CAVA GROUP INC

Previous wording

CAVA Group, Inc. (together with its wholly owned subsidiaries, referred to as the “Company”, “CAVA”, “we”, “us”, and “our” unless specified otherwise) was formed as a Delaware corporation in 2015, and prior to that, the first CAVA restaurant opened in 2011 in Bethesda, Maryland. The Company is headquartered in Washington, D.C. and, as of October 6, 2024, the Company operated 352 fast-casual CAVA Restaurants in 25 states and Washington, D.C. The Company’s authentic Mediterranean cuisine unites taste and health, with a menu that features chef-curated and customizable bowls and pitas. The Company’s dips, spreads, and dressings are centrally produced for use in our restaurants and to be sold in grocery stores.

Current wording

CAVA Group, Inc. (together with its wholly owned subsidiaries, referred to as the “Company,” “CAVA,” “we,” “us,” and “our” unless specified otherwise) was formed as a Delaware corporation in 2015, and prior to that, the first CAVA restaurant opened in 2011 in Bethesda, Maryland. The Company is headquartered in Washington, D.C. and, as of April 20, 2025, the Company operated 382 fast-casual CAVA Restaurants in 26 states and Washington, D.C. The Company’s authentic Mediterranean cuisine unites taste and health, with a menu that features chef-curated and customizable bowls and pitas. The Company’s dips, spreads, and dressings are centrally produced for use in our restaurants and to be sold in grocery stores.

Previous wording

In assessing the performance of our business, in addition to considering a variety of measures in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), our management team also considers a variety of other key performance measures, including non-GAAP measures. The key performance measures used by our management for determining how our business is performing are: CAVA Revenue, CAVA Same Restaurant Sales Growth, CAVA AUV, CAVA Restaurant-Level Profit, CAVA Restaurant-Level Profit Margin, CAVA Restaurants, Net New CAVA Restaurant Openings, CAVA Digital Revenue Mix, Adjusted EBITDA, and Adjusted EBITDA Margin.

Current wording

In assessing the performance of our business, in addition to considering a variety of measures in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), our management team also considers a variety of other key performance measures, including non-GAAP measures. The key performance measures used by our management for determining how our business is performing are detailed in the table below.

Previous wording

We believe that these key financial measures provide useful information to users of our financial statements in understanding and evaluating our results of operations in the same manner as our management team. The presentation of these key performance measures, including Adjusted EBITDA and Adjusted EBITDA margin, which are non-GAAP financial measures, is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. See “Non-GAAP Financial Measures” below.

Current wording

We believe that these key financial measures provide useful information to users of our financial statements in understanding and evaluating our results of operations in the same manner as our management team. The presentation of these key performance measures, including Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin, which are non-GAAP financial measures, is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. See “Non-GAAP Financial Measures” below.

Previous wording

(1) To achieve an optimal comparison of fiscal weeks in the CAVA Same Restaurant Sales calculation in fiscal 2024, giving consideration to holiday periods, each week of fiscal 2023 was shifted by one week. As a result of this shift, approximately $2.3 million of revenue is not included in CAVA Same Restaurant Sales Growth for the forty weeks ended October 6, 2024. Had this shift not been made, CAVA Same Restaurant Sales Growth would have been 11.6% in the forty weeks ended October 6, 2024 and immaterially impacted in the twelve weeks ended October 6, 2024.

Current wording

1 To achieve an optimal comparison of fiscal weeks in the CAVA Same Restaurant Sales Growth calculation in fiscal 2024, giving consideration to holiday periods, each week of fiscal 2023 was shifted by one week. As a result of this shift, approximately $3.9 million of revenue is not included in CAVA Same Restaurant Sales Growth for the sixteen weeks ended April 21, 2024. Had this shift not been made, CAVA Same Restaurant Sales Growth would have been 4.3% in the sixteen weeks ended April 21, 2024.

Previous wording

(2) Presented on a trailing thirteen period basis. For purposes of calculating CAVA AUV for the reporting period ended October 6, 2024, the applicable measurement period is the trailing thirteen periods ended October 6, 2024, excluding the 53rd week of fiscal 2023. For the reporting period ended October 1, 2023, the applicable measurement period is the trailing thirteen periods ended October 1, 2023.

Current wording

2 Presented on a trailing thirteen period basis. For purposes of calculating CAVA AUV for the reporting period ended April 20, 2025, the applicable measurement period is the trailing thirteen periods ended April 20, 2025. For the reporting period ended April 21, 2024, the applicable measurement period is the trailing thirteen periods ended April 21, 2024, excluding the 53rd week of fiscal 2023.

Previous wording

(3) See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA and Adjusted EBITDA Margin, and a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP measure to Adjusted EBITDA. Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of revenue.

Current wording

3 See “Non-GAAP Financial Measures” below for a discussion of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Net Income margin and reconciliations of Adjusted EBITDA and Adjusted Net Income to net income, the most directly comparable GAAP measure. Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of revenue. Adjusted Net Income margin is Adjusted Net Income as a percentage of revenue.

Previous wording

Our results of operations, on a consolidated basis and by segment, for the twelve and forty weeks ended October 6, 2024 and October 1, 2023 are set forth below. We present our segment results before our consolidated results as we believe that our CAVA segment is more useful and meaningful in assessing the performance of our business, which is mainly driven by our CAVA segment. As of March 2, 2023, we no longer operate any Zoes Kitchen locations, and on October 20, 2023, our conversion strategy was completed with the last conversion restaurant opening. As a result, we have limited our discussion of the Zoes Kitchen segment. In addition, because our consolidated results of operations include the results of our Zoes Kitchen segment, we believe that our consolidated results of operations are less indicative of our performance as compared to our CAVA segment.

Current wording

Our results of operations, on a consolidated basis and by segment, for the sixteen weeks ended April 20, 2025 and April 21, 2024, are set forth below. We present our segment results before our consolidated results as we believe that our CAVA segment is more useful and meaningful in assessing the performance of our business, which is mainly driven by our CAVA segment.

Previous wording

The increase in CAVA Revenue was primarily due to a $38.3 million increase from the 73 Net New CAVA Restaurant Openings during or subsequent to the twelve weeks ended October 1, 2023. In addition, the increase in CAVA Revenue was driven by CAVA Same Restaurant Sales Growth of 18.1%, which consisted of a 12.9% increase from guest traffic and a 5.2% increase from menu price and product mix.

Current wording

The increase in CAVA Revenue was primarily due to a $46.1 million increase from the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024. In addition, the increase in CAVA Revenue was driven by CAVA Same Restaurant Sales Growth of 10.8%, which consisted of a 7.5% increase from guest traffic and a 3.3% increase from menu price and product mix.

Previous wording

The increase in CAVA food, beverage, and packaging was primarily due to a $37.5 million increase from the 115 Net New CAVA Restaurant Openings during or subsequent to the forty weeks ended October 1, 2023, of which a portion was attributable to the 28 CAVA restaurants that were converted from Zoes Kitchen locations. The remainder of the increase was primarily due to CAVA Same Restaurant Sales Growth of 11.1%. As a percentage of CAVA Revenue, CAVA food, beverage, and packaging was flat primarily due to input costs associated with the June 3rd launch of grilled steak offset by lower other input costs.

Current wording

The increase in CAVA food, beverage, and packaging was primarily due to a $14.0 million increase from the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024. The remainder of the increase was primarily due to CAVA Same Restaurant Sales Growth of 10.8%. As a percentage of CAVA Revenue, CAVA food, beverage, and packaging increased primarily due to input costs associated with the launch of grilled steak in the second quarter of fiscal 2024.

Previous wording

The increase in CAVA labor was primarily due to the 73 Net New CAVA Restaurant Openings during or subsequent to the twelve weeks ended October 1, 2023. The remainder of the increase was primarily due to the impact of higher average hourly wages of 8%.

Current wording

The increase in CAVA labor was primarily due to the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024 and higher average hourly wages of 3%. As a percentage of CAVA Revenue, CAVA labor decreased due to the impact of higher sales, partially offset by the aforementioned incremental wage investments.

Previous wording

The increase in CAVA occupancy was primarily due to the 73 Net New CAVA Restaurant Openings during or subsequent to the twelve weeks ended October 1, 2023.

Current wording

The increase in CAVA occupancy was primarily due to the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024. As a percentage of CAVA Revenue, CAVA occupancy decreased primarily due to operating leverage associated with higher sales.

Previous wording

The increase in CAVA other operating expenses was primarily due to the 115 Net New CAVA Restaurant Openings during or subsequent to the forty weeks ended October 1, 2023, of which a portion was attributable to the 28 CAVA restaurants that were converted from Zoes Kitchen locations, investments in the integrity of our physical spaces in support of our increased restaurant volumes, and CAVA Same Restaurant Sales Growth of 11.1%.

Current wording

The increase in CAVA other operating expenses was primarily due to the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024, investments in the integrity of our physical spaces in support of our increased restaurant volumes, and CAVA Same Restaurant Sales Growth of 10.8%. As a percentage of CAVA Revenue, CAVA other operating expenses decreased due to operating leverage associated with higher sales, partially offset by the aforementioned investments in the integrity of our physical spaces in support of our increased restaurant volumes.

Previous wording

The following table summarizes remaining activity related to our CPG operations:

Current wording

The following table summarizes remaining activity related to CPG operations and the production of dips and spreads used in CAVA restaurants:

Previous wording

The increase in general and administrative expenses was primarily due to investments to support future growth and the timing of performance-based incentive compensation.

Current wording

The increase in general and administrative expenses was primarily due to investments to support future growth and higher equity-based compensation, including payroll taxes arising from the vesting of RSUs.

Previous wording

The increase in depreciation and amortization was primarily driven by the addition of assets from the 115 Net New CAVA Restaurant Openings during or subsequent to the forty weeks ended October 1, 2023, the commencement of operations at our new manufacturing facility in Verona, Virginia in the first quarter of fiscal 2024, and technology improvements.

Current wording

The increase in depreciation and amortization was primarily driven by the addition of assets from the 73 Net New CAVA Restaurant Openings during or subsequent to the sixteen weeks ended April 21, 2024 and technology improvements.

Previous wording

The decrease in pre-opening costs was due to the volume and timing of new CAVA restaurant openings.

Current wording

The increase in pre-opening costs was due to the timing of new CAVA restaurant openings, and includes the impact of higher rent geographies in the current quarter.

Previous wording

In addition to our consolidated financial statements, which are prepared in accordance with GAAP, we present Adjusted EBITDA and Adjusted EBITDA Margin as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. We believe these non-GAAP financial measures assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our operating performance. Management believes Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate, and capital investments. Management uses Adjusted EBITDA and Adjusted EBITDA Margin to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone provide.

Current wording

In addition to our consolidated financial statements, which are prepared in accordance with GAAP, we present Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. We believe these non-GAAP financial measures assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our operating performance. Management believes Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate, and capital investments. Management uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone provide.

Previous wording

Adjusted EBITDA and Adjusted EBITDA Margin are not recognized terms under GAAP and should not be considered as alternatives to net income or net income margin as measures of financial performance, or cash provided by operating activities as measures of liquidity, or any other performance measure derived in accordance with GAAP. Additionally, these measures are not intended to be measures of free cash flow available for management’s discretionary use, as they do not consider certain cash requirements such as tax payments and financing cash flows. Because not all companies use identical calculations, the presentation of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company.

Current wording

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin are not recognized terms under GAAP and should not be considered as alternatives to net income or net income margin as measures of financial performance, or cash provided by operating activities as measures of liquidity, or any other performance measure derived in accordance with GAAP. Additionally, these measures are not intended to be measures of free cash flow available for management’s discretionary use, as they do not consider certain cash requirements such as interest payments, tax payments, and debt service requirements. Because not all companies use identical calculations, the presentation of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company.

Previous wording

Our Adjusted EBITDA and Adjusted EBITDA Margin measures have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Some of these limitations are:

Current wording

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin measures have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Some of these limitations are:

Previous wording

•Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

Current wording

•Adjusted EBITDA and Adjusted Net Income do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

Previous wording

•Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

Current wording

•Adjusted EBITDA and Adjusted Net Income do not reflect changes in, or cash requirements for, our working capital needs;

Previous wording

•Adjusted EBITDA does not reflect financing activities of our business;

Current wording

•Adjusted EBITDA and Adjusted Net Income do not reflect financing activities of our business;

Previous wording

•other companies in our industry may calculate Adjusted EBITDA and Adjusted EBITDA Margin differently than we do, limiting their usefulness as comparative measures.

Current wording

•other companies in our industry may calculate Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, and Adjusted Net Income margin differently than we do, limiting their usefulness as comparative measures.

Previous wording

The following tables provides a reconciliation of net income to Adjusted EBITDA and net income margin to Adjusted EBITDA Margin:

Current wording

The following table provides a reconciliation of net income to Adjusted EBITDA and net income margin to Adjusted EBITDA margin for the periods indicated:

Previous wording

We believe that cash provided by operating activities and existing cash on hand, together with amounts available under our 2022 Credit Facility, will be sufficient to satisfy our anticipated cash requirements for the next twelve months and foreseeable future, including our expected capital expenditures for expansion of our CAVA restaurant base, operating lease obligations, and working capital obligations. Our sources of liquidity could be affected by factors described under the section entitled “Risk Factors” in our 2023 Annual Report. Depending on the severity and direct impact of these factors on us, we may not be able to secure additional financing on acceptable terms, or at all.

Current wording

We believe that cash provided by operating activities and existing cash on hand, together with amounts available under our 2022 Credit Facility, will be sufficient to satisfy our anticipated cash requirements for the next twelve months and foreseeable future, including our expected capital expenditures for expansion of our CAVA restaurant base, operating lease obligations, and working capital requirements. Our sources of liquidity could be affected by general macroeconomic conditions, as well as tariff policy and geopolitical tensions between the United States and foreign countries, as well as the factors described under the section entitled “Risk Factors” in our 2024 Annual Report. Depending on the severity and direct impact of these factors on us, we may not be able to secure additional financing on acceptable terms, or at all.

Previous wording

We had cash and cash equivalents of $367.2 million and $332.4 million as of October 6, 2024 and December 31, 2023, respectively. For the forty weeks ended October 6, 2024, our operations were funded from cash flows from operations.

Current wording

We had cash and cash equivalents of $289.4 million and $366.1 million as of April 20, 2025 and December 29, 2024, respectively. In addition, we had investments of $79.9 million as of April 20, 2025. For the sixteen weeks ended April 20, 2025, our operations were funded from cash flows from operations.

Previous wording

The increase in net cash provided by operating activities was primarily due to improved operating performance and interest income associated with an increase in short-term investments as a result of proceeds from the IPO.

Current wording

The increase in net cash provided by operating activities was primarily due to improved operating performance, partially offset by working capital changes.

Previous wording

The decrease in net cash used in investing activities was primarily due to higher capital expenditures in the prior year period related to the construction of our new manufacturing facility and the volume and timing of new CAVA restaurant openings.

Current wording

The increase in net cash used in investing activities was primarily due to launching an investment portfolio to optimize returns on our cash balances and higher capital expenditures related to future new CAVA restaurant openings.

Previous wording

The change in net cash (used in) provided by financing activities was primarily due to proceeds from the IPO in the prior year period and higher tax withholding obligations arising from the vesting of restricted stock units in the forty weeks ended October 6, 2024 compared with the prior year period.

Current wording

The change in net cash provided by (used in) financing activities was primarily due to decreased tax withholding obligations arising from the vesting of RSUs and an increase in stock options exercised in the sixteen weeks ended April 20, 2025 compared with the prior year period.

Previous wording

There has been no significant changes to the material cash commitments as disclosed in our 2023 Annual Report, other than those payments made in the ordinary course of business.

Current wording

There have been no significant changes to the material cash commitments as disclosed in our 2024 Annual Report, other than those payments made in the ordinary course of business.