Key Takeaways RRGB's "First Choice" plan is lifting traffic trends and enhancing restaurant performance.Sequential traffic rose with better four-wall execution and the Big Yummm Burger deal.Digital upgrades, targeted marketing and fresh menu innovations aim to drive sustained growth.Red Robin Gourmet Burgers, Inc. (RRGB) shares have declined 37.2% in the past six months compared with the Zacks Retail - Restaurants industry’s 11.9% fall. The decline can be primarily attributed to a tough consumer environment ...

Core Insights - Red Robin (RRGB) reported a quarterly loss of $0.7 per share, which is better than the Zacks Consensus Estimate of a loss of $0.78, and an improvement from a loss of $1.13 per share a year ago, indicating a positive earnings surprise of +10.26% [1] - The company achieved revenues of $265.13 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 0.97%, although this represents a decline from $274.64 million in the same quarter last year [2] - Red Robin has exceeded consensus EPS estimates three times in the last four quarters, indicating a trend of improving performance [2] Financial Performance - The stock has underperformed the market, losing approximately 14.6% since the beginning of the year, while the S&P 500 has gained 14.4% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.27, with expected revenues of $275.48 million, and for the current fiscal year, the estimate is -$0.60 on revenues of $1.21 billion [7] Industry Context - The Retail - Restaurants industry, to which Red Robin belongs, is currently ranked in the bottom 13% of over 250 Zacks industries, suggesting a challenging environment for the sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Red Robin's stock performance [5]

Financial Data and Key Metrics Changes - Total revenues for Q3 2025 were $265.1 million, down from $274.6 million in Q3 2024, reflecting a comparable restaurant revenue decline of 1.2% [18][19] - Restaurant-level operating profit as a percentage of restaurant revenue increased by 90 basis points year-over-year to 9.9%, driven by labor efficiency gains [19] - Adjusted EBITDA for Q3 2025 was $7.6 million, an increase of $3.4 million compared to Q3 2024, attributed to cost efficiency gains and menu price increases [20] Business Line Data and Key Metrics Changes - The off-premise business accounted for approximately 25% of sales in Q3 2025, with traffic growth of 2.9% [11] - The Big Yum Burger deal launched in Q3 contributed to a 250-basis point sequential traffic improvement from Q2 to Q3 [7][19] - The company achieved a 1.7% increase in net menu price, offset by a 3% decline in guest traffic [18] Market Data and Key Metrics Changes - Guest traffic run rate improved from approximately down 7% at the beginning of Q3 to negative 1.4% by the end of the quarter [8] - The company expects comparable restaurant sales to decline approximately 3% in Q4 2025 [21][22] Company Strategy and Development Direction - The company is focused on its "first choice plan" to enhance guest experience, operational efficiency, and profitability [4][5] - A data-driven marketing initiative was launched to engage guests more personally and effectively, with plans to expand this approach [10][39] - The company is exploring various options to strengthen its balance sheet, including debt refinancing and refranchising efforts [12][14] Management's Comments on Operating Environment and Future Outlook - Management noted that while guest traffic trends have slowed recently, they remain optimistic about regaining traction as marketing spend increases [22][23] - The company is committed to maintaining a balance between investment priorities and profitability, expecting G&A savings of $3-$4 million in 2025 [12][20] - Management expressed confidence in the operational improvements and the positive impact of the Big Yum initiative on traffic trends [24][25] Other Important Information - The company completed refreshes in 20 restaurants during Q3, which are expected to enhance guest experience and drive sales [15][16] - Management announced the appointment of Jesse Griffith as Chief Operations Officer, recognizing the contributions of the operations team [26] Q&A Session Summary Question: Can you provide insights on the Big Yum initiative and its impact on sales? - The Big Yum deal is mixing at about 8% of total sales, performing as expected [28][29] Question: What are the expectations for food and beverage costs moving forward? - The company anticipates maintaining a 25% cost of goods in Q4, with measures in place to mitigate beef inflation [29] Question: What was the financial cost of extending the current debt agreement? - The extension cost was 50 basis points, deemed reasonable for the additional time [30] Question: How is the refranchising initiative progressing? - Interest in refranchising remains strong, with proposals being evaluated, but no firm announcements yet [31] Question: What are the expectations for G&A sustainability? - G&A levels are expected to remain similar to Q3, reflecting efficiencies captured this year [45] Question: Can you elaborate on the comp guidance for Q4? - The company expects same-store sales and traffic to decline by 3% in Q4, with a mix of menu price increases and traffic impacts [47]

Core Points - Red Robin Gourmet Burgers, Inc. has established an "at-the-market equity offering" program to sell shares of its common stock with a total gross sales price of up to $40 million [1][3] - The net proceeds from this offering will be used for working capital, debt repayment, and other general purposes [1] - The shares will be offered through Evercore Group L.L.C. as the sales agent, utilizing various methods permitted by law for at-the-market offerings [2] Company Overview - Red Robin Gourmet Burgers, Inc. is a casual dining restaurant chain founded in 1969, operating under the trade name Red Robin Gourmet Burgers and Brews [6] - The company serves a variety of gourmet burgers, salads, appetizers, entrees, desserts, and signature beverages in a family-friendly atmosphere [6] - Red Robin operates nearly 500 locations in the United States and Canada, including franchise agreements, and offers online ordering for to-go, delivery, and catering [6]

Financial Performance - Total revenues for the third quarter of fiscal 2025 were $265.1 million, a decrease of $9.5 million or 3.5% compared to the same period in fiscal 2024[81]. - Comparable restaurant revenue decreased by 1.2% in the third quarter, with a 3.0% decrease in guest count, partially offset by a 1.7% increase in average guest check[90]. - Net loss for the third quarter was $18.4 million, an improvement of $0.5 million compared to a net loss of $18.9 million in the prior year[81]. - Adjusted EBITDA increased by 81% to $7.6 million in the third quarter compared to $4.2 million last year[81]. - Restaurant revenue for the year-to-date period decreased by $17.6 million, or 1.9%, compared to the same period in fiscal 2024[91]. - Restaurant revenue for the twelve weeks ended October 5, 2025, was $260.9 million, a decrease of 3.6% compared to $270.6 million for the same period in 2024[120]. - Net income for the twelve weeks ended October 5, 2025, was a loss of $18.4 million, compared to a loss of $18.9 million for the same period in 2024[122]. - Adjusted net income per diluted share for the twelve weeks ended October 5, 2025, was $(0.70), an improvement from $(1.03) for the same period in 2024[122]. Revenue Sources - Franchise revenue increased by $0.3 million, or 8.6%, in the third quarter, primarily due to transfer fee revenue from a franchisee transaction[92]. - Other revenue decreased by $2.9 million year-to-date, primarily due to lower gift card breakage[93]. Operating Costs - Cost of sales as a percentage of restaurant revenue increased to 25.0% in the third quarter from 24.1% in the prior year[94]. - Cost of sales as a percentage of restaurant revenue increased by 90 basis points in Q3 FY2025 compared to Q3 FY2024, primarily due to rising commodity prices and increased discounts[95]. - Labor costs as a percentage of restaurant revenue decreased by 250 basis points in Q3 FY2025 compared to Q3 FY2024, driven by improved labor efficiency and reduced turnover[98]. - Other operating costs as a percentage of restaurant revenue increased by 40 basis points in Q3 FY2025 compared to Q3 FY2024, mainly due to higher third-party commission expenses[101]. - Occupancy costs as a percentage of restaurant revenue increased by 20 basis points in Q3 FY2025 compared to Q3 FY2024, attributed to higher general liability insurance reserves[104]. - Total restaurant operating costs decreased by 4.6% to $235.1 million for the twelve weeks ended October 5, 2025, compared to $246.4 million for the same period in 2024[120]. Cash Flow and Liquidity - Cash and cash equivalents decreased by $8.5 million to $30.9 million as of October 5, 2025, from $39.4 million at the beginning of the fiscal year[128]. - Net cash provided by operating activities increased to $26.0 million for the forty weeks ended October 5, 2025, compared to $1.8 million for the same period in 2024[130]. - Adjusted EBITDA for the forty weeks ended October 5, 2025, was $57.9 million, compared to $31.2 million for the same period in 2024[123]. - The company had approximately $50.7 million in liquidity as of October 5, 2025, including cash and cash equivalents and available borrowing capacity[128]. Capital Expenditures and Financing - Net cash flows used in investing activities decreased by $23.9 million to a negative $19.0 million for fiscal 2025, primarily due to increased capital expenditures and lower proceeds from restaurant sales[131]. - Total capital expenditures for the forty weeks ended October 5, 2025, were $25.1 million, up from $19.4 million in the comparable period of fiscal 2024, representing a 29% increase[132]. - Net cash flows used in financing activities increased to $15.6 million for fiscal 2025, compared to $8.0 million in fiscal 2024, mainly due to debt repayment and proceeds from the sale of three restaurant locations[133]. - As of October 5, 2025, the Company had outstanding borrowings of $177.7 million under its Credit Facility, with $29.0 million of available borrowing capacity[134]. - The Company is in compliance with all debt covenants as of October 5, 2025[135]. Share Repurchase and Future Outlook - The Company has repurchased a total of 1,088,588 shares at an average price of $15.18 per share, totaling $16.5 million, with $58.5 million remaining under the current share repurchase program[137]. - The Company expects future cash flows from restaurant operations, combined with borrowing capacity and cash on hand, to meet anticipated cash requirements and fund capital expenditures over the next 12 months[136]. Risk Factors - The Company is exposed to commodity price risks, which could negatively impact profitability due to volatility in food and beverage costs[148]. - There have been no material changes in interest rate risk or commodity price risk since the last annual report[149].

Compensation and Benefits - Executive's annual base salary is set at $425,000, with a target annual bonus of 65% of the base salary, subject to performance criteria [10][11]. - The long-term incentive plan for fiscal year 2026 has a target value equal to 70% of the Executive's annual base salary [12]. - The Executive's participation in the Company's welfare benefit plans is on par with other senior executives [14]. - Any incentive compensation is subject to the Company's clawback policies as required by law [55]. - Executive's tax consequences of compensation and benefits are solely his responsibility [47]. Employment Terms - The Executive's employment is "at will," allowing termination by either party at any time for any reason [6]. - The Executive's employment will automatically terminate upon death or disability, with specific provisions for unpaid obligations [20]. - Executive must devote substantially all working time to the Company's business, with allowances for personal and charitable activities [9]. - The Agreement constitutes the entire understanding between the parties regarding Executive's employment [53]. - The provisions of the Agreement may only be amended with prior written consent from both the Board and Executive [54]. Severance and Termination - Executive is eligible for participation in the Company's Executive Severance Plan, which includes a cash severance multiplier of 1.0 and a benefits continuation period of 12 months [18][19]. - Executive agrees to a non-compete clause for 12 months post-termination, restricting involvement with competing businesses [28]. - Executive is prohibited from inducing employees at the level of Assistant Store Manager or higher to leave the Company during the Restrictive Period [30]. - Executive must return all Company property and non-personal documents upon termination of employment [33]. - The Company may seek injunctive relief in case of breach of the Agreement, without the necessity of posting bond or security [35]. Ownership and Compliance - Executive is required to own shares of common stock valued at least 3 times the annual base salary as part of the Company's Ownership Guidelines [13]. - Executive is required to maintain ownership of common stock as per the Company's Executive Stock Ownership Guidelines [37]. - Executive is allowed to report possible violations of law without prior authorization from the Company [56]. - The Company reserves the right to modify employee benefit plans without recourse by the Executive, as long as it applies to similarly situated senior executives [17]. Legal and Governance - The Agreement is governed by the laws of the State of Colorado [46]. - No relevant financial data or performance summaries were found in the provided content [59][60][61][62][63][64][65][66].

Core Viewpoint - Red Robin Gourmet Burgers, Inc. reported a decrease in total revenues for the fiscal third quarter of 2025, alongside improvements in adjusted EBITDA and restaurant-level operating profit margin, indicating ongoing operational efficiencies despite revenue challenges [2][4][10]. Financial Performance - Total revenues for the third quarter of 2025 were $265.1 million, a decrease of $9.5 million compared to the same period in 2024 [2]. - Comparable restaurant revenue decreased by 1.2%, with a net loss of $18.4 million, an improvement from a loss of $18.9 million in the previous year [10]. - Adjusted EBITDA for the third quarter was $7.6 million, an 81% increase from $4.2 million in the prior year [10]. Year-to-Date Performance - For the year-to-date period, total revenues were $941.2 million, down by $22.2 million from the previous year [10]. - Comparable restaurant revenue remained unchanged year-to-date, with a net loss of $13.2 million, significantly improved from a loss of $37.8 million last year [10]. Operational Efficiency - The restaurant-level operating profit margin improved by 90 basis points year-over-year to 9.9%, primarily driven by labor efficiency improvements [4]. - The company experienced a sequential traffic improvement of approximately 250 basis points from the second quarter, particularly during mid-week dining and lunch periods [4]. Balance Sheet and Liquidity - As of October 5, 2025, Red Robin had outstanding borrowings of $177.7 million, reduced by $11.8 million from the end of fiscal 2024, with liquidity of approximately $50.7 million [6]. - The company entered into a fourth amendment to its credit agreement, extending the maturity date to September 2027, providing additional flexibility for its operational plans [7]. Guidance and Outlook - The company maintained its total revenue guidance for fiscal 2025 at approximately $1.2 billion, with an updated expectation for restaurant-level operating profit of at least 12.5% [9]. - Adjusted EBITDA guidance was raised to at least $65 million, reflecting confidence in operational improvements [9].

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Core Insights - Red Robin is set to report its earnings, with analysts expecting a revenue decline of 6.5% year on year to $256.7 million, following a previous quarter where it beat revenue expectations by 1.6% with $283.7 million in revenue, down 5.5% year on year [1][2]. Revenue Performance - Last quarter, Red Robin reported revenues of $283.7 million, which was a 5.5% decrease compared to the previous year, but it exceeded analysts' expectations [1]. - Analysts have maintained their revenue estimates for Red Robin, indicating confidence in the company's performance heading into earnings [3]. Earnings Expectations - The adjusted loss for the upcoming quarter is anticipated to be -$0.78 per share, reflecting a further deceleration from the previous year's 1.1% revenue decrease [2]. Industry Context - In comparison to peers in the sit-down dining segment, Bloomin' Brands reported a 10.6% revenue decline but beat expectations, while First Watch saw a 25.6% revenue increase, outperforming estimates [4]. - The average share price for sit-down dining stocks has decreased by 1.2% over the last month, with Red Robin's shares down 24.8% during the same period, currently trading at $4.75 against an average analyst price target of $11 [5].

Core Insights - Red Robin's shares increased by 7.8% following the release of preliminary financial results for Q3 2025 and leadership changes, indicating positive investor sentiment towards the earnings guidance [1] - The company announced the departure of CFO Todd Wilson and the promotion of Jesse Griffith to COO, with the stock's movement suggesting that investors prioritized the financial outlook over executive changes [1] Financial Performance - Preliminary financial results indicate a projected quarterly loss of $0.78 per share, with expected revenues of $262.59 million, reflecting a 4.4% decline year-over-year [4] - The consensus earnings per share estimate was revised downward by 5.88% in the past 30 days, contributing to negative sentiment prior to the earnings report [4] Stock Performance - Red Robin's shares are currently trading at $4.83, which is 35.1% below its 52-week high of $7.44 from July 2025, and the stock has decreased by 14.8% since the beginning of the year [5] - The stock has exhibited high volatility, with 61 moves greater than 5% in the past year, indicating that while the recent news is seen as significant, it does not fundamentally alter market perception of the company [3]