Bloomin' Brands, Inc. Q4 FY2025 earnings call

• Mike Spanos discussed fourth quarter results and turnaround strategy focused on Outback, including improvements in guest metric scores and traffic gains. • Turnaround strategy has four platforms: deliver remarkable dine-in experience, drive brand relevancy, reignite culture of ownership and fun, invest in restaurants. • Outback launched new steak lineup with encouraging results in guest satisfaction and reorder intent. • Plan to introduce revised service model in Q2 2026. • Shifted marketing approach to more digital. • Plan to invest ~$50 million in 2026 with ~$30 million non-guest facing productivity savings. • Focus on consistency of execution, stake leadership, and phasing of turnaround elements. • Outback's brand trust, food, service, value, and atmosphere scores improved year over year.

For the fiscal fourth quarter 2025: Q4 comp sales were flat with U.S. traffic up 50 basis points. Outback's comp sales were down 60 basis points with traffic up 90 basis points (first positive traffic growth since Q4 2021). Carrabba's comp sales were up 160 basis points with traffic down 90 basis points. Bonefish's comp sales were down 10 basis points with traffic up 230 basis points (first positive traffic comp growth since Q1 2022). Fleming's comp sales were up 10 basis points with traffic down 240 basis points. Total revenues were $975 million compared to $972 million last year. Restaurant sales were up due to net impact of openings/closings, offset by decline in franchise revenue. Q4 adjusted diluted earnings per share was $0.26, within guidance range. Adjusted operating margins were 3.4% versus 3.5% last year.

• Fiscal 2026 U.S. comparable restaurant sales expected to be between 0.5% and 2.5%. • Total commodity inflation expected between 4.5% and 5.5%, labor inflation 3 - 3.5%. • Adjusted diluted earnings per share range 75 cents to 90 cents. • Capital expenditures between $185 and $195 million, with ~60% for remodels and normal course maintenance, ~20% for new units, and remainder for IT and infrastructure. • Q1 2026 U.S. comparable restaurant sales expected between flat and up 1%, adjusted diluted earnings per share between 57 cents and 62 cents. • Winter weather negatively affected Q1 2026 U.S. comparable restaurant sales by ~2.2% and adjusted diluted earnings per share by ~8 cents.

Q: Jeffrey Bernstein asked about comp trends, sequential trends in Q4, Q1 guidance, and where they are in the turnaround.

A: In Q4, first half had strong trends but back half saw step down in traffic; Q1 had strong start then extreme weather; in turnaround, biggest challenge is consistency of execution.

Q: Brian Harbor asked about value in Q4, Aussie 3 course, and remodels.

A: Aussie 3 course has 60% of guests trading up, testing learn culture; Carrabba's light refresh saw traffic growth, Outback remodel investment ~$350,000 to $400,000 per restaurant.

Q: Christine Chow asked about key variables in comp guidance, composition of price and traffic, and productivity gains.

A: Comp sales guidance includes mid-4s pricing, ~2 points mix investment; productivity gains from non-guest-facing initiatives like contract negotiations.

Q: Jeff Farmer asked about restaurant-level margin and tax benefit.

A: Restaurant margins expected mid-11s range; tax benefit $15 million to $18 million full-year, highest in Q1.

Q: Brian Mullin asked about Outback's awareness of changes, marketing message, and GNA.

A: Brand has high awareness; marketing message rolled out sequentially; GNA $215 million, ~5.3% of sales.

Q: John Ivanko asked about remodels and balance sheet.

A: Asset refresh plan is prudent, average investment $350,000 to $400,000, half of fleet to be dealt with in next three years.

Q: Andrew Strelzyk asked about service model test, commodity inflation.

A: Service model test saw positive guest metrics; beef costs locked in high single digits, ~70% - 80% of costs locked up.

Q: Lauren Silverman asked about average check and restaurant margin cadence.

A: Only elderly cohort showed sensitivity in check management; restaurant margin pressure expected to be highest in Q1, lowest in second half.

Q: Dennis Geiger asked about 42 test locations and comp outlook cadence.

A: 42 test locations showed positive results; comp outlook cadence focused on controlling execution and consistency.

Q: Brian Vaccaro asked about managing partner investments and CapEx.

A: Managing partner investments focus on competitiveness; CapEx expected ~100 remodels per year, maintenance capex ~$75 million annually.

Q: Brian Vaccaro also asked about marketing spend.

A: 2025 advertising ~2.4% of revenue, 2026 marketing mid to high twos, mostly second half.