Texas Roadhouse Q4 Earnings Call Highlights

Core Insights - Texas Roadhouse reported strong growth in 2025, with revenue reaching nearly $5.9 billion and the opening of its 800th restaurant, marking the 60th consecutive quarter of comparable restaurant sales growth [3][4][7] Financial Performance - Full-year 2025 same-store sales increased by 4.9%, driven by a 2.8% growth in traffic [1] - The company generated over $730 million in operating cash flow and returned capital through $180 million in dividends and $150 million in share repurchases [5][20] - Fourth-quarter revenue grew by 3.1%, with restaurant margin dollars decreasing by 15.6% to $205 million, and diluted earnings per share declining by 26.1% to $1.28 [6][8] Operational Initiatives - Management highlighted the completion of the Digital Kitchen rollout and upgraded Guest Management Systems, which are expected to enhance operational efficiency [2][21] - The company raised over $40 million for local schools and nonprofits through community initiatives [2] Pricing and Inflation Outlook - Management anticipates approximately 7% commodity inflation for 2026, primarily driven by beef prices, and plans a 1.9% menu price increase in Q2 [15][14] - Labor costs as a percentage of sales increased to 33.2%, while food and beverage costs rose to 36.4% of sales [10][11] Development Plans - In 2025, Texas Roadhouse added 48 restaurants, including 28 new openings and the acquisition of 20 franchise locations [17] - For 2026, the company expects to open approximately 35 company restaurants and maintain franchise development plans [18] Technology Investments - The company is expanding its technology initiatives, including testing handheld tablets for servers to improve order accuracy and speed [21] - The upgraded guest management software has improved operational execution, particularly during high-volume periods [22]