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Cava cuts full-year forecast as younger consumers pullback
11/5/2025, 7:07:57 PM
Economic Summary
- KAVA reported EPS and revenues roughly in line but same-store sales growth of 1.9% missed Street estimates, prompting a second consecutive cut to full-year same-store sales guidance and signaling weaker demand from younger diners (ages 24–35).
- McDonald's (MCD) posted U.S. comps up 2.4%, beating expectations, yet management remains cautious as lower-income consumers continue to struggle; the company plans to lean into value to offset pressure.
- Across the quick-service restaurant sector there's a bifurcated consumer: lower-income traffic is down nearly double digits while upper-income traffic is up nearly double digits, indicating consumers are being more selective amid economic uncertainty.
Bullish
- McDonald's U.S. comps beat expectations, up 2.4%.
- Upper-income customer traffic increased nearly double digits.
- McDonald's emphasis on value could stabilize visits among price-sensitive customers.
Bearish
- Kava cut full-year same-store sales guidance for the second consecutive time.
- Younger diners (ages 24-35) are visiting less frequently, pressuring same-store sales.
- Lower-income consumer traffic is declining double digits across QSR, weakening demand.
Bullish tickers
MCDCMG
Bearish tickers
KAVAMCD
KAVA
Bullish
EPS and revenues were roughly in line, and management says frequency decline is among younger diners rather than broad defections.
Bearish
Missed same-store sales estimates (1.9% SSS) and issued a second consecutive guidance cut; younger diners reducing visit frequency.
MCD
Bullish
U.S. comps rose 2.4% beating expectations; upper-income traffic grew strongly and the company is leaning into value to drive visits.
Bearish
Lower-income customer traffic is struggling, and management is cautious about consumer conditions both domestically and internationally.
CMG
Bullish
Previously saw same-store sales strength from lower-income customers, suggesting some resilience in different cohorts.
Bearish
Observed pullback among younger consumers similar to peers, which could pressure traffic.
People mentioned
Kate RogersDomBrett SchulmanIan BordenChris Kempczinski