Darden Restaurants Stock Jumps on Uber Partnership, Sales Outlook

GuruFocus
03-21

Darden Restaurants (DRI, Financials) shares climbed more than 6% at Thursday's open, reaching a record high as investors responded to the company's upbeat fiscal 2025 comparable sales outlook and a new partnership with Uber Direct.

One of the company's brands, Cheddar's Scratch Kitchen, will now combine Uber Direct for deliveries, therefore complementing Olive Garden in providing app-based takeout with Uber's countrywide network managing fulfillment. The action mirrors a larger industry trend toward digital ordering and third-party logistics to grab off-site revenues.Darden is also unveiling smaller restaurant prototypes to save 15% of building expenses. Chief Executive Ricardo Cardenas said the plan would increase cost efficiency and let the business into hitherto unexplored areas. The project is expected by the corporation to improve long-term profitability by reducing capital expenditures without sacrificing development.Darden's fiscal 2025 equivalent sales prediction, which beat Wall Street projections, helped investor confidence even further. Extensive demand across its restaurant brands, cost management, and digital expansion—all of which the firm emphasizes—helped propel the stock to a new high, thereby extending a five-day surge.

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