CAVA's Q4 2024 Earnings Call: Unpacking Contradictions in Sales Growth, Labor Model, and G&A Strategy

These are the key contradictions discussed in CAVA's latest 2024Q4 earnings call, specifically including: Same-Store Sales Growth Drivers, Labor Model Impact, G&A Growth Drivers, and Labor Model and Strategy:



Revenue and Same-Restaurant Sales Growth:
- CAVA reported a 36.8% increase in CAVA revenue for Q4 2024, excluding the 53rd week in 2023, and 21.2% growth in CAVA same-restaurant sales.
- This growth was driven by strong demand, increased traffic, and successful new restaurant openings.

Restaurant Expansion and New Store Performance:
- CAVA opened 15 new restaurants in Q4 2024, bringing the total to 367 restaurants, and plans for 62 to 66 net new openings in 2025.
- The strong performance of new store vintages, especially those opened in Q4 2024, supports these expansion plans.

Profitability and Free Cash Flow:
- CAVA reported net income of $78.6 million and adjusted net income of $6.5 million, with significant EBITDA growth of 60% over the fourth quarter of 2023.
- The growth in profitability is attributed to leverage in general and administrative expenses, and strong new restaurant performance.

Loyalty Program Success:
- CAVA's reimagined loyalty program contributed to a 230 basis point increase in loyalty percent of sales.
- The program's success is due to increased engagement and frequency, driven by incentives and personalized experiences.