DARDEN RESTAURANTS INC (NYSE:DRI) Stock Falls 7% After Q1 Earnings and Revenue Miss

DARDEN RESTAURANTS INC (NYSE:DRI) reported its fiscal first quarter 2026 earnings, revealing a mixed performance that fell short of analyst expectations on key metrics. The market reaction was swift and negative, with shares declining sharply in pre-market trading following the announcement.

Earnings and Revenue Performance

The company reported non-GAAP earnings per share of $1.97 for the quarter, below the consensus estimate of $2.02. Revenue also missed expectations, coming in at $3.04 billion against an anticipated $3.07 billion. This represents a rare dual miss for the restaurant operator, which has generally maintained a pattern of meeting or exceeding projections in recent quarters.

Key financial highlights from the report include:

• Actual Q1 2026 Revenue: $3.04 billion
• Estimated Q1 2026 Revenue: $3.07 billion
• Actual Non-GAAP EPS: $1.97
• Estimated Non-GAAP EPS: $2.02

Market Reaction and Price Action

The market response to these results has been decidedly negative. In pre-market trading following the earnings release, Darden shares fell approximately 7.3%, indicating investor disappointment with the quarterly performance. This sharp decline contrasts with the stock's relatively stable performance in recent weeks, which had shown modest gains of around 0.25% over the past month.

Outlook and Forward Estimates

The company updated its fiscal 2026 financial outlook, though specific details from the press release were not provided in the context materials. Analyst estimates for the full fiscal year 2026 project revenue of $13.21 billion and earnings that would need to show significant improvement in subsequent quarters to meet annual expectations.

For the upcoming second quarter of fiscal 2026, analysts are forecasting:

• Q2 2026 Revenue Estimate: $3.10 billion
• Q2 2026 Earnings Estimate: $2.23 per share

Press Release Summary

The earnings release highlighted the declaration of a quarterly dividend, maintaining Darden's reputation as a reliable income stock despite the earnings miss. The company emphasized its portfolio diversity across multiple restaurant brands including Olive Garden, LongHorn Steakhouse, and several fine dining concepts. Notably, the mention of Olive Garden's same-store sales missing estimates aligns with the overall revenue shortfall, suggesting particular challenges at one of the company's largest brands.

The broader restaurant industry has been facing headwinds from changing consumer spending patterns and increased operational costs, factors that may have contributed to Darden's performance challenges this quarter.

For more detailed earnings information and future estimates, readers can review additional data at DRI Earnings and Estimates.

Disclaimer: This article provides financial information for educational purposes only and should not be construed as investment advice. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions.