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Financial Performance - Total revenues for the thirteen-week period ended September 24, 2025, were $1,349.2 million, an increase from $1,139.0 million for the same period in 2024, reflecting a growth of approximately 18.4%[71] - Comparable restaurant sales for company-owned locations increased by 18.8%, with Chili's showing a 21.4% increase, while Maggiano's experienced a decline of 6.4%[72] - Chili's total revenues increased by 21.3% to $1,249.7 million for the thirteen-week period ended September 24, 2025, primarily due to favorable comparable restaurant sales[82] - Maggiano's total revenues decreased by 8.4% to $99.5 million for the same period, primarily due to unfavorable comparable restaurant sales and restaurant closures[85] Restaurant Operations - As of September 24, 2025, the company owned, operated, or franchised a total of 1,630 restaurants, including 1,161 company-owned and 469 franchised locations[63] - The company opened 7 new restaurants during the thirteen-week period, with 5 of these being franchise locations, and plans to open 32-38 new restaurants in fiscal 2026[69] - The "3 for Me" value offering has been highlighted as a key traffic driver, allowing guests to enjoy a meal starting at $10.99[65] - The company has focused on enhancing the digital experience for guests, including a seamless To-Go menu available through various platforms[65] Cost Management - Food and beverage costs represented 25.8% of company sales, showing a slight increase from 25.2% in the previous year, primarily due to unfavorable commodity costs[75] - Restaurant labor costs decreased to 32.3% of company sales from 33.5%, benefiting from sales leverage despite higher hourly labor costs[75] Cash Flow and Financing - Net cash provided by operating activities increased by $58.0 million to $120.8 million for the thirteen-week period ended September 24, 2025, due to an increase in operating income[87] - Net cash used in investing activities increased by $1.4 million to $(57.9) million, primarily due to increased spending on new restaurant construction and Maggiano's reimages[88] - Net cash used in financing activities decreased by $6.5 million to $(48.2) million, primarily due to an increase in net borrowings of long-term debt[90] - As of September 24, 2025, the company had $910.0 million available under its $1.0 billion revolving credit facility[91] - The company is focusing on cash flow generation and maintaining a solid financial position amid macroeconomic uncertainties, including commodity and labor inflation[96] - Current cash and cash equivalents, along with cash generated from operations, are expected to meet capital expenditure and working capital needs for at least the next twelve months[97] Shareholder Returns - The Board of Directors approved a $400.0 million increase in the share repurchase program, bringing the total available authority to $507.0 million[94] - In the thirteen-week period ended September 24, 2025, the company repurchased 0.9 million shares for $134.5 million, with approximately $415.0 million remaining under the current share repurchase program[95] Tax and Compliance - The effective income tax rate decreased to 7.5% for the thirteen-week period ended September 24, 2025, from 9.0% in the prior year, primarily due to excess tax benefits from stock-based compensation[79][80] - The company expects to remain in compliance with its covenants under the revolving credit facility and the terms of its 8.25% notes during the remainder of fiscal 2026[93] Future Commitments and Risks - Long-term purchase obligations for marketing programs total $18.0 million in fiscal 2026, $21.2 million in fiscal 2027, $21.1 million in fiscal 2028, and $4.4 million in fiscal 2029[98] - A hypothetical 100 basis point increase in interest rates on the $90.0 million outstanding under the revolving credit facility would result in an additional $0.9 million of annual interest expense[101] - The company faces commodity price risk due to fluctuations in market prices for food and other commodities, which could negatively impact short-term financial results[102] - Depreciation and amortization increased by $7.3 million to $53.6 million for the thirteen-week period ended September 24, 2025, primarily due to additions for new and existing restaurant assets[78] - General and administrative expenses rose by $5.4 million to $57.2 million for the same period, driven by payroll expenses and corporate technology initiatives[78] International Expansion - The company plans to strategically pursue international expansion of Chili's through development agreements with new and existing franchise partners[68]

Financial Data and Key Metrics Changes - For Q1 fiscal year 2026, total revenues reached $1.35 billion, an increase of 18.5% year-over-year, with consolidated comp sales up 18.8% [16] - Adjusted diluted EPS for the quarter was $1.93, up from $0.95 last year [16] - Restaurant operating margin improved to 16.2%, a 270 basis points increase year-over-year, primarily driven by sales leverage [17] Business Line Data and Key Metrics Changes - Chili's reported same-store sales growth of 21.4%, driven by a 13.1% increase in traffic, a positive mix of 4.3%, and a price increase of 4% [16][17] - Maggiano's experienced a decline in comp sales of 6.4% for the quarter, with a focus on stabilizing and improving the brand through the "Back to Maggiano's" strategy [17] Market Data and Key Metrics Changes - Chili's outperformed the casual dining industry by 1,650 basis points in same-store sales growth [5] - The customer base for Chili's is growing across all income levels, particularly among households with incomes under $60,000, indicating a strong value proposition [9][10] Company Strategy and Development Direction - The company is focused on enhancing guest experience through food and hospitality initiatives, with successful upgrades in menu items like ribs and beverages [7][8] - A reimaging program for Chili's is underway, with four pilot restaurants expected to be completed by the end of the quarter, aiming to return to the brand's original essence [20][50] - The "Back to Maggiano's" plan includes improving service levels, focusing on guest-facing repairs, and restoring pride in ownership among management teams [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong sales growth despite economic uncertainties and anticipated commodity inflation in the mid-single digits [22] - The company expects Q2 to show moderate gains compared to the previous year due to high comparison bases, with same-store sales normalizing in the mid-single digit range for the remainder of the fiscal year [23][56] Other Important Information - The company repurchased $92 million of common stock under its share repurchase program, supporting its disciplined capital allocation strategy [20] - The adjusted tax rate for the quarter increased to 18.5%, driven by higher sales [19] Q&A Session Summary Question: How does Chili's plan to leverage tokenized consumer data to enhance engagement? - Management plans to track monthly cohorts of new guests to understand their repeat behavior and the impact of menu initiatives on guest frequency [26][27] Question: How is the value platform performing against expectations? - The value platform is performing well, with the $10.99 burger deal remaining relevant and expected to be refreshed with new innovations in Q3 and Q4 [30][32] Question: What insights can be shared about younger consumers? - Younger consumers are returning as frequently as other guests, and marketing efforts are focused on maintaining relevance with Gen Z [39][40] Question: What is the status of the food renovation journey? - The company is progressing with food renovations, including a chicken sandwich platform and plans to bring back the old skillet queso due to customer demand [42][43] Question: How is the North of Six initiative progressing? - The initiative is yielding positive results, with improvements in scheduling and operational efficiency being implemented across the system [71][74] Question: What are the expectations for Maggiano's turnaround? - The turnaround is expected to be slower than Chili's due to its smaller size and less national marketing presence, but management is optimistic about stabilizing and growing the brand [80][83]

Financial Data and Key Metrics Changes - For Q1 fiscal year 2026, total revenues reached $1.35 billion, an increase of 18.5% year-over-year, with consolidated comp sales up 18.8% [16] - Adjusted diluted EPS for the quarter was $1.93, up from $0.95 last year [16] - Restaurant operating margin improved to 16.2%, a 270 basis points increase year-over-year, primarily driven by sales leverage [17] - Adjusted EBITDA for the first quarter was approximately $172.4 million, a 54.4% increase from the prior year [19] Business Line Data and Key Metrics Changes - Chili's reported same-store sales growth of 21.4%, driven by a 13.1% increase in traffic, a 4.3% positive mix, and a 4% price increase [16] - Maggiano's experienced a decline in comp sales of -6.4% for the quarter [17] Market Data and Key Metrics Changes - Chili's outperformed the casual dining industry by 1,650 basis points in same-store sales growth [5] - The customer base for Chili's is growing across all income levels, with the fastest growth seen in households earning under $60,000 [9] Company Strategy and Development Direction - The company is focusing on stabilizing and improving Maggiano's through the "Back to Maggiano's" strategy, which emphasizes classic recipes, improved service, and guest-facing repairs [12][14] - Chili's is ramping up its reimage program and expects to complete four remodel pilot restaurants by the end of the quarter [20] - The company aims to return to positive net new unit growth for Chili's and stabilize Maggiano's performance [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to maintain strong sales growth despite economic uncertainties and anticipated higher commodity inflation [22] - The first quarter is expected to be the strongest year-over-year, with more moderate gains anticipated in subsequent quarters [23] - Management remains focused on long-term growth and strategic investments, despite challenges in the macroeconomic environment [24] Other Important Information - The company repurchased $92 million of common stock under its share repurchase program [20] - The adjusted tax rate for the quarter increased to 18.5%, driven by higher sales [19] Q&A Session Summary Question: How does Chili's plan to leverage tokenized consumer data to enhance engagement? - Management plans to track monthly cohorts of new guests to understand their repeat visitation and the impact of menu initiatives on guest frequency [26][28] Question: How is the value platform performing against expectations? - The value platform is performing well, with significant lifts observed from recent advertising campaigns, particularly the $10.99 burger deal [30][31] Question: What insights can be shared regarding younger consumers? - Younger consumers are returning as frequently as other guests, and marketing efforts are focused on maintaining relevance with this demographic [39][40] Question: What is the status of the food renovation journey? - The company is progressing with food renovations, including a chicken sandwich platform and plans to bring back the old skillet queso due to customer demand [42][43] Question: How is the North of Six initiative progressing? - The initiative is yielding positive results, with improvements in scheduling and operational efficiency being implemented across the system [71][74] Question: What are the expectations for Maggiano's turnaround compared to Chili's? - The turnaround for Maggiano's is expected to be slower due to its smaller size and less national marketing presence, but management is optimistic about stabilizing and growing the brand [80][83]

Financial Data and Key Metrics Changes - For Q1 fiscal year 2026, total revenues reached $1.35 billion, marking an 18.5% increase year-over-year, with consolidated comp sales up 18.8% [14][16] - Adjusted diluted EPS for the quarter was $1.93, a significant rise from $0.95 in the previous year [14] - Restaurant operating margin improved to 16.2%, reflecting a 270 basis points increase year-over-year, primarily driven by sales leverage [16][18] Business Line Data and Key Metrics Changes - Chili's reported same-store sales growth of 21.4%, driven by a 13.1% increase in traffic, a 4.3% positive mix, and a 4% price increase [15][16] - Maggiano's experienced a decline in comp sales of -6.4%, with a focus on stabilizing and improving the brand through the "Back to Maggiano's" strategy [16][19] Market Data and Key Metrics Changes - Chili's has outperformed the casual dining industry by 1,650 basis points in same-store sales growth [4] - The customer base for Chili's is growing across all income levels, particularly among households earning under $60,000, indicating a shift in market dynamics [8][9] Company Strategy and Development Direction - The company is ramping up its reimage program for Chili's, with four remodel pilot restaurants expected to be completed by the end of the quarter [6][19] - The "Back to Maggiano's" plan focuses on improving service levels, restoring classic recipes, and enhancing guest experience [12][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong sales growth despite anticipated challenges such as higher commodity inflation and economic uncertainty [20][21] - The company expects Q2 to be strong but anticipates that same-store sales will normalize to mid-single-digit growth for the remainder of the fiscal year [21][22] Other Important Information - The company repurchased $92 million of common stock under its share repurchase program, reflecting a disciplined capital allocation strategy [19] - The adjusted tax rate for the quarter increased to 18.5%, driven by accelerated sales growth [18] Q&A Session Summary Question: How does Chili's plan to leverage tokenized consumer data to enhance engagement? - Management indicated that they are learning to use tokenized data to track guest frequency and understand the impact of menu initiatives on customer retention [23][24] Question: What is the performance of the value platform? - The value platform is performing well, with the $10.99 message driving significant market share for Chili's [25][26] Question: What is the outlook for younger consumers? - Management noted that younger consumers are returning as frequently as other guests, and marketing efforts are focused on maintaining relevance with this demographic [30][31] Question: What is the status of the menu renovation? - The company is progressing with menu renovations, including a chicken sandwich platform and plans to bring back the old skillet queso due to customer demand [34][35] Question: How is the North of Six initiative progressing? - The initiative is ongoing, with improvements in scheduling and equipment being implemented to enhance restaurant performance [59][61] Question: What is the impact of commodity inflation on margins? - Management indicated that commodity inflation may lead to flat to slightly positive margins, with ongoing adjustments to pricing strategies [47][49]

Q1 F26 October 29, 2025 SAFE HARBOR STATEMENT During these presentations, and in response to your questions, certain items may be discussed which are not based entirely on historical facts. Any such items should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Any forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update such statements to reflect events or circumstance ...

Core Insights - Brinker International (EAT) reported quarterly earnings of $1.93 per share, exceeding the Zacks Consensus Estimate of $1.76 per share, and showing significant growth from $0.95 per share a year ago [1] - The company achieved revenues of $1.35 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.21% and increasing from $1.14 billion year-over-year [3] Earnings Performance - The earnings surprise for the quarter was +9.66%, and the company has consistently surpassed consensus EPS estimates over the last four quarters [2] - In the previous quarter, Brinker International reported earnings of $2.49 per share against an expectation of $2.43, resulting in a surprise of +2.47% [2] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $2.60 on revenues of $1.4 billion, while the estimate for the current fiscal year is $10.34 on revenues of $5.7 billion [8] - The estimate revisions trend for Brinker International was mixed prior to the earnings release, leading to a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [7] Industry Context - The Retail - Restaurants industry, to which Brinker International belongs, is currently ranked in the bottom 11% of over 250 Zacks industries, suggesting potential challenges ahead [9] - The performance of Brinker International's stock may be influenced by the overall industry outlook, as research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [9]

Financial Performance - Brinker International reported first quarter sales of $1,335.4 million, a 21% increase compared to $1,127.3 million in the same period last year[3]. - Operating income for the first quarter was $117.9 million, up from $56.4 million, representing an increase of 61.5 million[3]. - Net income for the quarter was $99.5 million, compared to $38.5 million in the prior year, marking a 61.0 million increase[3]. - Total revenues for the thirteen-week period ended September 24, 2025, increased to $1,349.2 million, up 18.4% from $1,139.0 million for the same period in 2024[21]. - Net income for the same period rose to $99.5 million, compared to $38.5 million in the prior year, representing an increase of 158.2%[21]. - Basic net income per share increased to $2.23, up from $0.86, reflecting a growth of 159.1% year-over-year[21]. - Brinker reported a total operating income of $117.9 million in Q1 26, compared to $56.4 million in Q1 25, reflecting a growth of 108.5%[34]. - Net income for Q1 26 was $99.5 million, compared to $38.5 million in Q1 25, representing an increase of 158.2%[38]. Sales Performance - Comparable restaurant sales increased by 18.8%, with Chili's achieving a 21.4% increase, while Maggiano's experienced a decline of 6.4%[4]. - Chili's franchisees generated sales of approximately $269.5 million, an increase from $225.7 million in the prior year[15]. - Company-owned restaurant sales increased by 18.8% compared to the previous year, with Chili's domestic sales growing by 21.4%[30]. Guidance and Projections - Full year fiscal 2026 guidance includes total revenues expected to be between $5.60 billion and $5.70 billion[9]. - Net income per diluted share, excluding special items, is projected to be in the range of $9.90 to $10.50[9]. - Capital expenditures for fiscal 2026 are expected to be between $270.0 million and $290.0 million[9]. Tax and Financial Management - The effective income tax rate for the first quarter was 7.5%, lower than the statutory rate of 21.0% due to tax credits and benefits[11]. - Interest expenses decreased to $10.5 million from $14.3 million, indicating improved financial management[21]. - Interest expenses decreased to $10.5 million in Q1 26 from $14.3 million in Q1 25, a reduction of 26.6%[38]. Operating Costs and Expenses - The company recorded total operating costs and expenses of $1,231.3 million, up from $1,082.6 million, reflecting a 13.8% increase[21]. - Depreciation and amortization increased to $53.6 million in Q1 26 from $46.3 million in Q1 25, an increase of 15.7%[38]. Restaurant Operations - The company plans to open 32-38 new restaurants in fiscal 2026, with 7 openings in the first quarter[29]. - The company reported a total of 1,630 restaurants as of September 24, 2025, compared to 1,625 a year earlier[29]. - The non-GAAP restaurant operating margin for Chili's was 17.3% in Q1 26, up from 13.5% in Q1 25, an increase of 3.8 percentage points[34]. - Adjusted EBITDA for Q1 26 was $172.4 million, significantly higher than $111.6 million in Q1 25, marking a growth of 54.5%[38]. - Provision for income taxes in Q1 26 was $8.1 million, up from $3.8 million in Q1 25, indicating a rise of 113.2%[38]. - Maggiano's operating income for Q1 26 was a loss of $4.1 million, compared to a profit of $7.8 million in Q1 25, indicating a decline of 152.6%[34].

Core Insights - Brinker International reported strong financial results for the first quarter of fiscal 2026, with Chili's leading the way with a 21.4% increase in comparable restaurant sales, while overall company comparable restaurant sales rose by 18.8% [2][4]. Financial Performance - Company sales for Q1 fiscal 2026 reached $1,335.4 million, up from $1,127.3 million in Q1 fiscal 2025, representing a variance of $208.1 million [3]. - Total revenues increased to $1,349.2 million from $1,139.0 million, a rise of $210.2 million [3]. - Operating income was reported at $117.9 million, compared to $56.4 million in the previous year, with an operating income margin of 8.7% [3][10]. - Net income for the quarter was $99.5 million, significantly higher than $38.5 million in Q1 fiscal 2025 [3][18]. Segment Performance - Chili's generated sales of $1,236.2 million, up from $1,018.9 million, while Maggiano's saw a decline in traffic, impacting its sales [7][16]. - Chili's restaurant operating margin improved to 17.3%, up from 13.5% in the previous year, while Maggiano's experienced a decrease in its operating margin [9][29]. Comparable Restaurant Sales - Comparable restaurant sales for Brinker increased by 18.8%, with Chili's achieving a 21.4% increase, while Maggiano's faced a decline of 6.4% [4][21]. - The increase in comparable sales was attributed to higher traffic and menu pricing strategies [16][21]. Stock Repurchase and Investments - The company repurchased $92.0 million of its common stock during the quarter, reflecting confidence in its financial position [2][3]. Guidance for Fiscal 2026 - Brinker reiterated its full-year fiscal 2026 guidance, expecting total revenues between $5.60 billion and $5.70 billion, and net income per diluted share, excluding special items, in the range of $9.90 to $10.50 [5][8]. Restaurant Operations - As of September 24, 2025, Brinker operated a total of 1,630 restaurants, with 1,161 company-owned and 469 franchise locations [20]. - The company plans to open 32 to 38 new restaurants in fiscal 2026 [20]. Tax and Financial Metrics - The effective income tax rate for Q1 fiscal 2026 was 7.5%, lower than the statutory rate due to tax credits and benefits from stock-based compensation [10][18]. - Adjusted EBITDA for the quarter was $172.4 million, up from $111.6 million in the prior year [3][31].

Market Overview - Futures are trading higher, driven by positive news regarding a potential trade agreement with China and the TikTok issue resolution [1] - Wall Street is anticipating a significant number of earnings reports this week, particularly from technology giants in the Magnificent 7 [1] - Strong retail participation and new overseas investments are contributing to the momentum towards the S&P 500 reaching 7000 [1] Treasury Yields - Yields are mixed, with shorter maturities trading modestly lower and longer maturities, such as the 30-year and 20-year bonds, showing small gains [2] - The Treasury Market and Wall Street are pricing in a near 100% chance of a 25-basis-point cut this week [2] Oil & Gas - West Texas Intermediate (WTI) and Brent Crude started the week slightly lower after a rally that pushed WTI above $60 [3] - OPEC+ production increases are identified as the main reason for recent pricing dislocation [3] - Analysts expect a jump in gasoline demand as prices drop nationwide heading into the holidays [3] - Natural Gas prices increased over 4%, closing at $3.44 [3] Gold Market - Gold prices fell below $4,000 per ounce after a significant rally, with analysts noting improved risk appetite and profit-taking [4] - A potential correction in Gold prices could last for months, although Central Bank buying may provide support [4] - Some analysts are projecting Gold prices to reach $5,000 and Silver to $60 [4] Analyst Ratings - CrowdStrike Holdings (CRWD) upgraded to Buy with a target price of $706 [5] - Southern Copper (SCCO) target price raised from $89 to $115, but maintains a Sell rating [5] - DTE Energy (DTE) initiated with an Overweight rating and a $157 target price [6] - McDonald's Corporation (MCD) started with a Neutral rating and a target price of $300 [6] - Starbucks Corporation (SBUX) initiated with a Neutral rating and a target price of $84 [6] - Constellation Energy (CEG) initiated with an Overweight rating and a $478 target price [6] - Fox Corporation (FOXA) upgraded to Buy with a target price of $97 [6] - BioMarin Pharmaceutical (BMRN) target price lowered from $90 to $80 while maintaining a Buy rating [6] - Dow Inc. (DOW) target price raised from $24 to $27 while keeping a Neutral rating [6] - Brinker International (EAT) initiated with an Outperform rating and a target price of $155 [6]