Olive Garden’s parent company strikes Uber deal to revive pasta empire

The restaurant operator plans to offer nationwide delivery for Olive Garden through a two-year partnership with Uber by May next year, according to a statement Thursday. A pilot at a limited number of stores is planned for late this year. 

The deal signals Darden, which had previously resisted allowing its food to be widely delivered by third-party apps, is trying to attract cash-strapped consumers after seeing a “significant” drop in customers in July.

Darden shares rose as much as 9% in New York, the most intraday since September 2021.

Business picked up at Olive Garden after it extended its Never Ending Pasta Bowl promotion by four weeks, Darden Chief Executive Officer Rick Cardenas said on the company’s earnings call, starting it in late August rather than late September. Cardenas said all of Darden’s brands began recovering in August. 

The recovery led Darden to maintain its full-year guidance, according to a statement Thursday. Revenue for the first quarter was $2.76 billion, lower than analysts expected. 

The deal and expanded all-you-can-eat offering shows the restaurant chain is trying to expand its reach as it battles a spending pullback, especially among low-income consumers worried about inflation and job security.

Still, Cardenas said Darden won’t join the “real deep discount game.” Rival Applebee’s, owned by Dine Brands Global Inc., ran a $1 margarita promotion alongside its all-you-can-eat deal this summer.

The difficult July saw Darden’s comparable sales fall 1.1% in the first quarter compared to the same period last year, with Olive Garden down 2.9%.

(Updates with details on promotion and Uber partnership)