DARDEN RESTAURANTS INC

Previous wording

The discussion and analysis below for the Company, which contains forward-looking statements, should be read in conjunction with the unaudited consolidated financial statements and the notes to such financial statements included elsewhere in this quarterly report on Form 10-Q (Form 10-Q) and the audited consolidated financial statements and the notes thereto included in our Form 10-K for the fiscal year ended May 25, 2025 (Form 10-K). In addition to historical consolidated financial information, this discussion contains forward-looking statements that reflect our plans, estimates, and beliefs and involve numerous risks and uncertainties, including but not limited to those described in the “Item 1A. Risk Factors” section of the Form 10-K. Actual results may differ materially from those contained in any forward-looking statements. You should carefully read “Forward-Looking Statements” included below in this Form 10-Q.

Current wording

The following Management’s Discussion and Analysis, which contains forward-looking statements, should be read in conjunction with the unaudited consolidated financial statements and the notes to such financial statements included elsewhere in this quarterly report on Form 10-Q (“Form 10-Q”) and the audited consolidated financial statements and the notes thereto included in our Form 10-K for the fiscal year ended May 31, 2026 (“Form 10-K”). In addition to historical consolidated financial information, this discussion contains forward-looking statements that reflect our plans, estimates, and beliefs and involve numerous risks and uncertainties, including but not limited to those described in the “Item 1A. Risk Factors” section of the Form 10-K. Actual results may differ materially from those contained in any forward-looking statements. You should carefully read “Forward-Looking Statements” included below in this Form 10-Q.

Previous wording

To facilitate the review of our discussion and analysis, the following table sets forth our financial results for the periods indicated. All information is derived from the unaudited consolidated statements of earnings for the three and nine months ended February 22, 2026 and February 23, 2025, respectively.

Current wording

To facilitate the review of our discussion and analysis, the following table sets forth our financial results for the periods indicated. All information is derived from the unaudited consolidated statements of earnings for the three months ended August 30, 2026 and August 24, 2025, respectively.

Previous wording

The following table details the number of company-owned restaurants currently reported in continuing operations that were open at the end of the third quarter of fiscal 2026, compared with the number of company-owned restaurants open at the end of fiscal 2025 and at the end of the third quarter of fiscal 2025.

Current wording

The following table details the number of Company-owned restaurants currently reported in continuing operations that were open at the end of the first quarter of fiscal 2027, compared with the number of Company-owned restaurants open at the end of fiscal 2026 and at the end of the first quarter of fiscal 2026.

Previous wording

Our business operates in the full-service dining segment of the restaurant industry. At February 22, 2026, through subsidiaries, we owned and operated 2,196 restaurants in the United States under the Olive Garden®, LongHorn Steakhouse®, Cheddar’s Scratch Kitchen®, Chuy’s®, Yard House®, Ruth’s Chris Steak House® (Ruth’s Chris), The Capital Grille®, Seasons 52®, Eddie V’s Prime Seafood® (Eddie V’s), Bahama Breeze®, and The Capital Burger® trademarks. We own and operate all of our restaurants in the United States, except for five restaurants we manage through joint venture or other contractual agreements and 87 franchised restaurants. We also have 77 international franchised restaurants in operation located in Canada, Latin America, the Caribbean, Asia, Europe and the Middle East.

Current wording

Our business operates in the full-service dining segment of the restaurant industry. At August 30, 2026, through subsidiaries, we owned and operated 2,218 restaurants in the United States under the Olive Garden®, LongHorn Steakhouse®, Yard House®, Ruth’s Chris Steak House®, Cheddar’s Scratch Kitchen®, The Capital Grille®, Chuy’s®, Seasons 52®, Eddie V’s Prime Seafood®, Bahama Breeze®, and The Capital Burger® trademarks. We own and operate all of our restaurants in the United States, except for four restaurants operating under contractual agreements, one restaurant that we jointly own with a third party and operate independently, and 88 franchised restaurants. We also have 86 international franchised restaurants in operation located in Canada, Latin America, the Caribbean, Asia, Europe, and the Middle East.

Previous wording

On our June 2025 earnings call, we announced the decision to explore strategic alternatives for the Bahama Breeze brand, which includes 28 company‑owned restaurants and one franchised restaurant. As part of this review, we evaluated a potential sale of the brand as well as the conversion of certain restaurants to other Darden concepts. On February 3, 2026, we announced the completion of this process and our expectation that we will permanently close approximately 14 Bahama Breeze restaurants on or about April 5, 2026, and convert the remaining approximately 14 restaurants to other Darden brands over the next 12–18 months. As a result of the expected closures, we impaired some of the assets related to the 14 Bahama Breeze restaurants to be closed. See Note 7 to our unaudited consolidated financial statements in Part I, Item 1 of this Form 10-Q for additional information.

Current wording

On our June 2025 earnings call, we announced the decision to explore strategic alternatives for the Bahama Breeze brand, which, at that time, included 28 company-owned restaurants and one franchised restaurant. As part of this review, we evaluated a potential sale of the brand as well as the conversion of certain restaurants to other Darden brands. On February 3, 2026, we announced the completion of this process and our decision to permanently close approximately half of the Bahama Breeze restaurants, which we completed on or about April 5, 2026, and our expectation to convert the remaining Bahama Breeze restaurants to other Darden brands over the next 12–18 months. As of the end of Q1 fiscal 2027, we have completed two conversions of Bahama Breeze restaurants to other brands.

Previous wording

•Our net earnings from continuing operations were $310.6 million and $805.9 million for the third quarter and first nine months of fiscal 2026, respectively, compared to $323.7 million and $747.0 million for the third quarter and first nine months of fiscal 2025, respectively.

Current wording

•Our net earnings from continuing operations were $234.3 million for the first three months of fiscal 2027 compared to $257.9 million for the first three months of fiscal 2026.

Previous wording

•Reported diluted net earnings per share from continuing operations were $2.68 and $6.91 for the third quarter and first nine months of fiscal 2026, respectively, compared to $2.74 and $6.30 for the third quarter and first nine months of fiscal 2025, respectively.

Current wording

•Reported diluted net earnings per share from continuing operations were $2.05 for the first three months of fiscal 2027, compared to $2.19 for the first three months of fiscal 2026.

Previous wording

We expect sales growth for fiscal 2026 to be approximately 9.5 percent, driven by growth of approximately 2.0 percent related to the fifty-third week in fiscal 2026; same-restaurant sales growth to be approximately 4.5 percent 2; and new restaurant openings to be approximately 70. Additionally, we expect capital expenditures incurred to build new restaurants, remodel and maintain existing restaurants and for technology initiatives to be between $750 and $775 million. These amounts all include the addition of Chuy’s and our expectations for Chuy’s results from the date of acquisition forward.

Current wording

We expect fiscal 2027 sales from continuing operations to be $13.60 billion to $13.75 billion, driven by same-restaurant sales growth 1 of 2.5 percent to 3.5 percent and sales from 75 to 80 new restaurant openings. In fiscal 2027, we expect our annual effective tax rate to be approximately 13.5 percent, and we expect capital expenditures incurred to build new restaurants, remodel, and maintain existing restaurants and technology initiatives to be approximately $875 million.

Previous wording

2 Annual same-restaurant sales is a 52-week metric and excludes the impact of Chuy’s, which will not have been owned and operated by Darden for a 16-month period prior to the beginning of fiscal 2026, as well as Bahama Breeze as all restaurants are expected to be closed or converted to other brands (between the third quarter of fiscal 2026 and the fourth quarter of fiscal 2027).

Current wording

1 Annual same-restaurant sales is a 52-week metric and excludes the impact of Bahama Breeze as all locations are expected to be closed or converted to other brands by the fourth quarter of fiscal 2027.

Previous wording

(1)Same-restaurant sales is a year-over-year comparison of each period’s sales volumes for a 52-week year and is limited to restaurants that have been open, and operated by Darden, for at least 16 months. Accordingly, Chuy’s results will not be included in this calculation until the fourth quarter of fiscal 2026. Additionally, results from Bahama Breeze are excluded as all restaurants are expected to be closed or converted to other brands (between the third quarter of fiscal 2026 and the fourth quarter of fiscal 2027).

Current wording

(1)Same-restaurant sales is a year-over-year comparison of each period’s sales volumes for a 52-week year and is limited to restaurants that have been open, and operated by Darden, for at least 16 months. Additionally, results from Bahama Breeze are excluded as all restaurants are expected to be closed or converted to other brands (by the fourth quarter of fiscal 2027).

Previous wording

Olive Garden’s sales increase for the third quarter of fiscal 2026 was primarily driven by same-restaurant sales increases, as well as revenue from new restaurants. The increase in U.S. same-restaurant sales for the third quarter of fiscal 2026 resulted from a 3.6 percent increase in average check, which includes a 1.3 percent increase in off-premise catering sales, offset by a 0.4 percent decrease in same-restaurant guest counts. Olive Garden’s sales increase for the nine months of fiscal 2026 was primarily driven by same-restaurant sales increases, as well as revenue from new restaurants, partially offset by the sale of the Olive Garden Canada Restaurants. The increase in U.S. same-restaurant sales for the first nine months of fiscal 2026 resulted from a 1.3 percent increase in same-restaurant guest counts, combined with a 3.2 percent increase in average check, which includes a 1.1 percent increase in off-premise catering sales.

Current wording

Olive Garden’s sales increase for the first quarter of fiscal 2027 was primarily driven by same-restaurant sales increases, as well as revenue from new restaurants. The increase in U.S. same-restaurant sales for the first quarter of fiscal 2027 resulted from a 3.4 percent increase in average check, which includes a 0.5 percent increase in off-premise catering sales, offset by a 2.2 percent decrease in same-restaurant guest counts.

Previous wording

LongHorn Steakhouse’s sales increase for the third quarter of fiscal 2026 was primarily driven by same-restaurant sales increases, as well as revenue from new restaurants. The increase in same-restaurant sales for the third quarter of fiscal 2026 resulted from a 3.9 percent increase in average check combined with a 3.3 percent increase in same-restaurant guest counts. LongHorn Steakhouse’s sales increase for the nine months of fiscal 2026 was primarily driven by same-restaurant sales increases combined with revenue from new restaurants. The increase in same-restaurant sales for the first nine months of fiscal 2026 resulted from a 2.7 percent increase in average check combined with a 3.5 percent increase in same-restaurant guest counts.

Current wording

LongHorn Steakhouse’s sales increase for the first quarter of fiscal 2027 was primarily driven by same-restaurant sales increases, as well as revenue from new restaurants. The increase in same-restaurant sales for the first quarter of fiscal 2027 resulted from a 4.5 percent increase in average check combined with a 1.6 percent increase in same-restaurant guest counts.

Previous wording

Fine Dining’s sales increase for the third quarter of fiscal 2026 was primarily driven by revenue from new restaurants, as well as same-restaurant sales increases. The increase in same-restaurant sales for the third quarter of fiscal 2026 resulted from a 2.2 percent increase in average check, offset by a 0.1 percent decrease in same-restaurant guest counts. Fine Dining’s sales increase for the nine months of fiscal 2026 was primarily driven by revenue from new restaurants, as well as same-restaurant sales increases. The increase in same-restaurant sales for the nine months of fiscal 2026 resulted from a 1.1 percent increase in average check, offset by a 0.1 percent decrease in same-restaurant guest counts.

Current wording

Fine Dining’s sales increase for the first quarter of fiscal 2027 was primarily driven by revenue from new restaurants, as well as same-restaurant sales increases. The increase in same-restaurant sales for the first quarter of fiscal 2027 resulted from a 3.7 percent increase in average check, offset by a 2.0 percent decrease in same-restaurant guest counts.

Previous wording

The following table sets forth selected operating data as a percent of sales for the periods indicated. All information is derived from the unaudited consolidated statements of earnings for the three and nine months ended February 22, 2026 and February 23, 2025.

Current wording

The following table sets forth selected operating data as a percent of sales for the periods indicated. All information is derived from the unaudited consolidated statements of earnings for the three months ended August 30, 2026 and August 24, 2025.

Previous wording

•Food and beverage costs increased as a percent of sales primarily due to a 1.2% impact from inflation and a 0.2% impact from menu mix, partially offset by a 0.8% impact from pricing leverage and 0.2% cost savings.

Current wording

•Food and beverage costs increased as a percent of sales primarily due to a 1.0% impact from inflation and a 0.4% impact from brand mix, partially offset by a 1.1% impact from pricing leverage.

Previous wording

•Restaurant labor costs decreased as a percent of sales primarily due to a 1.2% impact from pricing and sales leverage and a 0.1% impact from productivity, partially offset by a 1.0% impact from inflation and a 0.1% impact from higher performance-based compensation expense.

Current wording

•Restaurant labor costs decreased as a percent of sales primarily due to a 1.2% impact from sales leverage and brand mix and a 0.1% impact from productivity, partially offset by a 1.0% impact from inflation.

Previous wording

•Restaurant expenses decreased as a percent of sales primarily due to a 0.7% impact from sales and pricing leverage, partially offset by a 0.5% impact from inflation and a 0.2% impact from delivery fees.

Current wording

•Restaurant expenses remained flat primarily due to a 0.5% impact from sales and pricing leverage, offset by a 0.5% impact from inflation.

Previous wording

•Pre-opening costs increased primarily due to new restaurant openings.

Current wording

•Pre-opening costs increased primarily due to an increase in new restaurant openings.

Previous wording

•Depreciation and amortization expenses remained flat as a percent of sales.

Current wording

•Depreciation and amortization expenses increased as a percent of sales due to new restaurant openings.

Previous wording

•Impairment and (gain) loss on disposal of assets, net increased as a percent of sales primarily due to the gain on sale of the Olive Garden Canada Restaurants, partially offset by the decision to close approximately 14 Bahama Breeze restaurants.

Current wording

•Impairments and (gain) loss on disposal of assets, net decreased as a percent of sales primarily due to the gain on the sale of the assets of the Olive Garden Canada Restaurants and certain liabilities related thereto in fiscal 2026.

Previous wording

Net interest expense increased as a percent of sales for the third quarter of fiscal 2026 driven primarily by increased short term borrowings. Net interest expense remained flat as percent of sales for the first nine months of fiscal 2026.

Current wording

Net interest expense increased as a percent of sales for the first three months of fiscal 2027, driven primarily by increased short-term borrowings.

Previous wording

The effective income tax rate for continuing operations for the three months ended February 22, 2026 was 12.9 percent compared to an effective income tax rate for the three months ended February 23, 2025 of 13.1 percent. The decrease in the tax rate is primarily driven by mark to market impacts on hedges related to our deferred compensation programs. The effective income tax rate for continuing operations for the nine months ended February 22, 2026 was 12.7 percent compared to an effective income tax rate for the nine months ended February 23, 2025 of 12.2 percent. The increase in the effective tax rate is primarily attributable to a reduction in an expected IRS refund, partially offset by the adjustment of our expected tax liability related to the disposition of the Olive Garden Canada Restaurants.

Current wording

The effective income tax rate for continuing operations for the three months ended August 30, 2026 was 12.9 percent compared to an effective income tax rate for the three months ended August 24, 2025 of 12.2 percent. The increase in the tax rate is primarily driven by mark to market impacts on hedges related to our deferred compensation programs.

Previous wording

On an after-tax basis, losses from discontinued operations for the third quarter and first nine months of fiscal 2026 were $3.8 million ($0.03 per diluted share) and $4.1 million ($0.04 per diluted share), respectively, compared with losses from discontinued operations for the third quarter and first nine months of fiscal 2025 of $0.3 million ($0.00 per diluted share) and $1.2 million ($0.01 per diluted share), respectively.

Current wording

On an after-tax basis, losses from discontinued operations for the first three months of fiscal 2027 were $0.9 million ($0.01 per diluted share) compared with losses from discontinued operations for the first three months of fiscal 2026 of $0.1 million ($0.00 per diluted share).

Previous wording

We manage our restaurant brands, Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Chuy’s, Yard House, Ruth’s Chris, The Capital Grille, Seasons 52, Eddie V’s, Bahama Breeze and The Capital Burger, in North America as operating segments. We aggregate our operating segments into reportable segments based on a combination of the size, economic characteristics and sub-segment of full-service dining within which each brand operates. Our four reportable segments are: (1) Olive Garden, (2) LongHorn Steakhouse, (3) Fine Dining and (4) Other Business (see Note 6 to our unaudited consolidated financial statements in Part I, Item 1 of this Form 10-Q).

Current wording

We manage our restaurant brands, Olive Garden, LongHorn Steakhouse, Yard House, Ruth’s Chris, Cheddar’s Scratch Kitchen, The Capital Grille, Chuy’s, Seasons 52, Eddie V’s, Bahama Breeze and The Capital Burger, in the U.S. as operating segments. We aggregate our operating segments into reportable segments based on a combination of the size, economic characteristics and sub-segment of full-service dining within which each brand operates. Our four reportable segments are: (1) Olive Garden, (2) LongHorn Steakhouse, (3) Fine Dining and (4) Other Business (see Note 6 to our unaudited consolidated financial statements in Part I, Item 1 of this Form 10-Q).

Previous wording

Our management uses segment profit as the measure for assessing performance of our segments. The following table presents segment profit margin 1 for the periods indicated.

Current wording

Our management uses segment profit as the measure for assessing performance of our segments. The following table presents segment profit margin for the periods indicated.

Previous wording

The decrease in Olive Garden’s segment profit margin for the third quarter of fiscal 2026 was driven primarily by higher restaurant expenses and marketing costs, partially offset by lower restaurant labor costs. Olive Garden’s segment profit margin for the first nine months of fiscal 2026 remained flat compared to fiscal 2025. The decrease in Longhorn Steakhouse’s segment profit margin for the third quarter of fiscal 2026 was driven by higher food and beverage costs and restaurant expenses, partially offset by lower restaurant labor costs. The decrease in Longhorn Steakhouse’s segment profit margin for the first nine months of fiscal 2026 was driven by higher food and beverage costs, partially offset by lower restaurant expenses. The decrease in Fine Dining’s segment profit margin for the third quarter and first nine months of fiscal 2026 was driven primarily by higher food and beverage costs and restaurant labor. Other Business’ segment profit margin for the third quarter of fiscal 2026 remained flat compared to fiscal 2025. The increase in Other Business’ segment profit margin for the first nine months of fiscal 2026 was driven primarily by the addition of Chuy’s operating results and lower food and beverage costs and restaurant expenses.

Current wording

The decrease in Olive Garden’s segment profit margin for the first quarter of fiscal 2027 was driven primarily by higher restaurant expenses, partially offset by lower restaurant labor. The increase in LongHorn Steakhouse’s segment profit margin for the first quarter of fiscal 2027 was driven by lower food and beverage costs, restaurant labor, and restaurant expenses. The decrease in Fine Dining’s segment profit margin for the first quarter of fiscal 2027 was driven primarily by higher restaurant expenses and restaurant labor, partially offset by lower food and beverage costs. The decrease in Other Business’ segment profit margin for the first quarter of fiscal 2027 was driven primarily by higher food and beverage costs and restaurant labor, partially offset by lower restaurant expenses.

Previous wording

Our sales volumes have historically fluctuated seasonally. Our average sales per restaurant are highest in the winter and spring, followed by the fall and summer. Holidays, changes in the economy, severe weather, and the effects of other conditions may impact sales volumes seasonally in some operating regions. Because of the historical seasonality of our business and these other factors, results for any fiscal quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

Current wording

Our sales volumes have historically fluctuated seasonally. Our average sales per restaurant are highest in the spring and winter, followed by the fall and summer. Holidays, changes in the economy, severe weather, and the effects of other conditions may impact sales volumes seasonally in some operating regions. Due to the historical seasonality of our business and these other factors, results for any fiscal quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

Previous wording

Typically, cash flows generated from operating activities are our principal source of liquidity, which we use to finance capital expenditures for new restaurants and to remodel and maintain existing restaurants, to pay dividends to our shareholders and to repurchase shares of our common stock. Since substantially all of our sales are for cash and cash equivalents, and accounts payable are generally paid in 5 to 90 days, we are typically able to carry current liabilities in excess of current assets.

Current wording

Typically, cash flows generated from operating activities are our principal source of liquidity, which we use to finance capital expenditures, including opening new restaurants, remodeling and maintaining existing restaurants, paying dividends to our shareholders, and repurchasing shares of our common stock. Since substantially all of our sales are for cash and cash equivalents, and accounts payable are generally paid in 5 to 90 days, we are typically able to carry current liabilities in excess of current assets.

Previous wording

On October 23, 2023, we entered into a $1.25 billion Revolving Credit Agreement (as amended, Revolving Credit Agreement) with Bank of America, N.A. (BOA), as administrative agent, and the lenders and other agents party thereto. The Revolving Credit Agreement is a senior unsecured credit commitment to the Company and contains customary representations and affirmative and negative covenants (including limitations on liens and subsidiary debt and, prior to the Amendment (as defined below), a maximum consolidated lease adjusted total debt to total capitalization ratio of 0.75 to 1.00) and events of default usual for credit facilities of this type. As of February 22, 2026, we had no outstanding balances and were in compliance with all covenants under the Revolving Credit Agreement. As of February 22, 2026, $290.0 million of commercial paper was outstanding and backed by this facility. After consideration of commercial paper and letters of credit backed by the Revolving Credit Agreement, as of February 22, 2026, we had $960 million of credit available under the Revolving Credit Agreement.

Current wording

On October 23, 2023, we entered into a $1.25 billion Revolving Credit Agreement (as amended, the “Revolving Credit Agreement”) with Bank of America, N.A. (“BOA”), as administrative agent, and the lenders and other agents party thereto. The Revolving Credit Agreement is a senior unsecured credit commitment to the Company and contains customary representations and affirmative and negative covenants (including limitations on liens and subsidiary debt and, prior to the Amendment (as defined below), a maximum consolidated lease adjusted total debt to total capitalization ratio of 0.75 to 1.00) and events of default usual for credit facilities of this type. As of August 30, 2026, we had no outstanding balances and were in compliance with all covenants under the Revolving Credit Agreement. As of August 30, 2026, $480.0 million of commercial paper was outstanding, which was supported by the Revolving Credit Agreement. After consideration of commercial paper and letters of credit backed by the Revolving Credit Agreement, as of August 30, 2026, we had $770 million of credit available under the Revolving Credit Agreement.

Previous wording

Loans under the Revolving Credit Agreement bear interest at a rate of (a) Term SOFR (which is defined, for the applicable interest period, as the Term SOFR Screen Rate two U.S. Government Securities Business Days prior to the commencement of such interest period with a term equivalent to such interest period) plus a Term SOFR adjustment of 0.10 percent plus the relevant margin determined by reference to a ratings-based pricing grid (Applicable Margin), or (b) the base rate (which is defined as the highest of the BOA prime rate, the Federal Funds rate plus 0.500 percent, and the Term SOFR plus 1.00 percent) plus the relevant Applicable Margin. Assuming a “BBB” equivalent credit rating level, the Applicable Margin under the Revolving Credit Agreement is 1.000 percent for Term SOFR loans and 0.000 percent for base rate loans.

Current wording

Loans under the Revolving Credit Agreement bear interest at a rate of (a) Term SOFR (which is defined, for the applicable interest period, as the Term SOFR Screen Rate two U.S. Government Securities Business Days prior to the commencement of such interest period with a term equivalent to such interest period) plus a Term SOFR adjustment of 0.10 percent plus the relevant margin determined by reference to a ratings-based pricing grid (the “Applicable Margin”), or (b) the base rate (which is defined as the highest of the BOA prime rate, the Federal Funds rate plus 0.500 percent, and the Term SOFR plus 1.00 percent) plus the relevant Applicable Margin. Assuming a “BBB” equivalent credit rating level, the Applicable Margin under the Revolving Credit Agreement is 1.000 percent for Term SOFR loans and 0.000 percent for base rate loans.

Previous wording

Net cash flows provided by operating activities from continuing operations increased to $1.28 billion for the first nine months of fiscal 2026, from $1.25 billion for the first nine months of fiscal 2025. Net cash flows provided by operating activities include net earnings from continuing operations of $805.9 million and $747.0 million in the first nine months of fiscal 2026 and 2025, respectively. Net cash flows provided by operating activities increased in fiscal 2026 primarily due to higher net earnings in fiscal 2026 and the timing of federal income tax payments, offset by changes in working capital.

Current wording

Net cash flows provided by operating activities from continuing operations decreased to $279.0 million for the first three months of fiscal 2027, from $342.5 million for the first three months of fiscal 2026. Net cash flows provided by operating activities include net earnings from continuing operations of $234.3 million and $257.9 million in the first three months of fiscal 2027 and 2026, respectively. Net cash flows provided by operating activities decreased in fiscal 2027 primarily due to changes in working capital.

Previous wording

Net cash flows used in investing activities from continuing operations were $523.1 million for the first nine months of fiscal 2026, compared to $1.10 billion for the first nine months of fiscal 2025. Net cash used in the acquisition of Chuy’s was $613.7 million for the first nine months of fiscal 2025. Capital expenditures increased to $540.9 million for the first nine months of fiscal 2026 from $472.6 million for the first nine months of fiscal 2025, reflecting an increase in new restaurant construction and remodel spend during fiscal 2026. Additionally, the first nine months of fiscal 2026 include a portion of the proceeds from the sale of the Olive Garden Canada Restaurants.

Current wording

Net cash flows used in investing activities from continuing operations were $171.3 million for the first three months of fiscal 2027, compared to $159.3 million for the first three months of fiscal 2026. Capital expenditures increased to $175.3 million for the first three months of fiscal 2027 from $174.1 million for the first three months of fiscal 2026, reflecting an increase in new restaurant construction and remodel spend during fiscal 2027. Additionally, the first three months of fiscal 2026 include a portion of the proceeds from the sale of the Olive Garden Canada Restaurants.

Previous wording

Net cash flows used in financing activities from continuing operations were $761.5 million for the first nine months of fiscal 2026, compared to net cash used in financing activities of $123.9 million for the first nine months of fiscal 2025. Net cash flows used in financing activities for the first nine months of fiscal 2026 included borrowings of commercial paper of $290.0 million, net, offset by dividends paid of $521.5 million and share repurchases of $534.4 million. Net cash flows used in financing activities for the first nine months of fiscal 2025 included repayment of commercial paper of $28.6 million, net proceeds from the issuance of long-term debt of $750.0 million, dividends paid of $494.6 million and share repurchases of $367.2 million. Dividends declared by our Board of Directors totaled $4.50 and $4.20 per share for the first nine months of fiscal 2026 and 2025, respectively.

Current wording

Net cash flows used in financing activities from continuing operations were $104.4 million for the first three months of fiscal 2027, compared to net cash used in financing activities of $212.2 million for the first three months of fiscal 2026. Net cash flows used in financing activities for the first three months of fiscal 2027 included borrowings of commercial paper of $285.9 million, net, offset by dividends paid of $184.2 million and share repurchases of $220.8 million. Net cash flows used in financing activities for the first three months of fiscal 2026 included borrowings of commercial paper of $142.0 million, dividends paid of $175.1 million and share repurchases of $182.7 million. Dividends declared by our Board of Directors totaled $1.62 and $1.50 per share for the first three months of fiscal 2027 and 2026, respectively.

Previous wording

On June 18, 2025, our Board of Directors authorized a new share repurchase program under which we may repurchase up to $1 billion of our outstanding common stock. This repurchase program does not have an expiration and replaced the prior share repurchase authorization. During the quarter and nine months ended February 22, 2026, we repurchased 0.7 million and 2.7 million shares of our common stock, respectively, compared to 0.3 million and 2.4 million shares of our common stock, respectively, during the quarter and nine months ended February 23, 2025.

Current wording

On June 24, 2026, our Board of Directors authorized a new share repurchase program under which we may repurchase up to $1.5 billion of our outstanding common stock. This repurchase program, which was announced publicly in a press release issued on June 25, 2026, does not have an expiration and replaced the prior share repurchase authorization. During the quarter ended August 30, 2026, we repurchased 1.1 million shares of our common stock compared to 0.9 million shares of our common stock during the quarter ended August 24, 2025.

Previous wording

Our current assets totaled $1.01 billion as of February 22, 2026, compared to $937.7 million as of May 25, 2025. The increase was primarily due to an increase in prepaid income taxes and inventories.

Current wording

Our current assets totaled $953.1 million as of August 30, 2026, compared to $942.9 million as of May 31, 2026. The increase was primarily due to an increase in prepaid expenses and other current assets, offset by a decrease in receivables, net.

Previous wording

Our current liabilities totaled $2.61 billion as of February 22, 2026, compared to $2.25 billion as of May 25, 2025. The increase was primarily driven by an increase in short term debt and unearned revenues associated with activations in excess of gift card redemptions.

Current wording

Our current liabilities totaled $3.20 billion as of August 30, 2026, compared to $3.01 billion as of May 31, 2026. The increase was primarily driven by an increase in short-term debt.

Previous wording

We prepare our consolidated financial statements in conformity with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales, costs and expenses during the reporting period. Actual results could differ from those estimates. We have discussed the development, selection and disclosure of those estimates with the Audit Committee. Our critical accounting estimates have not changed materially from those previously reported in our Annual Report on Form 10-K for the fiscal year ended May 25, 2025.

Current wording

We prepare our consolidated financial statements in conformity with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales, costs, and expenses during the reporting period. Actual results could differ from those estimates. We have discussed the development, selection, and disclosure of those estimates with the Audit Committee. Our critical accounting estimates have not changed materially from those previously reported in our Annual Report on Form 10-K for the fiscal year ended May 31, 2026.

Previous wording

Statements set forth in or incorporated into this report regarding the expected increase in the number of our restaurants and capital expenditures in fiscal 2026, projections for sales and all other statements that are not historical facts, including without limitation statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of Darden Restaurants, Inc. and its subsidiaries that are preceded by, followed by or that include words such as “may,” “will,” “expect,” “intend,” “anticipate,” “continue,” “could,” “estimate,” “project,” “believe,” “plan,” “outlook” or similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act. Any forward-looking statements speak only as of the date on which such statements are made, and we undertake no obligation to update such statements for any reason to reflect events or circumstances arising after such date. By their nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements. In addition to the risks and uncertainties of ordinary business obligations, and those described in information incorporated into this report, the forward-looking statements contained in this report are subject to the risks and uncertainties described in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended May 25, 2025 and in our Forms 10-Q (including this report), which are summarized as follows:

Current wording

Statements set forth in or incorporated into this report regarding the expected increase in the number of our restaurants and capital expenditures in fiscal 2027, projections for sales and all other statements that are not historical facts, including without limitation statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of Darden Restaurants, Inc. and its subsidiaries that are preceded by, followed by or that include words such as “may,” “will,” “expect,” “intend,” “focus,” “anticipate,” “continue,” “could,” “estimate,” “project,” “believe,” “plan,” “outlook,” “seek,” or similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act. Any forward-looking statements speak only as of the date on which such statements are made, and we undertake no obligation to update such statements for any reason to reflect events or circumstances arising after such date. By their nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements. In addition to the risks and uncertainties of ordinary business obligations, and those described in information incorporated into this report, the forward-looking statements contained in this report are subject to the risks and uncertainties described in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended May 31, 2026 and in our Forms 10-Q (including this report), which are summarized as follows:

Previous wording

•The impact of shortages, delay or interruptions in the delivery of food and other products from third-party vendors and suppliers;

Current wording

•The impact of shortages, delays, or interruptions in the delivery of food and other products from third-party vendors and suppliers;

Previous wording

•Disruptions in the financial markets that may impact consumer spending patterns, affect the availability and cost of credit;

Current wording

•Disruptions in the financial and credit markets that may impact consumer spending patterns and affect the availability and cost of credit;