Brinker International (EAT 2.31%), the company behind Chili's Grill & Bar and Maggiano's Little Italy, released its fourth quarter fiscal 2025 results on August 13, 2025. The headline news was a continued run of strong revenue growth and margin improvement, powered by sharply higher traffic and sales at Chili's. Non-GAAP earnings per share reached $2.49 for Q4 FY2025, slightly above the consensus estimate of $2.47 (non-GAAP), while GAAP revenue of $1,461.9 million also surpassed the $1,446.2 million forecast. Compared to prior year figures, key metrics showed double-digit growth. Overall, the quarter reflected steady progress on operational improvements, capital returns, and continued divergence in performance between Chili's and Maggiano's.
| Metric | Q4 2025 | Q4 2025 Estimate | Q4 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $2.49 | $2.47 | $1.61 | 54.7 % |
| Revenue (GAAP) | $1,461.9 million | N/A | $1,208.2 million | 21.1 % |
| Restaurant Operating Margin (Non-GAAP) | 17.8 % | 15.2 % | 2.6 pp | |
| Operating Income Margin (GAAP) | 9.8 % | 6.1 % | 3.7 pp | |
| Net Income (GAAP) | $107.0 million | $57.3 million | 86.7 % |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q3 2025 earnings report.
The Brinker International Business and Recent Focuses
Brinker International operates two principal casual dining restaurant brands: Chili's Grill & Bar and Maggiano's Little Italy. Chili's is known for Southwest-inspired American meals, like burgers and fajitas, in a lively setting, while Maggiano's focuses on Italian-American dishes suited for family meals and celebrations. The company's position in the crowded casual dining sector rests on brand differentiation, menu innovation, digital convenience, and a mix of company-operated and franchised locations.
Recently, Brinker has focused on several critical areas. These include enhancing digital tools and off-premise dining, adding innovative menu items, and modernizing kitchen equipment. The company also emphasizes targeted international expansion, primarily through Chili's franchising. Performance depends not only on attracting new customers but also on delivering consistent service and food quality, backed by investments in employee training and operational support.
Quarter Highlights: Sales, Margins, and Operational Drivers
During the quarter, sales grew strongly at Chili's, with comparable restaurant sales up 23.7%, where comparable restaurant sales jumped 23.7% for Chili’s, and traffic rose 16%. Chili's also saw a two-year comparable sales increase of 39%. Performance was driven by menu innovation, such as the launch of the Big QP burger, which outperformed last year's promotion. Value-focused platforms like the $10.99 “3 for Me” menu remained key, holding steady at about 18–19% of the sales mix in Q3 FY2025, with over half of those sales at the $10.99 tier. Expansion of the Triple Dipper appetizer platform also contributed, reaching 12% of menu mix and 15% of brand sales in Q3 FY2025.
Maggiano’s continued to face challenges. Maggiano’s comparable sales slipped 0.4%, while company sales declined slightly compared to the prior year. The management team has focused on following successful initiatives previously applied at Chili’s, such as enhancing core recipes and removing operational complexity, but a material turnaround remains a work in progress.
Digital and off-premise channels remained strong. About one-quarter of company sales came from delivery and carryout, split roughly evenly. These off-premise sales were supported by technology investments such as mobile ordering and partnerships with delivery services. While these upgrades lifted service and customer experience, they also pushed general and administrative expenses higher due to increased technology-related costs and expanded corporate support.
Brinker continued strategic restaurant development, opening three new Chili's and increasing franchise count by 23 units in fiscal year 2025, mostly internationally. Chili’s franchisees generated sales of approximately $262.3 million compared to $230.1 million for the fourth quarter of fiscal 2024. For the company as a whole, the number of company-owned restaurants fell by nine units, reflecting a focus on optimizing assets rather than maximized expansion. Capital expenditures came in at $265.3 million, up from $198.9 million in FY2024, and were channeled into kitchen updates and remodeling rather than aggressive new unit growth. EAT does not currently pay a dividend.
Financial Health, Margins, and One-Time Events
The improved performance led to notable margin expansion. Consolidated operating margin (GAAP) reached 9.8%, up from 6.1% in the prior-year quarter. Restaurant operating margin, a key measure of profitability for restaurants before corporate costs, improved from 15.2% to 17.8% (non-GAAP). At the segment level, Chili's delivered an operating margin of 13.2%, while Maggiano's margin fell to 11.0%.
Free cash flow allowed the company to reduce debt aggressively. Brinker paid off its outstanding revolver, lowering its long-term debt and finance leases to $426.0 million from $786.3 million as of Q4 FY2024. This deleveraging position provided room for the August 2025 announcement of a $400.0 million share repurchase program, bringing total authorization to $507.0 million.
From a product perspective, menu innovation and marketing continued to play a larger role in Chili’s results, with promotional campaigns around burgers and appetizers attracting new and returning guests. The Big QP burger introduction, for example, generated high customer engagement and outpaced previous launches in unit sales and public interest, as supported by management commentary. Maggiano’s, despite menu improvements, faces a longer road as management phases out short-term discounts in favor of structural menu improvements—a process described by management in Q3 FY2025 as being in the early stages of turnaround, with expectations for near-term traffic headwinds as discounting is eliminated and menu, service, and atmosphere are improved.
Shareholder equity (GAAP) also improved, rising to $370.9 million from $39.4 million as of Q4 FY2024, reflecting accumulated profits and aggressive debt paydown.
Looking Ahead: Guidance and Upcoming Drivers
Management provided formal guidance for fiscal 2026. Brinker projects GAAP revenue between $5.60 billion and $5.70 billion. Non-GAAP diluted earnings per share are expected in the range of $9.90 to $10.50. Capital expenditures are expected to be in the range of $270 million to $290 million and weighted average share count at 45.0 million to 46.0 million. This forecast assumes continued sales momentum and sustained operational improvements, but it also highlights risks, including potential impacts from wage and commodity inflation, tariffs on key imports like avocados and tequila, and increased competition in the casual dining sector.
Investors should monitor whether Chili’s can maintain its industry-leading traffic, especially as pricing and menu mix tailwinds moderate and head-to-head sales comparisons become more challenging. Recent results showed Chili’s traffic growth of 16%, with menu mix and pricing contributing 0.8% and 2.7%, respectively, to comparable restaurant sales (company data, Q4 FY2025). Maggiano’s turnaround efforts will be another important watchpoint. The company’s ability to control costs, optimize capital allocations, and generate cash for repurchases and investment in technology will also be key gauges of financial strength. There were no announced changes in dividend policy. EAT does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
