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Darden’s quarterly earnings met Wall Street expectations, but its revenue fell short of estimates.
LongHorn Steakhouse was the company’s only division to report same-store sales growth.
Olive Garden, usually the crown jewel of Darden’s portfolio, reported its same-store sales fell 1.8%.

A Ruth’s Steak House restaurant on May 03, 2023 in Miami, Florida. Darden Restaurants said Wednesday it is buying Ruth’s Hospitality Group, the parent company of Ruth’s Chris Steak House, for $715 million. 
Joe Raedle | Getty Images

Darden Restaurants on Thursday reported mixed quarterly results as the Olive Garden owner’s same-store sales shrank for the first time since the Covid pandemic.
Shares of the company fell more than 5% in premarket trading.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

Earnings per share: $2.62 adjusted, meeting expectations
Revenue: $2.97 billion vs. $3.03 billion expected

Darden reported fiscal third-quarter net income of $312.9 million, or $2.60 per share, up from $286.6 million, or $2.34 per share, a year earlier.
Excluding items, the restaurant company earned $2.62 per share.
Net sales rose 6.8% to $2.97 billion, fueled by Darden’s acquisition of Ruth’s Chris Steak House and 53 other new restaurant locations.
But Darden’s overall same-store sales fell 1% in the quarter as almost all of its restaurant segments reported same-store sales declines. Only LongHorn Steakhouse saw same-store sales growth. A year earlier, Darden reported same-store sales growth of 11.7%.

Olive Garden, usually the crown jewel of Darden’s portfolio, reported its same-store sales fell 1.8%. Analysts were expecting the chain’s same-store sales to rise 1.3%, according to StreetAccount estimates.
LongHorn Steakhouse’s same-store sales rose 2.3%, but still fell short of StreetAccount estimates of 3.1%.
Darden’s fine dining business, which includes The Capital Grille, saw its same-store sales decline 2.3%. That division now includes Ruth’s Chris, but those same-store results won’t be included in the category total for several more quarters.
Remaining chains, like Cheddar’s Scratch Kitchen, collectively saw same-store sales fall 2.6%.
Darden also updated its outlook for fiscal 2024. The company now expects adjusted earnings per share of $8.80 to $8.90, narrowing its earnings forecast from a prior range of $8.75 to $8.90. Darden also lowered its revenue projection from $11.5 billion to $11.4 billion and changed its same-store sales outlook from a range of 2.5% to 3% growth to a range of 1.5% to 2%.

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CNBC spoke with ESPN Chairman Jimmy Pitaro and head of programming Roz Durant as part of a documentary on the Disney-owned network’s future as cable TV declines.
Former Disney CEO Bob Chapek spoke with CNBC about ESPN’s challenges in his first public interview since his 2022 firing.
ESPN has multiple streaming strategies to maintain its dominance and relevance as tens of millions of Americans cancel cable TV.

Disney’s ESPN is at a crossroads.
For more than 40 years, the world’s largest all-sports network has grown annual revenue by increasing cable subscription fees. ESPN first charged pay-TV distributors less than $1 per month per subscriber in the 1980s. In 2023, ESPN’s monthly carriage fee was $9.42 per subscriber, according to data from S&P Global Market Intelligence.

That business model is eroding. Since 2013, tens of millions of Americans have canceled their cable TV subscriptions, raising questions about ESPN’s future in an increasingly fragmented media landscape. CNBC spoke with multiple current and former Disney and ESPN executives about the network’s path ahead as part of the digital documentary “ESPN’s Fight for Dominance.”
ESPN reported domestic and international revenue grew just 1% to $4.4 billion in its most recent fiscal quarter. The network can no longer rely on price increases to make up the difference as the number of cable customers declines.
The company has a new two-part streaming plan to reinvigorate growth. First, this fall, Disney will make ESPN available outside the traditional cable TV bundle for the first time as part of a joint venture with Warner Bros. Discovery and Fox. The service, which does not yet have a price, will target noncable customers who want to watch sports but don’t want to pay $80 or $100 a month for a full bundle of networks.
Second, in fall 2025 ESPN will launch its flagship streaming service that will include everything ESPN has to offer, both live and on demand. It will include unprecedented personalization and will interact with ESPN Bet, the company’s licensed online sportsbook, and fantasy sports to cater to younger fans. The product will go well beyond ESPN+, which exists as a $10.99 streaming service that doesn’t include ESPN’s most expensive programming, such as all of “Monday Night Football.”

ESPN Chairman Jimmy Pitaro
Steve Zak Photography | FilmMagic | Getty Images

“The industry is in a transition phase right now,” ESPN Chairman Jimmy Pitaro said in an interview as part of CNBC’s documentary.

“We’re seeing declines in the traditional ecosystem, cable and satellite universe,” Pitaro said. “There’s a transition to digital. That is by far the biggest component of our future.”
Pitaro and head of programming Roz Durant defended ESPN’s growth plan to CNBC, while former Disney and ESPN executives Bob Chapek, John Skipper and Mark Shapiro noted the so-called Worldwide Leader in Sports faces multiple potential obstacles while it charts its path forward.
Watch the documentary for the full story. More

Former Disney CEO Bob Chapek made his first public comments since his 2022 firing.
He told CNBC he didn’t see the strategic logic in ESPN bringing on more minority partners.
Chapek spoke for a CNBC documentary on ESPN’s digital strategy.

Bob Chapek, chief executive officer of Disney, speaks at the 2022 Disney Legends Awards during Disney’s D23 Expo in Anaheim, California, Sept. 9, 2022.
Mario Anzuoni | Reuters

In his first public comments since Disney fired him as CEO in November 2022, Bob Chapek told CNBC he sees no reason for Disney-owned ESPN to add minority partners.
“Strategically, I don’t really see a benefit in bringing on yet another minority partner into ESPN,” Chapek said as part of the CNBC documentary “ESPN’s Fight for Dominance,” which chronicles the network’s digital strategy, published Thursday.

Disney CEO Bob Iger told CNBC’s David Faber in July that he’d consider selling a minority stake in ESPN to strengthen the sports network’s content or technology as it plans a new direct-to-consumer offering, which he later said would launch by fall 2025.
The company hasn’t yet announced a deal to sell a stake in ESPN. CNBC reported in August that the network had held talks with the major American professional sports leagues, including the National Football League and the National Basketball Association, about potential partnerships or investments.
Disney owns 80% of ESPN and Hearst owns the other 20%, a structure that’s been in place since 1996. By searching for a partner, Disney wants to enhance the content, distribution and marketing of the direct-to-consumer ESPN, which hasn’t yet been priced, Iger said during Disney’s August quarterly earnings call.
Striking a partnership with one of the professional sports leagues could help secure future live rights, though it may irritate other media companies that bid against Disney for packages of games. Bringing on a technology or telecommunications company such as Verizon or Apple could give ESPN broader distribution options by reaching larger customer bases.
Still, it’s unclear selling equity in ESPN is needed to strike an arrangement. ESPN President Jimmy Pitaro, who also spoke with CNBC as part of the documentary, downplayed the need for the sports network to sell a stake in its business to build a partnership with a league or another company.

“It’s not about equity,” Pitaro said. “It’s not about these partners taking an ownership interest in ESPN. That is something, as Bob [Iger] has said, that we are very much open to, but this is about partnership and accelerating the launch or the adoption of ESPN flagship.”

Chapek’s first interview since his 2022 firing

Chapek’s remarks are his first public statements since Disney’s board fired him and brought back Iger as CEO about 16 months ago. He and Iger, who had stayed on as Disney’s executive chairman, had a strained relationship that got progressively worse through Chapek’s tenure as CEO, which ran nearly three years from 2020 to 2022, as documented by CNBC in September. Chapek declined to comment on anything other than ESPN’s future for the CNBC documentary.
While Chapek said he didn’t agree with the need to bring on a partner for strategic reasons, he did acknowledge Disney might do it to bring in cash to pay for Comcast’s one-third stake in Hulu, which Disney has committed to buy for at least $8.6 billion.
“There’s already one minority strategic partner in Hearst. So this would be bringing on a second minority strategic partner,” Chapek said. “Obviously, the benefit of doing that is that you make available some cash. And given some of the conversation that’s been happening between Comcast and Disney in terms of needing to buy the final share of Hulu to make it wholly owned by the Disney company, it’s possible that maybe that cash itself is what they’re after.”

ESPN Chairman James Pitaro at a New York Yankees baseball game at Yankee Stadium in New York City, June 19, 2019.
The Washington Post | The Washington Post | Getty Images

Hub for all sports

Chapek also discussed the vision he had as CEO of turning ESPN into a centralized hub to direct consumers to where a game is streaming, no matter which company owns the rights to air it — a concept CNBC first reported in March 2023.
“If I’m on my Apple TV and I want to watch a movie, I have no idea whether it’s on Prime or Netflix or Disney+ or Hulu or wherever it’s at,” Chapek said. “The way I find out is I go to Apple TV, I plug in the movie that I’m looking to watch, and they direct me exactly to where that movie is. And then they connect me seamlessly without me then having to exit and go to another app to go find the show on that app. I think ESPN should be that source for a central clearinghouse.”
Adding one-stop navigation can help ESPN become the first place sports fans go to when they want to watch a game, even if Disney doesn’t own the rights to certain sports, Chapek said.
“How do you make yourself indispensable to the sports viewer so that they stay on with you as you evolve over to a streaming world? I think solving that problem would be one big way to do it,” Chapek said.
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