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America's steakhouse franchises range from peanut-filled Texas Roadhouses to Outback Steakhouses. The recent success of LongHorn Steakhouse implies that more Americans are turning to the brand for grilled steak.
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Darden Restaurants' casual steakhouse outperformed analyst expectations in the most recent quarter, ended May 28, with a 7.1% increase in same-store sales.
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This outperforms Darden's 4% same-store sales increase and Olive Garden's 4.4% increase.
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Longhorn's powerful quarter? During a June 22 earnings call, Darden's president and CEO stated that there was no "silver bullet" to explain LongHorn's success. He suggested several plausible causes.
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He admitted that pricing increases contributed to higher quarter sales. Restaurant menu prices are frequently raised to cover rising food, labor, and other costs. Darden's CFO forecasted 6% to 6.5% price increases for the fiscal year 2023 in March.
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A restaurant's good service and food can make customers happier and more likely to return. Internal guest satisfaction indicators across our brands remain at or near all-time highs, according to the call.
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"No silver bullets." Great execution, investing in your people, investing in your product to create profitable, same-restaurant sales growth, that's what LongHorn's leadership has been doing," he said.
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LongHorn beat other Darden brands in the most recent quarter, but it will be compared to another well-known steakhouse chain, Ruth's Chris Steak House, which Darden acquired earlier this month.
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