Bloomin' Brands (BLMN 1.85%), the restaurant group behind Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s, reported financial results for Q2 FY2025 on August 6, 2025. The most notable headline was adjusted earnings per share of $0.32, beating the expected $0.29 (non-GAAP), while GAAP revenue also beat forecasts at $1,002.4 million compared to an $985.45 million estimate. Despite these beats, GAAP operating income margin fell sharply year over year, and same-store sales remained flat or declined, particularly at the core Outback Steakhouse brand, with comparable restaurant sales for Outback Steakhouse down 0.6% and combined U.S. comparable restaurant sales down 0.1%. Overall, the quarter was a modest outperformance on headline numbers, but underlying trends showed persistent operational challenges, with management reaffirming its full-year outlook.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.32 | $0.29 | $0.45 | (28.9%) |
| Revenue | $1,002.4 million | $985.45 million | $999.4 million | 0.3% |
| Revenue – U.S. segment | $985.8 million | $974.2 million | 1.2% | |
| Adjusted Operating Income Margin | 3.5% | 6.0% | (2.5 pp) | |
| Adjusted Restaurant-level Operating Margin | 12.0% | 14.0% | (2.0 pp) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
About Bloomin' Brands and Its Key Success Factors
Bloomin' Brands operates a diverse group of restaurant concepts, ranging from casual dining at Outback Steakhouse to fine dining at Fleming's Prime Steakhouse & Wine Bar. Its other key brands include Carrabba's Italian Grill and Bonefish Grill. The company's ability to attract and retain a wide range of customers is built on strong brand identities, with each restaurant offering distinct food and service experiences.
Key success factors for Bloomin' Brands include brand differentiation, operational efficiency, and supply chain control. Its growth depends on finding the right mix between company-operated and franchised restaurants, managing commodity and labor costs, and maintaining a quality-focused workforce. Strategic initiatives such as menu streamlining, technological upgrades like Ziosk guest tablets, and a focus on value offers are central to its ongoing efforts to improve profitability and traffic.
Quarterly Highlights: Financial and Operational Developments
Adjusted diluted earnings per share in Q2 FY2025 exceeded both the midpoint of company guidance and Wall Street consensus, rising to $0.32 (non-GAAP). However, this figure represented a steep decline compared to the $0.45 in adjusted diluted earnings per share (non-GAAP) posted in Q2 2024. The revenue figure, at just over $1 billion (GAAP), narrowly beat analyst projections and edged up by 0.3% year over year, representing only modest growth.
Despite these headline beats, adjusted operating income margin slid to 3.5% from 6.0% in the prior year, reflecting higher costs in key areas. Labor expenses (GAAP) climbed to $315.5 million from $300.3 million a year earlier, while food and beverage costs also inched higher. These pressures pushed restaurant-level operating margin down by two percentage points to 12.0%, indicating that cost inflation outpaced any operational improvements. Management cited restructuring, increased labor and commodity costs, and costs tied to foreign currency contracts as primary causes for the compression.
Traffic and comparable sales performance remained weak. Combined U.S. same-store sales dipped 0.1%, in line with recent flat trends. Outback Steakhouse saw a 0.6% decline in comparable sales and a 1.0% decrease in guest traffic for Outback Steakhouse U.S. company-owned restaurants, revealing ongoing challenges despite efforts to simplify menus and promote value offers like the "Aussie 3 Course" meal. Bonefish Grill fared worse, with comparable sales down 5.8% and traffic falling by 11.4%, while Fleming’s posted gains on both metrics as well, suggesting mixed results across the brand portfolio.
Beneath these numbers, average check size—a combined effect of price increases and customer mix—rose by 1.9% across U.S. brands. This growth in average check (up 3.4% in Q1 2025) helped offset some of the traffic declines. However, the company acknowledged ongoing price sensitivity, particularly for value-focused customers at Outback, where management noted it is “priced higher than our competition.” Early feedback from new menu initiatives and the deployment of digital tableside tablets has been positive, but thus far, these changes have not meaningfully improved foot traffic or overall margin.
This period included a net increase of 13 restaurants across all brands, with 19 system-wide restaurant openings and 6 closures. In the U.S, the brand count stands at 678 Outback locations, 208 Carrabba’s, 166 Bonefish Grills, and 65 Fleming’s. Management maintained its commitment to an asset-light approach outside the U.S, following the recent sale of a controlling stake in its Brazil business. Franchise revenue in international segments dropped from $9.4 million in Q2 2024 to $7.1 million.
On the capital management side, Bloomin' Brands declared a regular quarterly dividend of $0.15 per share, consistent with the prior pattern. No share repurchases occurred during the first half of the year, though $96.8 million remains authorized for buybacks through August 2025 under the 2024 Share Repurchase Program.
Looking Forward: Guidance and What to Watch Next
Management reaffirmed its full-year 2025 guidance, continuing to expect adjusted diluted earnings per share in the range of $1.00 to $1.10 for FY2025, though it does not project a dramatic turnaround. Guidance for the next quarter points to potential softness, with U.S. same-store sales are expected to be flat to down 1% for Q3 2025, and adjusted diluted earnings per share anticipated to be negative in the range of $(0.15) to $(0.10) for Q3 2025.
No major changes were announced in forward guidance. Management again cautioned investors about ongoing margin pressure, particularly due to labor and commodity inflation, which are forecast at approximately 4% and 3% to 3.5%, respectively, for FY2025. Uncertainties related to potential tariffs or broader economic shifts are not directly included in company estimates. The company’s main focus will remain on executing operational priorities at Outback, particularly improving value perception, as well as monitoring consumer spending patterns. Bloomin' Brands continues to invest in simplification, digital tools, and team training as it navigates a competitive casual dining landscape.
The quarterly dividend was declared at $0.15 per share, unchanged from prior periods.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
