Brinker Completes Five Years of Chili’s Same-Store Growth
Fourth-quarter company sales reached $1.52 billion as Chili’s comps rose 5.6% and the board authorized $750 million of additional buybacks.
Brinker International (EAT), the casual dining operator of Chili’s and Maggiano’s, reported that Chili’s same-store sales rose 5.6% in the fourth quarter of fiscal 2026, completing five consecutive years of comparable-sales growth at the brand. Company comparable restaurant sales were 5.0%, after 3.3% in the third quarter and 7.5% in the second quarter.
President and CEO Kevin Hochman said the fifth year produced a 71% cumulative increase in Chili’s same-store sales. Company sales were $1,521.2 million, compared with $1,448.9 million a year earlier. Chili’s drove positive traffic and continued to outperform the casual dining industry.
Chili’s company sales were $1,408.6 million. The increase came primarily from favorable comparable restaurant sales driven by menu pricing and higher traffic. Company restaurant expenses fell to 81.4% of company sales, down 0.4 points from a year earlier. Chili’s restaurant operating margin, a non-GAAP measure, was 18.6% of company sales, up 0.4 points from 18.2%. The expense ratio reflected sales leverage and lower manager bonuses, partially offset by higher food and beverage costs, advertising, hourly labor, delivery fees and to-go supplies, manager salaries and other restaurant expenses. Food and beverage costs were negatively impacted by higher beef costs and a temporary increase in produce costs after a late freeze in Florida. Chili’s franchisees generated sales of about $301.2 million.
Maggiano’s company sales were $112.6 million, down $9.5 million from $122.1 million a year earlier. The decline was primarily due to lower traffic and restaurant closures, partially offset by menu pricing. Maggiano’s comparable restaurant sales were down 2.5%, improving from a 4.6% decline in the third quarter. Restaurant operating margin at Maggiano’s was 10.3% of company sales, down 3.0 points from 13.3%. Company restaurant expenses rose to 89.7% of company sales. The decline reflected sales deleverage, unfavorable food and beverage costs and higher pre-opening costs, partially offset by lower workers’ compensation and general liability insurance, repairs and maintenance and advertising.
Brinker’s restaurant operating margin, non-GAAP, was 18.0% of company sales, up 0.2 points from 17.8% a year earlier, after 18.4% in the third quarter and 18.8% in the second quarter. Operating income as a percentage of total revenues was 10.9%, up 1.1 points from 9.8% a year earlier. Operating income was $167.0 million. Adjusted EBITDA, non-GAAP, was $227.6 million.
Net income was $131.1 million, or $2.99 a share, up 30.0% from $2.30 a share a year earlier. Net income excluding special items, non-GAAP, was $3.07 a share, up 23.3% from $2.49. The GAAP effective income tax rate was 17.3%, lower than the 21.0% statutory rate primarily due to leverage of the FICA tip credit. Excluding special items, the effective rate was 17.6%.
During fiscal 2026, the company used operational cash flow to repurchase $400.0 million of common stock. Effective August 10, 2026, the board authorized $750.0 million under the existing share repurchase program. Subsequent to year-end, on July 16, 2026, the company redeemed $350.0 million of 8.25% notes, funded with borrowings from the revolving credit facility. Cash and cash equivalents were $110.0 million at June 24, 2026.
The company executed an agreement with a franchisee to acquire 12 Chili’s restaurants in Alabama and Mississippi, including the real estate for six locations, with the acquisition expected to close August 27, 2026. At June 24, 2026, Brinker owned, operated or franchised 1,635 restaurants, including 1,209 Chili’s domestic locations and 52 Maggiano’s restaurants.
For fiscal 2027, which includes a 53rd operating week in the fourth quarter, the company estimates total revenues of $6.15 billion to $6.27 billion and net income excluding special items, non-GAAP, of $12.60 to $13.40 a share. It estimates the extra week will add about 2.0% to total revenues and $0.70 to non-GAAP earnings a share. Capital expenditures are guided at $265.0 million to $285.0 million, with diluted weighted average shares of 42.0 million to 43.0 million. The first-quarter fiscal 2027 earnings call is scheduled for October 28, 2026.