How CAVA (CAVA Group) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a fast-casual restaurant operator like CAVA (formerly Zoes Kitchen) makes money is essential for investors and anyone interested in the business of foodservice and hospitality. In this post, we break down CAVA's quarterly income statement (Q4 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick CAVA Overview

CAVA operates a network of fast-casual Mediterranean restaurants, focusing on fresh, customizable bowls, pitas, and salads. Revenue comes primarily from in-store restaurant sales, with a small contribution from branded product sales and other minor streams. The company’s business model centers on high-traffic urban and suburban locations, leveraging operational efficiency and a scalable menu.

Revenue Breakdown

• Total Revenue (Q4 2025): $292.2M (+19.9% YoY)
  • CAVA Restaurant Revenue: $289.8M (99.2% of total)
  • Other Revenue by Product: $2.45M (0.8% of total)
  • Zoes Kitchen Revenue: $0.0M (0% of total; legacy brand fully integrated)
• Growth is powered by new restaurant openings, strong same-store sales growth, and increased digital ordering.

Gross Profit and Margins

• Gross Profit: $198.9M (68.0% gross margin)
  • Cost of Revenue: $93.4M (-13.2% YoY)
  • CAVA maintains robust margins due to its scalable digital business model, efficient supply chain management, and menu simplicity.
• Most costs come from food ingredients, labor, and occupancy expenses.

Operating Income and Expenses

• Operating Income: $17.1M (+24.4% YoY, 5.9% margin)
• Operating Expenses: $126.5M (+72.0% YoY)
  • SG&A: $31.5M (+5.6% YoY, 10.8% of revenue) — includes corporate overhead, marketing, and administrative costs
  • R&D: Not separately disclosed; innovation investment is embedded in menu development and technology upgrades
  • CAVA continues to invest in growth and digital innovation while maintaining operational efficiency.

Net Income

• Pre-Tax Income: $20.7M (+15.4% YoY, 7.1% margin)
• Income Tax: $5.92M (28.6% effective tax rate)
• Net Income: $14.7M (-17.9% YoY, 5.0% net margin)
• CAVA converts a moderate portion of sales into profit due to scalability and disciplined cost management, though net income declined YoY due to higher operating expenses.

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What Drives CAVA's Money Machine?

• Restaurant sales: 99%+ of revenue comes from direct restaurant operations, with digital orders and delivery growing fastest.
• Same-store sales growth: Q4 2025 saw double-digit increases, driven by menu innovation and digital engagement.
• Strategic investment: CAVA invests heavily in new store openings, technology, and brand marketing.
• Future growth areas: Expansion into new markets and digital channels, though these segments are not yet profitable.

Visualizing CAVA's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially SG&A and store-level costs) taking the largest chunk.
• Even after significant investments in growth and technology, 5.0% of revenue drops to the bottom line.

Key Takeaways

• CAVA's money comes overwhelmingly from restaurant sales
• High gross margins illustrate the power of CAVA's efficient, scalable business model
• Heavy investment in new stores and digital innovation, balanced by tight control of operating costs
• Ongoing growth is driven by same-store sales increases, new openings, and digital channel expansion

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FAQ About CAVA's Income Statement

1. What is the main source of CAVA's revenue in 2025?

CAVA generates over 99% of its revenue from restaurant sales. Other sources, such as branded product sales, contribute less than 1% of total revenue.

2. How profitable is CAVA in Q4 2025?

CAVA reported net income of $14.7M in Q4 2025, with a net margin of approximately 5.0%, reflecting moderate profitability driven by high gross margins and ongoing investment in growth.

3. What are the largest expense categories for CAVA?

The biggest expenses on CAVA's income statement are operating expenses, particularly Sales, General & Administrative (SG&A) costs, which reached $31.5M in Q4 2025 (10.8% of revenue), as CAVA prioritizes corporate infrastructure, marketing, and technology upgrades.

4. Why does digital expansion operate at a loss?

Digital expansion, despite generating increased sales, posted an operating loss due to aggressive investment in technology, delivery partnerships, and marketing, as CAVA believes these will drive long-term growth—even if the division is unprofitable today.

5. How does CAVA's effective tax rate compare to previous years?

CAVA's effective tax rate in Q4 2025 was 28.6%, consistent with previous years. This moderate rate is primarily due to standard corporate tax treatment and limited international structuring.