Financial Data and Key Metrics Changes - For Q2 FY 2026, Brinker reported total revenues of $1.45 billion, an increase of 7% over the prior year, with consolidated comp sales of +7.5% [18] - Adjusted diluted EPS for the quarter was $2.87, up from $2.80 last year [18] - Restaurant operating margin was 18.8%, compared to 19.1% in the prior year, a decrease of 30 basis points year over year [19] - Adjusted EBITDA was approximately $223.5 million, a 3.6% increase from the prior year [21] Business Line Data and Key Metrics Changes - Chili's same-store sales were at +8.6%, outpacing the casual dining industry by 680 basis points, with a 2-year cumulative comp of 43% [4] - Maggiano's reported comp sales for the quarter of -2.4%, but there were signs of sequential improvement [19][13] - Chili's top-line sales growth was driven by a price increase of 4.4%, positive traffic of 2.7%, and a positive mix of 1.5% [18] Market Data and Key Metrics Changes - Chili's was the number one traffic brand in casual dining for the entire 2025 year [12] - The company captured value leadership in casual dining and the broader restaurant industry over the past three years [11] Company Strategy and Development Direction - The company plans to continue focusing on improving food, service, and atmosphere, with a strong emphasis on marketing and brand building [5] - A reimage program for Chili's has started, with plans to complete 60-80 reimages in fiscal 2027 and fully roll out the program in fiscal 2028 [22][88] - The company aims to maintain a disciplined capital allocation strategy, allowing for investments in restaurants and returning excess cash to shareholders [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving their fifth consecutive year of same-store sales growth and second consecutive year of traffic gains [17] - The company anticipates mid-single-digit comps for the back half of the year, despite potential pressure from recent weather events [36] - Management noted that the macroeconomic environment remains mixed, but they are focused on controllable factors like food service and atmosphere to drive guest traffic [66] Other Important Information - The company repurchased an additional $100 million of common stock under its share repurchase program [23] - Capital expenditures for the quarter were approximately $63.7 million, driven by capital maintenance spend [21] - The company expects to face commodity inflation in the low single digits for the fiscal year, with some pressures anticipated in the back half [26] Q&A Session Summary Question: What contributed to the strong traffic and sales growth in the quarter? - Management highlighted stable pricing and positive performance from the Margarita of the Month and other menu items, with no significant changes in guest frequency [30][32] Question: What are the expectations for the back half of the year regarding top-line performance? - Management expects solid mid-single-digit comps for the back half, with potential traffic pressure due to recent weather events [36][42] Question: Can you elaborate on the remodels and their expected impact? - Management confirmed plans for 60-80 remodels in 2027, with a focus on operational learning and cost-effective improvements [88][92] Question: How does the company plan to manage pricing power with the $10.99 price point? - Management emphasized the importance of a barbell strategy to maintain a diverse menu and prevent over-reliance on lower price points [44][46] Question: What is the outlook for commodity costs and their impact on margins? - Management reiterated that while tariffs have provided some favorability, mid-single-digit inflation is expected in the back half of the year [99]