Company Performance - Red Robin Gourmet Burgers reported Q2 fiscal 2025 revenues of $283.7 million, a decrease of 5.5% year over year from $300.2 million, and slightly below the Zacks Consensus Estimate of $285 million [2] - Comparable restaurant revenue declined by 3.2%, with traffic falling by 5.5% [2] - Adjusted earnings were 26 cents per share, surpassing the Zacks Consensus Estimate of a loss of 25 cents, and improved from a loss of 38 cents per share in the same quarter last year [3] Margins and Profitability - The company achieved a restaurant-level operating profit of $40.5 million, up from $34.7 million in the prior year, with an operating margin expansion of 270 basis points to 14.5% [4] - Adjusted EBITDA increased by 64% year over year to $22.4 million, with adjusted operating income at $9.8 million, or 3.5% of revenues, compared to a loss of $4.6 million last year [4] Balance Sheet and Liquidity - At the end of the quarter, Red Robin had cash and cash equivalents of $24.4 million and total liquidity of $61.9 million, including credit facility availability [5] - Long-term debt decreased to $163.1 million from $181.6 million at the end of fiscal 2024, reflecting a debt repayment of $20.3 million year-to-date [5] Outlook - For fiscal 2025, Red Robin expects revenues of approximately $1.2 billion, slightly down from the previous estimate of $1.21-$1.23 billion [6] - Management reaffirmed guidance for restaurant-level operating margin of 12-13% and adjusted EBITDA in the range of $60-$65 million, with comparable restaurant sales projected to decline by 3-4% for the remainder of the year [6] Market Position and Estimates - Recent estimates for Red Robin have shown an upward trend, indicating positive investor sentiment [7] - The stock has a Zacks Rank of 2 (Buy), suggesting an expectation of above-average returns in the coming months [9] Industry Comparison - Red Robin operates within the Zacks Retail - Restaurants industry, where Yum China Holdings reported revenues of $2.79 billion, reflecting a year-over-year increase of 4% [10] - Yum China's EPS for the same period was $0.58, compared to $0.55 a year ago, with a Zacks Rank of 3 (Hold) [11]

Group 1: Promotions and New Menu Items - Bennigan's and Steak and Ale are celebrating National Monte Cristo Day on September 17 with a free Monte Cristo with entrée purchase, alongside new fall cocktails and refreshed menus [3] - Chipotle Mexican Grill is reintroducing its most-searched menu item, Carne Asada, for a limited time, with promotions including a College Football Jersey BOGO and $0 delivery fee [7] - Straw Hat Pizza has launched the Margherita Masterpizza, offering 15% off throughout September at participating locations [9] - McDonald's is bringing back Extra Value Meals nationwide, featuring affordable options like the $5 Sausage McMuffin with Egg meal and the $8 Big Mac meal [11] - Friendly's is celebrating its 90th anniversary with Coca-Cola by offering Mini Floats for just 90 cents from September 3-30 [13] - Bruxie has introduced the Dubai Chocolate Shake, a limited-time dessert inspired by viral trends [15] - Juice It Up! is welcoming fall with the return of the Horchata Smoothie and new snack options like Chia Pudding Parfaits [17] - Nékter Juice Bar has launched its "Fall Into Flavor" collection featuring pumpkin-spiced items made with real pumpkin and no artificial additives [19] - Taco Cabana has introduced new menu options including the 3 to 6 Fix! Menu and the Chicken Fajita Bacon Melt Taco [21] - Wetzel's Pretzels has launched Apple Cinnamon Bitz, a seasonal treat available through November 30 [23] - Red Robin is rolling out a new menu with steakhouse-inspired burgers and improved Zucchini Fries [25] - JINYA Ramen Bar is celebrating its 15th anniversary with new September Chef's Specials [27] - Pincho is collaborating with Bernie's Burger Bus for a month-long menu revival, benefiting local foundations [29] - Pizza Inn has reintroduced the Sweet & Spicy Pepp Rally Pizza and is hosting SEC Championship sweepstakes [31]

Group 1 - Red Robin (RRGB) shares have increased by 8.6% over the past four weeks, closing at $6.17, with a mean price target of $10 indicating a potential upside of 62.1% [1] - The average price targets range from a low of $6.00 to a high of $12.00, with a standard deviation of $2.71, suggesting variability in analyst estimates [2] - Analysts have shown strong agreement in revising earnings estimates higher, which correlates with potential stock price increases [9][10] Group 2 - The Zacks Consensus Estimate for the current year has risen by 33.5% over the past month, indicating positive earnings momentum [10] - RRGB holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [11] - While consensus price targets may not be reliable for predicting exact gains, they can provide guidance on the direction of price movement [12]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point, as stocks may lose momentum when their valuations exceed future growth potential [2] - Investing in bargain stocks that have recently shown price momentum can be a safer strategy [3] Group 2: Red Robin (RRGB) Stock Analysis - Red Robin has seen a price increase of 8.6% over the past four weeks, indicating growing investor interest [4] - The stock has gained 27.2% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [5] - RRGB has a beta of 2.45, suggesting it moves 145% higher than the market in either direction, indicating fast-paced momentum [5] - RRGB has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [6] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which typically attract more investor interest [7] - RRGB is trading at a Price-to-Sales ratio of 0.09, indicating it is relatively cheap at 9 cents for each dollar of sales [7] Group 3: Additional Investment Opportunities - Besides RRGB, there are other stocks that meet the criteria of "Fast-Paced Momentum at a Bargain" and may be worth considering for investment [8] - Zacks offers over 45 Premium Screens tailored to different investing styles, which can help identify potential winning stocks [9]

Core Insights - The article discusses the current market trends and potential investment opportunities within specific sectors, highlighting the importance of thorough analysis before making investment decisions [2]. Group 1: Market Trends - Recent market fluctuations have shown a significant impact on investor sentiment, with a notable increase in volatility observed in the tech sector [2]. - Analysts are focusing on the performance of companies that have demonstrated resilience during economic downturns, particularly those in the healthcare and consumer staples sectors [2]. Group 2: Investment Opportunities - There is a growing interest in companies that are leveraging technology to enhance operational efficiency, which is expected to drive long-term growth [2]. - The renewable energy sector is highlighted as a promising area for investment, with increasing government support and consumer demand for sustainable solutions [2]. Group 3: Financial Performance - Companies that reported strong earnings in the last quarter have seen their stock prices rise, indicating a positive correlation between financial performance and market valuation [2]. - The article emphasizes the importance of analyzing quarterly earnings reports to identify potential investment opportunities and assess company health [2].

Core Insights - Red Robin Gourmet Burgers, Inc. (RRGB) reported a mixed second quarter, but profitability is improving with adjusted EBITDA at $22.4 million, an increase of nearly $9 million year-over-year, driven by labor efficiency and cost management [1][10] - Despite a 5.5% decline in guest traffic and a 3.2% drop in comparable sales, restaurant-level margins expanded by 270 basis points to 14.5%, indicating successful operational initiatives [1] Financial Performance - The company reaffirmed its EBITDA guidance for 2025 at $60-$65 million while reducing net debt to adjusted EBITDA to approximately 2x, enhancing financial flexibility [3][10] - RRGB's shares have increased by 27.5% over the past three months, contrasting with a 2.9% decline in the industry [8] Strategic Initiatives - Management's strategy is centered around the "First Choice" Plan, focusing on efficiency, traffic-driving initiatives, disciplined capital allocation, and restaurant refreshes [2][10] - The Big Yummm value deal has shown early success in boosting traffic trends while managing price sensitivity [2] Competitive Landscape - Red Robin's efforts to achieve sustainable EBITDA growth reflect broader challenges in the casual dining industry, where competitors like Brinker International and Bloomin' Brands are also focusing on value promotions and efficiency gains [5][6] - Both competitors are navigating a promotional environment that impacts guest loyalty and pricing power, which are critical for maintaining EBITDA stability [6][7]

Company Performance - Potbelly (PBPB) has returned approximately 38.6% since the beginning of the calendar year, significantly outperforming the average gain of 8.3% in the Retail-Wholesale sector [4] - The Zacks Consensus Estimate for Potbelly's full-year earnings has increased by 13% over the past quarter, indicating improved analyst sentiment and a stronger earnings outlook [3] Industry Context - Potbelly is part of the Retail - Restaurants industry, which includes 39 companies and currently ranks 197 in the Zacks Industry Rank. This industry has experienced an average loss of 3.5% so far this year, highlighting Potbelly's relative strength [5] - Another company in the same sector, Red Robin (RRGB), has also outperformed the sector with a year-to-date increase of 18% and a consensus EPS estimate increase of 40.5% over the past three months [4][5] Sector Ranking - The Retail-Wholesale group, which includes 202 companies, currently ranks 10 in the Zacks Sector Rank, reflecting the strength of the sector based on the average Zacks Rank of individual stocks [2]

Core Insights - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1] Group 1: Investment Philosophy - The investment approach is not confined to traditional categories such as value, dividend, or growth investing, but rather considers all prospects of a stock to assess risk-to-reward [1] Group 2: Market Focus - The investment strategy encompasses markets in the US, Canada, and Europe, indicating a broad geographical focus for potential investment opportunities [1]

Core Insights - Red Robin (RRGB) reported revenue of $283.7 million for the quarter ended June 2025, reflecting a year-over-year decline of 5.5% [1] - The EPS for the same period was $0.26, a significant improvement from -$0.48 a year ago, resulting in an EPS surprise of +204% compared to the consensus estimate of -$0.25 [1] Financial Performance - The reported revenue was a slight miss, with a surprise of -0.53% against the Zacks Consensus Estimate of $285.22 million [1] - Comparable restaurant revenue showed a year-over-year change of -3.2%, which was below the estimated increase of 1.7% by analysts [4] - Total number of restaurants remained stable at 487, with 90 franchised and 397 company-owned, aligning with analyst estimates [4] Market Performance - Over the past month, shares of Red Robin have returned +5.8%, outperforming the Zacks S&P 500 composite's +3.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

PART I - FINANCIAL INFORMATION [ITEM 1. Financial Statements (unaudited)](index=3&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) Unaudited condensed consolidated financial statements for Red Robin, covering balance sheets, income, equity, and cash flows [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Summarizes Red Robin's financial position, detailing assets, liabilities, and stockholders' equity at specific dates | (in thousands) | July 13, 2025 | December 29, 2024 | | :--- | :--- | :--- | | **Assets:** | | | | Total current assets | $84,658 | $99,434 | | Property and equipment, net | $173,822 | $181,224 | | Operating lease assets, net | $306,519 | $331,617 | | Total assets | $586,908 | $641,314 | | **Liabilities and Stockholders' Equity (Deficit):** | | | | Total current liabilities | $184,981 | $189,552 | | Long-term debt | $163,079 | $181,641 | | Total liabilities | $665,551 | $725,583 | | Total stockholders' equity (deficit) | $(78,643) | $(84,269) | - Total assets decreased by **$54.4 million** from **$641.3 million** at December 29, 2024, to **$586.9 million** at July 13, 2025[10](index=10&type=chunk) - Total liabilities decreased by **$60.0 million** from **$725.6 million** to **$665.6 million** over the same period[10](index=10&type=chunk) - Stockholders' deficit improved by **$5.6 million**, from **$(84.3) million** to **$(78.6) million**[10](index=10&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) Presents Red Robin's financial performance, including revenues, expenses, and net income (loss) over specific periods | (in thousands, except per share amounts) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $283,703 | $300,154 | $676,055 | $688,695 | | Total costs and expenses | $273,888 | $304,715 | $657,178 | $695,367 | | Income (loss) from operations | $9,815 | $(4,561) | $18,877 | $(6,672) | | Net income (loss) | $3,993 | $(9,489) | $5,242 | $(18,949) | | Basic net income (loss) per share | $0.22 | $(0.61) | $0.30 | $(1.21) | | Diluted net income (loss) per share | $0.21 | $(0.61) | $0.28 | $(1.21) | - For the twelve weeks ended July 13, 2025, total revenues decreased by **$16.45 million (5.5%)** year-over-year, while net income improved significantly to **$3.99 million** from a net loss of **$9.49 million** in the prior year[12](index=12&type=chunk) - Diluted EPS also turned positive to **$0.21** from **$(0.61)**[12](index=12&type=chunk) - For the twenty-eight weeks ended July 13, 2025, total revenues decreased by **$12.64 million (1.8%)** year-over-year, and net income improved to **$5.24 million** from a net loss of **$18.95 million** in the prior year, with diluted EPS at **$0.28** compared to **$(1.21)**[12](index=12&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Deficit)) Details changes in Red Robin's stockholders' equity (deficit), reflecting net income, share transactions, and other comprehensive income | (in thousands) | Balance, December 29, 2024 | Balance, July 13, 2025 | | :--- | :--- | :--- | | Common Stock (Shares) | 22,050 | 22,050 | | Common Stock (Amount) | $22 | $22 | | Treasury Stock (Shares) | 4,647 | 4,164 | | Treasury Stock (Amount) | $(164,937) | $(147,645) | | Paid-in Capital | $233,667 | $216,757 | | Accumulated Other Comprehensive Loss, net of tax | $(62) | $(60) | | Accumulated Deficit | $(152,959) | $(147,717) | | Total Stockholders' Equity (Deficit) | $(84,269) | $(78,643) | - Total stockholders' deficit improved from **$(84.27) million** at December 29, 2024, to **$(78.64) million** at July 13, 2025[15](index=15&type=chunk) - This improvement was primarily driven by net income of **$1.25 million** for the period ended April 20, 2025, and **$3.99 million** for the period ended July 13, 2025, and a decrease in treasury stock amount due to issuances of restricted stock and shares exchanged for exercise and tax[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Outlines Red Robin's cash inflows and outflows from operating, investing, and financing activities over specific periods | (in thousands) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $29,511 | $14,246 | | Net cash provided by (used in) investing activities | $(12,382) | $9,415 | | Net cash used in financing activities | $(22,987) | $(24,097) | | Net change in cash and cash equivalents, and restricted cash | $(5,858) | $(438) | - Net cash provided by operating activities significantly increased to **$29.51 million** for the twenty-eight weeks ended July 13, 2025, from **$14.25 million** in the prior year[19](index=19&type=chunk) - Net cash used in investing activities was **$(12.38) million**, a decrease from **$9.42 million** provided in the prior year, primarily due to increased capital expenditures and lower proceeds from asset sales[19](index=19&type=chunk) - Net cash used in financing activities remained relatively stable at **$(22.99) million** compared to **$(24.10) million** in the prior year[19](index=19&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations and additional information supporting the condensed consolidated financial statements [Note 1. Basis of Presentation and Recent Accounting Pronouncements](index=8&type=section&id=Note%201.%20Basis%20of%20Presentation%20and%20Recent%20Accounting%20Pronouncements) Explains the financial statement preparation basis, company operations, and impact of recent accounting standards - Red Robin Gourmet Burgers, Inc. operates and franchises full-service restaurants in North America, with **397 Company-owned** and **90 franchised locations** as of July 13, 2025[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk) - The financial statements are prepared in accordance with GAAP for interim information, with certain disclosures condensed or omitted as permitted by SEC rules[23](index=23&type=chunk) - The Company is evaluating the impact of recently issued accounting standards, including FASB Update 2024-03 (expense disclosures), Update 2023-09 (income tax disclosures), and ASU No. 2025-05 (credit losses for accounts receivable)[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) - Update 2023-07 (segment reporting) was adopted in the fiscal year ended December 29, 2024[29](index=29&type=chunk) - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with provisions effective in 2025 and phased in through 2027[31](index=31&type=chunk) - Management is evaluating its potential effects but does not currently anticipate a material impact on the consolidated financial statements[31](index=31&type=chunk) [Note 2. Revenue](index=10&type=section&id=Note%202.%20Revenue) Details Red Robin's revenue streams, including restaurant, franchise, and gift card breakage, along with unearned revenue balances | (in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Restaurant revenue | $279,305 | $294,457 | $665,115 | $673,025 | | Franchise revenue | $3,186 | $4,287 | $7,675 | $9,628 | | Gift card breakage | $876 | $1,025 | $2,581 | $5,188 | | Other revenue | $336 | $385 | $684 | $854 | | Total revenues | $283,703 | $300,154 | $676,055 | $688,695 | - Total revenues decreased by **5.5%** for the twelve weeks ended July 13, 2025, and by **1.8%** for the twenty-eight weeks ended July 13, 2025, compared to the prior year periods[32](index=32&type=chunk) - This was primarily driven by decreases in restaurant revenue, franchise revenue, and gift card breakage[32](index=32&type=chunk) | (in thousands) | July 13, 2025 | December 29, 2024 | | :--- | :--- | :--- | | Unearned gift card revenue | $13,083 | $24,333 | | Unearned Royalty revenue | $3,032 | $2,750 | | Total Unearned revenue | $16,115 | $27,083 | [Note 3. Leases](index=11&type=section&id=Note%203.%20Leases) Provides information on Red Robin's operating and finance lease costs and related financial impacts | (in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Operating lease cost | $16,985 | $17,412 | $40,005 | $40,418 | | Total finance lease cost | $307 | $322 | $672 | $747 | | Variable lease cost | $4,785 | $4,538 | $10,844 | $10,441 | | Total lease cost | $22,077 | $22,272 | $51,521 | $51,606 | - Total lease costs remained relatively stable, with a slight decrease of **$0.195 million** for the twelve weeks and **$0.085 million** for the twenty-eight weeks ended July 13, 2025, compared to the prior year periods[35](index=35&type=chunk) - Operating lease costs decreased, while variable lease costs increased[35](index=35&type=chunk) [Note 4. Earnings (Loss) Per Share](index=11&type=section&id=Note%204.%20Earnings%20(Loss)%20Per%20Share) Details the calculation of basic and diluted earnings (loss) per share, including weighted average shares outstanding | (in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Basic weighted average shares outstanding | 17,799 | 15,680 | 17,655 | 15,608 | | Dilutive effect of stock options and awards | 1,126 | — | 944 | — | | Diluted weighted average shares outstanding | 18,925 | 15,680 | 18,598 | 15,608 | | Awards excluded due to anti-dilutive effect | 2,866 | 1,996 | 2,426 | 1,668 | - Diluted weighted average shares outstanding increased for the twelve and twenty-eight weeks ended July 13, 2025, compared to the prior year, primarily due to the dilutive effect of stock options and awards[36](index=36&type=chunk)[37](index=37&type=chunk) - In the prior year periods, all potentially dilutive common shares were considered anti-dilutive due to a net loss position[37](index=37&type=chunk) [Note 5. Other Charges (Gains), net](index=11&type=section&id=Note%205.%20Other%20Charges%20(Gains),%20net) Summarizes various non-recurring charges and gains, including asset impairments, restaurant closures, and severance costs | (in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Gain on sale of restaurant property | $— | $— | $(1,137) | $(7,425) | | Asset impairment and restaurant closure costs, net | $(1,615) | $1,551 | $(1,405) | $(398) | | Severance and executive transition | $459 | $137 | $1,339 | $1,082 | | Litigation contingencies | $11 | $356 | $23 | $776 | | Asset disposal and other, net | $889 | $887 | $1,600 | $4,920 | | Other charges (gains), net | $(256) | $2,931 | $420 | $(1,045) | - For the twelve weeks ended July 13, 2025, the Company reported net gains of **$(256) thousand**, a significant improvement from net charges of **$2.93 million** in the prior year, primarily due to net lease remeasurement gains offsetting restaurant closure costs[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) - For the twenty-eight weeks, net charges were **$0.42 million**, compared to net gains of **$(1.05) million** in the prior year, largely influenced by a smaller gain on sale of restaurant property in 2025[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) - The Company recorded **$3.1 million** in executive severance and transition costs and **$1.3 million** in Team Member severance costs during the second quarter of fiscal 2025, partially offset by a **$3.9 million** stock-based compensation benefit from forfeiture of unvested awards[43](index=43&type=chunk) [Note 6. Borrowings](index=12&type=section&id=Note%206.%20Borrowings) Details Red Robin's debt structure, including revolving credit and term loans, and compliance with credit facility covenants | (in thousands) | July 13, 2025 | December 29, 2024 | | :--- | :--- | :--- | | Revolving line of credit | $2,500 | $20,000 | | Term loan | $166,701 | $169,470 | | Total borrowings | $169,201 | $189,470 | | Less: unamortized debt issuance costs and discounts | $6,122 | $7,829 | | Long-term debt | $163,079 | $181,641 | - Total borrowings decreased from **$189.47 million** at December 29, 2024, to **$169.20 million** at July 13, 2025[46](index=46&type=chunk) - The revolving line of credit balance significantly decreased from **$20.0 million** to **$2.5 million**[46](index=46&type=chunk) - The Credit Facility matures on March 4, 2027, and has a total capacity of **$240.0 million**, comprising a **$40.0 million** revolving line of credit and a **$200.0 million** term loan[48](index=48&type=chunk)[49](index=49&type=chunk)[50](index=50&type=chunk) - The Credit Agreement was amended multiple times, including the Second Amendment (August 21, 2024) which increased the maximum net total leverage ratio, increased revolving commitments to **$40.0 million**, and raised applicable margins on SOFR-based and ABR-based loans[55](index=55&type=chunk)[56](index=56&type=chunk) - The Third Amendment (November 4, 2024) extended these provisions through the first fiscal quarter of 2026[56](index=56&type=chunk) [Note 7. Fair Value Measurements](index=14&type=section&id=Note%207.%20Fair%20Value%20Measurements) Describes the fair value measurement of financial instruments, primarily investments in a rabbi trust and the Credit Facility | (in thousands) | July 13, 2025 | December 29, 2024 | | :--- | :--- | :--- | | Investments in rabbi trust | $1,908 | $1,821 | | Total assets measured at fair value | $1,908 | $1,821 | - The Company's investments in a rabbi trust, funding deferred compensation, are measured at fair value using Level 1 inputs (quoted prices in active markets)[59](index=59&type=chunk)[60](index=60&type=chunk)[64](index=64&type=chunk) - The fair value of the Credit Facility was approximately **$164.2 million** as of July 13, 2025, compared to its principal carrying value of **$169.2 million**[64](index=64&type=chunk) - During the second quarter of fiscal 2025, the Company impaired long-lived assets at one restaurant location with a carrying value of **$0.7 million**, resulting in a **$0.7 million** impairment charge[63](index=63&type=chunk) - In the second quarter of fiscal 2024, long-lived assets at two closed locations with a carrying value of **$3.1 million** were impaired, resulting in a **$1.1 million** charge[63](index=63&type=chunk) [Note 8. Commitments and Contingencies](index=15&type=section&id=Note%208.%20Commitments%20and%20Contingencies) Outlines Red Robin's significant contractual commitments and potential liabilities from litigation and lease arrangements - As of July 13, 2025, the Company had reserves of **$3.6 million** for loss contingencies related to litigation, included in Accrued liabilities and other[67](index=67&type=chunk) - Management believes adequate provision has been made for potential losses, and the ultimate resolution of pending matters will not materially adversely affect financial position[67](index=67&type=chunk) - Non-cancellable purchase commitments, primarily for food and beverage supplies, totaled **$140.9 million** as of July 13, 2025[68](index=68&type=chunk) - The Company also has potential contingent lease liability for certain franchisees' lease arrangements, amounting to **$3.4 million** as of July 13, 2025[69](index=69&type=chunk) [Note 9. Segment Reporting](index=15&type=section&id=Note%209.%20Segment%20Reporting) Explains Red Robin's operating segments and how performance is evaluated, primarily as a single restaurant segment - The Company operates as one operating and one reportable segment: restaurants[71](index=71&type=chunk) - Business activities are managed on a consolidated basis due to similar customers, products, and sales processes[71](index=71&type=chunk) - Revenue is primarily derived from food and beverage sales at Company-owned locations and royalties/fees from franchised restaurants[71](index=71&type=chunk) | (in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $283,703 | $300,154 | $676,055 | $688,695 | | Segment net income (loss) | $3,993 | $(9,489) | $5,242 | $(18,949) | - The Chief Operating Decision Maker (CEO) uses consolidated Net income (loss) to evaluate segment performance and allocate resources[71](index=71&type=chunk)[72](index=72&type=chunk) - No material changes to accounting policies for the restaurant segment have occurred since the 2024 Annual Report on Form 10-K[72](index=72&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's perspective on Red Robin's financial performance and condition, covering business, highlights, trends, and liquidity [Description of Business](index=17&type=section&id=Description%20of%20Business) Provides an overview of Red Robin's restaurant operations, including company-owned and franchised locations across North America - Red Robin Gourmet Burgers, Inc. operates, franchises, and develops full-service restaurants, with **487 locations** in North America as of July 13, 2025[76](index=76&type=chunk)[77](index=77&type=chunk) - This includes **397 Company-owned restaurants** in 39 states and **90 franchised restaurants** in 13 states and one Canadian province[77](index=77&type=chunk) - The primary revenue source is food and beverage sales at Company-owned restaurants, supplemented by royalties and fees from franchised locations[77](index=77&type=chunk) [Highlights for the Second Quarter and Year to Date Periods of Fiscal 2025](index=17&type=section&id=Highlights%20for%20the%20Second%20Quarter%20and%20Year%20to%20Date%20Periods%20of%20Fiscal%202025) Summarizes key financial and operational achievements for the second quarter and year-to-date periods of fiscal 2025 - Second Quarter Fiscal 2025 Highlights (vs Q2 Fiscal 2024)[81](index=81&type=chunk) - Total revenues: **$283.7 million**, a decrease of **$16.5 million**[81](index=81&type=chunk) - Comparable restaurant revenue: decreased **3.2% (1.3%** excluding deferred loyalty revenue)[81](index=81&type=chunk) - Net income: **$4.0 million**, a **$13.5 million** increase from a net loss of **$9.5 million**[81](index=81&type=chunk) - Adjusted EBITDA: **$22.4 million**, a **64%** increase from **$13.6 million**[81](index=81&type=chunk) - Year to Date Fiscal 2025 Highlights (vs YTD Fiscal 2024)[81](index=81&type=chunk) - Total revenues: **$676.1 million**, a decrease of **$12.6 million**[81](index=81&type=chunk) - Comparable restaurant revenue: increased **0.4% (1.3%** excluding deferred loyalty revenue)[81](index=81&type=chunk) - Net income: **$5.2 million**, a **$24.2 million** increase from a net loss of **$18.9 million**[81](index=81&type=chunk) - Adjusted EBITDA: **$50.3 million**, an **86%** increase from **$27.0 million**[81](index=81&type=chunk) - Debt repaid: **$20.3 million**[81](index=81&type=chunk) [Business Trends](index=17&type=section&id=Business%20Trends) Discusses macroeconomic conditions, inflationary pressures, and trade policies impacting Red Robin's operations and supply chain - The Company is monitoring macroeconomic conditions, including inflationary pressures and potential impacts from trade policies like tariffs[79](index=79&type=chunk) - While a significant portion of the supply chain is domestic, changes in trade regulations could increase commodity costs and affect consumer spending[79](index=79&type=chunk) - No material adverse impact is anticipated for the remainder of fiscal year 2025, but volatility in global trade and economic policy remains a risk[79](index=79&type=chunk) [Key Performance Indicators](index=17&type=section&id=Key%20Performance%20Indicators) Presents key metrics for restaurant performance, including comparable restaurant revenue changes and guest count trends | (Dollars in millions) | Twelve Weeks Ended July 14, 2024 | Increase/(Decrease) | Twelve Weeks Ended July 13, 2025 | | :--- | :--- | :--- | :--- | | Restaurant Revenue | $294.5 | $(15.1) | $279.4 | | Comparable restaurant revenue change | | (9.1) | | Non-comparable and closed restaurant revenue change | | (6.0) | | (Dollars in millions) | Twenty-Eight Weeks Ended July 14, 2024 | Increase/(Decrease) | Twenty-Eight Weeks Ended July 13, 2025 | | :--- | :--- | :--- | :--- | | Restaurant Revenue | $673.0 | $(7.9) | $665.1 | | Comparable restaurant revenue change | | 2.4 | | Non-comparable and closed restaurant revenue change | | (10.3) | - For the second quarter of fiscal 2025, comparable restaurant revenue decreased **3.2% (1.3%** excluding deferred loyalty revenue), driven by a **5.5%** decrease in Guest count, partially offset by a **4.2%** increase in average Guest check due to menu price increases[90](index=90&type=chunk)[91](index=91&type=chunk) - For the year-to-date period, comparable restaurant revenue increased **0.4% (1.3%** excluding deferred loyalty revenue), with a **5.6%** increase in average Guest check offsetting a **4.3%** decrease in Guest count[90](index=90&type=chunk)[91](index=91&type=chunk) [Restaurant Data](index=18&type=section&id=Restaurant%20Data) Provides a breakdown of Red Robin's restaurant count, including company-owned and franchised locations, and changes over periods | | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Company-owned:** | | | | | | Beginning of period | 401 | 413 | 407 | 415 | | Closed during the period | (4) | (2) | (10) | (4) | | End of period | 397 | 411 | 397 | 411 | | **Franchised:** | | | | | | Beginning of period | 90 | 92 | 91 | 92 | | Closed during the period | — | — | (1) | — | | End of period | 90 | 92 | 90 | 92 | | **Total number of restaurants** | 487 | 503 | 487 | 503 | - As of July 13, 2025, Red Robin operated a total of **487 restaurants**, down from **503** in the prior year[82](index=82&type=chunk) - This includes **397 Company-owned restaurants** and **90 franchised locations**[82](index=82&type=chunk) - The decrease is primarily due to the closure of **10 Company-owned restaurants** and **1 franchised restaurant** during the twenty-eight weeks ended July 13, 2025[82](index=82&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) Analyzes Red Robin's financial performance by detailing changes in revenues and various operating cost categories [Revenues](index=22&type=section&id=Revenues) Analyzes changes in Red Robin's restaurant, franchise, and other revenue streams, highlighting contributing factors | (Dollars in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Restaurant revenue | $279,305 | $294,457 | (5.1)% | | Franchise revenue | $3,186 | $4,287 | (25.7)% | | Other revenue | $1,212 | $1,410 | (14.0)% | | Total revenues | $283,703 | $300,154 | (5.5)% | | Average weekly net sales volumes in Company-owned restaurants | $60,856 | $59,498 | 2.3% | - Restaurant revenue decreased by **$15.2 million (5.1%)** in Q2 2025, primarily due to a **3.2%** decrease in comparable restaurant revenue (**1.3%** excluding deferred loyalty revenue) and **$6.0 million** from 14 restaurant closures[90](index=90&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk) - Franchise revenue decreased by **25.7%** due to lower franchisee marketing contributions[92](index=92&type=chunk)[93](index=93&type=chunk) - Other revenue decreased by **14.0%** due to lower gift card breakage[92](index=92&type=chunk)[93](index=93&type=chunk) [Cost of Sales](index=22&type=section&id=Cost%20of%20Sales) Examines changes in Red Robin's cost of sales as a percentage of restaurant revenue, driven by pricing and commodity costs | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Cost of sales | $65,159 | $69,444 | (6.2)% | | As a percent of restaurant revenue | 23.3% | 23.6% | (0.3)% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Cost of sales | $153,186 | $159,653 | (4.1)% | | As a percent of restaurant revenue | 23.0% | 23.7% | (0.7)% | - Cost of sales as a percentage of restaurant revenue decreased by **30 basis points** in Q2 2025 and **70 basis points** year-to-date, primarily due to menu price increases and cost-saving initiatives, partially offset by increased commodity prices[95](index=95&type=chunk)[96](index=96&type=chunk) - Year-to-date also benefited from vendor contributions for Partner recognition events[96](index=96&type=chunk) [Labor](index=23&type=section&id=Labor) Analyzes changes in Red Robin's labor costs as a percentage of restaurant revenue, reflecting efficiency and compensation trends | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Labor | $99,709 | $113,908 | (12.5)% | | As a percent of restaurant revenue | 35.7% | 38.7% | (3.0)% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Labor | $242,767 | $262,866 | (7.6)% | | As a percent of restaurant revenue | 36.5% | 39.1% | (2.6)% | - Labor costs as a percentage of restaurant revenue decreased by **300 basis points** in Q2 2025 and **260 basis points** year-to-date[98](index=98&type=chunk)[99](index=99&type=chunk) - This improvement was driven by increased hourly and management labor efficiency, reduced turnover, and lower group health and workers' compensation self-insurance costs[99](index=99&type=chunk) [Other Operating](index=23&type=section&id=Other%20Operating) Examines changes in Red Robin's other operating costs, including third-party commissions and restaurant supply expenses | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Other operating | $49,600 | $51,783 | (4.2)% | | As a percent of restaurant revenue | 17.8% | 17.6% | 0.2% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Other operating | $117,132 | $118,273 | (1.0)% | | As a percent of restaurant revenue | 17.6% | 17.6% | —% | - Other operating costs as a percentage of restaurant revenue increased by **20 basis points** in Q2 2025, primarily due to higher third-party commission expenses from increased delivery sales[101](index=101&type=chunk)[102](index=102&type=chunk) - Year-to-date, this percentage remained consistent, with higher third-party commissions offset by lower restaurant supply costs[102](index=102&type=chunk) [Occupancy](index=23&type=section&id=Occupancy) Analyzes changes in Red Robin's occupancy costs, including rent and insurance reserves, as a percentage of restaurant revenue | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Occupancy | $24,329 | $24,595 | (1.1)% | | As a percent of restaurant revenue | 8.7% | 8.4% | 0.3% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Occupancy | $56,526 | $56,023 | 0.9% | | As a percent of restaurant revenue | 8.5% | 8.3% | 0.2% | - Occupancy costs as a percentage of restaurant revenue increased by **30 basis points** in Q2 2025 and **20 basis points** year-to-date[104](index=104&type=chunk)[105](index=105&type=chunk) - This was mainly due to an increase in general liability insurance reserves and fixed rents, partially offset by reduced rent from 14 restaurant closures[105](index=105&type=chunk) [Depreciation and Amortization](index=23&type=section&id=Depreciation%20and%20Amortization) Examines changes in depreciation and amortization expense, influenced by asset impairments and restaurant closures | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Depreciation and amortization | $11,579 | $13,402 | (13.6)% | | As a percent of total revenues | 4.1% | 4.5% | (0.4)% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Depreciation and amortization | $27,013 | $31,556 | (14.4)% | | As a percent of total revenues | 4.0% | 4.6% | (0.6)% | - Depreciation and amortization expense as a percentage of revenue decreased by **40 basis points** in Q2 2025 and **60 basis points** year-to-date[108](index=108&type=chunk)[109](index=109&type=chunk) - This reduction was primarily due to asset impairments, restaurant closures, and a sale-leaseback transaction in Q1 2024 that reduced the depreciable asset base[109](index=109&type=chunk) [General and Administrative Expenses](index=24&type=section&id=General%20and%20Administrative%20Expenses) Analyzes changes in general and administrative expenses, driven by incentive compensation and non-cash stock-based compensation | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | General and administrative | $17,418 | $16,612 | 4.9% | | As a percent of total revenues | 6.1% | 5.5% | 0.6% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | General and administrative | $44,408 | $42,454 | 4.6% | | As a percent of total revenues | 4.6% | 6.2% | (1.6)% | - General and administrative costs increased by **$0.8 million (4.9%)** in Q2 2025 and **$2.0 million (4.6%)** year-to-date[111](index=111&type=chunk)[112](index=112&type=chunk) - This was mainly due to higher accrued incentive compensation from improved financial performance and increased non-cash stock-based compensation, partially offset by reduced Team Member costs from lower headcount[112](index=112&type=chunk) [Selling Expenses](index=24&type=section&id=Selling%20Expenses) Examines significant reductions in Red Robin's selling expenses due to strategic changes in paid media spending | (In thousands, except percentages) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Selling | $6,350 | $12,040 | (47.3)% | | As a percent of total revenues | 2.2% | 4.0% | (1.8)% | | (In thousands, except percentages) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Percent Change | | :--- | :--- | :--- | :--- | | Selling | $15,726 | $25,587 | (38.5)% | | As a percent of total revenues | 2.3% | 3.7% | (1.4)% | - Selling costs decreased significantly by **$5.7 million (47.3%)** in Q2 2025 and **$9.9 million (38.5%)** year-to-date[114](index=114&type=chunk)[115](index=115&type=chunk) - This reduction was primarily driven by intentionally reduced paid media spending as the Company develops a new marketing strategy[115](index=115&type=chunk) [Interest Expense](index=24&type=section&id=Interest%20Expense) Analyzes changes in Red Robin's interest expense, primarily driven by fluctuations in the weighted average interest rate on borrowings - Interest expense increased by **$0.7 million** to **$5.8 million** in Q2 2025 (from **$5.1 million** in Q2 2024) and by **$1.3 million** to **$13.9 million** year-to-date (from **$12.6 million** in YTD 2024)[116](index=116&type=chunk)[117](index=117&type=chunk) - This was primarily due to an increase in the weighted average interest rate to **14.3%** in Q2 2025 (from **12.9%** in Q2 2024) and **14.2%** year-to-date (from **13.5%** in YTD 2024)[117](index=117&type=chunk) [Income Tax Provision (benefit)](index=25&type=section&id=Income%20Tax%20Provision%20(benefit)) Details Red Robin's income tax provision or benefit for the reporting periods, reflecting profitability changes - The Company reported an income tax benefit of **$0.1 million** in Q2 2025, consistent with the prior year[118](index=118&type=chunk) - For the year-to-date period, an income tax benefit of **$0.1 million** was recorded, compared to an income tax provision of **$0.1 million** in the prior year[118](index=118&type=chunk) [Non-GAAP Financial Measures](index=26&type=section&id=Non-GAAP%20Financial%20Measures) Presents and reconciles non-GAAP financial measures like Restaurant Level Operating Profit and Adjusted EBITDA, highlighting operational performance | (Dollars in millions) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | Increase/ (Decrease) | | :--- | :--- | :--- | :--- | | Restaurant level operating profit | $40.5 | $34.8 | 16.4% | | Restaurant level operating profit margin | 14.5% | 11.8% | 270 basis points | | (Dollars in millions) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | Increase/ (Decrease) | | :--- | :--- | :--- | :--- | | Restaurant level operating profit | $95.5 | $76.1 | 25.5% | | Restaurant level operating profit margin | 14.4% | 11.3% | 310 basis points | | (in thousands, except per share amounts) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net income (loss) as reported | $3,993 | $(9,489) | | Adjusted net income (loss) per share - diluted | $0.26 | $(0.38) | | (in thousands, except per share amounts) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net income (loss) as reported | $5,242 | $(18,949) | | Adjusted net income (loss) per share - diluted | $0.46 | $(1.12) | | (Dollars in thousands) | Twelve Weeks Ended July 13, 2025 | Twelve Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net income (loss) as reported | $3,993 | $(9,489) | | EBITDA | $21,196 | $8,870 | | Adjusted EBITDA | $22,429 | $13,640 | | (Dollars in thousands) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net income (loss) as reported | $5,242 | $(18,949) | | EBITDA | $45,841 | $25,059 | | Adjusted EBITDA | $50,339 | $27,043 | - Restaurant level operating profit increased by **16.4%** in Q2 2025 and **25.5%** year-to-date, with margins improving by **270** and **310 basis points**, respectively[119](index=119&type=chunk)[121](index=121&type=chunk) - Adjusted EBITDA increased by **64%** in Q2 2025 and **86%** year-to-date, reflecting improved operational performance and the exclusion of non-operating or nonrecurring items[119](index=119&type=chunk)[121](index=121&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses Red Robin's cash position, borrowing capacity, and cash flow activities from operations, investing, and financing - As of July 13, 2025, the Company had **$33.5 million** in cash and cash equivalents and restricted cash, a decrease of **$5.9 million** from the beginning of the fiscal year[124](index=124&type=chunk)[134](index=134&type=chunk) - Total liquidity was approximately **$61.9 million**, including **$37.5 million** of available borrowing capacity under its Credit Facility[134](index=134&type=chunk) | (in thousands) | Twenty-Eight Weeks Ended July 13, 2025 | Twenty-Eight Weeks Ended July 14, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $29,511 | $14,246 | | Net cash provided by (used in) investing activities | $(12,382) | $9,415 | | Net cash used in financing activities | $(22,987) | $(24,097) | - Operating cash flows increased by **$15.3 million** to **$29.5 million** year-to-date, driven by improved restaurant level profitability and reduced selling expenses[126](index=126&type=chunk)[127](index=127&type=chunk)[129](index=129&type=chunk) - Investing cash flows shifted from a **$9.4 million** inflow to a **$12.4 million** outflow, primarily due to increased capital expenditures and lower proceeds from asset sales[126](index=126&type=chunk)[127](index=127&type=chunk)[129](index=129&type=chunk) - Financing cash flows remained stable, primarily used for debt repayment[126](index=126&type=chunk)[127](index=127&type=chunk)[129](index=129&type=chunk) - The Company was in compliance with all debt covenants under its Credit Facility as of July 13, 2025[135](index=135&type=chunk)[137](index=137&type=chunk) - The Credit Agreement limits share repurchases, and the Company had **$58.5 million** of availability under its share repurchase program, with no repurchases made during the periods presented[137](index=137&type=chunk) [Critical Accounting Estimates](index=32&type=section&id=Critical%20Accounting%20Estimates) Discusses Red Robin's critical accounting estimates involving significant subjective judgments, particularly for future cash flows - Critical accounting estimates involve significant subjective judgments, particularly for inherently uncertain matters like future restaurant level cash flows[140](index=140&type=chunk) - These estimates are based on historical experiences and appropriate assumptions, but actual results may differ[140](index=140&type=chunk) - No significant changes in critical accounting estimates were reported since the 2024 Annual Report on Form 10-K[140](index=140&type=chunk) [Forward-Looking Statements](index=33&type=section&id=Forward-Looking%20Statements) Highlights forward-looking statements in the report, outlining inherent risks and uncertainties that could affect actual results - This section highlights that the report contains forward-looking statements regarding business objectives, financial condition, operating costs, liquidity, capital expenditures, seasonality, and contingencies[141](index=141&type=chunk)[142](index=142&type=chunk) - These statements are based on reasonable assumptions but are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially[142](index=142&type=chunk) - Key risk factors include the effectiveness of strategic initiatives, economic and geopolitical environment, competition, adequacy of cash flows, debt compliance, privacy breaches, marketing effectiveness, changes in consumer preferences, commodity price volatility, supply chain disruptions, labor costs, and litigation[143](index=143&type=chunk)[144](index=144&type=chunk) - The Company undertakes no obligation to update these statements[144](index=144&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Outlines the Company's exposure to market risks, specifically interest rate and commodity price risks, with no material changes reported [Interest Rate Risk](index=34&type=section&id=Interest%20Rate%20Risk) Details Red Robin's exposure to interest rate fluctuations on variable-rate borrowings and potential financial impacts - The Company is exposed to interest rate risk on its **$169.2 million** in variable-rate borrowings under the Credit Facility as of July 13, 2025[145](index=145&type=chunk)[146](index=146&type=chunk) - A **1.0%** change in the effective interest rate would result in an annualized pre-tax interest expense fluctuation of approximately **$1.7 million**[146](index=146&type=chunk) - The Company monitors this risk and may use interest rate swaps in the future[146](index=146&type=chunk) [Commodity Price Risks](index=34&type=section&id=Commodity%20Price%20Risks) Discusses Red Robin's exposure to volatility in food and beverage commodity prices and their potential impact on cost of sales - The Company faces commodity price risks for food, supplies, and other items, which are subject to market volatility due to factors like supply/demand, weather, and trade policy[147](index=147&type=chunk) - A **1.0%** increase in food and beverage costs would negatively impact cost of sales by approximately **$2.8 million** on an annualized basis[147](index=147&type=chunk) - The ability to offset these increases through menu pricing or item changes may be limited[147](index=147&type=chunk) [ITEM 4. Controls and Procedures](index=34&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Details the Company's evaluation of disclosure controls and procedures and reports on changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=34&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Reports on the effectiveness of Red Robin's disclosure controls and procedures as assessed by management - The Company maintains disclosure controls and procedures designed to ensure timely and accurate reporting of information required by the Exchange Act[149](index=149&type=chunk) - The CEO and CFO concluded that these controls and procedures were effective as of July 13, 2025, providing reasonable assurance of achieving control objectives[149](index=149&type=chunk) [Changes in Internal Control Over Financial Reporting](index=34&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) Confirms no material changes to Red Robin's internal control over financial reporting during the fiscal quarter - There were no changes in the Company's internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting[150](index=150&type=chunk) PART II - OTHER INFORMATION [ITEM 1. Legal Proceedings](index=35&type=section&id=ITEM%201.%20Legal%20Proceedings) Addresses Red Robin's legal proceedings, emphasizing the subjective judgment in assessing contingencies and adequate provisions - Assessing litigation contingencies is complex and involves subjective judgment[153](index=153&type=chunk)[154](index=154&type=chunk) - The Company reviews accruals and disclosures quarterly, consulting legal counsel, and believes adequate provision for potential losses has been made[154](index=154&type=chunk) - The ultimate resolution of pending matters is not expected to have a material adverse effect on financial position or results of operations[154](index=154&type=chunk) [ITEM 1A. Risk Factors](index=35&type=section&id=ITEM%201A.%20Risk%20Factors) Refers to the comprehensive list of risk factors in the annual report, confirming no material changes since the last filing - Risk factors associated with the business are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2024[155](index=155&type=chunk) - There have been no material changes to these risk factors since that filing[155](index=155&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Confirms no unregistered sales of equity securities or share repurchases by Red Robin during the second fiscal quarter - During the second quarter of fiscal 2025, the Company did not have any unregistered sales of equity securities and made no share repurchases[156](index=156&type=chunk) [ITEM 5. Other Information](index=36&type=section&id=ITEM%205.%20Other%20Information) States that no directors or officers adopted, modified, or terminated trading arrangements during the second fiscal quarter - No directors or officers adopted, modified, or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the second quarter ended July 13, 2025[158](index=158&type=chunk) [ITEM 6. Exhibits](index=37&type=section&id=ITEM%206.%20Exhibits) Lists all exhibits filed with the Form 10-Q, including corporate documents, compensation plans, and certifications - Exhibit 3.1: Restated Certificate of Incorporation of Red Robin Gourmet Burgers, Inc., dated May 28, 2015[159](index=159&type=chunk) - Exhibit 3.2: Fifth Amended and Restated Bylaws dated March 20, 2023[159](index=159&type=chunk) - Exhibit 10.1*: Offer Letter by and between Red Robin Gourmet Burgers, Inc. and David A. Pace dated April 24, 2025[159](index=159&type=chunk) - Exhibit 10.2*: Separation and Transition Agreement by and between Red Robin Gourmet Burgers, Inc. and G.J. Hart dated April 24, 2025[159](index=159&type=chunk) - Exhibit 10.3*: Form of Red Robin Gourmet Burgers, Inc. 2024 Performance Incentive Plan Phantom Unit Award Agreement[159](index=159&type=chunk) - Exhibit 31.1: Rule 13a-14(a) Certification of Chief Executive Officer[159](index=159&type=chunk) - Exhibit 31.2: Rule 13a-14(a) Certification of Chief Financial Officer[159](index=159&type=chunk) - Exhibit 32.1: Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer[159](index=159&type=chunk) - Exhibit 101: XBRL financial information for the quarter ended July 13, 2025[159](index=159&type=chunk) - Exhibit 104: Cover Page Interactive Data File (Inline XBRL)[159](index=159&type=chunk) [Signature](index=38&type=section&id=Signature) Contains the official signature of Red Robin Gourmet Burgers, Inc. by its Chief Financial Officer, certifying the report's filing - The report was duly caused to be signed on behalf of Red Robin Gourmet Burgers, Inc. by Todd Wilson, Chief Financial Officer, on August 13, 2025[163](index=163&type=chunk)