Core Insights - Cheesecake Factory reported revenue of $907.23 million for the quarter ended September 2025, marking a year-over-year increase of 4.8% and an EPS of $0.68 compared to $0.58 a year ago, with an EPS surprise of +13.33% [1] - The revenue fell short of the Zacks Consensus Estimate of $912.96 million by -0.63% [1] Financial Performance Metrics - Comparable restaurant sales for The Cheesecake Factory were 0.3%, below the seven-analyst average estimate of 1.2% [4] - The number of company-owned restaurants for The Cheesecake Factory remained at 216, matching the seven-analyst average estimate [4] - Revenue for The Cheesecake Factory restaurants was $651.38 million, slightly below the $655.31 million estimated by six analysts, representing a year-over-year change of +0.6% [4] Other Business Segments - North Italia reported comparable restaurant sales of -3%, significantly lower than the average estimate of 0.3% [4] - Revenue for North Italia was $83.48 million, below the six-analyst average estimate of $84.85 million, but showed a year-over-year increase of +16.1% [4] - Revenue from Other segments was $94.35 million, exceeding the six-analyst average estimate of $91.61 million, with a year-over-year change of +19.7% [4]

Core Insights - Cheesecake Factory reported quarterly earnings of $0.68 per share, exceeding the Zacks Consensus Estimate of $0.60 per share, and showing an increase from $0.58 per share a year ago, resulting in an earnings surprise of +13.33% [1] - The company generated revenues of $907.23 million for the quarter ended September 2025, which was slightly below the Zacks Consensus Estimate by 0.63%, but an increase from $865.47 million year-over-year [2] - Cheesecake Factory's stock has increased approximately 17.9% year-to-date, outperforming the S&P 500's gain of 16.9% [3] Earnings Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $1.11 on revenues of $969.08 million, and for the current fiscal year, it is $3.77 on revenues of $3.76 billion [7] Industry Context - The Retail - Restaurants industry, to which Cheesecake Factory belongs, is currently ranked in the bottom 11% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Cheesecake Factory's stock may be influenced by the overall outlook for the industry, as historical data shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8] Estimate Revisions - Prior to the earnings release, the estimate revisions trend for Cheesecake Factory was mixed, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - Consolidated revenues for Q3 2025 were $907 million, finishing near the midpoint of the guidance range [14] - Adjusted net income margin was 3.7%, exceeding the high end of the guidance [15] - GAAP diluted net income per share was $0.66, while adjusted diluted net income per share was $0.68 [17] Business Line Data and Key Metrics Changes - Comparable sales at The Cheesecake Factory restaurants increased by 0.3%, with total sales of $651.4 million, up 1% from the prior year [15][6] - North Italia's total sales were $83.5 million, up 16% from the prior year, with comparable sales declining by 3% [15][12] - Flower Child's sales totaled $48.1 million, up 31% from the prior year, with comparable sales increasing by 7% [15][12] Market Data and Key Metrics Changes - Annualized unit volumes for The Cheesecake Factory averaged over $12 million [6] - North Italia's annualized AUVs reached $7.3 million [11] - Flower Child's annualized AUVs were $4.6 million [12] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025, including four Cheesecake Factory locations and six each of North Italia and Flower Child [20] - For 2026, the company expects to accelerate development with as many as 26 new restaurant openings [8][20] - The focus remains on delivering exceptional food, service, and hospitality while executing long-term growth strategies [8] Management's Comments on Operating Environment and Future Outlook - Management noted a softer macro and consumer environment but emphasized stable overall performance [6] - The company anticipates total revenues for Q4 2025 to be between $940 million and $955 million, representing a 1% step down from Q3 sales trends [18] - Management expressed confidence in navigating the dynamic macro environment and maintaining profitability [22] Other Important Information - The company recorded a pre-tax net expense of $0.8 million related to FRC acquisition-related expenses [16] - The Cheesecake Rewards program continues to show strong membership growth and positive member satisfaction [10] Q&A Session Summary Question: What is driving the caution in the current consumer environment? - Management indicated that the caution is primarily due to a decline in traffic, with stable day parts and good performance from new menu items [24] Question: Can you provide the breakdown of comps for The Cheesecake Factory and North Italia? - For The Cheesecake Factory, pricing was about 4%, traffic was -2.5%, and mix was the difference. For North Italia, price was 4%, mix was -1%, and traffic was -6% [27] Question: What is the outlook for commodity inflation in Q4? - Commodity inflation was about flat in Q3, but is expected to be around 2% in Q4, primarily driven by beef prices [29] Question: How is the company planning to promote lower price point items? - Management plans to continue promoting bites and bowls through social media and marketing campaigns, leveraging the Cheesecake Rewards program [36] Question: Are there any changes in labor demand or supply? - Management reported steady applicant flow and strong retention, indicating no significant changes in labor demand or supply [89] Question: What are the expectations for the app launch? - The company is working on launching a rewards app in the first half of next year, aimed at enhancing customer engagement and experience [91]

Financial Data and Key Metrics Changes - Total revenues for Q3 2025 were $907 million, finishing near the midpoint of the guidance range [14] - Adjusted net income margin was 3.7%, exceeding the high end of the guidance [15] - GAAP diluted net income per share was $0.66, while adjusted diluted net income per share was $0.68 [17] Business Line Data and Key Metrics Changes - Comparable sales at The Cheesecake Factory restaurants increased by 0.3%, with total sales of $651.4 million, up 1% from the prior year [15][6] - North Italia's total sales were $83.5 million, up 16% from the prior year, with comparable sales declining by 3% [15][12] - Flower Child's sales totaled $48.1 million, up 31% from the prior year, with comparable sales increasing by 7% [15][12] Market Data and Key Metrics Changes - Annualized unit volumes for The Cheesecake Factory averaged over $12 million, while North Italia reached $7.3 million [6][11] - Flower Child's annualized AUVs were $4.6 million, significantly outperforming the fast casual segment [12] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025 and 26 in 2026, focusing on delivering exceptional food and service [8][20] - Menu innovation is a key strategic focus, with new offerings resonating well with customers and driving sales [6][10] - The company is developing a dedicated rewards app to enhance guest engagement and streamline the rewards program [11][90] Management's Comments on Operating Environment and Future Outlook - Management noted a softer macro and consumer environment but emphasized stable overall performance and healthy demand for their concepts [6][22] - The company anticipates total revenues for Q4 2025 to be between $940 million and $955 million, reflecting a cautious outlook due to current consumer trends [18] - Management expressed confidence in navigating the dynamic macro environment, citing strong execution and a resilient business model [22] Other Important Information - The Cheesecake Factory's restaurant-level profit margin increased by 60 basis points year-over-year to 16.3% [7] - Labor as a percentage of sales declined by 30 basis points, driven by improved retention and productivity [16] Q&A Session Summary Question: What is driving the caution in consumer behavior? - Management indicated that the caution is primarily due to a decline in traffic, with stable day parts but a slight drop in overall consumer visits [24] Question: Can you provide the breakdown of comps for The Cheesecake Factory and North Italia? - For The Cheesecake Factory, pricing was about 4%, traffic was negative 2.5%, and mix was the difference. For North Italia, price was 4%, mix was negative 1%, and traffic rounded to negative 6% [27] Question: What is the outlook for commodity inflation in Q4? - Commodity inflation was flat in Q3, but is expected to be around 2% in Q4, primarily driven by beef prices [29] Question: How is the company addressing value at North Italia? - North Italia is promoting a small plate and pasta lunch for $25 to enhance value perception among guests [55] Question: Are there any changes in labor demand? - Management reported no significant changes in labor demand or applicant flow, maintaining a steady environment for hiring [88] Question: What are the expectations for the new app? - The app is expected to enhance the rewards program, allowing for easier reservations and order placements, with a launch planned for the first half of next year [90]

Financial Data and Key Metrics Changes - The Cheesecake Factory reported total revenues of $907 million for Q3 2025, finishing near the midpoint of the guidance range [11] - Adjusted net income margin was 3.7%, exceeding the high end of the guidance [12] - GAAP diluted net income per share was $0.66, while adjusted diluted net income per share was $0.68 [14] Business Line Data and Key Metrics Changes - Comparable sales at The Cheesecake Factory restaurants increased by 0.3%, with total sales reaching $651.4 million, up 1% from the prior year [4][12] - North Italia's total sales were $83.5 million, up 16% from the prior year, with comparable sales declining by 3% [10][12] - Flower Child experienced a 7% increase in comparable sales, translating into annualized AUVs of $4.6 million [10][12] Market Data and Key Metrics Changes - The Cheesecake Factory's annualized unit volumes averaged over $12 million [4] - North Italia's annualized AUVs reached $7.3 million [9] - Flower Child's restaurant-level profit margins improved by 140 basis points year over year to 17.4% [11] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025 and 26 new restaurants in 2026, focusing on delivering exceptional food and service [6][17] - The strategic focus on menu innovation is seen as a key differentiator, with new menu offerings resonating well with consumers [5][8] - The company aims to enhance the guest experience through a dedicated rewards app, expected to launch in the first half of 2026 [78] Management's Comments on Operating Environment and Future Outlook - Management noted a softer macro and consumer environment but emphasized stable overall performance and healthy demand for their concepts [4][20] - The company anticipates total revenues for Q4 2025 to be between $940 million and $955 million, reflecting a cautious outlook due to recent industry trends [15] - Management expressed confidence in navigating the dynamic macro environment, citing strong execution and a resilient business model [20] Other Important Information - The Cheesecake Factory's restaurant-level profit margin increased by 60 basis points year over year to 16.3% [5] - The company returned $13.8 million to shareholders through dividends and stock repurchases [12] - Total available liquidity at the end of the quarter was approximately $556.5 million [14] Q&A Session Summary Question: What is driving the caution in consumer behavior? - Management indicated that the caution is primarily related to traffic trends, with stable day parts but a slight decline in overall traffic [22] Question: Can you provide the breakdown of comps for The Cheesecake Factory and North Italia? - For The Cheesecake Factory, pricing was about 4%, traffic was negative 2.5%, and mix was positive [24] - For North Italia, pricing was 4%, mix was negative 1%, and traffic was negative 6% [25] Question: What is the outlook for commodity inflation in Q4? - Commodity inflation was flat in Q3, but is expected to rise to about 2% in Q4, primarily driven by beef prices [27] Question: How is the company addressing the lower price points in the menu? - Management plans to continue promoting lower price point items and menu innovation to attract customers [32] Question: Are there any changes in labor demand and retention? - The company has not seen changes in labor demand and continues to experience strong applicant flow and low turnover [75] Question: What are the expectations for the loyalty program and app? - The loyalty program is expected to contribute positively in 2026, with the app aimed at enhancing guest experience and engagement [82]

INVESTOR PRESENTATION October 28, 2025 SAFE HARBOR STATEMENT / NON-GAAP INFORMATION Non-GAAP Financial Measures In addition to the results provided in accordance with the Generally Accepted Accounting Principles ("GAAP") in this presentation, the Company is providing non-GAAP measurements which present free cash flow, adjusted net income, adjusted diluted net income per common share, adjusted net income margin and adjusted earnings before interest, tax, depreciation and amortization ("EBITDA"). The non-GAAP ...

Core Insights - The chain reported a profit of $31.9 million amid a softer operating environment for the restaurant industry [1] Company Performance - The reported profit of $31.9 million indicates the company's ability to maintain profitability despite challenges [1] Industry Context - The operating environment for the restaurant industry is described as softer, suggesting potential headwinds affecting overall performance [1]

Financial Performance - Total revenues for Q3 fiscal 2025 were $907.2 million, up from $865.5 million in Q3 fiscal 2024, representing a year-over-year increase of 4.1%[2] - Net income for Q3 fiscal 2025 was $31.9 million, with diluted net income per share at $0.66, compared to $29.99 million and $0.61 per share in Q3 fiscal 2024[2][16] - Total revenues for the 13 weeks ended September 30, 2025, were $907.226 million, an increase from $865.471 million for the same period in 2024, representing a growth of 4.0%[18] - The company reported an income from operations of $37.269 million for the 13 weeks ended September 30, 2025, compared to $33.700 million for the same period in 2024, marking an increase of 10.5%[18] - Net income (GAAP) for the 13 weeks ended September 30, 2025, was $31,899 million, compared to $29,994 million for the same period last year, representing a growth of 6.3%[27] - Adjusted net income (non-GAAP) for the 39 weeks ended September 30, 2025, was $134,656 million, up from $116,894 million in the prior year, reflecting a year-over-year increase of 15.1%[27] - Diluted net income per share (GAAP) increased to $0.66 for the 13 weeks ended September 30, 2025, compared to $0.61 in the same period last year, marking an 8.2% rise[27] - Adjusted diluted net income per share (non-GAAP) for the 39 weeks ended September 30, 2025, was $2.77, up from $2.40 in the previous year, indicating a growth of 15.4%[27] Sales and Restaurant Operations - Comparable restaurant sales increased by 0.3% year-over-year in Q3 fiscal 2025, indicating stable performance amid a competitive environment[4] - Comparable restaurant sales for The Cheesecake Factory increased by 0.3% compared to the prior year for the 13 weeks ended September 30, 2025, while North Italia experienced a decline of 3%[21] - The company opened two new FRC restaurants and two Cheesecake Factory restaurants internationally in Q3 fiscal 2025, remaining on track to open up to 25 new restaurants by the end of the fiscal year[6] - The Cheesecake Factory opened 2 new restaurants during the 39 weeks ended September 30, 2025, compared to 1 new restaurant in the same period of 2024[21] Expenses and Costs - Total costs and expenses for the 13 weeks ended September 30, 2025, were $869.957 million, up from $831.771 million in the same period of 2024, reflecting an increase of 4.6%[18] - Labor expenses accounted for 35.6% of total revenues in Q3 fiscal 2025, slightly down from 35.9% in Q3 fiscal 2024, reflecting improved labor productivity[16] - The Cheesecake Factory's total food and beverage costs for the 39 weeks ended September 30, 2025, were $605.758 million, up from $559.932 million in the same period of 2024, an increase of 8.2%[18] - The company’s general and administrative expenses for the 39 weeks ended September 30, 2025, were $177.706 million, compared to $56.204 million for the same period in 2024, indicating a significant increase[18] Liquidity and Debt - Total available liquidity as of September 30, 2025, was $556.5 million, including a cash balance of $190.0 million and $366.5 million available on the revolving credit facility[7] - Cash and cash equivalents as of September 30, 2025, were $189.978 million, significantly higher than $84.176 million at the end of 2024[23] - Current and long-term debt increased to $629.156 million as of September 30, 2025, from $452.062 million at the end of 2024[23] Other Financial Metrics - The company recorded a pre-tax net expense of $0.8 million related to acquisition expenses for Fox Restaurant Concepts[3] - The company recorded impairment of assets and lease termination expenses of $(104) million for the 13 weeks ended September 30, 2025, compared to $(3,472) million for the same period last year[27] - Acquisition-related contingent consideration and compensation expenses amounted to $910 million for the 13 weeks ended September 30, 2025, down from $1,020 million in the prior year[27] - The tax effect of adjustments for the 39 weeks ended September 30, 2025, was $(5,020) million, compared to $(445) million for the same period last year[27] - The company reported a loss on extinguishment of debt of $15,891 million for the 39 weeks ended September 30, 2025, with no such loss reported in the previous year[27] - The uncertain tax position related to tenant improvement allowances resulted in an expense of $717 million for both the 13 and 39 weeks ended September 30, 2025[27] Strategic Focus - The Cheesecake Factory's focus on menu innovation and customer experience has led to steady sales trends and positive early results from recent menu updates[5] - The company aims to achieve its unit growth objective for the year, with ongoing confidence in navigating the current softer restaurant industry environment[5] - The company anticipates continued growth in adjusted net income and earnings per share as it expands its market presence and enhances operational efficiencies[27]

Core Insights - The Cheesecake Factory is set to report its third-quarter fiscal 2025 earnings on October 28, with projected EPS of $0.60 and revenue of approximately $913 million [1][2] Financial Performance - Analysts forecast a 3.5% increase in EPS from $0.58 reported in the same quarter last year, driven by strong demand, menu innovations, and efficient cost management [2] - The company has consistently outperformed earnings expectations, with an average surprise of 15.2% over the last four quarters [2][6] - In the most recent quarter, CAKE reported earnings of $1.16 per share, exceeding the Zacks Consensus Estimate of $1.06 per share, resulting in a 9.43% surprise [3] Market Valuation - CAKE's price-to-earnings (P/E) ratio is approximately 16.39, and the price-to-sales ratio is about 0.76, indicating a valuation of $0.76 for every dollar of sales [4] - The enterprise value to sales ratio stands at around 1.29, reflecting the company's total valuation in relation to its sales [4] Financial Health - The current ratio is approximately 0.20, indicating potential liquidity challenges for the company [5][6] - The debt-to-equity ratio is notably high at 5.24, suggesting a significant reliance on debt financing over equity [5][6]

Core Insights - The Cheesecake Factory Incorporated (CAKE) is set to report its third-quarter fiscal 2025 results on October 28, with a history of beating earnings estimates in the past four quarters, averaging a surprise of 15.2% [1] Estimate Revisions - The Zacks Consensus Estimate for fiscal third-quarter earnings per share (EPS) is 60 cents, reflecting a 3.5% increase from 58 cents in the same quarter last year [2] - Revenue expectations are approximately $912.9 million, indicating a 5.5% rise from the previous year's quarter [2] Factors Influencing Quarterly Results - The company's performance is expected to benefit from steady demand, disciplined cost management, and sustained brand relevance, with strategic menu innovations like "Bowls" and "Bites" contributing to comparable sales growth [3] - Engagement from the Cheesecake Rewards program is anticipated to enhance top-line performance, with total revenues projected between $905 million and $915 million [3] Revenue Contributions - Strong contributions from North Italia Restaurants and Other FRC are expected, with revenues predicted to rise 14.6% to $82.3 million and 34.3% to $90 million year-over-year, respectively [4] Profitability Outlook - Profitability is expected to remain healthy due to operational excellence, improved labor retention, and favorable commodity costs, with four-wall margins reaching 18.5% in the prior quarter [5] - The company aims to maintain margins within a long-term target range of 16% to 18% through efficiency and guest satisfaction [5] Cost Challenges - Modest wage inflation, higher medical costs, and increased pre-opening expenses may partially offset profitability gains, with labor expenses projected to rise 5.5% year-over-year to $328.2 million [6] Earnings Prediction - The model predicts an earnings beat for Cheesecake Factory, supported by a positive Earnings ESP of +3.85% and a Zacks Rank of 3 (Hold) [7][9] - The expected Q3 EPS is $0.60 on revenues of $912.9 million, with menu enhancements and loyalty engagement likely aiding comparable sales growth [8]