The ONE Group Hospitality, Inc. (STKS) came out with a quarterly loss of $0.66 per share versus the Zacks Consensus Estimate of a loss of $0.19. This compares to a loss of $0.3 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -247.37%. A quarter ago, it was expected that this company would post earnings of $0.08 per share when it actually produced earnings of $0.05, delivering a surprise of -37.5%.Over the last four quarters, t ...

Financial Data and Key Metrics Changes - Total consolidated GAAP revenues for Q3 2025 were $180.2 million, a decrease of 7.1% from $194 million in the same quarter last year [13] - Company-owned restaurants net revenue was $177.4 million, down 6.9% from $190.6 million in the prior year quarter, primarily due to a 5.9% reduction in consolidated comparable sales [14] - Net loss attributable to the ONE Group Hospitality was $76.7 million compared to a net loss of $9.3 million in the prior year, with a net loss per share of $2.75 compared to $0.53 [20][21] - Adjusted EBITDA was $10.6 million, a decrease of 28.9% from $14.9 million in the prior year [21] Business Line Data and Key Metrics Changes - The Friends with Benefits loyalty program gained over 200,000 new members during the quarter, with a total of over 6.5 million members [1][2] - Company-owned restaurant operating expenses as a percentage of net revenue increased to 67.6% from 66.2% in the prior year quarter, driven by marketing investments and cost inflation [16] - Restaurant operating profit decreased to $20.1 million or 11.3% of owned restaurant net revenue compared to $24.5 million or 12.8% in the prior year quarter [17] Market Data and Key Metrics Changes - The company experienced a 6.9% decline in traffic for Q3 2025, an improvement from a 7.5% decline in Q2 and a 7.8% decline in Q1 [29] - California sales saw a significant decline, with a negative impact of seven points sequentially between Q2 and Q3 [32] Company Strategy and Development Direction - The company is focusing on capital-efficient growth, with a redesigned Benihana location in San Mateo achieving record performance [3][4] - Plans to convert up to nine additional locations to either Benihana or STK formats, requiring about $1 million in capital investments per location [8] - The company aims to expand its franchise operations, with a focus on Benihana Express locations, which are expected to represent over 60% of the total footprint in the future [5] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fourth quarter, historically the strongest period, and highlighted targeted investments to capture holiday demand [10][25] - The company is not relying on macroeconomic recovery but is focused on strategic initiatives to deliver strong results regardless of broader economic trends [11] Other Important Information - The company has approximately $45 million in liquidity and plans to reduce discretionary capital expenditures in the coming year [9][22] - The company expects total GAAP revenues for fiscal year 2025 to be between $820 million and $825 million, reflecting anticipated consolidated comparable sales of negative 3% to negative 2% [23][24] Q&A Session Summary Question: Update on Benihana and STK same store sales growth - Management noted that Q3 2025 was the best quarter for traffic, with a 6.9% decline, an improvement from previous quarters, and attributed this to effective pricing strategies [28][29] Question: Drivers of traffic improvements in Q4 - Management indicated that marketing efforts and macroeconomic conditions in California contributed to the sequential improvement in traffic [32] Question: Update on Benihana franchising efforts - Management confirmed progress in franchising, with new deals in development for Benihana Express locations in California and the Bay Area [36] Question: Performance in Las Vegas market - Management reported improvements in STK performance in Las Vegas, although the overall restaurant performance remains mixed [41] Question: Details on loyalty program member behavior - Management shared that loyalty program members show increased frequency of visits, with promising early returns from the program [43][45] Question: Impact of recent price increases - Management indicated that early feedback on price increases has been neutral, with no significant pushback observed [46][47] Question: Details on impairment charges - Management confirmed that the majority of impairment charges were related to Kona Grill, with minor amounts from STK in Downtown New York [54] Question: Economics of restaurant conversions - Management stated that conversions to STK or Benihana would cost around $1 million, with a focus on leveraging existing infrastructure [56][58]

Core Insights - The One Group Hospitality (NASDAQ:STKS) missed Wall Street's revenue expectations in Q3 CY2025, reporting a 7.1% year-on-year decline in sales to $180.2 million, which was below the analyst estimates of $191.1 million [1][8] - The company's full-year revenue guidance was lowered to $822.5 million at the midpoint, which is 1.5% below analysts' estimates and reflects a 3.5% decrease from previous guidance [1][8] - The GAAP loss per share was reported at $2.75, significantly missing the consensus estimate of -$0.44 [1][8] Company Overview - The One Group Hospitality operates upscale dining establishments, including STK Steakhouse and Kona Grill, and also provides hospitality services for hotels and resorts [3] Revenue Performance - The One Group's revenue for the past 12 months stands at $820.6 million, indicating it is a small restaurant chain that may face disadvantages compared to larger competitors but has potential for faster growth due to more opportunities for new restaurant openings [5] - The company experienced a remarkable annualized revenue growth of 43.4% over the last six years, normalized for COVID-19 impacts, indicating strong demand [6] Financial Highlights - Q3 CY2025 results included an adjusted EBITDA of $10.56 million, which was below analyst expectations of $16.75 million, resulting in a 5.9% margin [8] - The operating margin fell to -4.4%, down from 2.1% in the same quarter last year, and same-store sales declined by 5.9% year-on-year [8] Future Outlook - Analysts project a revenue growth of 5.3% over the next 12 months, which represents a deceleration compared to the previous six years, suggesting potential demand challenges for the company's menu offerings [9]

Financial Performance - Total GAAP revenues decreased by 7.1% to $180.2 million from $194.0 million in Q3 2024[8] - Consolidated comparable sales decreased by 5.9%[8] - GAAP net loss attributable to The ONE Group increased to $76.7 million from $9.3 million, primarily due to a $64.0 million increase in income tax expense[8] - Adjusted EBITDA decreased to $10.6 million from $14.9 million[8] - Total revenues for the three months ended September 28, 2025, were $180.2 million, a decrease of 7.9% compared to $194.0 million for the same period in 2024[30] - Owned restaurant net revenue was $177.4 million for the three months ended September 28, 2025, down from $190.6 million in the prior year, representing a decline of 6.9%[30] - The net loss attributable to The ONE Group Hospitality, Inc. for the three months ended September 28, 2025, was $76.7 million, compared to a net loss of $9.3 million for the same period in 2024[30] - Total GAAP revenues for the nine months ended September 28, 2025, were $598,708,000, compared to $451,464,000 for the same period in 2024, marking an increase of 32.6%[36] Operational Changes - The company plans to open five to seven new venues in 2025[7] - The company completed the closure of six underperforming Grill locations and plans to convert up to nine additional units by the end of 2026[4] - A non-cash loss on impairment of $3.4 million was recorded during Q3 2025, primarily related to underperforming restaurants[13] - Cash and cash equivalents decreased to $5.5 million as of September 28, 2025, from $27.6 million at December 31, 2024[34] - Total current assets decreased to $46.5 million as of September 28, 2025, compared to $69.3 million at December 31, 2024[34] - Total liabilities increased slightly to $762.6 million as of September 28, 2025, from $758.7 million at December 31, 2024[34] Sales and Revenue Trends - The company expects total GAAP revenues for 2025 to be between $820 million and $825 million, with consolidated comparable sales projected to decline by 3% to 2%[16] - Same Store Sales for US STK Owned Restaurants decreased by 8.3% year-to-date compared to 2023, with Q3 showing a decline of 11.4%[36] - The company experienced a decrease in Same Store Sales for Grill Concepts Owned Restaurants, which fell by 13.2% year-to-date compared to 2023[36] Profitability Metrics - Operating loss for the nine months ended September 28, 2025, was $3.5 million, an improvement from an operating loss of $3.2 million for the same period in 2024[30] - Total owned operating expenses for the three months ended September 28, 2025, were $157.3 million, a decrease of 5.3% from $166.1 million in the same period of 2024[30] - The company reported a net loss per common share of $2.75 for the three months ended September 28, 2025, compared to a loss of $0.53 per share for the same period in 2024[30] - General and administrative expenses as a percentage of total revenues increased to 7.4% for the three months ended September 28, 2025, from 6.6% in the same period of 2024[32] Restaurant Performance - Restaurant Operating Profit for the nine months ended September 28, 2025, was $86,838,000, compared to $67,012,000 for the same period in 2024, indicating a year-over-year increase of 29.5%[41] - STK restaurant operating profit for Q3 2025 is $5,879,000, down from $6,547,000 in Q3 2024, representing a decrease of 10.2%[42] - Benihana restaurant operating profit for Q3 2025 is $13,928,000, a decrease of 18.0% compared to $17,110,000 in Q3 2024[42] - Core Grill Concepts restaurant operating profit for Q3 2025 is $131,000, significantly down from $1,416,000 in Q3 2024, a decline of 90.8%[42] - STK restaurant EBITDA for Q3 2025 is $5,790,000, a decrease of 7.4% from $6,250,000 in Q3 2024[42] - Benihana restaurant EBITDA for Q3 2025 is $14,364,000, down 18.5% from $17,679,000 in Q3 2024[42] - Core Grill Concepts restaurant EBITDA for Q3 2025 is $22,000, a decline of 98.5% compared to $1,479,000 in Q3 2024[42] - Restaurant EBITDA as a percentage of owned restaurant net revenue was 11.5% for the three months ended September 28, 2025, compared to 13.0% for the same period in 2024[41] - Non-core Grill Concepts restaurant operating profit for Q3 2025 is $(12,000), improving from $(783,000) in Q3 2024[42]

Core Insights - One Group Hospitality reported a 20.2% increase in GAAP revenue for Q2 2025, reaching $207.4 million, primarily due to the acquisition of Benihana, although it fell short of analyst expectations of $208.9 million [1][5] - The company experienced a diluted non-GAAP EPS of $0.05, a significant decline of 73.7% year-over-year [2][5] - Comparable sales decreased by 4.1%, indicating ongoing challenges in sales performance across existing locations [1][6] Financial Performance - GAAP revenue for Q2 2025 was $207.4 million, up from $172.5 million in Q2 2024, but below the estimated $208.9 million [2][5] - Restaurant EBITDA rose to $31.9 million, a 7.8% increase from the previous year, but the EBITDA margin declined to 15.7% from 17.5% [2][5] - Operating expenses increased to 84.7% of owned restaurant net revenue, up from 82.6% in Q2 2024, reflecting rising cost pressures [7] Business Overview and Strategy - One Group Hospitality operates upscale dining brands including STK and Benihana, focusing on "vibe dining" experiences [3] - The company aims to expand its reach with a capital-light strategy, planning to open five to seven new venues in 2025 [4] - Management emphasizes operational efficiency and customer experience, with a focus on scaling the loyalty program to enhance customer engagement [4][10] Comparable Sales and Brand Performance - Benihana reported a 0.4% increase in same-store sales, while STK experienced a 4.9% decline [6] - Grill concepts faced a 14.6% drop in same-store sales, attributed to competition from larger chains [6] - STK saw a 2.8% increase in customer transactions due to value-driven menu strategies [6] Cost Structure and Debt - General and administrative costs were reported at $11.662 million, with interest expenses at $10.295 million due to higher debt levels from acquisitions [7][8] - Long-term debt stood at $327.5 million, with $15.1 million in available cash and credit card receivables [8] - The company recorded lease exit costs and other one-time expenses totaling $5.6 million, impacting profitability [7] Expansion and Future Guidance - Four new venues opened in the first half of FY2025, including owned and franchised locations [9] - The company projects Q3 GAAP revenue between $190 million and $195 million, with FY2025 revenue guidance of $835 million to $870 million [11] - Management anticipates continued focus on comparable sales recovery and margin improvement as integration efforts progress [12]

Core Insights - The ONE Group Hospitality, Inc. reported quarterly earnings of $0.05 per share, missing the Zacks Consensus Estimate of $0.08 per share, representing a -37.50% earnings surprise [1] - The company posted revenues of $207.38 million for the quarter ended June 2025, which was 0.68% below the Zacks Consensus Estimate, compared to $172.49 million in the same quarter last year [2] - The stock has gained approximately 4.5% since the beginning of the year, underperforming the S&P 500's gain of 7.6% [3] Earnings Performance - Over the last four quarters, the company has surpassed consensus EPS estimates only once [2] - The current consensus EPS estimate for the upcoming quarter is -$0.06, with expected revenues of $204.02 million, and for the current fiscal year, the estimate is $0.44 on revenues of $852.64 million [7] Market Outlook - The company's earnings outlook will be crucial for future stock performance, with management's commentary on the earnings call being a key factor [3][4] - The Zacks Rank for The ONE Group Hospitality is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Retail - Restaurants industry, to which The ONE Group Hospitality belongs, is currently in the top 41% of Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Wendy's, a competitor in the same industry, is expected to report quarterly earnings of $0.25 per share, reflecting a year-over-year decline of -7.4% [9]

Financial Data and Key Metrics Changes - The company achieved total consolidated GAAP revenues of $207.4 million, an increase of 20.2% from $172.5 million in the same quarter last year [20] - Adjusted EBITDA was $23.4 million, reflecting a 7.3% increase from $21.8 million in the prior year quarter [27] - Net loss was $10.1 million compared to a net loss of $7.3 million in the previous year, with adjusted net income at $1.7 million, down from $6.3 million [26][27] Business Line Data and Key Metrics Changes - Company-owned restaurant net revenues increased by 20.6% to $203.9 million, primarily due to the additional days of ownership of Benihana and Ra Sushi [20] - Restaurant EBITDA decreased to 15.4% from 17.5% in the prior year quarter, with Benihana locations at 18.5% and STK locations at 15.9% [22] - The company closed five locations that were underperforming or nearing lease renewals, indicating a focus on optimizing the growth portfolio [14] Market Data and Key Metrics Changes - The company noted that traffic in the upscale casual segment remains challenged, particularly in Las Vegas, which has been impacted by shifting convention schedules and visitor traffic declines [51][53] - Demand remains strong during peak periods, especially on weekends, with strategies in place to maximize throughput [8] Company Strategy and Development Direction - The company aims to drive same-store sales growth through operational excellence, culinary innovation, and targeted marketing [8] - A focus on asset-light growth opportunities is evident, with plans to open five to seven new venues in 2025, including a company-owned Benihana in Seattle [12][30] - The integration of Benihana is progressing ahead of plan, with significant synergies expected to be realized by the end of 2026 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a strong fourth quarter, driven by holiday traffic and improved logistics at Benihana [55][56] - The company is optimistic about its ability to navigate the current economic environment, focusing on internal factors rather than external economic conditions [58][59] - The loyalty program launched in Q2 is expected to enhance guest frequency and spending, with significant engagement anticipated in the upcoming quarters [90] Other Important Information - The company has approximately $50 million in liquidity, providing operational flexibility [15] - The new Benihana location in San Mateo has been performing exceptionally well, serving as a prototype for future openings [39][40] Q&A Session Summary Question: What were the issues faced by Benihana last year? - Management indicated that HVAC issues were significant challenges post-acquisition, which have since been addressed for better sales opportunities this year [35][36] Question: Can you discuss the new restaurant in San Mateo? - The San Mateo location has a different design, eliminating the sushi bar to increase table capacity, and has seen strong initial performance [37][39] Question: How is STK managing traffic in the current environment? - The strategy focuses on value pricing and happy hour promotions to drive traffic, while also emphasizing premium products [42] Question: What are the regional differences in same-store sales? - Vegas has been a challenged market due to shifting convention schedules and visitor traffic declines, while other regions performed consistently [51][53] Question: What gives confidence in maintaining annual guidance? - Management highlighted the strong performance of Benihana and STK, particularly during the holiday season, as key factors for confidence in guidance [55][56] Question: Can you elaborate on franchising efforts for Benihana? - There is growing interest from existing franchisees, and the company is actively participating in industry events to build a pipeline for new agreements [75][78] Question: What is the outlook for food inflation? - While some commodity prices have stabilized, beef prices remain a concern, but the company is prepared to navigate these challenges through innovation [70][72]

```markdown [Executive Summary & Business Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Highlights) The ONE Group reported strong Q2 2025 revenue growth, driven by Benihana integration, alongside strategic expansion [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) The ONE Group reported strong top-line growth in Q2 2025, with total GAAP revenues increasing 20.2% to $207.4 million, despite a 4.1% decrease in consolidated comparable sales and a GAAP net loss of $10.1 million | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :----------------------------------- | :------ | :------ | :----------- | | Total GAAP revenues | $207.4 million | $172.5 million | +20.2% | | Consolidated comparable sales | -4.1% | N/A | -4.1 pp | | Operating income | $0.7 million | $1.1 million | -36.4% | | Restaurant EBITDA | $31.9 million | $29.6 million | +8.0% | | GAAP net loss | $10.1 million | $7.3 million | +38.4% (increased loss) | | Adjusted EBITDA attributable to The ONE Group Hospitality, Inc. | $23.4 million | $21.8 million | +7.3% | - Operating income and GAAP net loss were impacted by **$5.6 million** of lease termination and exit expenses related to the exit of five grill locations[6](index=6&type=chunk) [CEO Commentary & Strategic Initiatives](index=1&type=section&id=CEO%20Commentary%20%26%20Strategic%20Initiatives) CEO Emanuel Hilario expressed satisfaction with meeting expectations and achieving 20% top-line growth, attributing it to successful Benihana acquisition integration and strategic execution - Strong top-line growth of **20%** driven by the successful integration of the Benihana acquisition and continued execution of key strategic initiatives[3](index=3&type=chunk) - Benihana delivered positive same store sales and STK achieved positive traffic for the second and third consecutive quarters, respectively, indicating consumer engagement and brand strength[3](index=3&type=chunk) - Focus on accelerating same store sales growth and pursuing asset-light and low-cost expansion strategies to enhance capital efficiency and balance sheet strength[4](index=4&type=chunk) - On track to open **five to seven new venues** in 2025 while optimizing operations across the expanded portfolio[4](index=4&type=chunk) [Restaurant Development & Expansion](index=1&type=section&id=Restaurant%20Development%20%26%20Expansion) The company plans to open five to seven new venues in 2025, having already opened several locations and with two company-owned restaurants currently under construction - Company plans to open **five to seven new venues** in 2025[5](index=5&type=chunk) - Opened Owned Benihana restaurant in San Mateo, California (March 2025) - Opened Owned STK restaurant in Topanga, California (April 2025) - Opened Owned STK restaurant in Los Angeles, California (May 2025 - relocation) - Opened Franchised Benihana Express restaurant in Miami, Florida (June 2025) - One Company-owned Benihana restaurant under construction in Seattle, Washington - One Company-owned Kona Grill restaurant under construction in San Antonio, Texas (relocation) [Liquidity & Share Repurchase Program](index=2&type=section&id=Liquidity%20%26%20Share%20Repurchase%20Program) As of June 29, 2025, the company held $15.1 million in cash and short-term credit card receivables and had $33.6 million available under its revolving credit facility, having repurchased 0.2 million shares for $0.6 million in Q2 2025 | Metric (as of June 29, 2025) | Amount (in millions) | | :----------------------------------- | :----- | | Cash and short-term credit card receivables | $15.1 | | Available under revolving credit facility | $33.6 | - Board of Directors authorized a **$5 million** share repurchase program in March 2024[8](index=8&type=chunk) - During Q2 2025, the Company purchased **0.2 million shares** for an aggregate consideration of **$0.6 million**[8](index=8&type=chunk) [Financial Results](index=6&type=section&id=Financial%20Results) Q2 2025 financial results show increased revenues but a wider net loss, with decreased total assets and stockholders' equity [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company's Q2 2025 financial statements show a significant increase in total revenues to $207.4 million, up from $172.5 million in Q2 2024, but operating income decreased and net loss widened to $10.1 million [Revenue and Operating Expenses](index=6&type=section&id=Revenue%20and%20Operating%20Expenses) Q2 2025 owned restaurant net revenue increased by 20.6% to $203.9 million, with total owned operating expenses up 23.7% | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | Owned restaurant net revenue | $203.9 | $169.0 | +20.6% | | Management, license, franchise and incentive fee revenue | $3.5 | $3.5 | -0.03% | | **Total revenues** | **$207.4** | **$172.5** | **+20.2%** | | Owned restaurant cost of sales | $43.2 | $35.9 | +20.4% | | Owned restaurant operating expenses | $129.5 | $103.8 | +24.8% | | Total owned operating expenses | $172.7 | $139.6 | +23.7% | | General and administrative | $11.7 | $10.6 | +9.7% | | Lease termination and exit expenses | $5.6 | $0.3 | +1735% | [Profitability and Net Loss](index=6&type=section&id=Profitability%20and%20Net%20Loss) Operating income decreased by 36.9% to $0.7 million, and net loss widened to $10.1 million due to higher interest expense | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | Operating income | $0.7 | $1.1 | -36.9% | | Interest expense, net | $10.3 | $7.9 | +30.9% | | Loss on early debt extinguishment | $0.0 | $4.1 | -100% | | Net loss attributable to The ONE Group Hospitality, Inc. | $(10.1) | $(7.3) | +37.6% (increased loss) | | Basic Net loss per common share | $(0.59) | $(0.38) | +55.3% (increased loss) | [Statements of Operations as Percentage of Revenue](index=7&type=section&id=Statements%20of%20Operations%20as%20Percentage%20of%20Revenue) Owned restaurant operating expenses as a percentage of net revenue increased to 63.5% in Q2 2025 | Metric (as % of Total Revenues) | Q2 2025 | Q2 2024 | | :----------------------------------- | :------ | :------ | | Owned restaurant net revenue | 98.3% | 98.0% | | Management, license, franchise and incentive fee revenue | 1.7% | 2.0% | | Owned restaurant cost of sales (as % of owned restaurant net revenue) | 21.2% | 21.2% | | Owned restaurant operating expenses (as % of owned restaurant net revenue) | 63.5% | 61.4% | | Total owned operating expenses (as % of owned restaurant net revenue) | 84.7% | 82.6% | | General and administrative | 5.6% | 6.2% | | Depreciation and amortization | 5.2% | 4.7% | | Lease termination and exit expenses | 2.7% | 0.2% | | Operating income | 0.3% | 0.6% | | Net loss attributable to The ONE Group Hospitality, Inc. | (4.9)% | (4.3)% | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 29, 2025, total assets decreased to $935.7 million from $960.1 million, while total liabilities also decreased, and stockholders' equity saw a notable reduction to $23.0 million | Metric | June 29, 2025 (in millions) | December 31, 2024 (in millions) | Change (in millions) | | :----------------------------------- | :---------------------------- | :---------------------------- | :------------------- | | Cash and cash equivalents | $4.7 | $27.6 | -$22.9 | | Total current assets | $42.7 | $69.3 | -$26.6 | | Total assets | $935.7 | $960.1 | -$24.4 | | Total current liabilities | $121.1 | $131.4 | -$10.3 | | Long-term debt, net | $327.5 | $328.1 | -$0.6 | | Total liabilities | $742.0 | $758.7 | -$16.7 | | Series A preferred stock | $173.8 | $158.1 | +$15.7 | | Total stockholders' equity | $23.0 | $45.9 | -$22.8 | [Non-GAAP Financial Measures & Reconciliations](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines and reconciles key non-GAAP financial measures, including Adjusted EBITDA and Adjusted Net Income, for performance insights [Non-GAAP Definitions](index=4&type=section&id=Non-GAAP%20Definitions) The company uses several non-GAAP financial measures, including Total food and beverage sales at owned and managed units, Adjusted EBITDA, and Adjusted Net Income/(Loss), to provide additional insights into operating performance - Non-GAAP financial measures used include total food and beverage sales at owned and managed units, Adjusted EBITDA, Restaurant Operating Profit, Restaurant EBITDA, adjusted net income, and adjusted net income / (loss) per share[14](index=14&type=chunk)[15](index=15&type=chunk)[28](index=28&type=chunk) - These measures exclude items management does not consider in the evaluation of its ongoing core operating performance, such as non-cash rent, non-recurring gains and losses, stock-based compensation, transaction and exit costs, transition and integration expenses, and lease termination and exit expenses[15](index=15&type=chunk)[18](index=18&type=chunk) - Starting in Q3 2024, pre-opening expenses are no longer deducted from Adjusted EBITDA[15](index=15&type=chunk)[18](index=18&type=chunk) [Total Food and Beverage Sales at Owned and Managed Units](index=9&type=section&id=Total%20Food%20and%20Beverage%20Sales%20at%20Owned%20and%20Managed%20Units) This non-GAAP measure represents total revenue from owned operations plus revenue from managed locations, providing a comprehensive view of sales associated with the company's brands and hospitality services | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | GAAP revenues | $207.4 | $172.5 | +20.2% | | Food and beverage sales from managed units | $31.2 | $32.1 | -2.8% | | **Total food and beverage sales at owned and managed units** | **$235.1** | **$201.1** | **+16.9%** | [Same Store Sales](index=9&type=section&id=Same%20Store%20Sales) Consolidated comparable sales decreased by 4.1% in Q2 2025, with Benihana Owned Restaurants showing positive growth while US STK Total Restaurants and Grill Concept Owned Restaurants experienced declines | Segment | Q2 2025 vs. 2024 | Q2 2024 vs. 2023 | | :-------------------------- | :--------------- | :--------------- | | US STK Owned Restaurants | (4.9)% | (11.9)% | | US STK Managed Restaurants | (9.5)% | (7.4)% | | US STK Total Restaurants | (6.0)% | (10.6)% | | Benihana Owned Restaurants | 0.4% | (1.0)% | | Grill Concept Owned Restaurants | (14.6)% | (13.0)% | | **Combined Same Store Sales** | **(4.1)%** | **(7.0)%** | [Adjusted EBITDA](index=10&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA attributable to The ONE Group Hospitality, Inc. increased by 7.3% to $23.4 million in Q2 2025, excluding various non-cash and non-recurring items for a clearer view of operational performance | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | Net loss attributable to The ONE Group Hospitality, Inc. | $(10.1) | $(7.3) | +37.6% (increased loss) | | EBITDA | $11.5 | $4.9 | +134.1% | | Adjusted EBITDA | $23.2 | $21.7 | +6.9% | | **Adjusted EBITDA attributable to The ONE Group Hospitality, Inc.** | **$23.4** | **$21.8** | **+7.3%** | [Restaurant Operating Profit and Restaurant EBITDA](index=10&type=section&id=Restaurant%20Operating%20Profit%20and%20Restaurant%20EBITDA) Restaurant Operating Profit increased to $31.2 million and Restaurant EBITDA to $31.9 million in Q2 2025, though as a percentage of owned restaurant net revenue, both decreased | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | Restaurant Operating Profit | $31.2 | $29.4 | +6.3% | | Restaurant Operating Profit as a percentage of owned restaurant net revenue | 15.3% | 17.4% | -2.1 pp | | Restaurant EBITDA | $31.9 | $29.6 | +7.9% | | Restaurant EBITDA as a percentage of owned restaurant net revenue | 15.7% | 17.5% | -1.8 pp | | Segment (Company owned) | Q2 2025 Restaurant Operating Profit (in millions) | Q2 2024 Restaurant Operating Profit (in millions) | Q2 2025 Restaurant EBITDA (in millions) | Q2 2024 Restaurant EBITDA (in millions) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------- | :-------------------------------------- | | STK | $9.1 | $8.3 | $8.1 | $8.9 | | Benihana | $16.2 | $20.8 | $21.3 | $16.5 | | Core Grill Concepts | $4.2 | $2.3 | $2.7 | $4.3 | | Non-core Grill Concepts | $(0.2) | $(0.1) | $(0.3) | $(0.3) | [Adjusted Net Income / (Loss)](index=11&type=section&id=Adjusted%20Net%20Income%20%2F%20(Loss)) Adjusted net income (non-GAAP) for Q2 2025 decreased to $1.7 million from $6.3 million in Q2 2024, with adjusted net income per share also declining | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :----------------------------------- | :-------------------- | :-------------------- | :----------- | | Net income (loss) available to common stockholders (GAAP) | $(18.2) | $(11.9) | +53.5% (increased loss) | | **Adjusted net income (loss) (non-GAAP)** | **$1.7** | **$6.3** | **-73.5%** | | Adjusted net income (loss) per share: Basic | $0.05 | $0.20 | -75% | | Adjusted net income (loss) per share: Diluted | $0.05 | $0.19 | -73.7% | [2025 Financial Targets & Outlook](index=2&type=section&id=2025%20Financial%20Targets%20%26%20Outlook) The company provided guidance for Q3 2025 and the full year 2025, projecting total GAAP revenues of $835 to $870 million and consolidated Adjusted EBITDA between $95 to $115 million | Metric | Q3 2025 Guidance (in millions) | 2025 Guidance (Full Year, in millions) | | :----------------------------------- | :----------------------------- | :------------------------------------- | | Total GAAP revenues | $190 to $195 | $835 to $870 | | Consolidated comparable sales | -4% to -2% | -3% to 1% | | Managed, license and franchise fee revenues | $3 to $4 | $15 to $16 | | Total owned operating expenses as a percentage of owned restaurant net revenue | Approx. 86% | 83.5% to 82.2% | | Consolidated total G&A, excluding stock-based compensation | Approx $11 | Approx. $47 | | Consolidated Adjusted EBITDA | $15 to $18 | $95 to $115 | | Consolidated restaurant pre-opening expenses | $1 to $2 | $7 to $8 | | Consolidated effective income tax rate | | Approx. 7.5% | | Consolidated total capital expenditures, net of allowances received by landlords | | $45 to $50 | | Consolidated number of new system-wide venues | None | 5-7 new venues | [Company Information & Disclosures](index=2&type=section&id=Company%20Information%20%26%20Disclosures) This section provides company overview, conference call details, forward-looking statement cautions, and investor contact information [About The ONE Group](index=4&type=section&id=About%20The%20ONE%20Group) The ONE Group Hospitality, Inc. is an international restaurant company focused on "Vibe Dining," developing and operating upscale restaurants and providing hospitality management services - The ONE Group Hospitality, Inc. is an international restaurant company that develops and operates upscale and polished casual, high-energy restaurants and lounges and provides hospitality management services for hotels, casinos and other high-end venues[12](index=12&type=chunk) - The ONE Group's focus is to be the global leader in Vibe Dining[12](index=12&type=chunk) - STK: Modern American steakhouse concept - Benihana: Interactive dining destination with skilled chefs - Benihana Express: Small footprint casual concept without teppanyaki tables or bar - Kona Grill: Polished casual, bar-centric grill concept - RA Sushi: Japanese cuisine concept with a fun-filled, bar-forward atmosphere - Salt Water Social: Features an array of signature and unique fresh seafood items - ONE Hospitality: Food and beverage hospitality services business for high-end hotels and casinos [Conference Call and Webcast](index=2&type=section&id=Conference%20Call%20and%20Webcast) The company hosted a conference call and webcast on August 5, 2025, at 4:30 PM Eastern Time to discuss financial results, with a replay available until August 19, 2025 - Emanuel "Manny" Hilario, President and CEO, and Tyler Loy, CFO, hosted a conference call and webcast on August 5, 2025, at 4:30 PM Eastern Time[11](index=11&type=chunk) - A replay was available until Tuesday, August 19, 2025, accessible by phone or from the Investor Relations tab of The ONE Group's website[11](index=11&type=chunk)[12](index=12&type=chunk) [Cautionary Statement on Forward-Looking Statements](index=4&type=section&id=Cautionary%20Statement%20on%20Forward-Looking%20Statements) The press release contains forward-looking statements regarding future events like restaurant openings and financial targets, subject to risks and uncertainties, and investors are cautioned not to place undue reliance on them - The press release includes "forward-looking statements" regarding the impact of the Benihana Inc. acquisition, restaurant openings, and 2025 financial targets[19](index=19&type=chunk) - These statements are subject to a number of factors that could cause actual results or outcomes to differ materially, including integration challenges, ability to open new restaurants, economic downturns, and changes in regulations[19](index=19&type=chunk) - Investors are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made, and the company undertakes no obligation to update or revise them[20](index=20&type=chunk) [Contact Information](index=5&type=section&id=Contact%20Information) Contact information for investor relations and media inquiries is provided through ICR - Investors: Michelle Michalski or Raphael Gross at ICR, (646) 277-1224, Michelle.Michalski@icrinc.com - Media: Seth Grugle at ICR, (646) 277-1272, seth.grugle@icrinc.com ```

Core Viewpoint - ONE Group Hospitality, Inc. (STKS) is set to release its second-quarter 2025 results, with expectations of revenue growth driven by recent acquisitions and new restaurant openings, although earnings may remain flat due to increased costs and integration expenses [1][10]. Financial Estimates - The Zacks Consensus Estimate for second-quarter earnings per share is 8 cents, unchanged from the previous year [2]. - Revenue is projected at $209.3 million, indicating a 21.4% increase compared to the same quarter last year [2][10]. Factors Influencing Performance - The revenue growth is attributed to the full-quarter impact of the acquired Benihana and RA Sushi brands, which now constitute a significant portion of total revenues [4]. - New unit openings, including six restaurants added since early 2024, have contributed to broadening the revenue base [4]. - Strategic pricing initiatives, such as happy hour menus and midweek dining bundles, have attracted cost-conscious consumers, alongside targeted marketing and a loyalty program [5]. Earnings Outlook - Despite revenue strength, earnings are expected to remain flat due to higher interest expenses from increased debt related to the Benihana acquisition, seasonally softer operating margins, and elevated general and administrative expenses from integration activities [6][10]. - The Earnings ESP for ONE Group is -28.00%, indicating a lower likelihood of an earnings beat this quarter [8].

Wall Street expects flat earnings compared to the year-ago quarter on higher revenues when The ONE Group Hospitality, Inc. (STKS) reports results for the quarter ended June 2025. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near- term stock price is how the actual results compare to these estimates. The stock might move higher if these key numbers top expectations in the upcoming earnings report. On the other hand, ...