
PART I - FINANCIAL INFORMATION ITEM 1. Financial Statements (unaudited) Unaudited condensed consolidated financial statements for Red Robin, covering balance sheets, income, equity, and cash flows Condensed Consolidated Balance Sheets 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, 202510 - Total liabilities decreased by $60.0 million from $725.6 million to $665.6 million over the same period10 - Stockholders' deficit improved by $5.6 million, from $(84.3) million to $(78.6) million10 Condensed Consolidated Statements of Operations and Comprehensive Income (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 year12 - Diluted EPS also turned positive to $0.21 from $(0.61)12 - 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 Condensed Consolidated Statements of Stockholders' Equity (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, 202515 - 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 tax15 Condensed Consolidated Statements of Cash Flows 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 year19 - 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 sales19 - Net cash used in financing activities remained relatively stable at $(22.99) million compared to $(24.10) million in the prior year19 Notes to the Condensed Consolidated Financial Statements Provides detailed explanations and additional information supporting the condensed consolidated financial statements Note 1. Basis of Presentation and Recent Accounting Pronouncements 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, 2025212223 - The financial statements are prepared in accordance with GAAP for interim information, with certain disclosures condensed or omitted as permitted by SEC rules23 - 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)26272829 - Update 2023-07 (segment reporting) was adopted in the fiscal year ended December 29, 202429 - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with provisions effective in 2025 and phased in through 202731 - Management is evaluating its potential effects but does not currently anticipate a material impact on the consolidated financial statements31 Note 2. Revenue 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 periods32 - This was primarily driven by decreases in restaurant revenue, franchise revenue, and gift card breakage32 | (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 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 periods35 - Operating lease costs decreased, while variable lease costs increased35 Note 4. Earnings (Loss) Per Share 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 awards3637 - In the prior year periods, all potentially dilutive common shares were considered anti-dilutive due to a net loss position37 Note 5. Other Charges (Gains), net 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 costs3839404142 - 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 20253839404142 - 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 awards43 Note 6. Borrowings 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, 202546 - The revolving line of credit balance significantly decreased from $20.0 million to $2.5 million46 - 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 loan484950 - 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 loans5556 - The Third Amendment (November 4, 2024) extended these provisions through the first fiscal quarter of 202656 Note 7. Fair Value Measurements 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)596064 - 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 million64 - 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 charge63 - 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 charge63 Note 8. Commitments and Contingencies 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 other67 - Management believes adequate provision has been made for potential losses, and the ultimate resolution of pending matters will not materially adversely affect financial position67 - Non-cancellable purchase commitments, primarily for food and beverage supplies, totaled $140.9 million as of July 13, 202568 - The Company also has potential contingent lease liability for certain franchisees' lease arrangements, amounting to $3.4 million as of July 13, 202569 Note 9. Segment Reporting 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: restaurants71 - Business activities are managed on a consolidated basis due to similar customers, products, and sales processes71 - Revenue is primarily derived from food and beverage sales at Company-owned locations and royalties/fees from franchised restaurants71 | (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 resources7172 - No material changes to accounting policies for the restaurant segment have occurred since the 2024 Annual Report on Form 10-K72 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management's perspective on Red Robin's financial performance and condition, covering business, highlights, trends, and liquidity Description of Business 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, 20257677 - This includes 397 Company-owned restaurants in 39 states and 90 franchised restaurants in 13 states and one Canadian province77 - The primary revenue source is food and beverage sales at Company-owned restaurants, supplemented by royalties and fees from franchised locations77 Highlights for the Second Quarter and Year to Date Periods of Fiscal 2025 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 - Total revenues: $283.7 million, a decrease of $16.5 million81 - Comparable restaurant revenue: decreased 3.2% (1.3% excluding deferred loyalty revenue)81 - Net income: $4.0 million, a $13.5 million increase from a net loss of $9.5 million81 - Adjusted EBITDA: $22.4 million, a 64% increase from $13.6 million81 - Year to Date Fiscal 2025 Highlights (vs YTD Fiscal 2024)81 - Total revenues: $676.1 million, a decrease of $12.6 million81 - Comparable restaurant revenue: increased 0.4% (1.3% excluding deferred loyalty revenue)81 - Net income: $5.2 million, a $24.2 million increase from a net loss of $18.9 million81 - Adjusted EBITDA: $50.3 million, an 86% increase from $27.0 million81 - Debt repaid: $20.3 million81 Business Trends 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 tariffs79 - While a significant portion of the supply chain is domestic, changes in trade regulations could increase commodity costs and affect consumer spending79 - No material adverse impact is anticipated for the remainder of fiscal year 2025, but volatility in global trade and economic policy remains a risk79 Key Performance Indicators 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 increases9091 - 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 count9091 Restaurant Data 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 year82 - This includes 397 Company-owned restaurants and 90 franchised locations82 - 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, 202582 Results of Operations Analyzes Red Robin's financial performance by detailing changes in revenues and various operating cost categories 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 closures909293 - Franchise revenue decreased by 25.7% due to lower franchisee marketing contributions9293 - Other revenue decreased by 14.0% due to lower gift card breakage9293 Cost of Sales 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 prices9596 - Year-to-date also benefited from vendor contributions for Partner recognition events96 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-date9899 - This improvement was driven by increased hourly and management labor efficiency, reduced turnover, and lower group health and workers' compensation self-insurance costs99 Other Operating 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 sales101102 - Year-to-date, this percentage remained consistent, with higher third-party commissions offset by lower restaurant supply costs102 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-date104105 - This was mainly due to an increase in general liability insurance reserves and fixed rents, partially offset by reduced rent from 14 restaurant closures105 Depreciation and Amortization 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-date108109 - This reduction was primarily due to asset impairments, restaurant closures, and a sale-leaseback transaction in Q1 2024 that reduced the depreciable asset base109 General and Administrative Expenses 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-date111112 - 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 headcount112 Selling Expenses 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-date114115 - This reduction was primarily driven by intentionally reduced paid media spending as the Company develops a new marketing strategy115 Interest Expense 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)116117 - 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 Income Tax Provision (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 year118 - 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 year118 Non-GAAP Financial Measures 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, respectively119121 - 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 items119121 Liquidity and Capital Resources 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 year124134 - Total liquidity was approximately $61.9 million, including $37.5 million of available borrowing capacity under its Credit Facility134 | (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 expenses126127129 - 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 sales126127129 - Financing cash flows remained stable, primarily used for debt repayment126127129 - The Company was in compliance with all debt covenants under its Credit Facility as of July 13, 2025135137 - 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 presented137 Critical Accounting Estimates 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 flows140 - These estimates are based on historical experiences and appropriate assumptions, but actual results may differ140 - No significant changes in critical accounting estimates were reported since the 2024 Annual Report on Form 10-K140 Forward-Looking Statements 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 contingencies141142 - These statements are based on reasonable assumptions but are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially142 - 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 litigation143144 - The Company undertakes no obligation to update these statements144 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk Outlines the Company's exposure to market risks, specifically interest rate and commodity price risks, with no material changes reported Interest Rate Risk 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, 2025145146 - A 1.0% change in the effective interest rate would result in an annualized pre-tax interest expense fluctuation of approximately $1.7 million146 - The Company monitors this risk and may use interest rate swaps in the future146 Commodity Price Risks 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 policy147 - A 1.0% increase in food and beverage costs would negatively impact cost of sales by approximately $2.8 million on an annualized basis147 - The ability to offset these increases through menu pricing or item changes may be limited147 ITEM 4. Controls and Procedures 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 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 Act149 - The CEO and CFO concluded that these controls and procedures were effective as of July 13, 2025, providing reasonable assurance of achieving control objectives149 Changes in Internal Control Over Financial Reporting 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 reporting150 PART II - OTHER INFORMATION ITEM 1. Legal Proceedings Addresses Red Robin's legal proceedings, emphasizing the subjective judgment in assessing contingencies and adequate provisions - Assessing litigation contingencies is complex and involves subjective judgment153154 - The Company reviews accruals and disclosures quarterly, consulting legal counsel, and believes adequate provision for potential losses has been made154 - The ultimate resolution of pending matters is not expected to have a material adverse effect on financial position or results of operations154 ITEM 1A. Risk Factors 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, 2024155 - There have been no material changes to these risk factors since that filing155 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 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 repurchases156 ITEM 5. Other Information 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, 2025158 ITEM 6. Exhibits 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, 2015159 - Exhibit 3.2: Fifth Amended and Restated Bylaws dated March 20, 2023159 - Exhibit 10.1*: Offer Letter by and between Red Robin Gourmet Burgers, Inc. and David A. Pace dated April 24, 2025159 - Exhibit 10.2*: Separation and Transition Agreement by and between Red Robin Gourmet Burgers, Inc. and G.J. Hart dated April 24, 2025159 - Exhibit 10.3*: Form of Red Robin Gourmet Burgers, Inc. 2024 Performance Incentive Plan Phantom Unit Award Agreement159 - Exhibit 31.1: Rule 13a-14(a) Certification of Chief Executive Officer159 - Exhibit 31.2: Rule 13a-14(a) Certification of Chief Financial Officer159 - Exhibit 32.1: Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer159 - Exhibit 101: XBRL financial information for the quarter ended July 13, 2025159 - Exhibit 104: Cover Page Interactive Data File (Inline XBRL)159 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, 2025163