Wall Street got its first taste of Cava's (CAVA) future earnings potential.
In its first quarterly report since its much-hyped IPO, the Mediterranean fast-casual restaurant chain turned profitable, with revenue jumping 62.4% year over year and same-store sales moving higher, up 18.2% in its Q2 earnings results.
Cava stock (CAVA) popped more than 5% after the market close on Tuesday.
Following its IPO, Cava stock closed at $43.30, valuing the restaurant chain at roughly $4.8 billion. That was almost twice what the company priced its valuation night before at $22 per share (for a total valuation of $2.5 billion).
In mid-July, analysts initiated coverage on the stock and were hopeful for lots of long-term potential, with some drawing comparisons to rival Chipotle (CMG).
In Q2, Cava saw same-store sales grow 18.2% year over year, topping Chipotle's 7.4% same-store sales growth. In Q1 2023, Cava sales increased 28.4%.
Profitability is a key focus.
Last quarter, the company posted a net loss of $6.5 million. In all of fiscal year 2021, the company posted a net loss of $37.4 million, which widened in 2022 to a net loss of $59.00 million.
"Revenue and profitability reached record levels," Cofounder and CEO Brett Schulman said in the earnings release. "Our dominant leadership position and proven portability create meaningful opportunity for growth in new and existing markets, as evidenced by our 16 Net New CAVA Restaurant Openings during the quarter."
The earnings rundown
Net Sales: $172.9M, up 27% year-over-year
Diluted EPS: -0.21
Same-store sales: a 18.2% increase
Net Income: $6.5 million
AUV: $2.6 million
This story is breaking. Please check back for updates.
—
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
Read the latest financial and business news from Yahoo Finance
