El Pollo Loco Holdings, Inc.

For Q2 ended 07/01/2026, total revenue was $129.6 million versus $125.8 million last year. Company-operated restaurant revenue was $108.1 million, up 3.7% from $104 million, and franchise revenue was $12.9 million, down 3.8%. Systemwide same-store sales increased 3.9%, company-operated comparable sales rose 3.0%, and franchise comparable sales rose 4.5%; average check increased 4.2% at company stores and 5.3% at franchise stores, while transactions declined 1.1% and 0.8%, respectively. Restaurant-level margin was 19.5% versus 19.1%; GAAP net income was $12.8 million, or $0.43 per diluted share, versus $7.1 million, or $0.24 per diluted share. Adjusted EBITDA was $19.1 million versus $18.5 million, and adjusted net income was $8.9 million, or $0.30 per diluted share, versus $8.2 million, or $0.28 per diluted share. For 2026, the company raised systemwide comparable sales guidance to 3.5% to 4.5% and adjusted EBITDA guidance to $68 million to $70 million. It lowered capex guidance to $33 million to $37 million, kept restaurant opening guidance at at least 3 to 4 company-operated and 15 to 16 franchise-operated restaurants, and maintained G&A guidance of $52 million to $54 million and tax rate guidance of about 29% to 29.5%. It now expects full-year restaurant margin of 18.25% to 18.75% and Q3 restaurant margin of 18.0% to 18.5%.

Liz Williams framed the quarter as evidence that the company’s improvement is becoming more durable, pointing to sales growth plus operational gains and healthy unit economics. She emphasized menu innovation, value, loyalty, and culturally relevant marketing as the core of the current growth engine, citing tenders, quesadillas, and beverage innovation as ways to bring in new guests and expand occasions. Her tone was upbeat and confident, especially on the brand’s ability to travel beyond its core markets and support national expansion.

Ira Fils walked through the financials and noted that company-operated sales rose on 3% comp growth and new unit openings, while franchise revenue was pressured by a $1.1 million decline in POS pass-through revenue. Food and paper costs rose 90 basis points to 25.4% of company restaurant sales, mainly from 4.1% commodity inflation led by produce; labor fell 90 basis points to 29.9% and occupancy/other operating expenses fell 30 basis points to 25.3%. He said the company had $30 million of debt outstanding and $13.3 million in cash and cash equivalents at quarter-end, and it amended its $150 million revolver on 08/04/2026 to extend maturity to August 4, 2031; the spread increases by about 50 basis points.

Analysts pressed on what is driving the current sales acceleration and whether the Q3 guide implies a slowdown. Management said July benefited from loaded quesadilla momentum, media support, World Cup-related advertising, and some easier behavior comparisons, while Ira said the rest of Q3 should be broadly in line with Q2 and that Q4 comparisons get tougher by about 200 basis points. Questions also focused on new market franchise expansion, where Liz said interest is nationwide, not necessarily contiguous, and that the company wants experienced multi-unit operators with a strong fit and proven restaurant execution. On food safety and sourcing, management said El Pollo Loco is not involved in lettuce recalls, sources lettuce from the U.S., uses serrano rather than jalapeño peppers, and is not using the supplier being discussed in headlines.