Kura Sushi USA, Inc.

Fiscal third quarter 2026 total sales were $85.9 million, up from $74 million in the prior year period. Comparable restaurant sales were -0.4%, with traffic down 5.1% and price/mix up 4.7%; effective pricing was 4.5%. Restaurant-level operating profit margin was 19.1% versus 18.2% a year ago, adjusted EBITDA was $6.6 million versus $5.4 million, and adjusted EBITDA margin improved to 7.7% from 7.3%. Net income was $423,000, or $0.03 per share, versus $565,000, or $0.05 per share, last year. For fiscal 2026, management now expects total sales of $330.5 million to $331.5 million, 16 new unit openings, average net capex per unit of about $2.5 million, G&A of about 12% of sales excluding litigation expense, and full-year restaurant-level operating profit margin of about 18.5%.

Hajime Uba said the quarter showed meaningful progress toward sustainable margin improvement and a return to historical 20% restaurant-level operating profit margins, even without tariff relief. He stressed that the team offset higher COGS through discipline, improved labor, and stronger mix, and said the company remains bullish on fiscal 2027 given a strong real estate pipeline, more IP collaborations, and the new rewards program. His tone was upbeat and confident, but he also acknowledged that traffic has been choppy and that the top line was challenged by macro pressure and delays.

Benjamin Porten detailed that food and beverage costs rose to 30.2% of sales from 28.3% due to tariffs, while labor and related costs improved to 30.6% from 33.1% on operational efficiencies and pricing. He noted occupancy was 7.8%, depreciation and amortization 4.9%, other costs 14.6%, and G&A 11.9%; the company ended the quarter with $66.1 million in cash, cash equivalents and investments and no debt. He also pointed to only $3 million of cash burn despite opening 7 restaurants, said the company expects around 30% COGS for the full year, and explained that the lower revenue guide reflects both delayed openings and the macro/traffic backdrop.

Analysts focused on weak traffic, the stronger-than-expected mix, and the impact of delayed openings on revenue guidance. Management said the -0.4% comp was within expectations, blamed much of the traffic weakness on elevated gas prices and some distraction from the World Cup, and said the biggest surprise was the opening delays, including several fire-inspection-related issues. On mix, management argued the continued improvement reflects pricing power and a value gap versus competitors, and said nonmember average check growth is now outpacing reward members, which they view as evidence of a higher-spending guest mix.