Good morning. With mounting consumer demand evident in the restaurant sector, Cava continues its strategic focus on expansion and cultivating its future leadership.
TL;DR
- Cava maintains stable prices despite consumer pressures and a government shutdown impacting spending.
- The company focuses on expansion, with revenue growing to $954 million in 2024.
- Cava cultivates future leaders through its "Flavor Your Future" program and new assistant general manager initiative.
- Despite a lowered sales growth outlook, Cava's brand strength and market share growth remain robust.
Last week, Cava, the Mediterranean-inspired fast-casual restaurant headed by CEO Brett Schulman, announced its third-quarter financial results. Sales saw a 20% jump, reaching $289.8 million. The company lowered its full-year sales growth guidance following reports of stagnant foot traffic and a 1.9% rise in comparable sales, falling short of Wall Street's 2.7% projection.
CFO Tricia Tolivar informed me that Cava's lowered outlook for the remainder of the year accounts for a highly unpredictable consumer economic landscape. Consumers are experiencing increased strain due to the government shutdown. “We took a very thoughtful and judicious approach to our guidance,” Tolivar said.
CEOs from Chipotle, Cava, and McDonald's have recently highlighted consumer strain, especially affecting younger or less affluent patrons, as a business challenge during earnings discussions. These observations align with the concept of a K-shaped economy, suggesting that affluent individuals maintain widespread spending habits, whereas those with less income are curtailing their expenditures, Coins2Day reported.
Tolivar stated that Cava has approached price hikes with considerable caution. Cava has implemented menu price hikes of approximately 15% since late 2019, a figure lower than both the overall inflation rate (around 23%) and the average price adjustments seen in quick-service dining establishments (exceeding 30%). In January, the company implemented a modest menu price hike of 1.7%, with no substantial increases expected for the upcoming year. “There’s pressure on costs for us, but we don’t think in today’s environment it is appropriate to pass that all on to the consumer,” Tolivar added.
Focus on growth and talent pipeline
“Despite the challenges the consumer is facing, we have been able to significantly grow market share, and that really underscores the power of the brand and the white space opportunity ahead of us,” Tolivar said.
Cava's revenue saw an increase from approximately $564 million in 2022 to $954 million in 2024. According to her, the company's momentum stems from the robustness of its brand within the rapidly expanding Mediterranean category, a diet that has held the top spot for eight years running.
Tolivar stated that the company is now present in 28 states, operating more than 400 restaurants. He also mentioned that new establishments are launching with average unit volumes exceeding $3 million, surpassing the chain's overall average. Cava initiated its “Flavor Your Future” program to cultivate internal staff for emerging leadership positions, fostering company expansion. The launch of a new assistant general manager program is one of the first actions under this initiative. Current general managers and area leaders evaluate high-performing candidates in Cava’s restaurants to assess future leadership potential, Tolivar said.
“When I was in New York recently, Brett and I visited different restaurants,” Tolivar said. “When we walked into the Wall Street restaurant, our general manager said, ‘Hey, let me introduce you to my new assistant general manager; she’s a high-potential team member.’ It was inspiring to see the passion for developing leaders.”
Tolivar highlighted adaptability and a consistent strategic outlook when questioned about sustaining growth during periods of uncertainty. “Staying committed to our long-term goals—while adapting when needed—will ensure lasting success for our brand and teams,” she said.
Sheryl Estrada
[email protected]
Top Performers
David G. Anderson was promoted to VP, CFO, treasurer and assistant secretary of Ampco-Pittsburgh Corporation (NYSE: AP), effective January 1, 2026. Anderson will succeed Michael G. McAuley, who will assume the role of strategic advisor to the CEO until his planned retirement on June 30, 2026. Anderson will also retain his current role as president of Air and Liquid Systems Corporation, a wholly-owned subsidiary of Ampco-Pittsburgh. He joined the corporation in 2010 and brings over 35 years of experience in finance and operations leadership to his new, expanded role.
Reza Taleghani was appointed EVP and CFO of Under Armour, Inc. (NYSE: UAA, UA), effective February 2026. He will succeed David Bergman, a 21-year Under Armour veteran, who will step down as CFO. Taleghani has more than 25 years of experience. He joins Under Armour from Samsonite Group S.A., where he has served as EVP and CFO since 2018. Before joining Samsonite, Taleghani served as President and CFO at Brightstar Corp. He spent over 15 years at J.P. Morgan, holding senior roles in investment banking, commercial banking and asset management, and served as President and CEO of Sterling Airlines A/S in Copenhagen.
Big Deal
The University of Michigan’s Consumer Sentiment Index fell to 50.3 in the preliminary November reading, down 3.3 points (6%) from October. The decline was led by a 17% drop in current personal finances and an 11% decline in year-ahead expected business conditions, according to Joanne Hsu, director of surveys of consumers at the University of Michigan.
“With the federal government shutdown dragging on for over a month, consumers are now expressing worries about potential negative consequences for the economy," Hsu said in a statement. "This month’s decline in sentiment was widespread across age, income, and political affiliation.”
The index is now at its lowest level since June 2022, when it reached an all-time low of 50, according to an analysis by S&P Global Market Intelligence. Consumers are struggling to build and maintain confidence in both the future and the present. The prolonged government shutdown has intensified concerns about the economy, the data shows.
“The contrast between consumer feelings and consumer spending remains the story of 2025,” according to S&P Global Market Intelligence. “Had consumers followed their fears, the economy would have been in recession long ago.”
Deeper exploration
"Dow futures rise as enough Democrats join Republicans to end the shutdown and ‘surrender’ on ACA subsidies" is a Coins2Day report by Jason Ma.
From the report: "U.S. Stock futures were positive on Sunday evening as a bill that will end the longest-ever government shutdown advanced in the Senate. A short-term spending bill cleared a procedural hurdle after seven Democratic senators and one independent voted with Republicans. Futures tied to the Dow Jones industrial average climbed 66 points, or 0.14%. S&P 500 futures were up 0.68%, and Nasdaq futures jumped 1.19%."
The bill would extend current funding through Jan. 30 and pay for SNAP and Veterans Affairs for the rest of the fiscal year, which ends next September, Ma writes. There isn't a provision in the bill for an extension for Affordable Care Act subsidies. Instead, a promise that the Senate will vote on extending the subsidies by December. You can read more here.
Overheard
"This is an 'AI Arms Race' and what is fueling this next chapter of growth is Big Tech spending, and that is not slowing down into 2026."
—Wedbush Securities analysts wrote in a Sunday industry note. The analysts also said that they believe Nvidia's earnings next week will be a "positive catalyst for tech stocks into year-end as investors continue to underestimate the scale and scope of this transformational spending trend over the next few years."