Bloomin' Brands, Inc. Q1 FY2026 earnings call

Mike Stannos started by thanking teams, discussed turnaround strategy launched in Q4 last year for Outback Steakhouse with focus on food, service, experience, value. Outback's guest metric scores improved for third consecutive quarter. Turnaround strategy has four platforms: deliver remarkable dine-in experience (new steak lineup, focus on consistency of execution, new service model launched in April), drive brand relevancy, reignite culture of ownership and fun, invest in restaurants. Eric Christel reviewed financials: Q1 total revenues $1.06 billion (+1% vs last year), GAAP diluted EPS 64 cents vs 50 cents last year, adjusted diluted EPS 67 cents vs 59 cents last year. Capital structure: total debt net of cash $681 million, leverage metrics 3.8 times on lease adjusted net leverage basis and 2.2 times on net debt to adjusted EBITDA basis. Capital expenditures $25 million, expected higher in remaining quarters of 2026.

Q1 U.S. comparable restaurant sales positive 90 basis points, traffic down 180 basis points. Weather impact 240 basis points this year vs. 130 basis points negative last year. Outback's Q1 comp sales down 30 basis points, traffic down 240 basis points; 60% of guests trading up from $14.99 to $17.99 and $20.99, ~20% trading up on dessert. Carabas Cubs sales up 130 basis points, traffic down 270 basis points (fifth consecutive quarter of positive same-store sales growth). Bonefish's comp sales up 610 basis points, traffic up 300 basis points. Fleming's comp sales up 80 basis points, traffic down 290 basis points (seventh consecutive quarter of positive comp sales growth).

Reiterate full-year fiscal 2026 guidance communicated in February. Q2 U.S. comparable restaurant sales expected between 1% and 2%. Q2 adjusted diluted earnings per share expected between 27 cents and 32 cents. Tax benefit expected between $4 and $5 million in the quarter. 33% Brazil EMI expected between approximately negative $1.2 million and negative $1.7 million.

Q: Alex Slagle from Jefferies asked about Outback's check growth, pricing, mix component and Carabas' check.

A: Mike Stannos said Outback's check average to grow 2.5% to 3%, balanced, and discussed commodity inflation and pricing. Eric Christel mentioned labor performance and hot schedules.

Q: Jeffrey Bernstein from Barclays asked about Outback core comp trends, sequential trends, weather and gas price spikes.

A: Mike Stannos said results within expectations, sequential improvement in March and April, positive early read on Mother's Day.

Q: Brian Harbor from Morgan Stanley asked about marketing timing and impact on margins, and server ratio change impact.

A: Mike Stannos discussed marketing mix shift to digital, tested server model with positive comp and tips.

Q: Jeff Farmer from Gordon Haskett asked about Q1 pricing cadence and GNA.

A: Mike Stannos said Q1 pricing about five, Q2 higher, GNA 215 million number still in play.

Q: Sarah Senator from Bank of America asked about steakhouse category and capacity investments.

A: Mike Stannos said both category strength and company initiatives driving Outback's momentum, capacity investments for optimal cooking platform.

Q: Christine Cho with Goldman Sachs asked about margin drivers and consumer demographics.

A: Eric Christel discussed margin drivers, Mike Stannos talked about consumer demographics and engagement.

Q: Christabel Rocca with J.P. Morgan asked about expanding chargrill capacity and remodels.

A: Eric Christel and Mike Stannos explained chargrill capacity is for optimal cooking, remodels are light touch with traffic tailwind.

Q: Brian Vaccaro with Raymond James asked about Outback comps vs segment trends and commodity inflation.

A: Mike Stannos said Outback improved vs Black Box, commodities inflation still in 4.5 to 5.5 range.