Brinker Raises 2027 Guidance to $13.30–$13.90 per Share After Sales Growth
Key Facts
Brinker International raised its fiscal 2027 guidance range for diluted net income per share excluding special items to $13.30–$13.90, from a previous range of $12.60–$13.40. The company reported results for the first quarter of its fiscal year, ended September 23, 2026, with growth in revenue and comparable sales. It also raised its full-year revenue guidance to $6.23–$6.33 billion, from $6.15–$6.27 billion. Results included increases in net income, operating income and free cash flow compared with the same period a year earlier. The announcement came as the market watched Chili’s performance and whether its traffic growth would continue.
Brinker’s total revenue was $1,475.6 million in the first quarter of fiscal 2027, versus $1,349.2 million a year earlier, while company sales were $1,461.2 million, compared with $1,335.4 million. Net income rose to $113.3 million from $99.5 million, and operating income increased to $151.0 million from $117.9 million. Diluted net income per share excluding special items, a non-GAAP measure, was $2.77 versus $1.93. Restaurant operating margin as a percentage of company sales also rose to 17.7% from 16.2% a year earlier, an increase of 1.5 percentage points. These metrics show improvement across sales, income and operating profitability during the quarter.
Brinker’s comparable restaurant sales rose 9.1% year over year overall, with a clear divergence between its two brands. Chili’s posted growth of 10.1%, while Maggiano’s comparable sales fell 3.4%. The company attributed Chili’s performance to higher traffic and menu pricing. It said the launch of the Big Crispy sandwich supported initiatives to improve the guest experience. The results highlight the group’s reliance on Chili’s strength for growth, while Maggiano’s did not share the same trend.
CEO Kevin Hochman said Chili’s delivered its 22nd consecutive quarter of comparable restaurant sales growth. Growth was 10% in the quarter, following an increase of 21% in the year-earlier period and 14% two years earlier, bringing cumulative growth over three years to 52%. Hochman said the company continues its “flywheel” of sustainable growth and market share gains, citing value, marketing and operational investment as supporting factors. The comparison reflects a strong annual base, as quarterly growth followed a substantial increase in the prior period. Before the results were announced, UBS forecast Chili’s comparable sales growth of 8.5% to 9.5%, with investors focused on whether traffic and sales momentum would continue and on an update to guidance.
Free cash flow, a non-GAAP measure, rose to $105.7 million in the first quarter of fiscal 2027, compared with $62.2 million a year earlier. The company used operating cash flow to repurchase $125 million of shares. It also redeemed $350 million of outstanding notes bearing interest at 8.25%, using funding from its revolving credit facility. These moves accompanied the increases in earnings and cash flows recorded during the quarter. The company thus provided details on its use of liquidity alongside its updated fiscal-year guidance.
Fiscal 2027 guidance includes an additional operating week in the fourth quarter, which Brinker estimated would lift total revenue by about 2.0% and add $0.70 to diluted net income per share excluding special items. Management said on the earnings call that it expects Chili’s comparable sales to grow at a mid-single-digit rate in the second through fourth quarters, with traffic continuing to increase. It said it started October with positive momentum. The company scheduled its first-quarter earnings review call for October 28, 2026, at 10 a.m. Central Time. In trading that day, market data showed the stock up 13.29% at $222.86 at 1:56 p.m. Eastern Time, compared with a previous close of $196.72.