Group 1 - Genki Global Dining Concepts is acquiring Food Odyssey, which operates approximately 180 Sushi Sushi restaurants in Australia [1][2] - The acquisition aims to position the overseas Japanese food and sushi market as a core part of Genki's medium- to long-term growth strategy, focusing on the maturation of the domestic market [2] - Genki Global Dining Concepts aspires to become one of the world's leading Japanese sushi brands in terms of store numbers and a top QSR brand [2][3] Group 2 - Genki Global Dining Concepts operates over 430 stores across 14 countries, including China, Hong Kong, Indonesia, Kuwait, the Philippines, and the US [3] - The CEO of Sushi Sushi, Stephen Anders, confirmed the sale and emphasized that it would support the brand's growth plans in Australia and internationally [3][4] - Anders highlighted the importance of a clear growth strategy, inspiring retail environments, and technology that enhances the customer journey for transforming retail outlets into a high-performing growth platform [4]

Core Insights - The revolving sushi bar chain has increased prices more than usual without experiencing the anticipated decline in customer demand [1] Company Summary - The sushi bar chain's decision to raise prices indicates a strategic shift in pricing policy, reflecting confidence in customer loyalty and demand [1] - The lack of expected pullback suggests that the brand has a strong market position and customer base that is less sensitive to price changes [1]

Core Insights - McDonald's has significantly reduced its presence in Walmart stores, closing about 200 locations in 2020, with over half of those being in Walmart [2][3] - Walmart is evolving its food offerings by introducing sushi bars in select locations, aiming to enhance customer perception and compete with regional grocers [5][6] Group 1: McDonald's Presence in Walmart - McDonald's closed approximately 200 restaurants in 2020, with around 100 of those located inside Walmart stores [2] - The decline of McDonald's locations within Walmart has continued, with only about 150 remaining out of over 1,000 that once existed [3] Group 2: Walmart's New Food Offerings - Walmart's new Supercenter in Jacksonville, Florida, features a sushi bar as part of its next-generation store design [5][8] - The introduction of sushi aims to improve Walmart's foodservice offerings and compete with regional grocers known for higher quality prepared foods [6][7] - Walmart plans to remodel and build 150 Supercenter locations to incorporate features like the sushi bar seen in Jacksonville [14] Group 3: Sushi Market Trends - Sushi has become increasingly popular in the U.S., with market research estimating around 16,800 to 17,400 sushi restaurant establishments by 2025 [11] - Sales volumes of sushi at U.S. retailers have increased by over 50% in the past four years, with dollar sales rising approximately 72% [14] - Walmart's sushi offerings include fresh sushi made daily at Sam's Club locations under the Member's Mark brand, emphasizing community involvement [10][9]

Financial Data and Key Metrics Changes - The company reported a strong performance in November and December, with traffic and ticket-driven growth leading to better-than-expected comparable sales [4][5] - Effective pricing increased by 4.5% as of November 1st, contributing to improved flow-through and traffic [7][12] - The company expects a restaurant-level margin of 18% for fiscal 2026, with a goal to reach closer to 20% by fiscal 2027 [13][15] Business Line Data and Key Metrics Changes - The company is experiencing a 20% annual growth rate in unit openings, aiming for over 300 units in the U.S. [2] - The class of 2025 openings is outperforming previous classes by at least 10%, attributed to improved site selection and landlord relationships [19][20] Market Data and Key Metrics Changes - The company has 83 units across 22 states and the District of Columbia, demonstrating a broad market presence [1] - The competitive landscape includes local mom-and-pop sushi restaurants, which are struggling to maintain pricing due to increased costs [8][9] Company Strategy and Development Direction - The company is focused on leveraging its scale advantages to enhance guest experience and attract new customers [23] - There is an emphasis on technology integration, such as robotic dishwashers, to improve operational efficiency and reduce labor costs [41][44] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment has improved, benefiting the company's performance [5] - The company anticipates continued traffic growth as guests seek value amidst rising prices at independent competitors [9][10] Other Important Information - The company filed a $100 million shelf registration to maintain flexibility for future capital raises [27] - The Kura Rewards program has one million members, significantly increasing customer frequency and average check size [32] Q&A Session Summary Question: What drove the acceleration in November and December? - Management attributed the acceleration to a better macro setup and successful marketing campaigns [4][5] Question: How is the company managing tariff impacts? - The company shared the burden of tariffs with suppliers, resulting in a 150-200 basis point impact on COGS for the year [11][12] Question: What are the expectations for restaurant-level margins? - The company expects to maintain an 18% margin for fiscal 2026, with potential improvements in fiscal 2027 [13][15] Question: How is the class of 2025 performing compared to previous classes? - The class of 2025 is outperforming previous classes by at least 10% due to better site selection and landlord relationships [19][20] Question: What is the status of the IP partnerships? - The company expects meaningful comp outperformance due to improved IP partnerships and collaborations [30] Question: How is the Kura Rewards program evolving? - The company plans to introduce tiered statuses to enhance engagement and drive traffic [34]

Financial Data and Key Metrics Changes - The company reported a strong performance in November and December, with traffic and ticket-driven growth leading to better-than-expected comparable store sales [4][5][7] - The effective price increase of 4.5% as of November 1st contributed to improved flow-through and traffic, with an average check increase of about $1 [7][8] - The company expects a restaurant-level margin of 18% for fiscal 2026, with potential to reach closer to 20% in fiscal 2027 due to various operational improvements [13][15] Business Line Data and Key Metrics Changes - The company is experiencing a 20% annual growth rate in unit openings, aiming for over 300 units in the U.S. [2] - The class of 2025 openings is outperforming previous classes by at least 10%, attributed to better site selection and landlord relationships [19][20] Market Data and Key Metrics Changes - The company has expanded to 83 units across 22 states and the District of Columbia, demonstrating the brand's portability beyond coastal markets [21] - The competitive landscape includes local mom-and-pop sushi restaurants, which are struggling to maintain pricing, allowing Kura Sushi to capitalize on its value proposition [8][9] Company Strategy and Development Direction - The company is focused on leveraging its scale advantages to enhance guest experience and drive customer traffic, particularly among less sophisticated sushi consumers [23] - The introduction of tiered statuses in the rewards program is expected to enhance customer engagement and drive traffic [34] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment has improved, contributing to the company's strong performance in late 2023 [5] - The company is optimistic about future growth, citing the potential for continued traffic growth as guests rediscover the value offered by Kura Sushi [9] Other Important Information - The company filed a $100 million shelf registration to maintain flexibility for future capital raises, with a robust balance sheet of over $76 million in cash and investments [27] - The company is implementing robotic dishwashers, expected to improve operational efficiency and reduce labor costs [41][44] Q&A Session Summary Question: What drove the acceleration in November and December? - Management attributed the acceleration to a better macro setup and successful marketing campaigns, including the One Piece campaign [4][5] Question: What is the visibility into achieving the 18% restaurant-level margin? - Management indicated that negotiations with suppliers helped mitigate tariff impacts, and they expect to achieve the margin through operational improvements [10][12] Question: How is the class of 2025 performing compared to previous classes? - The class of 2025 is outperforming previous classes by at least 10%, aided by improved site selection and landlord relationships [19][20] Question: Can you elaborate on the IP partnerships and their impact? - Management expressed optimism about the IP pipeline, noting that the quality of partnerships continues to improve year over year [30] Question: What are the plans for the rewards program? - The company plans to introduce tiered statuses to enhance engagement and drive traffic, while also decoupling the reservation system from the rewards program to increase accessibility [32][34]

Financial Data and Key Metrics Changes - Kura Sushi reported a strong performance in November and December, with traffic and ticket-driven growth leading to better-than-expected comparable sales [5][6] - The company is guiding for an 18% restaurant-level margin for fiscal 2026, with expectations to improve to around 20% in fiscal 2027 [12][13] - Cost of goods sold (COGS) is expected to be approximately 30% for the year, influenced by tariffs and a 3.5% price increase implemented on November 1st [12][15] Business Line Data and Key Metrics Changes - The company is experiencing a 20% annual growth rate in unit openings, aiming for over 300 locations in the U.S. [3] - The class of 2025 openings is outperforming previous classes by at least 10%, attributed to improved site selection and landlord relationships [18][19] Market Data and Key Metrics Changes - Kura Sushi's competitive advantage is highlighted by its ability to attract customers from local mom-and-pop sushi restaurants, especially as these competitors struggle with pricing [7][8] - The company has a robust balance sheet with over $76 million in cash and investments, providing liquidity and optionality for future growth [26] Company Strategy and Development Direction - Kura Sushi is focused on expanding its footprint while enhancing guest experience through automation and technology, such as the introduction of robotic dishwashers [41][44] - The company is leveraging IP partnerships to drive brand awareness and customer engagement, with a strong pipeline of collaborations expected to enhance performance [27][28] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment has improved, contributing to better performance in late 2025 [6] - The company anticipates that the current pricing dynamics will continue to benefit its market position, regardless of tariff conditions [9] Other Important Information - The company has implemented a reservation system that has significantly increased engagement among rewards program members, with plans to introduce tiered statuses to enhance the program [30][33] - Kura Sushi is actively working on marketing strategies to attract new customers, focusing on experiential marketing to convey the value of its offerings [35] Q&A Session Summary Question: What drove the acceleration in November and December? - Management attributed the acceleration to a better macro setup and successful marketing campaigns, including an LTO and IP campaign [6][7] Question: How does the company plan to achieve the 18% margin guidance? - The company expects to achieve the 18% margin through improved cost management and operational efficiencies, with a focus on new market openings [12][13] Question: What is the impact of tariffs on COGS? - Tariffs initially posed a significant risk, but through negotiations with suppliers, the impact was mitigated to about 150-200 basis points on COGS [11][12] Question: How is the class of 2025 performing compared to previous classes? - The class of 2025 is outperforming previous classes by at least 10%, due to better site selection and improved landlord relationships [18][19] Question: What are the future plans for the rewards program? - The company plans to introduce tiered statuses to enhance engagement and drive traffic, moving beyond a simplistic discount-driven model [33]

Core Viewpoint - Kura Sushi USA is optimistic about its fiscal first-quarter performance, expecting positive comparable sales in Q2 and maintaining guidance for flat to slightly positive comps for the full year, despite facing margin pressures from tariffs and sales deleverage [1][6][21]. Financial Performance - Total sales for the fiscal first quarter reached $73.5 million, an increase from $64.5 million in the prior-year period, while comparable restaurant sales declined by 2.5% due to negative traffic and flat pricing [3][7]. - The company reported an operating loss of $3.7 million and a net loss of $3.1 million, with adjusted EBITDA decreasing to $2.4 million from $3.6 million year-over-year [9][7]. Pricing Strategy - A 3.5% menu price increase was implemented on November 1, which did not fully benefit the first quarter; effective pricing for the quarter was noted at 3.5%, with expectations of 4.5% in the fiscal second quarter [2][6]. Margin Analysis - Food and beverage costs accounted for 29.9% of sales, up from 29.0%, attributed to tariffs on imported ingredients; labor costs decreased to 32.5% of sales from 32.9% due to pricing and operational initiatives [10]. - The restaurant-level operating profit margin was 15.1%, down from 18.2% in the prior-year quarter, with management expecting margins to stabilize around 18% for the full year [11][6]. Growth and Development - Kura Sushi opened four new restaurants during the quarter and has 10 more under construction, aiming for a total of 16 new units in fiscal 2026 [5][13]. - The company ended the quarter with $78.5 million in cash and no debt, indicating strong liquidity [14]. Marketing and Loyalty Initiatives - The company has reached 1 million rewards members, with members spending approximately $6 more per person compared to non-members [18]. - Kura Sushi is enhancing its marketing strategy with collaborations and promotions, including themed offerings tied to popular franchises [15][16]. Operational Improvements - Robotic dishwashers are scheduled for installation in Q3, with expectations for improved labor costs in fiscal 2026 through various operational initiatives [19]. - Management is optimistic about improving labor leverage and reducing general and administrative expenses through aggressive cost management [4][10]. Guidance and Outlook - Kura Sushi reiterated its fiscal 2026 guidance, projecting total sales between $330 million and $334 million, with an expected restaurant-level operating profit margin of approximately 18% [24][20].

Financial Data and Key Metrics Changes - Total sales for the fiscal first quarter were $73.5 million, up from $64.5 million in the prior year period, representing a comparable sales growth of negative 2.5% [10][12] - Cost of goods sold as a percentage of sales was 29.9%, compared to 29% in the prior year quarter, influenced by tariffs on imported ingredients [11][12] - Labor costs as a percentage of sales decreased to 32.5% from 32.9% in the prior year, attributed to operational initiatives [6][11] - Net loss was $3.1 million, or negative $0.25 per share, compared to a net loss of $1 million, or negative $0.08 per share in the prior year [12][14] - Adjusted net loss was $2.8 million, or negative $0.23 per share, compared to an adjusted net loss of $1 million, or negative $0.08 per share in the prior year [13] Business Line Data and Key Metrics Changes - The company opened four new restaurants in the first quarter and has 10 units under construction, with plans to open one more in the fiscal second quarter [4][7] - Restaurant-level operating profit as a percentage of sales was 15.1%, down from 18.2% in the prior year quarter [13] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were negative 2.8%, and in the Southwest market, they were negative 2.7% [10] - Effective pricing for the quarter was 3.5%, with expectations for the second quarter to be 4.5% after lapping prior year increases [10] Company Strategy and Development Direction - The company aims to open 16 new units in fiscal 2026, maintaining an annual unit growth rate above 20% [14] - The focus on aggressive cost management has reduced general and administrative expenses as a percentage of sales by 80 basis points on an adjusted basis [4] - The company is leveraging technology, such as robotic dishwashers, to improve operational efficiency [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving qualitative comparable sales for the year, citing strong momentum from the end of the first quarter into the second [4][26] - The management noted that the pricing taken in November has led to improved traffic and sales, indicating a positive consumer response [26][32] - There is optimism regarding the potential for improved margins and sales as the company navigates tariff impacts and operational efficiencies [32][46] Other Important Information - The company has $78.5 million in cash and no debt, indicating strong liquidity [14] - The company is currently engaged in marketing campaigns tied to popular IPs, which have been well received by customers [8][105] Q&A Session Summary Question: Discussion on decoupling the reservation system from loyalty - Management noted that more than half of visits by rewards members are through the reservation system, indicating better-than-expected uptake [21][22] Question: Expectations for Q2 comparable sales - Management expects positive comps for Q2, supported by strong performance in November and December [26] Question: Impact of tariffs on food costs - Management indicated that food costs are expected to be around 30%, with a significant impact from tariffs, but negotiations have helped mitigate some costs [31][32] Question: Future promotions and collaborations - Management highlighted successful collaborations with popular IPs and plans for future promotions, including Sanrio and Jujutsu Kaisen [107] Question: Long-term growth targets - Management reiterated the target of 16 new units for the year, with no changes to the long-term growth target of 300 units in the U.S. [95][61]

Financial Data and Key Metrics Changes - Total sales for the fiscal first quarter were $73.5 million, compared to $64.5 million in the prior year period, representing a year-over-year increase of approximately 12.4% [9] - Comparable sales growth was negative 2.5%, with a negative traffic of 2.5% and flat price and mix [9] - Adjusted net loss was $2.8 million, or negative $0.23 per share, compared to an adjusted net loss of $1 million, or negative $0.08 per share in the prior year quarter [13] - Restaurant-level operating profit as a percentage of sales was 15.1%, compared to 18.2% in the prior year quarter [13] Business Line Data and Key Metrics Changes - The company opened four new restaurants in the first quarter and has 10 units under construction, including locations in new markets [7] - Labor as a percentage of sales improved to 32.5% from 32.9% in the prior year period due to operational initiatives [6] - Cost of goods as a percentage of sales increased to 29.9% from 29% in the prior year quarter, impacted by tariffs [10] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were negative 2.8%, while the Southwest market saw negative 2.7% [9] - The company expects full-year costs to stabilize around 30% after considering tariffs and menu price adjustments [6] Company Strategy and Development Direction - The company aims to open 16 new restaurants in fiscal 2026, maintaining an annual unit growth rate above 20% [13] - Marketing efforts include a campaign with Kirby, coinciding with the release of Kirby Air Riders for Switch 2, and the introduction of a reservation system decoupled from the rewards program [7][8] - The company is focused on aggressive cost management, reducing G&A as a percentage of sales by 80 basis points on an adjusted basis [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive comparable sales for the year, citing strong performance in November and December [25] - The company anticipates that the pricing taken in November will continue to support sales growth and improve traffic [25] - Management noted that the broader industry is showing signs of improvement, which is encouraging for future performance [53] Other Important Information - The company has $78.5 million in cash, cash equivalents, and investments, with no debt [13] - General and administrative expenses as a percentage of sales were 13%, down from 13.5% in the prior year quarter [11] Q&A Session Summary Question: What led to the decision to decouple the reservation system from loyalty? - Management noted that more than half of visits by rewards members are through the reservation system, indicating better-than-expected uptake [20] Question: Do you expect positive comps in the February quarter? - Management confirmed expectations for positive comps in Q2, supported by strong performance in November and December [25] Question: How long would it take for tariff relief to impact financials? - Management indicated it would take 60 to 90 days to see benefits from reduced tariffs due to inventory turnover [30] Question: Can you comment on the impact of tariffs on other expense lines? - Management stated that tariffs have significantly impacted promotional costs, particularly for items sourced from overseas [100] Question: How are rewards members performing in terms of spending? - Management reported that rewards members spend about $6 more per person compared to non-members, with a significant increase in visit frequency [75] Question: What are the future planned promotions for the year? - Upcoming promotions include Sanrio for February and Jujutsu Kaisen for March and April [108]

Financial Data and Key Metrics Changes - Total sales for Q1 2026 were $73.5 million, up from $64.5 million in the prior year, with comparable sales growth of negative 2.5% [5][10] - Cost of goods sold as a percentage of sales increased to 29.9% from 29% in the prior year quarter, influenced by tariffs [5][11] - Labor costs as a percentage of sales decreased to 32.5% from 32.9% in the prior year, due to operational initiatives [5][11] - Net loss for the quarter was $3.1 million, or negative $0.25 per share, compared to a net loss of $1 million, or negative $0.08 per share in the prior year [12][13] - Adjusted net loss was $2.8 million, or negative $0.23 per share, compared to an adjusted net loss of $1 million, or negative $0.08 per share in the prior year [13] Business Line Data and Key Metrics Changes - The company opened four new restaurants in Q1 2026, with ten more under construction [6] - Restaurant-level operating profit as a percentage of sales was 15.1%, down from 18.2% in the prior year quarter [13] Market Data and Key Metrics Changes - Comparable sales in the West Coast market were negative 2.8%, and in the Southwest market, they were negative 2.7% [10] - Effective pricing for the quarter was 3.5%, with expectations for the second quarter to be 4.5% [10] Company Strategy and Development Direction - The company aims to open 16 new restaurants in fiscal 2026, maintaining an annual unit growth rate above 20% [14] - The company is focusing on aggressive cost management, reducing G&A as a percentage of sales by 80 basis points on an adjusted basis [4] - Marketing efforts include a campaign with Kirby, coinciding with the release of Kirby Air Riders for Switch 2, and the introduction of a reservation system [6][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving qualitative comparable sales for the year, with expectations for positive comps in Q2 [4][23] - The company noted that the first quarter created a strong foundation for growth, with momentum continuing into December [5][23] - Management acknowledged the impact of tariffs on costs but expressed optimism about negotiations with suppliers mitigating some of the pressures [28][81] Other Important Information - The company has $78.5 million in cash and no debt, indicating strong liquidity [13] - General and administrative expenses as a percentage of sales were 13%, down from 13.5% in the prior year quarter [12] Q&A Session Summary Question: Discussion on decoupling the reservation system from loyalty - Management reported that over half of visits by rewards members are through the reservation system, indicating better-than-expected uptake [19] Question: Expectations for Q2 comps - Management expects positive comps for Q2, citing strong performance in November and December [23] Question: Impact of tariffs on food costs - Management indicated that it takes 4-6 months to see the impact of tariff changes on food costs due to inventory cycles [27] Question: Future promotions and collaborations - Management confirmed ongoing promotions with Kirby and upcoming collaborations with Sanrio and Jujutsu Kaisen [88] Question: Long-term growth target - Management did not revise the long-term growth target of 300 units in the U.S. but will provide updates as necessary [78]