Financial Data and Key Metrics Changes - Total sales for the fiscal first quarter were $73.5 million, compared to $64.5 million in the prior year period, representing a year-over-year increase of approximately 12.4% [9] - Comparable sales growth was negative 2.5%, with a negative traffic of 2.5% and flat price and mix [9] - Adjusted net loss was $2.8 million, or negative $0.23 per share, compared to an adjusted net loss of $1 million, or negative $0.08 per share in the prior year quarter [13] - Restaurant-level operating profit as a percentage of sales was 15.1%, compared to 18.2% in the prior year quarter [13] Business Line Data and Key Metrics Changes - The company opened four new restaurants in the first quarter and has 10 units under construction, including locations in new markets [7] - Labor as a percentage of sales improved to 32.5% from 32.9% in the prior year period due to operational initiatives [6] - Cost of goods as a percentage of sales increased to 29.9% from 29% in the prior year quarter, impacted by tariffs [10] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were negative 2.8%, while the Southwest market saw negative 2.7% [9] - The company expects full-year costs to stabilize around 30% after considering tariffs and menu price adjustments [6] Company Strategy and Development Direction - The company aims to open 16 new restaurants in fiscal 2026, maintaining an annual unit growth rate above 20% [13] - Marketing efforts include a campaign with Kirby, coinciding with the release of Kirby Air Riders for Switch 2, and the introduction of a reservation system decoupled from the rewards program [7][8] - The company is focused on aggressive cost management, reducing G&A as a percentage of sales by 80 basis points on an adjusted basis [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive comparable sales for the year, citing strong performance in November and December [25] - The company anticipates that the pricing taken in November will continue to support sales growth and improve traffic [25] - Management noted that the broader industry is showing signs of improvement, which is encouraging for future performance [53] Other Important Information - The company has $78.5 million in cash, cash equivalents, and investments, with no debt [13] - General and administrative expenses as a percentage of sales were 13%, down from 13.5% in the prior year quarter [11] Q&A Session Summary Question: What led to the decision to decouple the reservation system from loyalty? - Management noted that more than half of visits by rewards members are through the reservation system, indicating better-than-expected uptake [20] Question: Do you expect positive comps in the February quarter? - Management confirmed expectations for positive comps in Q2, supported by strong performance in November and December [25] Question: How long would it take for tariff relief to impact financials? - Management indicated it would take 60 to 90 days to see benefits from reduced tariffs due to inventory turnover [30] Question: Can you comment on the impact of tariffs on other expense lines? - Management stated that tariffs have significantly impacted promotional costs, particularly for items sourced from overseas [100] Question: How are rewards members performing in terms of spending? - Management reported that rewards members spend about $6 more per person compared to non-members, with a significant increase in visit frequency [75] Question: What are the future planned promotions for the year? - Upcoming promotions include Sanrio for February and Jujutsu Kaisen for March and April [108]

Financial Data and Key Metrics Changes - Total sales for Q1 2026 were $73.5 million, up from $64.5 million in the prior year, with comparable sales growth of negative 2.5% [5][10] - Cost of goods sold as a percentage of sales increased to 29.9% from 29% in the prior year quarter, influenced by tariffs [5][11] - Labor costs as a percentage of sales decreased to 32.5% from 32.9% in the prior year, due to operational initiatives [5][11] - Net loss for the quarter was $3.1 million, or negative $0.25 per share, compared to a net loss of $1 million, or negative $0.08 per share in the prior year [12][13] - Adjusted net loss was $2.8 million, or negative $0.23 per share, compared to an adjusted net loss of $1 million, or negative $0.08 per share in the prior year [13] Business Line Data and Key Metrics Changes - The company opened four new restaurants in Q1 2026, with ten more under construction [6] - Restaurant-level operating profit as a percentage of sales was 15.1%, down from 18.2% in the prior year quarter [13] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were negative 2.8%, and in the Southwest market, they were negative 2.7% [10] - Effective pricing for the quarter was 3.5%, with expectations for the second quarter to be 4.5% [10] Company Strategy and Development Direction - The company aims to open 16 new restaurants in fiscal 2026, maintaining an annual unit growth rate above 20% [14] - The company is focusing on aggressive cost management, reducing G&A as a percentage of sales by 80 basis points on an adjusted basis [4] - Marketing efforts include a campaign with Kirby, coinciding with the release of Kirby Air Riders for Switch 2, and the introduction of a reservation system [6][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving qualitative comparable sales for the year, with expectations for positive comps in Q2 [4][23] - The company noted that the first quarter created a strong foundation for growth, with momentum continuing into December [5][23] - Management acknowledged the impact of tariffs on costs but expressed optimism about negotiations with suppliers mitigating some of the pressures [28][81] Other Important Information - The company has $78.5 million in cash and no debt, indicating strong liquidity [13] - General and administrative expenses as a percentage of sales were 13%, down from 13.5% in the prior year quarter [12] Q&A Session Summary Question: Discussion on decoupling the reservation system from loyalty - Management reported that over half of visits by rewards members are through the reservation system, indicating better-than-expected uptake [19] Question: Expectations for Q2 comps - Management expects positive comps for Q2, citing strong performance in November and December [23] Question: Impact of tariffs on food costs - Management indicated that it takes 4-6 months to see the impact of tariff changes on food costs due to inventory cycles [27] Question: Future promotions and collaborations - Management confirmed ongoing promotions with Kirby and upcoming collaborations with Sanrio and Jujutsu Kaisen [88] Question: Long-term growth target - Management did not revise the long-term growth target of 300 units in the U.S. but will provide updates as necessary [78]

Financial Performance - Sales for the three months ended November 30, 2025, were $73.5 million, an increase of $9.0 million or 14.0% compared to $64.5 million for the same period in 2024, driven by new restaurant openings and menu price increases [81]. - Comparable restaurant sales decreased by 2.5%, attributed to negative traffic and flat price/mix, reflecting lower consumer spending due to the macroeconomic environment [81]. - Net loss for the three months ended November 30, 2025, was $3.1 million, compared to a net loss of $1.0 million for the same period in 2024, representing an increase in loss of 218.4% [79]. - Adjusted EBITDA for the three months ended November 30, 2025, was $2.4 million, down from $3.6 million in 2024, resulting in an Adjusted EBITDA margin of 3.3% compared to 5.5% [96]. - Restaurant sales decreased by 2.5% for the three months ended November 30, 2025, compared to a 1.8% increase in the same period of 2024 [104]. Cost and Expenses - Food and beverage costs rose to $21.9 million, an increase of $3.2 million or 17.5%, with food and beverage costs as a percentage of sales increasing to 29.9% from 29.0% due to tariffs on imported ingredients [82]. - Labor and related costs increased to $23.9 million, up $2.7 million or 12.5%, with labor costs as a percentage of sales decreasing to 32.5% from 32.9% [83]. - Occupancy and related expenses were $5.8 million, an increase of $1.0 million or 22.8%, with occupancy costs as a percentage of sales rising to 7.9% from 7.4% [84]. - Total restaurant operating costs increased to $67.5 million, up $10.4 million or 18.2%, reflecting the impact of new restaurant openings [79]. - General and administrative expenses were $9.6 million, an increase of $0.9 million or 9.4%, with expenses as a percentage of sales decreasing to 13.0% from 13.5% [87]. Restaurant Operations - The company plans to open a total of 16 new restaurants in fiscal year 2026, expecting revenue and operating costs to increase accordingly [68]. - The number of restaurants increased from 79 at the beginning of the period to 83 at the end of the period, with 4 new openings during the three months ended November 30, 2025 [105]. - Restaurant-level operating profit was $11.1 million for the three months ended November 30, 2025, compared to $11.7 million in 2024, with a restaurant-level operating profit margin of 15.1% [102]. - Comparable restaurant base increased from 45 to 62 restaurants year-over-year, indicating growth in the existing restaurant portfolio [104]. Cash Flow and Financial Position - Net cash provided by operating activities was $0.5 million for the three months ended November 30, 2025, a decrease from $4.4 million in 2024 [111]. - Net cash used in investing activities was $12.7 million for the three months ended November 30, 2025, primarily due to $18.4 million in purchases of investments and $13.8 million in property and equipment [113]. - The company has $25.7 million in contractual obligations as of November 30, 2025, including $13.5 million for food purchases and $12.2 million for new restaurant construction [117]. - The company maintains a Revolving Credit Agreement with Kura Japan, with $45.0 million of availability remaining as of November 30, 2025 [109]. Accounting and Risk - No material changes in critical accounting policies and estimates from the previous fiscal year ended August 31, 2025 [121]. - No material changes to market risk during the three months ended November 30, 2025 [122]. - Financial statements are prepared in accordance with GAAP, requiring estimates and assumptions that affect reported amounts of assets and liabilities [119]. - Assessment of potential impairments of long-lived assets involves significant judgments and estimates [120]. - Tariffs are expected to continue impacting food and beverage costs, construction, and equipment costs throughout fiscal year 2026, with menu price increases implemented to manage profitability [69].

Financial Performance - Total sales for the fiscal first quarter 2026 were $73.5 million, an increase of 14.7% compared to $64.5 million in the first quarter of 2025[6] - Comparable restaurant sales decreased by 2.5%, driven by negative traffic of 2.5% and flat price/mix compared to the first quarter of 2025[6] - Operating loss was $3.7 million, worsening from an operating loss of $1.5 million in the first quarter of 2025[9] - Net loss was $3.1 million, or $(0.25) per diluted share, compared to a net loss of $1.0 million, or $(0.08) per diluted share, in the first quarter of 2025[9] - Adjusted net loss was $2.8 million, or $(0.23) per diluted share, compared to an adjusted net loss of $1.0 million, or $(0.08) per diluted share, in the first quarter of 2025[12] - Restaurant-level operating profit was $11.1 million, representing 15.1% of sales, down from $11.7 million, or 18.2% of sales, in the first quarter of 2025[12] Growth and Expansion - The company opened four new restaurants during the fiscal first quarter of 2026, contributing to a total of 83 locations across 22 states and Washington DC[13][17] - For the full fiscal year 2026, the company projects total sales between $330 million and $334 million, with 16 new restaurant openings planned[17] - The number of restaurants at the end of the period increased to 83 in November 2025, compared to 70 in August 2025, showing a growth of 18.6%[31] Cost and Expense Management - General and administrative expenses as a percentage of sales decreased to 13.0% from 13.5% in the first quarter of 2025, despite an increase in total expenses[10] - Food and beverage costs as a percentage of sales increased to 29.9% from 29.0% in the first quarter of 2025, primarily due to tariffs on imported ingredients[7] - Total restaurant operating costs rose to $67,455 thousand in Q4 2025, up from $57,088 thousand in Q4 2024, an increase of 18.1%[29] Comparative Performance - Sales for the three months ended November 30, 2025, increased to $73,455 thousand from $64,456 thousand in the same period of 2024, representing a growth of 12.4%[29] - Comparable restaurant sales performance declined by 2.5% in Q4 2025, compared to an increase of 1.8% in Q4 2024[31] - Restaurant-level operating profit was $11,088 thousand in Q4 2025, down from $11,714 thousand in Q4 2024, a decrease of 5.3%[37] - Adjusted EBITDA for Q4 2025 was $2,435 thousand, down from $3,572 thousand in Q4 2024, indicating a decline of 31.8%[35] Asset and Liability Overview - Total assets increased to $443,511 thousand as of November 30, 2025, from $430,942 thousand as of August 31, 2025, a growth of 2.6%[31] - Total liabilities rose to $214,310 thousand in November 2025, up from $199,872 thousand in August 2025, an increase of 7.1%[31]

Market Performance - The U.S. stock market had a mixed trading session on January 7, 2026, with the Nasdaq Composite and S&P 500 showing modest gains, while the Dow Jones Industrial Average declined [1] - The S&P 500 rose by 0.03% to close at 6,946.92 points, after reaching an intraday high of 6,965.69 points [2] - The Nasdaq Composite increased by 0.48% to finish at 23,660.86 points, driven by renewed investor confidence in technology and AI-related companies [2] - The Dow Jones Industrial Average fell by 0.54% to close at 49,193.37 points, retreating from its previous intraday record of 49,509.92 [3] Economic Data - The ADP National Employment Report indicated a recovery in private sector hiring with 41,000 payroll additions, missing the estimate of 47,000 [5] - The ISM Services Index for December reached a 14-month high of 54.4, exceeding expectations and indicating strong services sector activity [5] - The Job Openings and Labor Turnover Survey (JOLTS) reported a decline to 7.146 million openings, below the anticipated 7.648 million [5] Upcoming Earnings Reports - The fourth-quarter earnings season is underway, with notable companies reporting after the market close, including Constellation Brands (STZ) with estimated earnings of $2.64 per share on revenue of $2.17 billion, and Jefferies Financial Group (JEF) with estimated earnings of $0.90 per share on revenue of $1.96 billion [4] Sector Developments - The technology sector saw significant gains, particularly in AI-related companies, with NVIDIA Corporation (NVDA) experiencing a positive trading session following new developments announced at CES [7][8] - The semiconductor and storage sectors had explosive gains, with SanDisk (SNDK) surging nearly 28%, Western Digital (WDC) rising 16.8%, and Seagate Technology Holdings (STX) increasing by 14% [9] - The energy sector reacted to geopolitical news, with oil prices falling after an announcement regarding Venezuelan oil supply to the U.S., leading to declines in shares of Exxon Mobil Corporation (XOM) and Chevron (CVX) [10] Company-Specific News - UnitedHealth Group Incorporated (UNH) gained 2% as healthcare emerged as a strong sector, while Moderna (MRNA) jumped 10.9% following a positive assessment from Bank of America [11] - JPMorgan Chase (JPM) fell 2.4% after a downgrade, and American International Group, Inc. (AIG) plunged 7.5% following the announcement of its CEO stepping down [11] - Warner Bros. Discovery (WBD) rose 0.5% after rejecting a buyout bid from Paramount and advising shareholders to consider a rival offer from Netflix [11]

Core Insights - Kura Sushi USA, Inc. reported financial results for the fiscal first quarter ended November 30, 2025, highlighting a total sales increase but a decline in comparable restaurant sales [1][5][10]. Financial Performance - Total sales reached $73.5 million, up from $64.5 million in the first quarter of 2025, representing a year-over-year increase of approximately 12.3% [5][10]. - Comparable restaurant sales decreased by 2.5%, driven by negative traffic of 2.5% and flat price/mix compared to the same quarter in the previous year [5][10]. - The operating loss was $3.7 million, worsening from a loss of $1.5 million in the first quarter of 2025 [9][10]. - Net loss was $3.1 million, or $(0.25) per diluted share, compared to a net loss of $1.0 million, or $(0.08) per diluted share, in the first quarter of 2025 [11][10]. Cost Structure - Food and beverage costs as a percentage of sales increased to 29.9% from 29.0% in the first quarter of 2025, primarily due to tariffs on imported ingredients [6]. - Labor and related costs as a percentage of sales decreased to 32.5% from 32.9% in the first quarter of 2025, attributed to menu price increases and operational initiatives [6]. - General and administrative expenses rose to $9.6 million from $8.7 million in the first quarter of 2025, but as a percentage of sales, they decreased to 13.0% from 13.5% [8]. Restaurant Development - The company opened four new restaurants during the fiscal first quarter of 2026, bringing the total to 83 locations across 22 states and Washington D.C. [13][17]. - Kura Sushi aims to open a total of 16 new restaurants in fiscal 2026, with ten units currently under construction [4]. Outlook - For the full fiscal year of 2026, Kura Sushi maintains its guidance of total sales between $330 million and $334 million, with an annual unit growth rate above 20% [19].

Core Insights - Kura Sushi USA, Inc. is set to release its first-quarter earnings results on January 7, 2026, with analysts predicting a quarterly loss of 16 cents per share, compared to a loss of 8 cents per share in the same quarter last year [1] - The consensus estimate for Kura Sushi's quarterly revenue is $73.05 million, an increase from $64.46 million a year earlier [1] Financial Performance - On November 6, Kura Sushi reported better-than-expected fourth-quarter financial results and raised its FY 2025 sales guidance [2] - Following the announcement, Kura Sushi shares increased by 1.7%, closing at $52.33 [2] Analyst Ratings - TD Cowen analyst Andrew M. Charles maintained a Hold rating and reduced the price target from $79 to $59 on November 7, 2025 [3] - Barclays analyst Jeffrey Bernstein kept an Equal-Weight rating and lowered the price target from $75 to $67 on October 22, 2025 [3] - Citigroup analyst Jon Tower maintained a Neutral rating and raised the price target from $85 to $96 on July 9, 2025 [3] - Roth Capital analyst George Kelly maintained a Buy rating and increased the price target from $89 to $106 on July 9, 2025 [3]

Core Insights - Kura Sushi USA, Inc. is set to release its first-quarter earnings results on January 7, 2026, with analysts predicting a quarterly loss of 16 cents per share, compared to a loss of 8 cents per share in the same quarter last year [1] - The consensus estimate for Kura Sushi's quarterly revenue is $73.05 million, an increase from $64.46 million a year earlier [1] Financial Performance - On November 6, Kura Sushi reported better-than-expected fourth-quarter financial results and raised its FY 2025 sales guidance [2] - Following the announcement, Kura Sushi shares increased by 1.7%, closing at $52.33 [2] Analyst Ratings - TD Cowen analyst Andrew M. Charles maintained a Hold rating and reduced the price target from $79 to $59 on November 7, 2025 [3] - Barclays analyst Jeffrey Bernstein kept an Equal-Weight rating and lowered the price target from $75 to $67 on October 22, 2025 [3] - Citigroup analyst Jon Tower maintained a Neutral rating and raised the price target from $85 to $96 on July 9, 2025 [3] - Roth Capital analyst George Kelly maintained a Buy rating and increased the price target from $89 to $106 on July 9, 2025 [3]

Core Viewpoint - The market anticipates Kura Sushi (KRUS) will report a year-over-year decline in earnings despite higher revenues in its upcoming earnings report for the quarter ended November 2025 [1] Earnings Expectations - Kura Sushi is expected to post a quarterly loss of $0.17 per share, reflecting a year-over-year change of -112.5% [3] - Revenues are projected to be $73.88 million, which is an increase of 14.6% from the same quarter last year [3] Estimate Revisions - The consensus EPS estimate has been revised 3.85% lower in the last 30 days, indicating a reassessment by analysts [4] - The Most Accurate Estimate for Kura Sushi is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -3.03% [12] Earnings Surprise Prediction - A positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [10] - Kura Sushi currently holds a Zacks Rank of 4, making it challenging to predict an earnings beat [12] Historical Performance - In the last reported quarter, Kura Sushi was expected to post earnings of $0.17 per share but actually delivered $0.20, resulting in a surprise of +17.65% [13] - Over the past four quarters, Kura Sushi has beaten consensus EPS estimates three times [14] Conclusion - Kura Sushi does not appear to be a compelling candidate for an earnings beat based on current estimates and rankings, but other factors should also be considered by investors [17]

Core Viewpoint - Kura Sushi USA, Inc. will host a conference call to discuss its fiscal first quarter 2026 financial results on January 7, 2026, at 5:00 p.m. ET, with a press release issued the same day after market close [1]. Group 1 - The conference call will be hosted by Hajime "Jimmy" Uba, President and CEO, Jeff Uttz, CFO, and Benjamin Porten, SVP of Investor Relations & System Development [1]. - Interested parties can listen to the conference call via telephone or through a webcast available on the company's website [2]. - A telephone replay of the call will be available shortly after it concludes, with specific access details provided [2]. Group 2 - Kura Sushi USA, Inc. operates 83 locations across 22 states and Washington DC, offering a unique dining experience centered on authentic Japanese cuisine and a revolving sushi service model [3]. - The company was established in 2008 as a subsidiary of Kura Sushi, Inc., which has over 650 restaurants globally and a brand history of 45 years [3].