Core Viewpoint - The Cheesecake Factory Incorporated reported strong first-quarter revenues but revised its outlook due to economic concerns and tariff-related uncertainties [1][2]. Financial Performance - First-quarter revenues reached $927.2 million, an increase from $891.2 million year-over-year [1]. - Adjusted EBITDA forecast for 2025 was lowered from $323.5 million to $317.6 million, and adjusted EPS was revised from $3.72 to $3.68 [4]. - For 2026, EBITDA estimate was reduced from $348.8 million to $343.3 million, and adjusted EPS was trimmed from $4.14 to $4.09 [5]. Market Position and Trends - The company maintains a strong foundation of steady consumer demand, supported by a broad menu appealing to a wide range of guests [4]. - Positive trends include gradually improving same-store sales, year-over-year margin expansion, and increased unit growth, positioning shares for continued momentum through fiscal 2025 [3]. - The company plans a summer menu update to reinforce a value-focused trend as customers favor lower-priced items and non-alcoholic beverages [5]. Stock Performance - CAKE shares are currently trading lower by 3.82% at $48.45 [5].

Core Insights - The Cheesecake Factory reported first-quarter earnings of 93 cents per share, exceeding the analyst consensus estimate of 81 cents per share, while quarterly sales of $927.20 million fell short of the estimate of $927.44 million [1][2] Financial Performance - The company demonstrated strong topline revenue, margins, and earnings, indicating positive momentum across its business [2] - Sales were at the higher end of expectations, driven by The Cheesecake Factory restaurants, reflecting consistent consumer demand for its dining experiences [2] Operational Efficiency - The company achieved year-over-year improvements in labor productivity, food efficiency, wage management, and retention among staff and managers, contributing to strong profit flow-through and margin expansion [2] Stock Performance - Following the earnings announcement, Cheesecake Factory shares declined by 4.9%, trading at $47.88 [2] Analyst Ratings and Price Targets - Baird analyst David Tarantino maintained a Neutral rating and raised the price target from $46 to $49 [7] - Wells Fargo analyst Zachary Fadem maintained an Equal-Weight rating and increased the price target from $45 to $50 [7] - Morgan Stanley analyst John Glass maintained an Underweight rating and raised the price target from $39 to $40 [7]

Core Insights - The Cheesecake Factory Incorporated (CAKE) reported strong first-quarter fiscal 2025 results, with earnings and revenues exceeding the Zacks Consensus Estimate, showing growth compared to the prior-year quarter [1][4]. Financial Performance - Adjusted earnings per share (EPS) for the quarter were 93 cents, surpassing the Zacks Consensus Estimate of 81 cents by 14.8%, and up from 73 cents in the same quarter last year [4]. - Quarterly revenues reached $927.2 million, beating the consensus estimate of $926 million by 0.2%, and reflecting a 4% increase year-over-year [4]. Operational Highlights - The company's strong performance was attributed to effective operational execution and a focus on staffing and retention, which improved guest satisfaction scores and contributed to sales growth [2]. - Enhanced execution led to margin expansion while maintaining quality and value in a competitive market [3]. Marketing and Brand Engagement - A recent menu update featuring over 20 new items generated significant media attention, resulting in over 700 placements and more than 8 billion potential PR impressions, nearly double the exposure from the same quarter last year [3]. Comparable Sales - Comparable sales at Cheesecake Factory restaurants increased by 1% year-over-year, compared to a 0.6% decline in the prior-year quarter [5]. - North Italia's comparable sales declined by 1% year-over-year, contrasting with a 3% growth reported in the year-ago quarter [5]. Cost Structure - The cost of food and beverage as a percentage of revenues decreased by 100 basis points year-over-year to 21.8% [6]. - Labor expenses as a percentage of total revenues were 35.7%, down 30 basis points year-over-year [6]. - Other operating costs increased to 26.7% of total revenues, up 40 basis points year-over-year [7]. Balance Sheet and Liquidity - As of April 1, 2025, cash and cash equivalents totaled $135.4 million, up from $84.2 million at the end of 2024 [8]. - Long-term debt increased to $627.3 million from $452.1 million as of December 31, 2024 [8]. - Total available liquidity was reported at $501.9 million [8]. Shareholder Returns - The company declared a quarterly cash dividend of 27 cents per share, payable on May 27, 2025 [9]. - Approximately 2.6 million shares were repurchased for $141.4 million during the fiscal first quarter [9]. Expansion Plans - In the first quarter of fiscal 2025, the company opened eight new restaurants and plans to add up to 25 restaurants across its portfolio in 2025 [10].

Core Insights - Cheesecake Factory reported revenue of $927.2 million for the quarter ended March 2025, reflecting a 4% increase year-over-year [1] - The company's EPS was $0.93, up from $0.73 in the same quarter last year, exceeding the consensus estimate of $0.81 by 14.81% [1] - The revenue surpassed the Zacks Consensus Estimate of $925.55 million by 0.18% [1] Financial Performance Metrics - Comparable restaurant sales for The Cheesecake Factory were reported at 1%, slightly below the nine-analyst average estimate of 1.2% [4] - North Italia's comparable restaurant sales were down 1%, compared to the eight-analyst average estimate of 1.4% [4] - Total number of company-owned restaurants was 355, below the average estimate of 359 by eight analysts [4] Revenue Breakdown - Revenues from The Cheesecake Factory restaurants were $672.73 million, slightly below the estimated $673.38 million, representing a year-over-year increase of 0.7% [4] - Revenues from Other segments were $83.63 million, compared to the average estimate of $84.31 million, showing a year-over-year increase of 6.8% [4] - Revenues from Other FRC were $87.42 million, exceeding the average estimate of $86.99 million, with a year-over-year change of 17.8% [4] - Revenues from North Italia were $83.41 million, surpassing the estimated $81.63 million, reflecting a 17.7% increase year-over-year [4] Stock Performance - Cheesecake Factory shares have returned -2.4% over the past month, compared to a -0.2% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market [3]

Company Overview - The company owns and operates 358 restaurants across the US and Canada, including 215 The Cheesecake Factory locations[8] - The company's fiscal year 2024 revenue was $3.6 billion[8] - The company's market capitalization was $2.5 billion as of April 1, 2025[8] Expansion and Growth - There are 33 international The Cheesecake Factory locations[12, 21] - The company is targeting approximately 20% average annual unit growth for North Italia and Flower Child[82, 91] - The company plans to open as many as 25 new units in 2025[105, 118] Financial Performance - Total revenue for Q1 2025 was $927 million, up 4% from the previous year[113] - Adjusted net income margin for Q1 2025 was 4.9%, up 90 bps from the previous year[113] - The company issued $575 million of 2.00% Convertible Senior Notes due 2030[113, 117] Sales and Unit Volume - The Cheesecake Factory's FY 2024 average weekly sales equate to $12.5 million annualized AUV[111] - North Italia's FY 2024 average weekly sales equate to $7.7 million annualized AUV[111] - Flower Child's FY 2024 average weekly sales equate to $7.2 million annualized AUV[111] Off-Premise Performance - Off-premise sales accounted for 17% of total revenue in FY 2024[26] - The Cheesecake Factory's off-premise average weekly sales for FY 2024 were $2.8 million per restaurant[39]

Financial Data and Key Metrics Changes - The company reported total revenues of $927 million for Q1 2025, finishing towards the high end of guidance, with a 27% year-over-year increase in adjusted earnings per share [5][15] - Adjusted net income margin was 4.9%, exceeding the high end of the guidance range [15] - The Cheesecake Factory restaurants' total sales were $673 million, up 1% from the prior year, with comparable sales also increasing by 1% [16][17] - The four-wall restaurant margins increased to 17.4%, up 140 basis points from Q1 2024 [6] Business Line Data and Key Metrics Changes - North Italia's total sales were $83.4 million, up 18% from the prior year, with comparable sales declining by 1% [17][12] - Flower Child's sales totaled $43.5 million, up 26% from the prior year, with comparable sales increasing by 5% [17][13] - The company opened eight restaurants in Q1 2025, including three North Italia and three Flower Child locations [6][24] Market Data and Key Metrics Changes - The off-premise sales mix for The Cheesecake Factory was 22%, consistent with Q1 2024 [16][100] - North Italia's annualized average unit volumes (AUVs) increased to $7.75 million, while Flower Child's AUV was over $4.6 million, reflecting strong consumer demand [12][13] Company Strategy and Development Direction - The company aims to open as many as 25 new restaurants in 2025, with a focus on accelerating new unit growth [7][24] - The company has been recognized as one of Fortune Magazine's 100 Best Companies to Work For for the twelfth consecutive year, highlighting its commitment to employee satisfaction [7] - The company is focused on menu innovation, operational execution, and maintaining contemporary restaurant designs as key components of its strategy [8][25] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment feels less robust than three months ago, citing various external factors impacting performance [29] - The company anticipates total revenues for Q2 2025 to be between $935 million and $950 million, reflecting a cautious outlook due to economic conditions [21] - Management remains confident in the company's ability to absorb potential tariff impacts without changing adjusted net income margin expectations [21][39] Other Important Information - The company returned $153.8 million to shareholders during the quarter through dividends and share repurchases [15] - The company ended the quarter with total available liquidity of approximately $501.9 million [19] Q&A Session Summary Question: Is the uncertain macro environment already impacting the business? - Management indicated that while the business remains stable, the environment feels less robust than previously expected, suggesting a prudent outlook for the remainder of the year [28][29] Question: Can you quantify the expected impact of tariffs on the P&L? - Management noted that the biggest impact would likely be in other operating expenses, with potential pricing adjustments of 50 to 75 basis points if necessary [34][39] Question: What are the same-store sales components for The Cheesecake Factory? - The Cheesecake Factory experienced 4% effective pricing, with traffic down 1.2%, indicating a mix shift due to menu changes [47] Question: How is the loyalty program performing? - The loyalty program is seeing strong member acquisition and positive guest feedback, with plans to implement more personalized offers moving forward [42][44] Question: What is the outlook for commodity inflation? - Management reported that commodity inflation was close to breakeven in Q1, with expectations of low single-digit inflation in Q2 [64] Question: Are there any planned closures affecting guidance? - Management confirmed a closure in Seattle but indicated no other planned closures at this time [66] Question: What differentiates Flower Child's performance in a slowing environment? - Flower Child's strong performance is attributed to food quality, operational stability, and effective staffing, which resonate well with consumers [70]

Financial Data and Key Metrics Changes - The company reported total revenues of $927 million for the first quarter, finishing towards the high end of guidance, with a 27% year-over-year increase in adjusted earnings per share [7][16] - Adjusted net income margin was 4.9%, exceeding the high end of the guidance range [16] - GAAP diluted net income per share was $0.67, while adjusted diluted net income per share was $0.93 [20] Business Line Data and Key Metrics Changes - Comparable sales at The Cheesecake Factory restaurants increased by 1%, with total sales reaching $673 million, up 1% from the prior year [7][17] - North Italia's total sales were $83.4 million, an 18% increase from the prior year, with comparable sales declining by 1% [17][14] - Flower Child sales totaled $43.5 million, up 26% from the prior year, with comparable sales increasing by 5% [17][14] Market Data and Key Metrics Changes - The Cheesecake Factory's off-premise sales mix was 22%, consistent with the previous year [18][102] - North Italia's annualized average unit volumes (AUVs) increased to $7.75 million, while Flower Child's AUV was over $4.6 million, reflecting strong consumer demand [13][14] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025, with eight openings expected in the second quarter [9][26] - The company has been recognized on Fortune Magazine's 100 Best Companies to Work For list for the twelfth consecutive year, highlighting its commitment to employee satisfaction [9] - The focus remains on menu innovation, operational execution, and maintaining restaurant design and ambiance [9][27] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment feels less robust than three months ago, citing unprecedented weather and economic factors [30][31] - The company anticipates total revenues for fiscal 2025 to be approximately $3.76 billion at the midpoint of estimates, with adjusted net income margin expectations around 4.75% [24][25] - Management expressed confidence in navigating near-term uncertainties while delivering sustainable long-term value [27] Other Important Information - The company returned $153.8 million to shareholders during the quarter through dividends and share repurchases [17] - The company ended the quarter with total available liquidity of approximately $501.9 million [20] Q&A Session Summary Question: Has the uncertain macro environment already impacted the business? - Management acknowledged that there has been a lot of noise in the first four months of the year, but the business remains stable and predictable [30][31] Question: Can you quantify the expected impact of tariffs on the P&L? - Management indicated that the biggest impact would be in other operating expenses, with potential pricing adjustments of 50 to 75 basis points if necessary [35][40] Question: What are the same-store sales components for The Cheesecake Factory? - The Cheesecake Factory experienced 4% effective pricing, with traffic down 1.2% [50] Question: How is the performance of Flower Child differentiating in a slowing environment? - Management highlighted the strong food quality and operational stability as key factors driving Flower Child's performance [70] Question: What is the expected pricing for the year? - Management confirmed that the pricing expectation remains at 4% for the year [75]

Financial Performance - Total revenues for Q1 fiscal 2025 were $927.2 million, up 4.0% from $891.2 million in Q1 fiscal 2024[2] - Net income for Q1 fiscal 2025 was $32.9 million, with diluted net income per share at $0.67[2] - Adjusted net income for Q1 fiscal 2025 was $45.7 million, with adjusted diluted net income per share at $0.93[3] - Total revenues for the 13 weeks ended April 1, 2025, were $927.2 million, a 4.0% increase from $891.2 million for the same period in 2024[20] - The company reported a net income (GAAP) of $32.9 million for the 13 weeks ended April 1, 2025, compared to $33.2 million in the prior year[28] - Adjusted net income (non-GAAP) for the 13 weeks ended April 1, 2025, was $45.7 million, up from $35.6 million in the same period last year[28] - The adjusted diluted net income per share (non-GAAP) was $0.93 for the 13 weeks ended April 1, 2025, compared to $0.73 in the prior year[28] Comparable Restaurant Sales - Comparable restaurant sales increased by 1.0% year-over-year in Q1 fiscal 2025[4] - Comparable restaurant sales for The Cheesecake Factory increased by 1.0% compared to a decline of 0.6% in the prior year[22] - North Italia's comparable restaurant sales decreased by 1% compared to an increase of 3% in the prior year[22] Restaurant Openings - The company opened eight new restaurants in Q1 fiscal 2025 and plans to open up to 25 new restaurants throughout the fiscal year[6][7] - The company opened 3 new North Italia restaurants during the period, increasing the total to 45[22] - The Cheesecake Factory operated 215 restaurants at the end of the period, down from 216 a year earlier[22] Liquidity and Debt - Total available liquidity as of April 1, 2025, was $501.9 million, including a cash balance of $135.4 million[9] - Cash and cash equivalents increased to $135.4 million as of April 1, 2025, from $84.2 million a year earlier[24] - Long-term debt rose to $627.3 million as of April 1, 2025, compared to $452.1 million at the end of 2024[24] Shareholder Returns - The Board of Directors declared a quarterly dividend of $0.27 per share to be paid on May 27, 2025[10] - The company repurchased approximately 2.6 million shares of common stock at a cost of $141.4 million in Q1 fiscal 2025[10] Other Financial Items - The company reported a pre-tax net expense of $17.3 million related to debt extinguishment and acquisition-related items[3] - The company issued $575 million of 2.00% convertible senior notes due 2030 on February 28, 2025[8]

Core Insights - The Cheesecake Factory has introduced 22 new menu items while discontinuing 13, aiming to enhance customer demand and sales performance [1][5] - The company's shares increased by 5.1% following the menu update, reflecting positive investor sentiment [1] - The focus on menu innovation and strategic adjustments is expected to support the company's competitive position in the casual dining sector [4][5] Menu Changes - New menu items include Chicken Shawarma, Mortadella Panino, grilled seafood, steak dishes, and lighter options, while some pizzas, burgers, pasta, and seafood dishes have been removed [2][3] - The "SkinnyLicious" menu has been updated with a new seafood dish, and a new dessert for kids has been added [3] Business Strategy - The Cheesecake Factory operates 352 restaurants in the U.S. and Canada, with 34 international locations through licensing agreements [4] - The company updates its menu biannually and adjusts prices to manage rising operating costs, which helps maintain margins and customer traffic [4] Financial Performance - Shares of The Cheesecake Factory have increased by 24.5% over the past six months, contrasting with a 0.8% decline in the Zacks Retail – Restaurants industry [8] - Earnings estimates for 2025 have risen to $3.72 per share, indicating an 8.1% growth from 2024 [9]

The Cheesecake Factory Incorporated (CAKE) has shown strong stock performance in recent months. Over the past six months, the stock has jumped 22.1%, significantly outperforming the Zacks Retail – Restaurants industry’s decline of 0.5%. It has also fared better than the broader Zacks Retail-Wholesale sector’s 2.1% growth and the S&P 500 index’s 1.6% decline during the same period.Cheesecake Factory continues to benefit from strong consumer demand, improving comparable sales and restaurant openings. The soli ...