Red Robin Gourmet Burgers, Inc. Q4 FY2025 earnings call

The first choice plan is being executed. Labor efficiency initiatives contributed ~180 basis points to restaurant-level margins in Q4. The $9.99 Big Yum Burger offer drove traffic, and the new menu launched in January expanded options. A data-driven marketing strategy was deployed, focusing on precise messaging. Corporate efficiency actions reduced G&A expenses. 20 light touch restaurant refreshes were completed in 2025, and 2026 capital plan allocates more to refreshes. An enterprise version of ChatGPT AI platform was launched, with expanding utilization.

For the full year, comp sales were down 0.3% excluding deferred loyalty revenue, with a 3.5% increase in average check offset by a 3.8% decrease in traffic. For the fourth quarter, comp sales were down 3.3% excluding deferred loyalty revenue, with a 0.3% increase in average check and a 3.6% decline in traffic. Full year adjusted EBITDA was $69.7 million, representing 53% growth over 2024, and restaurant-level margin grew by 190 basis points.

2026 comparable restaurant revenues (excluding deferred loyalty revenue) expected to be between 0.5% and 1.5%. Restaurant-level operating profit margin approximately 13%. Adjusted EBITDA expected between $70 million and $73 million. Capital expenditures expected between $25 million and $30 million.

Trends softened in October and November, weather events impacted results, commodity costs like beef pricing remain a headwind, and uncertainties in refinancing and franchising progress.

Q: Todd Brooks asked about same-store sales guidance for 2026 and pricing assumption.

A: Chris said a 3.2% menu price increase was rolled out in January and expected to carry through.

Q: Todd Brooks asked about micro-targeted marketing implementation and selling expense plan.

A: Chris said they're two-thirds into implementation and expect selling expense to be up in 2026.

Q: Jeremy Hamlin asked about same-store sales cadence and expense side.

A: Chris discussed Q1 context, weather impact, and commodity cost expectations.

Q: Jeremy Hamlin asked about re-franchising efforts and labor savings.

A: Dave and Chris provided updates on re-franchising and labor savings potential.

Q: Mark Smith asked about G&A outlook and restaurant base.

A: Chris and Dave discussed G&A outlook and restaurant portfolio optimization.