Q3 2025 Performance - Total revenue for Q3 2025 reached $181.4 million[9], representing a 1.8% increase[9] - Operating income for Q3 2025 was $5.4 million[9] - Adjusted EBITDA for Q3 2025 amounted to $21.4 million[9] - Restaurant-Level Adjusted EBITDA for Q3 2025 was $36.7 million[9] - Net income for Q3 2025 was $0.8 million[9] Q3 YTD 2025 Performance - Total revenue for Q3 YTD 2025 reached $546.3 million[14], showing a 3.9% growth[13] - Operating income for Q3 YTD 2025 was $33.3 million[16] - Adjusted EBITDA for Q3 YTD 2025 amounted to $72.7 million[16] - Restaurant-Level Adjusted EBITDA for Q3 YTD 2025 was $117.8 million[16] - Net income for Q3 YTD 2025 was $14.8 million[16] Fiscal 2025 Financial Targets - The company expects revenue between $730 million and $733 million[19] - The company plans to open 8 new restaurants[17, 19]

Financial Performance - Total revenues for the quarter ended September 28, 2025, were $181.4 million, an increase of 1% compared to $178.3 million for the same quarter in 2024[17] - Net income attributable to Portillo's Inc. for the quarter was $1.2 million, down from $7.2 million in the same quarter last year, representing a decrease of 83%[17] - The company reported a loss before income taxes of $465,000 for the quarter, compared to income before income taxes of $11.3 million in the same quarter last year[17] - Basic net income per common share attributable to Portillo's Inc. was $0.02 for the quarter, down from $0.12 in the same quarter last year[17] - Net income for the three quarters ended September 28, 2025, was $14,815,000, a decrease of 34.8% compared to $22,647,000 for the same period in 2024[22] - Operating cash flow for the three quarters ended September 28, 2025, was $48,741,000, down from $71,954,000 in the prior year, reflecting a decline of 32.2%[22] - Net income for the quarter ended September 28, 2025, was $0.8 million, compared to $8.8 million for the same quarter in 2024, representing a decline of 90.9%[100] - For the three quarters ended September 28, 2025, net income was $14.8 million, down from $22.6 million for the same period in 2024, a decrease of 34.5%[100] Assets and Liabilities - Total current assets decreased to $50.1 million as of September 28, 2025, from $52.7 million as of December 29, 2024[16] - Total assets increased to $1.59 billion as of September 28, 2025, compared to $1.50 billion as of December 29, 2024[16] - Total liabilities rose to $1.10 billion as of September 28, 2025, from $1.01 billion as of December 29, 2024[16] - Total stockholders' equity increased to $488,400,000 as of September 28, 2025, compared to $477,592,000 as of September 29, 2024, representing a growth of 2.7%[21] - Total liabilities under the Tax Receivable Agreement decreased by $16,248,000 due to adjustments in deferred tax assets associated with increases in tax basis[21] - The company estimated its obligation for future payments under the Tax Receivable Agreement (TRA) liability to be $353.2 million as of September 28, 2025[92] Expenses - Restaurant operating expenses for the quarter were $144.7 million, an increase of 6% from $136.3 million in the same quarter last year[17] - The company experienced a 10% increase in food, beverage, and packaging costs, totaling $62.6 million for the quarter[17] - The company reported depreciation and amortization expenses of $21,489,000 for the three quarters ended September 28, 2025, compared to $20,729,000 in the previous year, indicating a rise of 3.7%[22] - The company incurred equity-based compensation expenses of $4,288,000 for the three quarters ended September 28, 2025, compared to $9,223,000 in the prior year, a reduction of 53.5%[22] - The company recorded interest paid of $17,326,000 for the three quarters ended September 28, 2025, compared to $13,010,000 for the same period in 2024, reflecting an increase of approximately 33%[24] - Total interest expense for the quarter ended September 28, 2025, was $5.7 million, compared to $6.5 million for the same quarter in 2024[76] Investments and Capital Expenditures - The company invested $58,097,000 in property and equipment during the three quarters ended September 28, 2025, compared to $56,514,000 in the same period last year, reflecting an increase of 2.8%[22] - As of September 28, 2025, total property and equipment, net amounted to $407.3 million, an increase of 13.4% from $359.0 million as of December 29, 2024[52] - The company entered into a joint venture to develop a restaurant at Dallas-Fort Worth International Airport, expected to commence operations in 2026, with a 65% ownership interest[28] - The company capitalized deferred financing costs and issuance discounts of $1.3 million under the 2025 Credit Agreement[74] Operational Changes - The company is actively searching for a new Chief Executive Officer, which may impact future operations and strategy[13] - The company launched Portillo's Perks™, a visit-based loyalty program, on March 3, 2025[49] - The company recognized a non-cash impairment charge of $2.2 million related to its legacy Barnelli's trade name during the quarter ended September 28, 2025[37] - The company recognized trade name impairment charges of $2.2 million during the quarter ended September 28, 2025, with no impairment of goodwill reported[53] Shareholder Information - The weighted average ownership percentage for pre-IPO LLC Members was 4.6% for the quarter ended September 28, 2025, down from 15.8% in the same quarter of the previous year[82] - Portillo's Inc. reported a total of 75,366,495 LLC Units outstanding as of September 28, 2025, with 95.4% owned by Portillo's Inc.[81] - Berkshire Partners LLC and its affiliates beneficially own approximately 5.2% of the Company as of September 28, 2025, following the redemption of 7,290,465 LLC units for Class A common stock[108] Legal Matters - A class action lawsuit was filed alleging wage and hour violations, with a loss considered reasonably possible but not estimable, resulting in no litigation reserve recorded[98] Miscellaneous - No guest accounts for 10% or more of the Company's revenues, indicating a diversified revenue stream[103] - The Company has one operating segment and one reportable segment, as assessed by the Chief Operating Decision Maker[99]

Core Insights - Portillo's Inc. reported a revenue increase of 1.8% to $181.4 million for Q3 2025 compared to $178.3 million in Q3 2024, driven by new restaurant openings despite a decline in same-restaurant sales [4][9][10] - The company experienced a significant decrease in net income, which fell by 91.1% to $0.8 million from $8.8 million in the previous year, primarily due to increased operating expenses and impairment charges [8][9][10] - Adjusted EBITDA decreased by 23.4% to $21.4 million, reflecting challenges in maintaining profitability amid rising costs and a competitive market [10][9] Financial Performance - Total revenues for Q3 2025 were $181.4 million, up $3.2 million or 1.8% from Q3 2024 [4][9] - Same-restaurant sales decreased by 0.8%, attributed to a 2.2% drop in transactions, partially offset by a 1.4% increase in average check [4][9] - Total restaurant operating expenses rose by 6.2% to $144.7 million, driven by new restaurant openings and a 6.3% increase in commodity prices [5][9] - General and administrative expenses increased by 9.4% to $20.0 million, largely due to dead site costs [6][9] Operational Highlights - The company opened four new restaurants in Q3 2025, bringing the total to 99, with plans for three more openings in Q4 2025 [11][12] - Portillo's introduced a new in-line restaurant format, with future openings focusing on a smaller prototype designed for efficiency [12][11] - The company aims to open a total of eight new restaurants in fiscal 2025 [14] Financial Targets - Management updated fiscal 2025 targets, projecting revenues between $730 million and $733 million, with same-restaurant sales expected to decline by 1% to 1.5% [14] - Adjusted EBITDA is targeted between $90 million and $94 million, with capital expenditures estimated at $97 million to $100 million [14]

Core Insights - Portillo's Inc. (PTLO) is expected to report a year-over-year decline in earnings despite higher revenues for the quarter ended September 2025, with a consensus EPS estimate of $0.04, reflecting a decrease of 63.6% [1][3] - The anticipated revenue for the same quarter is $184.12 million, which represents a 3.3% increase from the previous year [3] - The earnings report is scheduled for November 4, and the actual results will significantly influence the stock price, depending on whether they meet or exceed expectations [2] Earnings Estimates and Revisions - The consensus EPS estimate has been revised down by 33.33% over the last 30 days, indicating a bearish sentiment among analysts regarding the company's earnings prospects [4] - Portillo's has an Earnings ESP of -25.00%, suggesting that the Most Accurate Estimate is lower than the Zacks Consensus Estimate, making it challenging to predict an earnings beat [12] Historical Performance - In the last reported quarter, Portillo's met the expected EPS of $0.12, resulting in no surprise [13] - Over the past four quarters, the company has beaten consensus EPS estimates three times [14] Industry Context - In the Zacks Retail - Restaurants industry, El Pollo Loco Holdings (LOCO) is expected to post earnings of $0.23 per share for the same quarter, indicating a year-over-year increase of 9.5% [18] - El Pollo Loco's revenue is projected to be $123.51 million, up 2.6% from the previous year, but it also has a negative Earnings ESP of -2.22% and a Zacks Rank of 4, indicating difficulty in predicting an earnings beat [19][20]

Core Viewpoint - The article critiques the speculative nature of quantum computing stocks, particularly IonQ, while highlighting the potential of companies like Remitly Global and Portillo's that are currently creating value in the market [2][12]. Group 1: Quantum Computing Stocks - IonQ has seen a significant increase in stock price, up hundreds of percent in the last year, reaching a market cap of $25 billion despite generating less than $100 million in revenue [2]. - The company is characterized as highly speculative with little to no viable business model, making it a risky investment [2][12]. Group 2: Remitly Global - Remitly has experienced a 34% year-over-year revenue growth last quarter, with a 40% increase in send volume, indicating strong performance despite concerns over immigration policies affecting cross-border payments [6][5]. - The company generated $1.46 billion in trailing revenue with an EBIT of $27 million, showcasing its path to profitability and operational leverage compared to IonQ's significant losses [7]. - Remitly is positioned to capture market share from traditional players due to its low fees and user-friendly mobile application [6]. Group 3: Portillo's - Portillo's is expanding its restaurant chain into new markets like Texas and Florida, despite facing challenges from a slowdown in consumer spending [8]. - The company reported a modest 3.6% annual revenue growth, with plans for significant expansion in the coming years as new store openings are scheduled for the latter half of 2025 [9]. - Portillo's generated $65 million in EBIT on $728 million in revenue over the last 12 months, contrasting sharply with IonQ's $53 million in revenue and $351 million in losses [11].

Core Insights - Middle Coast Investing's third-quarter 2025 investor letter indicates a favorable performance, with its portfolio outperforming the S&P 500, returning 9.6% compared to the S&P 500's 7.8% [1] - The Core U.S. portfolios returned 10%, while the Russell 2000 returned 12%, the S&P 600 returned 8.7%, and the Nasdaq generated 11.2% during the same period [1] - European Portfolios appreciated by 5.5% in Q3 2025 [1] Company Focus: Portillo's Inc. (NASDAQ:PTLO) - Portillo's Inc. had a one-month return of -0.77% and a 52-week loss of 47.86%, closing at $6.47 per share with a market capitalization of $465.229 million on October 6, 2025 [2] - Middle Coast Investing acknowledged a misjudgment regarding Portillo's, noting a disappointing Q2 report and lowered guidance, but expressed confidence in the company's strategy and potential to resolve its issues, particularly in Texas [3] - Portillo's Inc. was held by 26 hedge fund portfolios at the end of Q2 2025, an increase from 17 in the previous quarter [4] - The company reported revenue of $188.5 million in Q2 2025, reflecting an increase of $6.6 million compared to Q2 2024 [4] - Despite recognizing Portillo's potential, Middle Coast Investing believes certain AI stocks present greater upside potential and less downside risk [4]

Core Insights - Portillo's, Inc. is scheduled to host its Q3 2025 earnings webcast on November 4, 2025, at 10 a.m. EST, with the earnings release occurring before market open on the same day [1]. Company Overview - Portillo's has expanded from a small hot dog trailer in Chicago to over 90 restaurants across 10 states, offering a unique menu that includes Italian beef sandwiches, Chicago-style hot dogs, char-grilled burgers, fresh salads, and chocolate cake [2]. - The company operates a model that focuses on creating experience-oriented destinations, combining dine-in, drive-thru, takeout, and delivery services to meet customer demands [2]. - Portillo's aims to extend its iconic food and dining experience to a broader audience across the United States after six decades of successful operations [2].

Core Insights - The article compiles significant research calls from Wall Street, highlighting upgrades and downgrades that could impact investor decisions. Upgrades - Deutsche Bank upgraded Mobileye (MBLY) to Buy from Hold with a price target of $19, indicating a favorable setup for the shares [2] - BofA upgraded Brinker (EAT) to Buy from Neutral with a price target of $192, up from $190, noting that full-service restaurants are better positioned due to higher incomes among older consumers [3] - Jefferies upgraded Ford (F) to Hold from Underperform with a price target of $12, up from $9, citing the potential for improved earnings as constraints on higher CO2 mix models loosen [4] - Rothschild & Co Redburn upgraded Affirm (AFRM) to Buy from Neutral with a price target of $101, up from $74, highlighting its established product set and international growth potential [5] - Morgan Stanley upgraded Micron (MU) to Overweight from Equal Weight with a price target of $220, up from $160, predicting multiple quarters of double-digit price increases that could enhance earnings power [6] Downgrades - Susquehanna downgraded Rambus (RMBS) to Neutral from Positive with a price target of $100, indicating that the best-case EPS outlook is already priced in [7] - BofA downgraded Shake Shack (SHAK) to Underperform from Neutral with a price target of $86, down from $148, due to margin pressures from competition and inflation [7] - Citi downgraded Boston Beer (SAM) to Neutral from Buy with a price target of $235, down from $255, anticipating continued challenges in the second half of 2025 [7] - Scotiabank downgraded AT&T (T) to Sector Perform from Outperform with a price target of $30.25, expecting modest revenue and EBITDA growth amid business segment weakness [7] - Scotiabank downgraded Check Point (CHPT) to Sector Perform from Outperform with a price target of $205, down from $220, expressing less optimism about the company despite a positive outlook for the U.S. software sector [7]

Core Viewpoint - Portillo's has appointed Michael Miles Jr as interim CEO following the departure of Michael Osanloo, who served as president and CEO for seven years and will assist in the transition for 90 days [1][2]. Group 1: Leadership Changes - Michael Miles Jr, previously the chairman of Portillo's board, has taken over as interim CEO [1][5]. - Osanloo expressed gratitude for his time leading the company and acknowledged the contributions of the team [1]. - A search committee has been formed to find a permanent CEO, consisting of directors Paulette Dodson, GJ Hart, Eugene I Lee Jr, and Michael Miles Jr [2]. Group 2: Executive Background - Michael Miles Jr has extensive experience in the retail and restaurant sectors, having previously served as president and COO of Staples and COO of Pizza Hut [3]. - Eugene Lee Jr has been appointed as the lead independent director, bringing experience from his tenure as CEO of Darden Restaurants [4]. Group 3: Company Overview - Portillo's operates 90 outlets across ten US states, known for its Italian beef sandwiches, char-grilled burgers, Chicago-style hot dogs, salads, and chocolate cake [5].

Company Leadership Transition - Portillo's Inc. has appointed Michael A. Miles, Jr. as Interim CEO, effective immediately, succeeding Michael Osanloo who has departed the company [2][5] - A Search Committee has been established to identify the next CEO, comprising Directors Paulette Dodson, G.J. Hart, Eugene I. Lee, Jr., and Michael A. Miles, Jr., with assistance from an executive search firm [3] - Eugene I. Lee, Jr. has been appointed as Lead Independent Director during this transition period [5] Leadership Experience - Michael A. Miles, Jr. brings extensive leadership experience from the retail and restaurant industries, having previously served as President and COO of Staples and COO of Pizza Hut [4] - Miles has been Chairman of the Board at Portillo's since 2014 and served as Interim CEO from 2014 to 2015 [4] Company Overview - Portillo's has grown from a small hot dog trailer in Chicago to over 90 restaurants across 10 states, known for its menu of Italian beef sandwiches, Chicago-style hot dogs, and other offerings [6] - The company operates a model that focuses on experience, blending dine-in, drive-thru, takeout, and delivery to serve its guests [6]