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Brinker International, Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 28 January 2026: press release. Guidance figures: 2 raised, 2 lowered, 1 new, 1 kept. The quarter’s numbers.

Key takeaways

  • Company comparable sales rose 7.5%: Company comparable restaurant sales rose 7.5%, with Chili’s at 8.6% and Maggiano’s at (2.4)%. Company sales were $1,438.8 million against $1,346.1 million. Source
  • Maggiano’s restaurant margin fell: Maggiano’s restaurant operating margin was 16.0% of company sales against 22.7%. Company restaurant expenses were 84.0% of company sales against 77.3%. Source
  • Chili’s traffic and price both rose: Chili’s comparable sales of 8.6% comprised price impact of 4.4%, mix of 1.5% and traffic of 2.7%, against the prior year period. Source
  • Revenue and EPS guidance raised: Fiscal 2026 total revenues are now guided to $5.76 billion to $5.83 billion, and diluted EPS excluding special items to $10.45 to $10.85. Source
  • Winter Storm Fern cut sales and EPS: Winter Storm Fern closures and reduced hours cut about $20.0 million of revenue and $0.15 of diluted EPS excluding special items, as of January 27, 2026. Source
  • Repurchases of $100.0 million: The company repurchased $100.0 million of common stock in the quarter. Treasury stock purchases were $235.0 million for the twenty-six weeks. Source

“Chili’s delivered another strong quarter with industry-leading growth of +9%, rolling the industry-leading growth from last year for a 2-year comp sales growth of +43%”

Kevin Hochman, President & CEO of Brinker International

Guidance

AreaPeriodFigureAgainst last quarter
Total revenues Sourcefiscal 2026$5.76 billion - $5.83 billionRaised from $5.60 billion - $5.70 billion
Net income per diluted share, excluding special items, non-GAAP Sourcefiscal 2026$10.45 - $10.85Raised from $9.90 - $10.50
Capital expenditures Sourcefiscal 2026$250.0 million - $260.0 millionLowered from $270.0 million - $290.0 million
Weighted average shares Sourcefiscal 202644.7 million - 45.2 millionLowered from 45.0 million - 46.0 million
Winter Storm Fern impact included in guidance Sourceas of January 27, 2026approximately $20.0 million in reduced revenues; $0.15 decrease in diluted EPS excluding special itemsNew
Full-year restaurant openings Sourcefiscal 202632-38 totalKept

What changed from last quarter

  • Guidance raised: Management raised fiscal 2026 revenue and diluted EPS guidance, citing Chili’s sales and profit through year end. Source
  • Guidance lowered: Capital expenditures guidance was reduced to $250.0 million to $260.0 million from $270.0 million to $290.0 million. Source
  • Guidance lowered: Weighted average shares guidance was reduced to 44.7 million to 45.2 million from 45.0 million to 46.0 million. Source
  • Guidance kept: The full-year openings projection of 32 to 38 was the same as in the first quarter release. Source
  • New: Winter Storm Fern closures and reduced operating hours were added as a factor in the revised guidance. Source

Quarter results and growth

  • Company comparable sales rose 7.5%: Company comparable restaurant sales rose 7.5%, with Chili’s at 8.6% and Maggiano’s at (2.4)%. Company sales were $1,438.8 million against $1,346.1 million. Source
  • Net income and diluted EPS higher: Net income was $128.5 million against $118.5 million, and diluted EPS $2.86 against $2.61. Excluding special items, diluted EPS was $2.87 against $2.80. Source
  • Operating income and Adjusted EBITDA rose: Operating income was $168.4 million, 11.6% of total revenues, against $156.0 million and 11.5%. Adjusted EBITDA was $223.5 million against $215.8 million. Source
  • Six-month diluted EPS reached $5.03: For the twenty-six weeks, net income was $228.0 million against $157.0 million, and diluted EPS $5.03 against $3.44. Source

Chili’s and Maggiano’s segments

  • Chili’s company sales grew: Chili’s company sales were $1,304.1 million against $1,196.9 million. Chili’s restaurant operating margin was 19.1% of company sales against 18.7%. Source
  • Chili’s expense ratio improved on leverage: Chili’s company restaurant expenses were 80.9% of company sales, against 81.3%. Sales leverage was partly offset by menu mix, labor, advertising and repairs. Source
  • Maggiano’s company sales declined: Maggiano’s company sales were $134.7 million against $149.2 million, with comparable restaurant sales down 2.4% for the quarter. Source
  • Maggiano’s restaurant margin fell: Maggiano’s restaurant operating margin was 16.0% of company sales against 22.7%. Company restaurant expenses were 84.0% of company sales against 77.3%. Source
  • Chili’s franchisee sales rose: Chili’s franchisees generated about $271.9 million of sales in the quarter, against $232.3 million a year earlier. Source

“With 19 consecutive quarters of same-store sales growth, Chili’s turnaround, led by guest experience improvements, is sustaining over the long-term.”

Kevin Hochman, President & CEO of Brinker International

Comparable sales, traffic and pricing

  • Chili’s traffic and price both rose: Chili’s comparable sales of 8.6% comprised price impact of 4.4%, mix of 1.5% and traffic of 2.7%, against the prior year period. Source
  • Maggiano’s traffic declined: Maggiano’s comparable sales were down 2.4%, with traffic down 8.8% and price up 6.0% against the prior year period. Source
  • Menu and advertising drew new guests: Management said menu enhancements, competitive pricing and advertising strengthened the value proposition and attracted new guests. Source
  • Franchise comparable sales 7.3%: Franchise comparable restaurant sales were 7.3%, with U.S. at 9.2% and International at 6.2% in the quarter. Source

Costs, margins and tax rate

  • Food, labor and restaurant costs rose: Food and beverage costs were $370.5 million against $343.9 million, restaurant labor $446.4 million against $421.0 million, and restaurant expenses $352.1 million against $324.4 million. Source
  • Other charges fell: Other gains and charges were $0.5 million in the quarter, against $12.1 million a year earlier. Source
  • Tax rate lower on FICA tip credit: The GAAP effective income tax rate was 18.7% for the quarter, below the 21.0% statutory rate, and 18.8% excluding special items. Source

“We are raising our guidance to reflect a stronger sales and profit outlook for Chili’s through the end of the fiscal year.”

Brinker International, Inc., press release

Full-year guidance and Winter Storm

  • Revenue and EPS guidance raised: Fiscal 2026 total revenues are now guided to $5.76 billion to $5.83 billion, and diluted EPS excluding special items to $10.45 to $10.85. Source
  • Capital expenditure guidance lowered: Fiscal 2026 capital expenditures are now guided to $250.0 million to $260.0 million, down from $270.0 million to $290.0 million. Source
  • Share count guidance lowered: Weighted average shares for fiscal 2026 are now guided to 44.7 million to 45.2 million, from 45.0 million to 46.0 million. Source
  • Winter Storm Fern cut sales and EPS: Winter Storm Fern closures and reduced hours cut about $20.0 million of revenue and $0.15 of diluted EPS excluding special items, as of January 27, 2026. Source

Capital, cash and share repurchases

  • Repurchases of $100.0 million: The company repurchased $100.0 million of common stock in the quarter. Treasury stock purchases were $235.0 million for the twenty-six weeks. Source
  • Operating cash flow rose: Net cash from operating activities was $339.7 million for twenty-six weeks, against $281.0 million. Payments for property and equipment were $122.3 million against $105.8 million. Source
  • Revolver borrowings and debt repayments: Revolving credit borrowings were $475.0 million and repayments $455.0 million. Payments on long-term debt were $7.2 million against $362.1 million. Source
  • Long-term debt rose: Long-term debt and finance leases were $451.3 million at December 24, 2025, against $426.0 million at June 25, 2025. Source

Restaurant openings and franchising

  • Five franchised Chili’s international openings: Franchised Chili’s international had five openings in the quarter and ten for the fiscal year to date, against projected 24 to 28. Source
  • Maggiano’s company-owned count lower: Company-owned Maggiano’s domestic restaurants numbered 48 against 50, with no openings in the quarter or fiscal year to date. Source

Brand strategy and guest experience

  • Back to Maggiano’s initiatives underway: Back to Maggiano’s covers in-flight initiatives across food, service and atmosphere, aimed at revitalizing the brand’s core. Source
  • Repeat visits tied to operations: Management said improved restaurant operations remained a driver of repeat visits, alongside menu and pricing work at Chili’s. Source

Coming up, as management said on 28 January 2026

  • Form 10-Q filing by February 2: The company said its Form 10-Q for the second quarter is due on or before February 2, 2026. Source
  • Third-quarter results call April 29: The earnings release call for the third quarter of fiscal 2026 is scheduled for April 29, 2026. Source

Figures management reported

FigureReported
Comparable restaurant sales, Brinker Source7.5%
Comparable restaurant sales, Chili’s Source8.6%
Comparable restaurant sales, Maggiano’s Source(2.4)%
Traffic, Chili’s Source2.7%
Traffic, Maggiano’s Source(8.8)%
Store openings, second quarter Source6
Restaurant operating margin as % of company sales Source18.8%

Risks management discussed

  • External: Winter Storm Fern closures and reduced operating hours reduced revenue and diluted EPS in the period. Source
  • Demand: Maggiano’s comparable sales declined 2.4%, and the company describes improving that brand’s performance as a current focus. Source
  • Operational: Maggiano’s restaurant expenses rose on delivery fees, to-go supplies and insurance costs, among other items. Source

Earlier plans management reported on

  • Not stated: The first quarter release reiterated fiscal 2026 guidance; the second quarter release raised it.
  • Not stated: The first quarter release expressed confidence in lapping high comparisons in the second and third quarters. Chili’s comparable sales in the second quarter were 8.6%.
  • Ahead: The first quarter release described Chili’s performance as above the company’s plans, while Maggiano’s traffic declined.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.