The Cheesecake Factory Incorporated Q1 FY2026 earnings call

• David Overton mentioned strong first quarter results, exceeding expectations in revenue, margins, and adjusted diluted earnings per share, with disciplined execution across restaurants and continued demand for differentiated concepts. Culinary innovation is a core strength with well-received menu additions. Development: Opened three restaurants in first quarter, including international Cheesecake Factory in Mexico, on track to open 26 new restaurants in 2026. - David Gordon provided operational update: Performance reflects strong operations team execution, improvements in labor productivity, food cost management, etc. Cheesecake Rewards new mobile app exceeded expectations. Details on concept performances: Cheesecake Factory comparable sales outperformed index, North Italia focus on returning to positive sales growth, Flower Child strong performance with differentiated positioning, Henry opened to strong demand

Cheesecake Factory: First quarter comparable sales increased 1.6%, average weekly sales reached new all-time high, annualized AUVs nearly $12.8 million, restaurant-level profit margins improved, adjusted diluted earnings per share grew double-digit. North Italia: First quarter annualized AUVs $7.4 million, comparable sales declined 2%, mix positive 1%, price about 3%, traffic negative 6%, restaurant-level profit margin 14.8% vs 16.6% prior year. Flower Child: First quarter comparable sales increased 10%, two-year comparable sales increase 15%, annualized AUVs $4.9 million, restaurant-level profit margin 19.6% up 100 basis points from prior year. Henry: Opened in Phoenix with average weekly sales over $280,000 in first four weeks, annualized AUV over $14 million

While not providing specific comparable sales and earnings guidance, updated thoughts on Q2 and full year 2026. Anticipate Q2 total revenues between $990 million and $1 billion. Effective commodity inflation low to mid single digits, net total labor inflation low to mid single digits, other operating expenses estimated 20 basis points higher, G&A estimated $63 to $64 million, depreciation $28 to $29 million, pre-opening expenses $7 million. Anticipate fiscal 2026 total revenues approximately $3.91 billion at midpoint, net income margin approximately 5%, gna about 6.5% of sales, depreciation about $115 million, pre-opening expenses $35 to $36 million. Plan to open as many as 26 new restaurants in 2026, roughly three-quarters in second half, with cash capex ~$210 million

Q: Andy Barish asked about guest check management and quarter-to-date trends.

A: Matt said Cheesecake Factory comps above average, bullish outlook on business, positive on app rollout and new menu items.

Q: Jeff Farmer asked about Q1 revenue outperformance driver and impact of Iran conflict on sales.

A: Matt said Cheesecake Factory comps and Flower Child above expectations contributed to beat, sales steady throughout quarter with no impact from Iran conflict.

Q: Jim Salra asked about Cheesecake Factory comp components and macro backdrop outperforming.

A: Matt said Cheesecake Factory pricing 3.3%, mix negative 0.3%, traffic negative 1.4%, David Gordon added on retention and experiential dining.

Q: Jeff Bernstein asked about North Italia comp components and trade down.

A: Etienne provided North Italia comp components, David Gordon said add-ons consistent, Flower Child taking market share from fast casual/QSR.

Q: Samantha Chang asked about Cheesecake app member engagement and personalized marketing.

A: David said pleased with app downloads and sign-ins, Matt added on new guests from sign-up.

Q: John Ivanco asked about Flower Child unit growth and North Italia new units.

A: David said Flower Child has management pipeline, North Italia new Brea location had busiest opening week.

Q: Jim Sanderson asked about North Italia store margin and impact of launch.

A: Matt said focus on positive comp sales for margin, Brian said about aggregate traffic and flow through.

Q: Kelly Merrill asked about bowls and bites menu iteration.

A: David said menu innovation core, will refresh bowls and bites in next menu change.

Q: Sarah Senator asked about North Italia AUVs and development strategy.

A: David said North Italia mix 50-50 new and existing markets, still some cannibalization lingering