Darden Restaurants Inc (DRI)

Operating return on assets (Operating ROA)

		May 31, 2025	May 31, 2024	May 26, 2024	May 31, 2023	May 28, 2023
Operating income	US$ in thousands	1,362,300	1,314,200	1,314,200	1,201,800	1,201,800
Total assets	US$ in thousands	12,587,000	11,323,000	11,323,000	10,241,500	10,241,500
Operating ROA		10.82%	11.61%	11.61%	11.73%	11.73%

May 31, 2025 calculation

Operating ROA = Operating income ÷ Total assets
= $1,362,300K ÷ $12,587,000K
= 10.82%

The operating return on assets (operating ROA) for Darden Restaurants Inc, as of the provided data, indicates a generally stable yet slightly declining profitability measure over the specified period. As of May 28 and May 31, 2023, the operating ROA stood at 11.73%. This rate reflects the company's ability to generate operating income from its assets during that time and suggests a strong operational efficiency.

By May 26 and May 31, 2024, the operating ROA decreased marginally to 11.61%, indicating a slight decline in operational efficiency or in the effective utilization of assets to generate operating income within that year. Despite this modest reduction, the company maintained a high level of asset productivity.

However, by May 31, 2025, the operating ROA further declined to 10.82%. This trend suggests a continued, albeit gradual, deterioration in operational performance relative to asset levels. The decline in operating ROA over this period may reflect increased operating costs, changes in revenue generation efficiency, or an expansion of assets that has not yet proportionally increased operating income.

Overall, the data exhibits a downward trend in Darden's operating ROA over the observed periods, which warrants close monitoring. While the level of approximately 11% in the earlier years indicates effective asset utilization, the decline to around 10.8% by the most recent date may suggest challenges in maintaining previous levels of operational efficiency. Management may need to evaluate operational strategies to sustain or enhance asset productivity and to understand underlying factors contributing to this decline.