Black Rock Coffee Bar, Inc. Class A Common Stock (BRCB) Earnings

Management highlights

### Customer Engagement & Loyalty - Loyalty program participation reached 66% in Q1, with month-over-month growth; loyalty members have higher visit frequency and average spend than non-members, and the loyalty database has grown into a key customer insight asset - A Q1 pilot of segmented personalized offers (tailored to guest type and lifecycle, instead of one-size-fits-all blanket offers) in Phoenix, Colorado, and Dallas more than doubled engagement, nearly doubled incremental spend, and delivered over three times the incremental visits compared to the blanket approach; the strategy will be expanded to additional markets - Programmatic marketing campaigns launched in Q4 2025 continued through Q1, exceeding expectations by driving strong visit lifts from both new non-customers and high-frequency core guests; a second programmatic campaign with added retargeting will launch in Q2 ### Menu Innovation - The first seasonal limited-time offering (LTO) window of the year delivered strong year-over-year growth, with core product mix increasing over 60%; indulgent, flavor-forward beverages (including the top-performing Strawberry Blondie with Sweetheart Cold Foam) led sales, and shareable, visually appealing menu items drove organic social engagement - Egg Bites continue to outperform expectations, driving food attachment and check growth; a new protein add-on platform (protein-boosted milk, protein shakes, protein cold foam) launched as a test in Phoenix in early March, with strong early results leading to a full system rollout completed in April, creating a unique category offering for energy beverages - A seasonal Dirty Soda partnership with Olipop delivered encouraging guest feedback, particularly for afternoon day part traffic, with a recipe refresh and barista variations planned for Q2 to refine the offering ahead of potential future scaling - Micro influencer marketing, focused on regional local creators, has delivered strong early engagement on discovery platforms like TikTok, and will be expanded to align with 2026 summer seasonal menu launches ### People & Culture - Team member turnover hit an all-time low of 54% in Q1, outperforming the industry average and improving year-over-year, driven by improved onboarding and training via an updated learning management system - Store lead turnover remains below industry average, supported by the company's career roadmap training program that builds leadership and business acumen for retail leaders, creating a robust internal pipeline to support new store growth - John Vingo joined as the new Chief Development Officer, bringing deep experience in large-scale national retail expansion to support the company's growth strategy ### Store Expansion - Nine new company-operated stores were opened in Q1 2026, bringing the total store count to 190 as of quarter end; four new openings were in high-growth Colorado, with additional openings in existing markets including Portland and Phoenix - Strategic densification (adding new stores near existing high-volume locations) in Phoenix created a 160 basis point headwind to Q1 same-store sales from modest sales transfer between existing and new locations, but overall market-level sales remain strong and new stores are meeting performance targets - 5 of the 9 Q1 new stores opened in the last week of the quarter, reducing counted store weeks as expected; the development pipeline is mature, positioning the company for a more robust opening cadence for the remainder of 2026 - The company maintains flexible build options, with a planned near-term shift to more reverse build-to-suit leases to increase development control and speed to market

Guidance

- Full-year 2026 guidance is reaffirmed unchanged from prior guidance: 36 new store openings, total revenue of $255 to $257 million, mid-single-digit same-store sales growth, consolidated adjusted EBITDA of $33.5 to $34.5 million - 2026 capital expenditure guidance is reaffirmed at $40 to $41 million inclusive of anticipated tenant improvement allowances, or $58 to $61 million excluding $18 to $20 million in tenant improvement allowances, with capital spending supporting 2026 new stores, existing store investments, and pre-investment for 2027 new store openings - No additional general price increases are planned for the remainder of 2026, after the late Q4 2025 price increase that will carry through the full year - Long-term guidance is maintained: 20% annual unit growth, 20% or higher annual revenue growth, mid-single-digit same-store sales growth, and adjusted EBITDA growth that outpaces revenue growth, with a target of 1,000 total stores by 2035 - New market entry evaluation is underway, with potential first new market entries planned for 2027 to 2028, after the company's original timeline of 2028+

Segment performance

BlackRock Coffee Bar operates only one core business segment of company-operated coffee and beverage retail stores. For the first quarter of 2026: Total revenue was $55.5 million, a 23.7% year-over-year increase. Store level profit reached $16.4 million, up 29.2% year-over-year, with a store level profit margin of 29.6% (126 basis points higher year-over-year). Consolidated adjusted EBITDA was $7.4 million, up 23.5% year-over-year. By product mix: Coffee represents 55% of total revenue, energy beverages represent 25%, food represents 13%, and all other items make up the remaining 7%. Digital sales (app, online ordering, third-party delivery) account for 17% of total revenue.

Risks & headwinds

- Strategic market densification in high-penetration, high-volume markets like Phoenix can create temporary headwinds to same-store sales from sales transfer between existing and new locations; the company is monitoring proximity dynamics to balance growth and same-store performance - The company operates amid a uneven, dynamic macroeconomic environment, though its balanced demographic exposure, resilient coffee category mix, and balanced day part sales are positioned to insulate against broader consumer slowdowns - Commodity price volatility for coffee, dairy, and sugar could impact COGS margins, though the company's procurement team has locked in stable pricing and the low proportional share of coffee costs (less than 3% of total revenue) limits overall exposure - Scaling new initiatives (segmented loyalty offers, marketing campaigns, new menu platforms) requires disciplined operational execution to maintain consistent guest experience and positive return on investment

Analyst Q&A

• Q: Why is BlackRock pursuing strategic market densification, and did the 160 bps sales headwind from sales transfer in Phoenix surprise management? /

  A: Densification in high-demand, high-volume mature markets like Phoenix leverages strong underlying demand to capture high AUV returns from attractive available real estate, while improving overall guest access in the market. The 160 bps impact was not materially outside of expectations. Only Phoenix, the company's most penetrated market, is seeing this impact currently, and most future Phoenix openings will not fall within 5 miles of existing stores, so larger impacts are not expected for the full year.

• Q: What explains strong first-quarter unit margins, and what pushes and pulls should be expected for full-year margins? /

  A: First-quarter margins benefited from disciplined inventory management and procurement, plus lapping higher discounting for the loyalty program launch in Q1 2025. Management expects margin momentum to continue for the full year, with first-quarter's 29.6% store margin representing a strong baseline that the team is proud of. Elevating food mix (a higher attachment category) is also supporting check growth and margins.

• Q: What is management's confidence that segmented personalized loyalty offers drive incremental demand versus just pulling future demand forward? What is the planned pace of rollout? /

  A: Initial testing in Phoenix and Colorado showed doubled engagement, nearly 100% higher incremental spend, and three times the incremental visits, with clear early evidence of incrementality. The company will pace rollout gradually through the rest of 2026 to ensure consistent operational experience for guests, building on the strong initial test results, with more market expansions planned as the year progresses.

• Q: Why are new market entries being evaluated earlier than the originally planned 2028 timeline, and what markets are being considered? /

  A: The company is on track to hit its 20% annual growth target to reach 1,000 stores by 2035, and opening new states allows for purposeful, predictable growth that avoids over-densification in existing seven states of operation. The company is targeting states with strong coffee culture, similar demographic profiles to existing markets, and favorable income/consumer dynamics, with California identified as a key near-term new market with a robust development pipeline already in place.

• Q: Has BlackRock seen any impact on performance from new competitor beverage launches (e.g. McDonald's new beverage test in Colorado) and how do newer stores perform against established competitors? /

  A: The company has not seen any measurable impact from competitor new product tests. High-performing BlackRock stores, both mature and new, continue to deliver strong growth even when located directly next to major competitors like Starbucks, Dutch Bros, and McDonald's, with the company's combined drive-thru/community lobby experience and differentiated menu driving strong outperformance.