The Cheesecake Factory Incorporated

Second-quarter total revenues were over $1 billion, above the high end of prior guidance. Adjusted diluted EPS was $1.44, up 24% year over year; GAAP diluted EPS was $1.41. Net income was a record $68 million, up 25%, and adjusted EBITDA was a record $118 million, up 18%. At The Cheesecake Factory restaurants, sales were $729.5 million, up 7%; North Italia sales were $98.4 million, up 8%; Flower Child sales were $56.6 million, up 18%; and other FRC sales were $104 million, up 15%. For The Cheesecake Factory, comparable sales grew 5.8%, traffic rose 2.7%, pricing was 3.0%, and mix was 0.1% positive. Restaurant-level margin for Cheesecake was 20%; North Italia mature restaurant margin was 15.6% versus 18.2% a year ago; Flower Child mature restaurant margin was 20.1%. Cash returned to shareholders totaled $25 million, including $15.7 million in dividends and $9.3 million in share repurchases. The company ended the quarter with $561.7 million in total available liquidity, including $195.2 million of cash. For Q3, management expects total revenues of $980 million to $990 million, commodity inflation in low single digits, labor inflation in low to mid-single digits, G&A of $63 million to $64 million, depreciation of $29 million, preopening expenses of $10 million to $11 million, and adjusted net income margin of about 4.3% at the midpoint. For fiscal 2026, management now expects total revenues of approximately $4 billion at the midpoint, G&A at about 6.4% of sales, depreciation of about $116 million, preopening expenses of $35 million to $36 million, and full-year net income margin of approximately 5.4% at the sales estimate provided. The company remains on track to open as many as 26 restaurants in 2026, including six in Q3, and expects about $210 million of cash CapEx for the year.

David Overton said the quarter was ‘outstanding’ and emphasized that revenue, margins, and earnings all beat expectations. He framed the results as evidence that the company’s core strategy is working: strong hospitality, culinary innovation, rewards engagement, and operational excellence. His tone was confident and upbeat, with recurring emphasis on record performance and long-term growth.

Matt Clark highlighted the hard numbers: over $1 billion in revenue, adjusted net income margin of 6.8%, adjusted EPS of $1.44, $68 million of net income, and $118 million of adjusted EBITDA. He also noted $561.7 million of available liquidity, repayment of the remaining $69 million convertible note principal due in June 2026, and quarter CapEx of about $43 million. On the outlook, he laid out Q3 and full-year assumptions for revenue, inflation, G&A, depreciation, preopening expense, tax rate, shares, and said the company expects about $210 million in cash CapEx for 2026.

Analysts focused on how much of Cheesecake Factory’s traffic improvement came from the app launch, social media, and viral menu items versus underlying operating strength. Management said the improvement came from a mix of strong execution, menu innovation, and rewards/app engagement, and added that social media mentions were running well above casual dining norms, about 2 to 3 times on a unit basis. Questions also centered on margin and pricing: management said full-year four-wall improvement is now about 60 basis points, split roughly half from commodities and half from labor, while other opex stays roughly flat as they reinvest in marketing. Analysts pressed on rewards adoption and repeat behavior, but management declined to give user counts, saying engagement and sign-ups were strong and still early to fully assess.