Brinker Raises Fiscal 2027 Revenue and Non-GAAP EPS Guidance

Brinker International (EAT ) on October 28, 2026, reported higher sales and earnings for the first quarter of fiscal 2027 and raised its full-year guidance, with Chili’s posting a 10.1% increase in comparable restaurant sales for the thirteen weeks ended September 23, 2026. Total revenues were $1,475.6 million, compared with $1,349.2 million in the first quarter of fiscal 2026.

Company sales were $1,461.2 million, up from $1,335.4 million a year earlier, and franchise revenues were $14.4 million, up from $13.8 million. Operating income rose to $151.0 million, or 10.2% of total revenues, from $117.9 million, or 8.7%. Net income was $113.3 million, or $2.64 per diluted share, compared with $99.5 million, or $2.17 per diluted share, in the prior-year quarter. Excluding special items, net income was $119.1 million, or $2.77 per diluted share, versus $88.5 million, or $1.93 per diluted share. Adjusted EBITDA, a non-GAAP measure, was $209.1 million, up from $172.4 million. Special items in the quarter included a $17.6 million loss on debt extinguishment.

Company comparable restaurant sales increased 9.1%, including a 10.1% gain at Chili’s and a 3.4% decline at Maggiano’s, while system-wide comparable sales, which cover company-owned and franchised locations, rose 8.9%. For company-owned restaurants, the company reported a 3.6% price impact, no mix-shift impact and a 5.5% traffic impact; at Chili’s, traffic contributed 6.4% and menu pricing 3.7%. Comparable restaurant sales include restaurants in operation for more than 18 full months and exclude locations temporarily closed for 14 days or more.

In the company’s first-quarter earnings release, President and Chief Executive Officer Kevin Hochman said: “Chili’s delivered its 22nd consecutive quarter of same-store sales growth, up +10%, lapping a +21% from last year and a +14% from 2024 for a 3 year cumulative comp of +52%.” The company attributed the quarter’s performance to ongoing brand initiatives to improve the guest experience and to the launch of its Big Crispy chicken sandwich.

Updated Fiscal 2027 Guidance

Brinker raised its fiscal 2027 total revenue guidance to a range of $6.23 billion to $6.33 billion, from the previous range of $6.15 billion to $6.27 billion. Guidance for net income per diluted share excluding special items, a non-GAAP measure, was raised to a range of $13.30 to $13.90, from $12.60 to $13.40. The company left unchanged its previous guidance for capital expenditures of $265.0 million to $285.0 million and for diluted weighted average shares of 42.0 million to 43.0 million.

Fiscal 2027 includes a 53rd operating week in the fourth quarter, which the company estimates will add approximately 2.0% to total revenues and $0.70 to net income per diluted share excluding special items. The company said it is unable to reliably forecast special items without unreasonable effort and therefore does not present a reconciliation of its forecasted non-GAAP measures to the corresponding GAAP measures.

Cash Flow, Share Repurchases and Debt Redemption

Net cash provided by operating activities was $169.1 million, compared with $120.8 million in the first quarter of fiscal 2026, an increase the company attributed primarily to higher operating income. Free cash flow, which Brinker defines as net cash provided by operating activities less payments for property and equipment, was $105.7 million versus $62.2 million. Payments for property and equipment were $63.4 million, up from $58.6 million.

During the quarter, the company repurchased $125.0 million of its common stock and redeemed the outstanding $350.0 million of 8.25% notes using funding from its revolving credit facility. Interest expenses were $24.6 million, compared with $10.5 million a year earlier, and included the $17.6 million loss on debt extinguishment resulting from the early redemption of the 8.25% notes on July 15, 2026. Financing activity included $470.0 million of borrowings and $95.0 million of payments on the revolving credit facility, as well as $368.0 million of payments on long-term debt and the extinguishment premium. Cash and cash equivalents ended the quarter at $30.7 million, down from $110.0 million at the beginning of the period. Long-term debt and finance leases, less current installments, stood at $451.0 million at September 23, 2026, compared with $419.7 million at June 24, 2026.

At the segment level, Chili’s company sales were $1,366.5 million, up from $1,236.2 million, and operating income was $205.0 million versus $169.0 million. Chili’s restaurant operating margin, a non-GAAP measure, was 18.7% of company sales, up from 17.3%. The company attributed the sales increase primarily to favorable comparable restaurant sales driven by higher traffic and menu pricing, and the decrease in restaurant expenses as a percentage of company sales primarily to sales leverage, partially offset by unfavorable commodity costs, higher hourly labor, advertising, repairs and maintenance, worker’s compensation and general liability insurance, delivery fees and to-go supplies, and other restaurant expenses. Chili’s franchisees generated sales of approximately $296.7 million, compared with $269.5 million a year earlier.

Maggiano’s company sales were $94.7 million, down from $99.2 million, with an operating loss of $3.6 million compared with a loss of $4.1 million in the prior-year quarter. The company attributed the sales decrease primarily to lower traffic, partially offset by menu pricing, and the decrease in Maggiano’s restaurant expenses as a percentage of sales primarily to lower advertising, delivery fees and to-go supplies, partially offset by sales deleverage and higher rent and manager salaries.

Brinker owned, operated or franchised 1,641 restaurants at September 23, 2026, up from 1,630 a year earlier, including 1,210 Chili’s domestic and 380 Chili’s international locations. During the quarter, the company acquired 12 Chili’s domestic restaurants previously owned by a franchisee; projected openings for full-year fiscal 2027 total 30 to 36 restaurants. The effective income tax rate was 10.8% on a GAAP basis, below the 21.0% statutory rate, a difference the company attributed primarily to the FICA tip credit and excess tax benefits from stock-based compensation; excluding special items, the rate was 19.0%. Management scheduled a conference call and live audio webcast for 10 a.m. CDT on October 28, 2026, with a replay available after the broadcast.