Portillo's Cuts Corporate Workforce After Same-Sales Slide
Same-restaurant sales fell 1.2% in the second quarter as transactions dropped 3.4% and commodity prices rose 7.0%.
Portillo’s Inc. (PTLO), the Chicago-style restaurant chain, cut its corporate headquarters active workforce by about 18% on July 31, 2026, after same-restaurant sales worsened to a 1.2% decline in the quarter ended June 28, 2026. No restaurant-level team members were affected, the company said.
The same-restaurant sales drop followed a near-flat 0.1% decline in the first quarter and a 3.3% drop in the fourth quarter of 2025. Transactions fell 3.4% in the second quarter. Average check rose 2.2%, which the company attributed to an approximate 2.6% increase in certain menu prices, including a roughly 2.0% April 2026 price increase, partially offset by a 0.4% product-mix decline. Sales for 85 restaurants open at least 24 full fiscal periods were in the comparable base.
Total revenue was $199.0 million, up 5.6% from $188.5 million a year earlier. Restaurants outside the comparable base contributed $13.3 million of the year-over-year increase. Growth accelerated from 3.5% in the first quarter and 0.6% in the fourth quarter of 2025. The company said the increase was primarily from eight restaurants opened in fiscal 2025 and seven during the two quarters ended June 28, 2026.
Restaurant operating expenses rose 8.1% to $155.7 million. The company said the increase was driven by those new units, higher commodity costs and investments in team members. Commodity prices increased 7.0% year over year, versus a 1.8% increase cited in the first quarter and 4.0% in the fourth quarter of 2025. Food, beverage and packaging costs were $69.6 million. Labor was $51.1 million. Occupancy was $11.7 million. Other operating expenses were $23.3 million.
Operating income fell 21.4% to $13.8 million from $17.5 million a year earlier. The company said higher revenue was more than offset by those expense factors and an increase in other loss of $1.4 million due to a legal contingency. Net income declined 28.8% to $7.2 million from $10.0 million. Diluted earnings were $0.09 a share.
Restaurant-level Adjusted EBITDA was $43.2 million, with a margin of 21.7%. Adjusted EBITDA was $29.8 million, with a margin of 15.0%. General and administrative expenses were $19.6 million, including $0.9 million of dead-site costs.
Portillo’s opened three restaurants in the quarter, including its first airport location at Dallas-Fort Worth International, bringing the count to 109. It plans one more in the fourth quarter of 2026, a second in-line Chicago location. Fiscal 2026 targets call for eight new units, mid-single-digit commodity inflation, labor inflation of 3% to 3.5%, restaurant-level Adjusted EBITDA margin of 19.5% to 20.5%, general and administrative expenses of $78 million to $82 million, Adjusted EBITDA of $92 million to $96 million, and capital expenditures of $55 million to $60 million. The company said revisions reflecting the workforce reduction appear in the guidance section.
Chief Executive Officer Brett Patterson said the second quarter was highlighted by resilient underlying sales despite difficult promotional comparisons and by actions to simplify the business. He said the company finalized brand and consumer research that is helping shape a long-term strategy focused on sustainable, profitable growth, and that it looks forward to sharing that roadmap soon. On the July 31 reduction, Patterson said it is imperative to examine areas where the company can operate more efficiently and direct resources and future investments at the right priorities.
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