CAVA Group, Inc.

Good afternoon, ladies and gentlemen, and welcome to the CAVA first quarter 2025 earnings conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star 0 for the operator. This call is being recorded on May 15, 2025. I would now like to turn the conference over to Matt Milinovich. Please go ahead.

Good afternoon and welcome to CAVA's first quarter 2025 financial results conference call. Before we begin, if you do not already have a copy, the earnings released and related 8K furnished to the SEC are available on our website at investor.cava.com. The purpose of this conference call is to give investors further details regarding the company's financial results, as well as a general update on the company's progress. You will find reconciliations of any non-GAAP financial measure discussed on today's call to the most directly comparable financial measure calculated in accordance with GAAP to the extent available without unreasonable efforts in today's earnings release and supplemental deck, each of which is posted on the company's website. Before we begin, let me remind everyone that this call will contain forward-looking statements. For this purpose, any statements made during this call that are not statements of historical fact may be deemed to be forward-looking statements. Investors should be aware that any forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those discussed here today. These risk factors are explained in detail in CAVA's most recent annual report on Form 10-K and other filings with the SEC. Please refer to these filings for a more detailed discussion of forward-looking statements and the risks and uncertainties of such statements. All forward-looking statements are made as of today. and accept as required by law, CABA undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future developments, or otherwise. And now I'll turn the call over to the company's co-founder and CEO, Brett Schulman.

Thanks, Matt, and welcome to the call, everyone. In the first quarter of 2025, we continued to demonstrate the strength of our category-defining brand, further cementing Mediterranean as the next major cultural cuisine category. Despite broader uncertainty, we sustained momentum, delivered strong results, including positive traffic, and expanded our reach, reinforcing our ability to capture the substantial white space opportunity in front of us. Regardless of near-term headwinds, we remain unwavering in our long-term strategic approach, and our value proposition remains clear and compelling. A menu where taste and health unite, delivered with the relevance, convenience, quality, and experience today's guests seek. Powering this momentum is our unit economic engine, remaining strong and steadfast while fueling our growth and brand loyalty. Our first quarter highlights include a 28.2% increase in CAVA revenue, CAVA same restaurant sales growth of 10.8%, driven by 7.5% traffic, 15 net new restaurants, ending the quarter with 382 restaurants, an 18.3% increase year over year, adjusted EBITDA of $44.9 million, a 34.6% increase over the first quarter of 2024, net income of $25.7 million, an 83.7% increase over the first quarter of 2024, and $2.7 million in free cash flow. In addition to these highlights, I'm proud to say that on a trailing 12-month basis, we have now surpassed a billion dollars in revenue. a milestone that is a testament to Mediterranean becoming the next large-scale cultural cuisine category, a category we have firmly established our leadership in. In a fluid macroeconomic environment, our performance this past quarter underscores the strength of our value proposition and the enduring relevance of our brand. At a time when tomorrow feels unclear to many, our ability to deliver bold, flavorful, health-conscious food paired with convenience and genuine human connection is a strategy for success. What sets us apart is beyond what we serve. It's the community we cultivate that defines our brand. That strength has always been deeply aligned with our mission to bring heart, health, and humanity to food, and it continues to resonate with guests across our geographically diverse markets. Our growth is driven by both intention and momentum as we lean into our first strategic pillar, expand our Mediterranean way in communities across the country. This quarter, we entered Indiana, expanding our footprint to 26 states and the District of Columbia. Additionally, we deepened our presence in Florida with the opening of our Hialeah location, marking our highly anticipated entry into the greater Miami area. Looking ahead, we are excited to continue expanding across the Midwest and Mid-Atlantic with upcoming new market entries in Detroit and Pittsburgh. We are well on our way to our goal of at least 1,000 restaurants by 2032. creating more spaces where connection, community, and Mediterranean hospitality can thrive. The in-restaurant experience remains a vital part of how we foster this connection, and we're committed to bringing this to life through our Project Soul initiative. By incorporating natural light, softer seating, enhanced greenery, and warm, inviting tones, we're creating spaces where guests feel welcomed, places designed for gathering, sharing, and creating meaningful moments. We will continue to challenge the idea that the dining room is a relic of the past and were recently recognized for our efforts around Project Soul and Fast Companies, world's 50 most innovative companies as number one in restaurants, dining and food services, and number 13 overall. Now more than ever, people are seeking human connection and we aim to meet that need by delivering the warmth and hospitality that defines the Cava brand. And that same warmth and hospitality extends well beyond our physical spaces. it's reflected in what we serve and why our guests continue to return to our table. This summer, we're leaning into flavor and relevance with the launch of our Spice World campaign, a celebration of bold, spicy offerings that capture the spirit of the season without compromising health. As part of this campaign, we debuted Hot Harissa Pita Chips, a bold, spicy take on our fan favorite chips, leveraging our existing pantry, mitigating added operational complexity, and bringing the heat just in time for summer. In tandem, we're launching two new chef-curated bowls, Steak and Harissa and Spicy Lamb and Avocado, each designed to spotlight vibrant flavor profiles and offer guests even more ways to experience the warmth of the Mediterranean. Seasonal moments like these reflect who we are as a brand, innovative, intentional, and attuned to what today's guests are craving, all while staying true to our concept essence. A key tenet of our concept essence is our spirit of generosity, something we were able to bring to life this past quarter through our newest brand moment, National Pita Day. On March 29th, we celebrated this social holiday as a platform to deepen connection with our community, anchored by the debut of a playful new team member, Peter Chip. Peter Chip's birthday was purposefully aligned with National Pita Day, celebrated with complimentary pita chips for all CAVA Rewards members. National Pita Day exemplified how we bring generosity, cultural relevance, and guest engagement together in a way that builds brand affinity and drives business results. By aligning the promotion with a branded holiday and social storytelling, we saw increased reach, record high app traffic, and over 130% more rewards redeemed than originally anticipated. It's a launch we're excited to build on in the years ahead. As we grow our loyalty base and bring more guests into our first-party ecosystem, we're unlocking new opportunities to advance our second pillar, deepening personal relationships with guests even as we scale. Campaigns like National Pee Today not only reflect our brand's spirit of generosity, they also serve as dynamic testing grounds for how we engage and excite our growing first-party audience. These initiatives give us valuable insights that inform the ongoing development of new loyalty features and experiences, helping us build stronger, more lasting relationships with our guests. We've seen strong momentum since the launch of our Reimagine Loyalty program, with sales through the program up 340 basis points as a percentage of total revenue since relaunch and total membership now approaching 8 million members. Later this year, we plan to roll out the next phase of the program, including testing a new tiered structure designed to further tailor benefits to guest preferences and enhance long-term engagement. To deliver the best guest experience possible, we remain focused on our third pillar, running great restaurants, every location, every shift. Consistency, efficiency, quality, and hospitality are integral to our operations, and we continue to invest in initiatives that elevate performance in each of these areas. At the center of it all are our team members. We're committed to enhancing, not replacing the human experience, which is why we rolled out a new labor deployment and scheduling model late last year. We are continuing to see improved productivity across both day parts. As restaurants grow more comfortable with the tool, they are refining and optimizing with the opportunity to drive even greater efficiencies and productivity across the system. Additionally, we're continuing to make steady progress on our connected kitchen initiative. As shared during our last call, we plan to roll out our new kitchen display system to 250 restaurants by year end. We're currently live in 42 locations and are continuing to see improvements in guest satisfaction scores driven by better digital accuracy and more proactive guest communications. Another promising advancement under our Connected Kitchen platform is our AI video technology, which recently completed its test and learn phase and is live in four restaurants. This system currently supports our teams in two critical ways. The grill assistant helps grill cooks determine how much food to prepare based on real-time depletion data cross-referenced with historical data, while prep assistant equips our teams with actionable insights to make more informed and accurate prep production. Finally, our fourth pillar, operate as a high-performing team, is foundational to everything we do. A great guest experience at CAVA begins with a great team. We remain deeply committed to building a workplace that fosters growth, leadership, and long-term career development. Nothing brings our commitment to developing future leaders to life more vividly than our Restaurant Leader Conference, Cava Connect, which took place just last week. This year's theme was Ignite, a reflection of the passion, purpose, and momentum driving our teams forward. Over three days of recognition, celebration, and learning, we laid the foundation for an expanded training journey. from team member to general manager, further building on our Academy GM network and laying the groundwork for a deeper, role-ready leadership bench. We're already beginning to see the power of this approach in leaders like Dani Morales, whose journey with Cava began as a grill cook at our VCU location in Richmond, Virginia. Through grit, heart, and a commitment to growth, she rose through the ranks, opening 14 restaurants, and now serving as an Academy GM with her sights set on multi-unit leadership. Along the way, she's developed future leaders of her own, including a former grill cook who now runs the very restaurant where she started. Dani's story is a testament to the depth of talent within our system and the impact of investing early and often in our people. We look forward to sharing more on our broader talent development strategy in the coming quarters. Before I turn the call over, I want to thank our teams across the country for delivering another strong quarter while staying rooted in our mission. In times of uncertainty, our ability to lead with purpose, innovation, and long-term focus matters more than ever. As we move forward, we remain committed to offering bold, healthful food, providing flexible and convenient ways to engage with our brand, and most importantly, keeping the human connection that we are known for at the center of everything we do. With that, I'll let Tricia walk you through the financials.