AGM role will just reinforce our ability to do that,” Tolivar said.
Cava could eventually reach 2,000 units, up from about 480 today, Zackfia said.
In April, Cava added glazed salmon to its menu. The premium protein helped boost same-store sales by driving increases in average ticket, Tolivar said on the chain’s earnings call. Zackfia noted that Cava’s salmon deployment depressed restaurant-level margins somewhat, as the chain tried to keep the menu item penny-profit neutral, rather than margin neutral. While a menu strategy like that raises the cost-of-goods sold, it can also help preserve value and restrain pricing.
While other fast casuals saw traffic declines due to consumer concerns over industry problems with Cyclospora and Salmonella, Tolivar said Cava’s traffic was flat during the worst period of media coverage related to the cyclosporiasis epidemic, and has since rebounded to mid-single digit growth.
Cava does not source from Taylor Farms’ Mexico operations — which have been linked to thousands of food-borne illnesses this summer — though it does source some items from the distributor overall, Tolivar said.
The breadth of the chain’s menu and customization helps insulate it from health concerns related to individual ingredients, Tolivar said, and the brand has a further advantage in that it has not been linked to this summer’s outbreaks.
“We are not involved in any of the current public health investigations, and there's nothing in our network that gives us any concern based on the data that we've seen,” Tolivar said.
