third quarter of fiscal 2026
Filed Oct 27, 2026The Cheesecake Factory Reports Results for Third Quarter of Fiscal 2026
Third-quarter revenue reached $ 1,033,440, The Cheesecake Factory comparable restaurant sales increased 15.2 %, income from operations was $ 74,873 at 7.2 % of revenues, and diluted net income per share was $ 1.19. Results included $(12,889 ) of acquisition-related contingent consideration, compensation and amortization (income)/expenses, while adjusted diluted net income per share was $ 1.02.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenues (13 weeks ended September 29, 2026)GAAP | $1.03B | – | – |
| Food and beverage costs (13 weeks ended September 29, 2026)GAAP | 218,919; 21.2 % | – | – |
| Labor expenses (13 weeks ended September 29, 2026)GAAP | 359,758; 34.8 % | – | – |
| Other operating costs and expenses (13 weeks ended September 29, 2026)GAAP | 285,791; 27.7 % | – | – |
| General and administrative expenses (13 weeks ended September 29, 2026)GAAP | 66,645; 6.4 % | – | – |
| Depreciation and amortization expenses (13 weeks ended September 29, 2026)GAAP | 29,175; 2.8 % | – | – |
| Impairment of assets and lease termination expenses/(income) (13 weeks ended September 29, 2026)GAAP | 8; 0.0 % | – | – |
| Acquisition-related contingent consideration, compensation and amortization (income)/expenses (13 weeks ended September 29, 2026)GAAP | (12,889 ); (1.2 )% | – | – |
| Preopening costs (13 weeks ended September 29, 2026)GAAP | 11,160; 1.1 % | – | – |
| Total costs and expenses (13 weeks ended September 29, 2026)GAAP | 958,567; 92.8 % | – | – |
| Income from operations (13 weeks ended September 29, 2026)GAAP | 74,873; 7.2 % | – | – |
| Interest expense, net (13 weeks ended September 29, 2026)GAAP | (1,988 ); (0.2 )% | – | – |
| Other income, net (13 weeks ended September 29, 2026)GAAP | 520; 0.1 % | – | – |
| Income before income taxes (13 weeks ended September 29, 2026)GAAP | 73,405; 7.1 % | – | – |
| Income tax provision (13 weeks ended September 29, 2026)GAAP | 12,105; 1.2 % | – | – |
| Net income (13 weeks ended September 29, 2026)GAAP | $ 61,300; 5.9 % | – | – |
| Basic net income per share (13 weeks ended September 29, 2026)GAAP | $ 1.31 | – | – |
| Diluted net income per share (13 weeks ended September 29, 2026)GAAP | $ 1.19 | – | – |
| Adjusted net income (13 weeks ended September 29, 2026)non-GAAP | $52.32M | – | – |
| Adjusted diluted net income per share (13 weeks ended September 29, 2026)non-GAAP | $ 1.02 | – | – |
| Revenues (39 weeks ended September 29, 2026)GAAP | $3.04B | – | – |
| Total costs and expenses (39 weeks ended September 29, 2026)GAAP | 2,833,380; 93.1 % | – | – |
| Income from operations (39 weeks ended September 29, 2026)GAAP | 208,526; 6.9 % | – | – |
| Interest expense, net (39 weeks ended September 29, 2026)GAAP | (6,040 ); (0.2 )% | – | – |
| Loss on debt extinguishment (39 weeks ended September 29, 2026)GAAP | –; – % | – | – |
| Income before income taxes (39 weeks ended September 29, 2026)GAAP | 203,659; 6.7 % | – | – |
| Net income (39 weeks ended September 29, 2026)GAAP | $ 179,242; 5.9 % | – | – |
| Diluted net income per share (39 weeks ended September 29, 2026)GAAP | $ 3.62 | – | – |
| Adjusted net income (39 weeks ended September 29, 2026)non-GAAP | $173.1M | – | – |
| Adjusted diluted net income per share (39 weeks ended September 29, 2026)non-GAAP | $ 3.50 | – | – |
| Cash and cash equivalents (September 29, 2026)GAAP | $249.3M | – | – |
| Current and long-term debt, net of issuance costs (September 29, 2026)GAAP | 563,713 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| The Cheesecake Factory restaurants (13 weeks ended September 29, 2026)Comparable restaurant sales increased 15.2% year-over-year; the Company cited menu innovation, its rewards program, and engagement across social media. | $754.4M | – | 15.2 % comparable restaurant sales vs. prior year |
| North Italia (13 weeks ended September 29, 2026)One North Italia restaurant opened during the period. | $92.99M | – | (3 )% comparable restaurant sales vs. prior year |
| Other FRC (13 weeks ended September 29, 2026)Two Other FRC restaurants opened during the period. | $90.31M | – | – |
| Other (13 weeks ended September 29, 2026)The Other segment includes Flower Child and Grand Lux Cafe concepts, the third-party bakery, international and consumer packaged goods businesses, unallocated corporate expenses and gift card costs. | $95.76M | – | – |
| The Cheesecake Factory restaurants (39 weeks ended September 29, 2026)Two restaurants opened during the period. | $2.17B | – | 7.5 % comparable restaurant sales vs. prior year |
| North Italia (39 weeks ended September 29, 2026)Four restaurants opened during the period. | $280.9M | – | (3 )% comparable restaurant sales vs. prior year |
| Other FRC (39 weeks ended September 29, 2026)Four restaurants opened during the period. | $298.9M | – | – |
| Other (39 weeks ended September 29, 2026)Three restaurants opened during the period. | $287.8M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
fiscal 2026 outlook
- NoteThe Company continues to expect to open as many as 26 new restaurants in fiscal 2026.
- NoteIncluding as many as five The Cheesecake Factory restaurants, eight North Italia locations, seven Flower Child locations and as many as six FRC restaurants.
Capital returns
- Repurchased approximately 29,800 shares of its stock at a cost of $2.4 million during the third quarter of fiscal 2026.
- The Board of Directors declared a quarterly dividend of $0.30 per share, to be paid on November 24, 2026, to shareholders of record at the close of business on November 10, 2026.
What drove it
- The Cheesecake Factory comparable restaurant sales increased 15.2 % year-over-year in the third quarter of fiscal 2026.
- The Company said year-over-year improvements in labor productivity and food efficiency supported strong profitability.
- The Company opened six new restaurants during the quarter: two Cheesecake Factory restaurants, one North Italia, one Flower Child and two FRC restaurants.
- Subsequent to quarter-end, the Company opened two Flower Childs and one FRC restaurant.
Concerns
- North Italia comparable restaurant sales vs. prior year were (3 )% for both the 13 weeks and 39 weeks ended September 29, 2026.
- Other FRC reported an income from operations loss of $ (3,595 ) for the 13 weeks ended September 29, 2026.
- Preopening costs were 11,160; 1.1 % for the 13 weeks ended September 29, 2026, compared with 6,584; 0.7 % in the prior-year period.
- The quarter included $(12,889 ) of acquisition-related contingent consideration, compensation and amortization (income)/expenses.
What to watch
- Comparable restaurant sales at The Cheesecake Factory restaurants and North Italia.
- Execution against the expectation to open as many as 26 new restaurants in fiscal 2026.
- Labor productivity and food efficiency cited by management as contributors to profitability.
- The continued effect of acquisition-related contingent consideration, compensation and amortization on GAAP results.
Balance sheet and cash flow
- Total available liquidity was $585.3 million as of September 29, 2026, including a cash balance of $249.3 million and $336.0 million of availability on its revolving credit facility with no outstanding balance.
- Total principal amount of debt outstanding was $575 million, representing the principal amount of 2.00% convertible senior notes due 2030.
- Current and long-term debt, net of issuance costs, was 563,713 as of September 29, 2026, compared with 630,074 as of December 30, 2025.
- The September 29, 2026 debt balance included $563.7 million net balance of 2.00% convertible senior notes due 2030, consisting of principal amount of $575 million less $11.3 million in unamortized issuance costs.
Analysis
The third quarter produced $ 1,033,440 of revenue, compared with $ 907,226 in the prior-year quarter. The Cheesecake Factory restaurants generated $ 754,374 of revenue and posted 15.2 % comparable restaurant sales growth. North Italia generated $ 92,993, while its comparable restaurant sales vs. prior year were (3 )%. The Company opened six restaurants during the quarter and reported additional openings after quarter-end.
Profitability strengthened in the reported statement of income. Income from operations was $ 74,873, or 7.2 % of revenues, compared with $ 37,269, or 4.1 % of revenues, in the prior-year quarter. Food and beverage costs, labor expenses, and other operating costs and expenses represented 21.2 %, 34.8 %, and 27.7 % of revenues, respectively, versus 21.8 %, 35.6 %, and 28.2 % in the prior-year period. Management attributed profitability support to labor productivity and food efficiency.
GAAP net income was $ 61,300 and diluted net income per share was $ 1.19, compared with $ 31,899 and $ 0.66 in the prior-year quarter. The quarter included $(12,889 ) of acquisition-related contingent consideration, compensation and amortization (income)/expenses. Adjusted net income was $ 52,321 and adjusted diluted net income per share was $ 1.02, compared with $ 33,212 and $0.68, respectively, in the prior-year quarter.
Liquidity was $585.3 million as of September 29, 2026, including $249.3 million of cash and $336.0 million of revolver availability with no outstanding balance. The Company had $575 million of principal debt outstanding, its 2.00% convertible senior notes due 2030. Capital allocation included approximately 29,800 shares repurchased for $2.4 million and a declared quarterly dividend of $0.30 per share.
The forward outlook supplied in the release is development-focused rather than financial. The Company continues to expect to open as many as 26 new restaurants in fiscal 2026, including as many as five The Cheesecake Factory restaurants, eight North Italia locations, seven Flower Child locations and as many as six FRC restaurants. The key operating contrast in the release is strong Cheesecake Factory comparable sales alongside negative North Italia comparable sales.
Management, verbatim
We delivered an exceptional third quarter, generating record quarterly revenue, with margins and earnings also exceeding our expectations.
David Overton, Chairman and Chief Executive Officer
The Cheesecake Factory restaurants led our performance, with comparable sales and traffic meaningfully outperforming the broader casual dining industry.
David Overton, Chairman and Chief Executive Officer
Continued menu innovation, our rewards program and significant engagement across social media contributed to the impressive sales growth, while year-over-year improvements in labor productivity and food efficiency supported strong profitability.
David Overton, Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- Gross profit and gross margin were not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Financial guidance for revenue, gross margin, operating expenses and tax rate was not reported.
- Prior-quarter comparisons for the reported operating and earnings metrics were not reported.
- Percentage revenue growth for consolidated revenue and segment revenue was not printed on the relevant revenue rows.
- A prior outlook was not provided, so comparison with prior guidance is unavailable.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.