Company: CAVA
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001628280-25-049080
Chunk: 34

Company: CAVA GROUP, INC.
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 1
Chunk 34
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 taxes5,898 0.7 482 0.1 5,416 N/MNet income$58,822 6.5 %$51,700 7.0 %$7,122 13.8 %

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N/M data not meaningful

Revenue, Food, beverage, and packaging, Labor, Occupancy, and Other operating expenses:

The increases in Revenue, Food, beverage, and packaging, Labor, Occupancy, and Other operating expenses are primarily driven by the growth of our CAVA Segment. Refer to “CAVA Segment Results” above for more information.

General and administrative expenses:

The increase in general and administrative expenses was primarily due to investments to support future growth, including our CAVA Connect conference, higher equity-based compensation, including payroll taxes arising from the vesting of RSUs, and executive transition costs, partially offset by lower performance-based incentive compensation and legal costs. 

Depreciation and amortization:

The increase in depreciation and amortization was primarily driven by the addition of assets from the 106 Net New CAVA Restaurant Openings during or subsequent to the forty weeks ended October 6, 2024 and technology improvements. 

Pre-opening costs:

The increase in pre-opening costs was due to the volume of new CAVA restaurants under construction and higher costs on a per unit basis.

22

Interest income, net:

The decrease in interest income, net, was due to lower interest rates on short term investments in the current year period.

Other income, net:

The increase in other income, net, was due to the fair value change recognized on a convertible promissory note described in Item 1, Financial Statements, Note 3 (Investments).

Provision for income taxes:

The effective income tax rate for the forty weeks ended October 5, 2025 was 9.1%, which includes the impact of a $12.6 million reduction to income tax expense associated with equity-based compensation. The effective tax rate for the forty weeks ended October 6, 2024 was 0.9% as the amount of income tax expense was immaterial prior to the Company’s release of its valuation allowance against deferred tax assets in the fourth quarter of fiscal 2024.

Non-GAAP Financial Measures

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