What changed in this filing

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Item 1. Financial Statements

2026-05-04 compared with 2025-11-03 · 123 added, 197 removed, 374 unchanged (46% of the section changed)

3 unchanged sentences

(In thousands, except share and per share data)

September 30,

Current assets:

25 unchanged sentences

Common stock, $ .01 par value, 250,000,000 shares authorized;

109,502,394 shares issued and 49,819,581 shares outstanding at September 30, 2025 and 108,387,574 shares issued and 51,332,298 shares outstanding at December 31, 2024

110,024,749 shares issued and 49,781,827 shares outstanding at March 31, 2026 and 109,546,812 shares issued and 49,635,893 shares outstanding at December 30, 2025

Additional paid-in capital

Retained earnings

Treasury stock inclusive of excise tax, 59,682,813 and 57,055,276 shares at cost at September 30, 2025 and December 31, 2024, respectively

Treasury stock inclusive of excise tax, 60,242,922 and 59,910,919 shares at cost at March 31, 2026 and December 30, 2025, respectively

( 2,003,891 )

7 unchanged sentences

(In thousands, except per share data)

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Costs and expenses:

4 unchanged sentences

Depreciation and amortization expenses

Impairment of assets and lease termination (income)/expenses

Impairment of assets and lease termination expenses

Acquisition-related contingent consideration, compensation and amortization expenses

14 unchanged sentences

(In thousands)

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Other comprehensive (loss)/gain:

6 unchanged sentences

(In thousands, except per share data)

For the thirty-nine weeks ended September 30, 2025:

For the thirteen weeks ended March 31, 2026:

Comprehensive

(Loss)/Income

Balance, December 30, 2025

5 unchanged sentences

Treasury stock purchases, inclusive of excise tax

Balance, April 1, 2025

( 1,972,311 )

Foreign currency translation adjustment

Cash dividends declared common stock, net of forfeitures, $ 0.27 per share

Stock-based compensation

Common stock issued under stock-based compensation plans

Treasury stock purchases, inclusive of excise tax

Balance, July 1, 2025

( 1,972,286 )

Foreign currency translation adjustment

Cash dividends declared common stock, net of forfeitures, $ 0.27 per share

Stock-based compensation

Common stock issued under stock-based compensation plans

Treasury stock purchases, inclusive of excise tax

Balance, September 30, 2025

Balance, March 31, 2026

( 2,003,891 )

For the thirty-nine weeks ended October 1, 2024:

For the thirteen weeks ended April 1, 2025:

Comprehensive

(Loss)/Income

Balance, January 2, 2024

Balance, December 31, 2024

( 1,829,953 )

2 unchanged sentences

Stock-based compensation

Common stock issued under stock-based compensation plans

Treasury stock purchases, inclusive of excise tax

1 unchanged sentence

( 1,972,311 )

Foreign currency translation adjustment

Cash dividends declared common stock, net of forfeitures, $ 0.27 per share

Stock-based compensation

Treasury stock purchases, inclusive of excise tax

Balance, July 2, 2024

( 1,828,382 )

Foreign currency translation adjustment

Cash dividends declared common stock, net of forfeitures, $ 0.27 per share

Stock-based compensation

Treasury stock purchases, inclusive of excise tax

Balance, October 1, 2024

( 1,829,462 )

See the accompanying notes to the condensed consolidated financial statements.

2 unchanged sentences

(In thousands)

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Cash flows from operating activities:

1 unchanged sentence

Depreciation and amortization expenses

Impairment of assets and lease termination (income)/expenses

Impairment of assets and lease termination expenses

Loss on debt extinguishment

1 unchanged sentence

Stock-based compensation

Payment of deferred consideration and compensation in excess of acquisition-date fair value

Changes in assets and liabilities:

19 unchanged sentences

Treasury stock purchases, inclusive of excise tax

Cash provided by/(used in) financing activities

Cash (used in)/provided by financing activities

Foreign currency translation adjustment

6 unchanged sentences

Construction payable

Pursuant to ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, income taxes paid for fiscal 2026 are presented net of refunds received.

Prior year disclosures are presented under previous guidance.

See the accompanying notes to the condensed consolidated financial statements.

12 unchanged sentences

Fiscal year 2025 ended on December 30, 2025 and was also a 52 -week year.

Beginning with our Form 10-Q for the first quarter of fiscal year 2025, we separately disclosed interest expense, net and other income, net on the condensed consolidated statement of income.

Corresponding prior year balances were reclassified to conform to the current year presentation.

Use of Estimates

3 unchanged sentences

Geopolitical and Other Macroeconomic Impacts to our Operating Environment

In recent years, our operating results were impacted by geopolitical and macroeconomic events, causing supply chain challenges and significantly increased commodity and wage inflation.

In recent years, our operating results have been impacted by geopolitical and macroeconomic events, causing supply chain challenges and significantly increased commodity and wage inflation.

Our commodity and wage inflationary environment began returning to more historical levels in fiscal 2024.

The impact of ongoing geopolitical and macroeconomic events could lead to further wage inflation, product and services cost inflation, disruptions in the supply chain, staffing challenges, shifts in consumer behavior, and delays in new restaurant openings.

The impact of ongoing geopolitical and macroeconomic events, including evolving government policies and global trade and tariff dynamics, could lead to further wage inflation, product and services cost inflation, disruptions in the supply chain, staffing challenges, shifts in consumer behavior and delays in new restaurant openings.

Adverse weather conditions and natural disasters may further exacerbate a number of these factors.

For more information regarding the risks to our business relating to the geopolitical and macroeconomic events, see Part II, Item 1A of this report “Risk Factors,” and “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 30, 2025.

Recent Accounting Pronouncements and Tax Legislation

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, which updates income tax disclosures related to the rate reconciliation and requires disclosure of income taxes paid by jurisdiction.

The update also provides further disclosure comparability.

The amendment is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The amendment should be applied prospectively;

however, retrospective application is permitted.

We will adopt the ASU in our annual report on Form 10 - K for the fiscal year ending December 30, 2025, using a prospective transition method.

Management is currently evaluating this ASU to determine its impact on our disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires more detailed disclosures of certain categories of expenses such as inventory purchases, employee compensation and depreciation that are components of existing expense captions presented on the face of the income statement.

The amendment is effective for fiscal years beginning after December 15, 2026, with early adoption permitted.

The amendment should be applied prospectively, however, retrospective application is permitted.

Management is currently evaluating this ASU to determine its impact on our disclosures.

Recent Accounting Pronouncements

Recently Adopted Accounting Standards

In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversion and Other Options (Topic 470):

2 unchanged sentences

The amendment is effective for fiscal years beginning after December 15, 2025, with early adoption permitted.

The amendment should be applied prospectively, however, retrospective application is permitted.

Management is currently evaluating this ASU to determine its impact on our consolidated financial statements.

On July 4, 2025, the U.S.

1 (a bill “To provide for reconciliation pursuant to Title II of H.

The legislation includes several provisions that may impact the timing and magnitude of certain tax deductions and provides for the permanent extension of several business tax benefits originally introduced under the 2017 Tax Cuts and Jobs Act.

The enactment of H.R.

1 did not have a material impact on the condensed consolidated financial statements.

The amendment should be applied prospectively.

However, retrospective application is permitted.

We adopted this ASU in the first quarter of fiscal 2026 using the prospective transition method, and adoption did not have a material impact on our consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326):

2 unchanged sentences

The amendments in the ASU should be applied prospectively.

Management is currently evaluating this ASU to determine its impact on our consolidated financial statements.

We adopted this ASU in the first quarter of fiscal 2026 using the practical expedient, and adoption did not have a material impact on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40):

5 unchanged sentences

The amendments can be applied prospectively, retrospectively, or via a modified prospective transition method.

Management is currently evaluating this ASU to determine its impact on our consolidated financial statements.

We adopted this ASU in the first quarter of fiscal 2026 using the prospective transition method and adoption did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Standards

The amendment is effective for fiscal years beginning after December 15, 2026.

Early adoption is permitted.

The amendment should be applied prospectively.

However, retrospective application is permitted.

Management is currently evaluating this ASU to determine its impact on our disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements, which clarifies interim disclosure requirements by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable.

The standard is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.

Management is currently evaluating this ASU to determine its impact on our disclosures.

Fair Value Measurements

4 unchanged sentences

The following tables present the components and classification of our assets and liabilities that are measured at fair value on a recurring basis (in thousands):

September 30, 2025

March 31, 2026

Assets/(Liabilities)

8 unchanged sentences

The following table presents a reconciliation of the beginning and ending amounts of the fair value of the acquisition-related contingent consideration and compensation liabilities categorized as Level 3 (in thousands):

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Beginning balance

1 unchanged sentence

Ending balance

The fair value of the acquisition-related contingent consideration and compensation liabilities was determined utilizing a Monte Carlo model based on estimated future revenues, margins and volatility factors, among other variables and estimates and has no minimum or maximum payment.

The undiscounted range of outcomes per the Monte Carlo model utilized to determine the fair value of the acquisition-related contingent consideration and compensation liabilities on September 30, 2025 was $ 0.0 million to $ 142.4 million.

Results could change materially if different estimates and assumptions were used.

During the first nine months of fiscal 2025 and 2024, we made payments of $ 8.7 million and $ 6.5 million, respectively, per the Fox Restaurant Concept LLC (“FRC”) acquisition agreement.

The fair value of the acquisition-related contingent consideration and compensation liability was based on estimated future revenues, margins and probability of achievement, recent performance, discount rate and has no minimum or maximum payment.

During the first three months of fiscal 2026 and 2025, we did not make any payments, pursuant to the Fox Restaurant Concept LLC (“FRC”) acquisition agreement.

The fair values of our cash and cash equivalents, accounts and other receivables, income taxes receivable, prepaid expenses, accounts payable, income taxes payable and other accrued liabilities approximate their carrying amounts due to their short duration.

The fair value of our Revolver Facility (as defined below) approximates carrying value due to the variable interest rate.

As of September 30, 2025, we had $ 69.0 million aggregate principal amount of convertible senior notes due 2026 (“2026 Notes”) outstanding.

The estimated fair value of the 2026 Notes based on a market approach as of September 30, 2025 was approximately $ 67.9 million and was determined based on the estimated or actual bids and offers of the 2026 Notes in an over-the-counter market on the last business day of the reporting period.

As of March 31, 2026, we had $ 69.0 million aggregate principal amount of convertible senior notes due 2026 (“2026 Notes”) outstanding.

The estimated fair value of the 2026 Notes based on a market approach as of March 31, 2026, was approximately $ 68.4 million and was determined based on the estimated or actual bids and offers of the 2026 Notes in an over-the-counter market on the last business day of the reporting period.

The decrease in the fair value of the 2026 Notes was primarily due to a decrease in our stock price from the date of the issuance of the 2026 Notes.

As of September 30, 2025, we had $ 575.0 million aggregate principal amount of convertible senior notes due 2030 (“2030 Notes”) outstanding.

The estimated fair value of the 2030 Notes based on a market approach as of September 30, 2025 was approximately $ 587.1 million and was determined based on the estimated or actual bids and offers of the 2030 Notes in an over-the-counter market on the last business day of the reporting period.

As of March 31, 2026, we had $ 575.0 million aggregate principal amount of convertible senior notes due 2030 (“2030 Notes”) outstanding.

The estimated fair value of the 2030 Notes based on a market approach as of March 31, 2026, was approximately $ 581.3 million and was determined based on the estimated or actual bids and offers of the 2030 Notes in an over-the-counter market on the last business day of the reporting period.

The increase in the fair value of the 2030 Notes was primarily due to an increase in our stock price from the date of the issuance of the 2030 Notes.

1 unchanged sentence

Inventories consisted of (in thousands):

September 30, 2025

March 31, 2026

December 30, 2025

3 unchanged sentences

The following tables present information related to gift cards (in thousands):

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Gift card liabilities:

2 unchanged sentences

Ending balance

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Gift card contract assets:

1 unchanged sentence

Ending balance

Included in prepaid expenses on the condensed consolidated balance sheets.

Revolving Credit Facility

On October 6, 2022, we entered into a Fourth Amended and Restated Loan Agreement (the “Loan Agreement” and the revolving credit facility provided thereunder, the “Revolver Facility”).

The Revolver Facility, which terminates on October 6, 2027, provides us with revolving loan commitments that total $ 400 million, of which $ 50 million may be used for issuances of letters of credit.

The Revolver Facility contains a commitment increase feature that, subject to certain conditions precedent, could provide for an additional $ 200 million in revolving loan commitments.

On March 26, 2026, we entered into a Fifth Amended and Restated Loan Agreement (the “Loan Agreement” and the revolving credit facility provided thereunder, the “Revolver Facility”).

The Revolver Facility, which matures on March 26, 2031, provides us with revolving loan commitments that total $ 400 million, of which $ 85 million may be used for issuances of letters of credit and $ 10 million for swingline loans.

The Revolver Facility contains (i) a commitment increase feature that, subject to certain conditions precedent, could provide for an additional $ 200 million in revolving loan commitments and (ii) a feature that permits the letter of credit issuers thereunder to increase their letter of credit sublimits by $ 25 million in the aggregate.

Our obligations under the Revolver Facility are unsecured.

Certain of our material subsidiaries have guaranteed our obligations under the Revolver Facility.

Certain of our material subsidiaries have guaranteed our obligations under the Revolver Facility on an unsecured basis.

As of December 31, 2024, we had net availability for borrowings of $ 256.5 million, based on a $ 110.0 million outstanding debt balance and $ 33.5 million in standby letters of credit under the Revolver Facility.

In the first quarter of fiscal 2025 we repaid $ 110.0 million on the Revolver Facility.

As of September 30, 2025, we had net availability for borrowings of $ 366.5 million, based on no outstanding debt balance and $ 33.5 million in standby letters of credit under the Revolver Facility.

As of March 31, 2026, we had net availability for borrowings of $ 366.5 million, based on no outstanding debt balance and $ 33.5 million in standby letters of credit under the Revolver Facility.

Under the Revolver Facility, we are subject to the following financial covenants as of the last day of each fiscal quarter:

(i) a maximum ratio of net adjusted debt to EBITDAR (the “ Net Adjusted Leverage Ratio”) of 4.25 and (ii) a minimum ratio of EBITDAR to interest and rent expense (“EBITDAR Ratio”) of 1.90 .

(i) a maximum ratio of net adjusted debt to earnings before interest, tax, depreciation and amortization and rent (“EBITDAR”) (the “Net Adjusted Leverage Ratio”) of 4.25 to 1.00 and (ii) a minimum ratio of EBITDAR to interest and rent expense (“EBITDAR Ratio”) of 1.90 to 1.00 .

The Net Adjusted Leverage Ratio includes a rental expense multiplier of six .

As of September 30, 2025, we were in compliance with all the foregoing covenants in effect at that date.

Borrowings under the Loan Agreement bear interest, at the Company’s election, at a rate equal to either:

(i) the sum of (A) adjusted term SOFR (as defined in the Loan Agreement, the “Term SOFR Rate”) plus (B) a rate variable based on the Net Adjusted Leverage Ratio, ranging from 1.00 % to 1.75 %, or (ii) the sum of (A) the highest of (x) the rate of interest last quoted by The Wall Street Journal as the prime rate in effect in the United States, (y) the greater of the rate calculated by the Federal Reserve Bank of New York as the federal funds effective rate or the rate that is published by the Federal Reserve Bank of New York as the overnight bank funding rate, in either case, plus 0.50 %, and (z) the one-month Term SOFR Rate plus 1.00 %, plus (B) a rate variable based on the Net Adjusted Leverage Ratio, ranging from 0.00 % to 0.75 %.

The Company will also pay a fee variable based on the Net Adjusted Leverage Ratio, ranging from 0.125 % to 0.25 %, on the daily amount of unused commitments under the Loan Agreement.

As of March 31, 2026, we were in compliance with all the foregoing covenants in effect at that date.

Borrowings under the Loan Agreement bear interest, at the Company’s option, at a per annum rate equal to either:

(i) (A) the forward-looking term rate based on secured overnight financing rate (“SOFR”) that is published by CME Group Benchmark Administration Limited (the “Term SOFR Rate”) plus (B) an applicable margin based on the Net Adjusted Leverage Ratio, ranging from 1.00 % to 1.50 %, or (ii) the sum of (A) the highest of (x) the rate of interest last quoted by The Wall Street Journal as the prime rate in effect in the United States, (y) the greater of the rate calculated by the Federal Reserve Bank of New York as the federal funds effective rate or the rate that is published by the Federal Reserve Bank of New York as the overnight bank funding rate, in either case, plus 0.50 %, and (z) the one-month Term SOFR Rate plus 1.00 %, plus (B) an applicable margin based on the Net Adjusted Leverage Ratio, ranging from 0.00 % to 0.50 %.

The Company will also pay a variable fee based on the Net Adjusted Leverage Ratio, ranging from 0.125 % to 0.225 %, on the daily amount of unused commitments under the Loan Agreement.

Letters of credit bear fees that are equivalent to the interest rate margin that is applicable to revolving loans that bear interest at the Term SOFR Rate plus other customary fees charged by the issuing bank.

We paid certain customary loan origination fees in conjunction with the Loan Agreement.

We paid certain customary fees in conjunction with the Loan Agreement.

We are also subject to customary events of default that, if triggered, could result in acceleration of the maturity of the Revolver Facility.

Subject to certain exceptions, the Revolver Facility also limits distributions with respect to our equity interests, such as cash dividends and share repurchases, based on a defined ratio, and sets forth negative covenants that restrict indebtedness, liens, investments, sales of assets, fundamental changes and other matters.

Subject to certain exceptions, the Loan Agreement contains a number of covenants and restrictions that, among other things, restrict the Company’s and its subsidiaries’ ability to incur additional debt, pay dividends and make distributions, make certain investments and acquisitions, create liens, enter into agreements with affiliates, sell material assets, and merge or consolidate.

2030 Convertible Senior Notes

On February 28, 2025, we issued $ 575.0 million aggregate principal amount of convertible senior notes (“2030 Notes”).

On February 28, 2025, we issued $ 575.0 million of 2030 Notes.

The net proceeds from the sale of the 2030 Notes were approximately $ 558.5 million after deducting issuance costs of $ 16.5 million.

14 unchanged sentences

The conversion rate and conversion price will be subject to customary adjustments upon the occurrence of certain events but will not be adjusted for regular quarterly dividends that do not exceed the dividend threshold (initially equal to $ 0.27 per share of common stock as defined in the 2030 Indenture).

In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the 2030 Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.

As of September 30, 2025, the conversion rate for the 2030 Notes was 14.1377 shares of common stock per $ 1,000 principal amount of the 2030 Notes, which represents a conversion price of approximately $ 70.73 per share of common stock.

date, but only if (i) the notes are “Freely Tradable” (as defined in the 2030 Indenture), and all accrued and unpaid additional interest, if any, has been paid in full, as of the date we send the related redemption notice;

In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the 2030 Indenture) occur, then the conversion rate will, in certain circumstances, be

increased for a specified period of time.

As of March 31, 2026, the conversion rate for the 2030 Notes was 14.1444 shares of common stock per $ 1,000 principal amount of the 2030 Notes, which represents a conversion price of approximately $ 70.70 per share of common stock.

In connection with the cash dividend that was declared by our Board of Directors (“Board”) on April 23, 2026, we will, on May 13, 2026, adjust the conversion rate (which is expected to increase) and the conversion price (which is expected to decrease) of the 2030 Notes in accordance with the terms.

The 2030 Notes are redeemable, in whole or in part (subject to certain limitations described below), at our option at any time, and from time to time, on or after March 20, 2028 and on or before the 35th scheduled trading day immediately before the maturity date, but only if (i) the notes are “Freely Tradable” (as defined in the 2030 Indenture), and all accrued and unpaid additional interest, if any, has been paid in full, as of the date we send the related redemption notice;

and (ii) the last reported sale price per share of our common stock exceeds 130 % of the conversion price on (1) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date we send such redemption notice;

16 unchanged sentences

However, notwithstanding the foregoing, we may elect, at our option, that the sole remedy for an Event of Default relating to certain failures by us to comply with certain reporting covenants in the 2030 Indenture consists exclusively of the right of the noteholders to receive special interest on the 2030 Notes for up to 180 days at a specified rate per annum not exceeding 0.50 % on the principal amount of the 2030 Notes.

As of September 30, 2025, the 2030 Notes had a gross principal balance of $ 575.0 million and a balance of $ 560.4 million, net of unamortized issuance costs of $ 14.6 million.

As of March 31, 2026, the 2030 Notes had a gross principal balance of $ 575.0 million and a balance of $ 562.1 million, net of unamortized issuance costs of $ 12.9 million.

The net carrying value of the 2030 Notes is included in long-term debt within total liabilities on the condensed consolidated balance sheet.

Total amortization expense was $ 0.8 million and $ 1.9 million during the thirteen and thirty-nine weeks ended September 30, 2025.

The effective interest rate for the 2030 Notes was 2.57 % as of September 30, 2025.

Total amortization expense was $ 0.8 million and $ 0.3 million during the thirteen weeks ended March 31, 2026 and April 1,2025, respectively and was included in interest expense, net in the condensed consolidated statements of income.

The effective interest rate for the 2030 Notes was 2.57 % as of March 31, 2026.

2026 Convertible Senior Notes

On June 15, 2021, we issued $ 345.0 million aggregate principal amount of convertible senior notes (“2026 Notes”).

On June 15, 2021, we issued $ 345.0 million of 2026 Notes.

The net proceeds from the sale of the 2026 Notes were approximately $ 334.9 million after deducting issuance costs of $ 10.1 million.

1 unchanged sentence

The 2026 Note Repurchase Transaction was accounted for as a debt extinguishment.

Note Repurchase Transactions resulted in a $ 15.9 million loss on early debt extinguishment in the first quarter of fiscal 2025, of which $ 2.1 million consisted of unamortized issuance costs.

The 2026 Note Repurchase Transactions resulted in a $ 15.9 million loss on early debt extinguishment in the first quarter of fiscal 2025, of which $ 2.1 million consisted of unamortized issuance costs.

The 2026 Notes are senior, unsecured obligations and are (i) equal in right of payment with our existing and future senior, unsecured indebtedness;

12 unchanged sentences

In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the 2026 Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.

As of September 30, 2025, the conversion rate for the 2026 Notes was 14.0812 shares of common stock per $ 1,000 principal amount of the 2026 Notes, which represents a conversion price of approximately $ 71.02 per share of common stock.

In connection with the cash dividend that was declared by our Board of Directors (“Board”) on October 22, 2025, on November 11, 2025 we will adjust the conversion rate (which is expected to increase) and the conversion price (which is expected to decrease) of the 2026 Notes in accordance with the terms.

As of March 31, 2026, the conversion rate for the 2026 Notes was 14.2316 shares of common stock per $ 1,000 principal amount of the 2026 Notes, which represents a conversion price of approximately $ 70.27 per share of common stock.

In connection with the cash dividend that was declared by our Board on April 23, 2026, we will, on May 13, 2026, adjust the conversion rate (which is expected to increase) and the conversion price (which is expected to decrease) of the 2030 Notes in accordance with the terms.

The 2026 Notes are redeemable, in whole or in part (subject to certain limitations described below), at our option at any time, and from time to time, on or after June 20, 2024 and on or before the 30th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if the last reported sale price per share of our common stock exceeds 130 % of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date we send the related redemption notice;

8 unchanged sentences

(iii) our failure to comply with certain covenants in the Indenture relating to our ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of our assets and our subsidiaries, taken as a whole, to another person;

(iv) a default by us in our other obligations or agreements under

the 2026 Indenture or the 2026 Notes if such default is not cured or waived within 60 days after notice is given in accordance with the 2026 Indenture;

(iv) a default by us in our other obligations or agreements under the 2026 Indenture or the 2026 Notes if such default is not cured or waived within 60 days after notice is given in accordance with the 2026 Indenture;

(v) certain defaults by us or any of our significant subsidiaries with respect to indebtedness for borrowed money of at least $ 20,000,000 ;

4 unchanged sentences

However, notwithstanding the foregoing, we may elect, at our option, that the sole remedy for an Event of Default relating to certain failures by us to comply with certain reporting covenants in the 2026 Note Indenture consists exclusively of the right of the noteholders to receive special interest on the 2026 Notes for up to 180 days at a specified rate per annum not exceeding 0.50 % on the principal amount of the 2026 Notes.

As of September 30, 2025, the 2026 Notes had a gross principal balance of $ 69.0 million and a balance of $ 68.7 million, net of unamortized issuance costs of $ 0.3 million.

As of March 31, 2026, the 2026 Notes had a gross principal balance of $ 69.0 million and a balance of $ 68.9 million, net of unamortized issuance costs of $ 0.1 million.

The net carrying value of the 2026 Notes is included in current portion of long-term debt within total current liabilities on the condensed consolidated balance sheet.

Total amortization expense was $ 0.1 million and $ 0.6 million during the thirteen and thirty-nine weeks ended September 30, 2025, respectively.

Total amortization expense was $ 0.5 million and $ 1.5 million during the thirteen and thirty-nine weeks ended October 1, 2024, respectively.

The effective interest rate for the 2026 Notes was 0.96 % as of September 30, 2025.

Total amortization expense was $ 0.1 million and $ 0.4 million during the first quarter of fiscal 2026 and fiscal 2025, respectively and was included in interest expense, net in the condensed consolidated statements of income.

The effective interest rate for the 2026 Notes was 0.96 % as of March 31, 2026.

Components of lease expense were as follows (in thousands):

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Supplemental information related to leases (in thousands):

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Cash paid for amounts included in the measurement of lease liabilities:

2 unchanged sentences

Commitments and Contingencies

On June 7, 2024, the Internal Revenue Service (“IRS”) issued its examination report for tax years 2015 through 2020 in which it proposed to disallow a portion of our depreciation deductions and domestic production activity deductions and to assess penalties.

On June 7, 2024, the Internal Revenue Service issued its examination report for tax years 2015 through 2020 in which it proposed to disallow a portion of our depreciation deductions and domestic production activity deductions and to assess penalties.

On August 12, 2024, we submitted protest memoranda indicating our disagreement with a majority of the findings in the examination report, and our case is now under the jurisdiction of the Appeals Division (“Appeals”).

An Appeals conference was held during the third quarter of fiscal 2025.

Based on the current status of this matter, we have reserved an immaterial amount.

In addition, within the ordinary course of our business, we are subject to private lawsuits, government audits and investigations, administrative proceedings and other claims.

These matters often involve claims from customers, staff members and

others related to operational and employment issues common to the food service industry.

Appeals conferences were held during fiscal 2025, and based on the current status of this matter, we have reserved an immaterial amount.

Within the ordinary course of our business, we are subject to private lawsuits, government audits and investigations, administrative proceedings and other claims.

These matters typically involve claims from customers, staff members and others related to operational and employment issues common to the foodservice industry.

A number of these claims may exist at any given time, and some of the claims may be pled as class actions.

6 unchanged sentences

Common Stock – Dividends and Share Repurchases

On July 23, 2025 , our Board declared a quarterly cash dividend of $ 0.27 per share which was paid on August 26, 2025 to the stockholders of record of each share of our common stock at the close of business on August 12, 2025 .

On February 12, 2026 , our Board declared a quarterly cash dividend of $ 0.30 per share which was paid on March 17, 2026 to the stockholders of record of each share of our common stock at the close of business on March 4, 2026 .

Future decisions to pay or to increase or decrease dividends are at the discretion of the Board and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of the Loan Agreement and applicable law, and such other factors that the Board considers relevant.

(See Notes 5 and 12 for further discussion of our debt and dividends declared subsequent to September 30, 2025, respectively.)

Under authorization by our Board to repurchase up to 61.0 million shares of our common stock, we have cumulatively repurchased 59.7 million shares at a total cost of $ 1,972.4 million, excluding excise tax, through September 30, 2025, with 18,897 shares and 2.6 million shares repurchased at a cost of $ 1.2 million and $ 142.7 million, excluding excise tax, during the thirteen and thirty-nine weeks ended September 30, 2025, respectively, inclusive of the 2.4 million shares of our common stock repurchased concurrently with the 2030 Notes issuance in privately negotiated transactions on February 28, 2025.

(See Notes 5 and 12 for further discussion of our debt and dividends declared subsequent to March 31, 2026, respectively.)

On February 12, 2026, our Board increased the authorization to repurchase our common stock by 5.0 million shares to 66.0 million shares.

Under this authorization, we have cumulatively repurchased 60.2 million shares at a total cost of $ 2,002.8 million, excluding excise tax, through March 31, 2026, with 0.3 million shares repurchased at a cost of $ 19.2 million, excluding excise tax, during the thirteen weeks ended March 31, 2026.

Our objectives with regard to share repurchases have been to offset the dilution to our shares outstanding that result from equity compensation grants and to supplement our earnings per share growth.

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We maintain stock-based incentive plans under which incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares and restricted share units may be granted to staff members, consultants and non-employee directors.

On March 26, 2025, our Board approved an amendment to our The Cheesecake Factory Incorporated Stock Incentive Plan (the “Plan”) to increase the number of shares of common stock authorized for issuance under the Plan by 6.0 million shares to 13.15 million shares from 7.15 million shares (the “Plan Amendment”).

million shares from 7.15 million shares (the “Plan Amendment”).

This Plan Amendment was approved by our stockholders at our 2025 annual meeting held on May 22, 2025.

The following table presents information related to stock-based compensation, net of forfeitures (in thousands):

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

Labor expenses

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Stock Options

We did not issue any stock options during the third quarters of fiscal 2025 and fiscal 2024.

Stock option activity during the thirty-nine weeks ended September 30, 2025 was as follows:

We did not issue any stock options during the first quarter of fiscal 2026 and fiscal 2025.

Stock option activity during the thirteen weeks ended March 31, 2026 was as follows:

Exercise Price

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Forfeited or cancelled

Outstanding at September 30, 2025

Exercisable at September 30, 2025

Outstanding at March 31, 2026

Exercisable at March 31, 2026

(1) Aggregate intrinsic value is calculated as the difference between our closing stock price at fiscal period end and the exercise price, multiplied by the number of in-the-money options and represents the pre-tax amount that would have been received by the option holders, had they all exercised their options on the fiscal period-end date.

The total intrinsic value of options exercised during the thirteen and thirty-nine ended September 30, 2025 was $ 0.8 million and $ 5.0 million, respectively.

There were no options exercised during the thirteen and thirty-nine weeks ended October 1, 2024.

September 30, 2025, total unrecognized stock-based compensation expense related to unvested stock options was $ 1.0 million, which we expect to recognize over a weighted-average period of approximately 3.1 years.

The total intrinsic value of options exercised during both the thirteen weeks ended March 31, 2026 and April 1, 2025 was $ 0.1 million.

As March 31, 2026, total unrecognized stock-based compensation expense related to unvested stock options was $ 0.8 million, which we expect to recognize over a weighted-average period of approximately 2.6 years.

Restricted Shares and Restricted Share Units

Restricted share and restricted share unit activity during the thirty-nine weeks ended September 30, 2025 was as follows:

Restricted share and restricted share unit activity during the thirteen weeks ended March 31, 2026 was as follows:

(In thousands)

Outstanding at December 30, 2025

Outstanding at September 30, 2025

Outstanding at March 31, 2026

Fair value of our restricted shares and restricted share units is based on our closing stock price on the date of grant.

The weighted average fair value for restricted shares and restricted share units issued during the third quarter of fiscal 2025 and 2024 was $ 68.51 and $ 36.69 , respectively.

The fair value of shares that vested during the thirteen and thirty-nine weeks ended September 30, 2025 was $ 2.1 million and $ 26.5 million, respectively.

The fair value of shares that vested during the thirteen and thirty-nine weeks ended October 1, 2024 was $ 1.9 million and $ 24.4 million, respectively.

As of September 30, 2025, total unrecognized stock-based compensation expense related to unvested restricted shares and restricted share units was $ 68.0 million, which we expect to recognize over a weighted-average period of approximately 2.9 years.

The weighted average fair value for restricted shares and restricted share units issued during the first quarter of fiscal 2026 and 2025 was $ 60.35 and $ 51.89 , respectively.

The fair value of shares that vested during the thirteen weeks ended March 31, 2026, and April 1, 2025, was $ 20.6 million and $ 22.4 million, respectively.

As of March 31, 2026, total unrecognized stock-based compensation expense related to unvested restricted shares and restricted share units was $ 84.5 million, which we expect to recognize over a weighted-average period of approximately 3.0 years.

Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period, reduced by unvested restricted stock awards.

As of September 30, 2025 and October 1, 2024, an aggregate of 3.1 million and 3.2 million shares, respectively, of restricted stock and restricted stock units issued were unvested and, therefore, excluded from the calculation of basic earnings per share for the fiscal periods ended on those dates.

As of both March 31, 2026 and April 1, 2025, an aggregate of 3.2 million and 3.3 million shares, of restricted stock and restricted stock units issued were unvested, respectively, and, therefore, excluded from the calculation of basic earnings per share for the fiscal periods ended on those dates.

Diluted net income per share is computed by dividing net income by the weighted-average number of common stock equivalents outstanding for the period.

Common stock equivalents for the 2026 Notes and 2030 Notes are determined by application of the if-converted method, and common stock equivalents for outstanding stock options, restricted stock and restricted stock units are determined by the application of the treasury stock method.

September 30, 2025

October 1, 2024

September 30, 2025

October 1, 2024

March 31, 2026

April 1, 2025

(In thousands, except per share data)

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Diluted net income per share

(1) Shares of common stock equivalents related to outstanding stock options, restricted stock and restricted stock units of 1.1 million and 2.7 million for September 30, 2025 and October 1, 2024, respectively, were excluded from the diluted calculation due to their anti-dilutive effect.

(1) Shares of common stock equivalents related to outstanding stock options, restricted stock and restricted stock units of 0.6 million and 0.8 million for March 31, 2026, and April 1, 2025, respectively, were excluded from the diluted calculation due to their anti-dilutive effect.

No shares of common stock equivalents related to the 2026 Notes or 2030 Notes were included in the diluted calculation due to their anti-dilutive effect.

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Significant expenses are expenses that are regularly provided to the CODM and are included in segment income/(loss).

Our operating segments, are aligned with our strategic priorities and are the businesses for which our CODM reviews discrete financial information for decision-making purposes, are comprised of The Cheesecake Factory Restaurants, North Italia, Flower Child, the other FRC brands and our bakery division.

Our operating segments are aligned with our strategic priorities and are the businesses for which our CODM reviews discrete financial information for decision-making purposes.

They are comprised of The Cheesecake Factory Restaurants, North Italia, Flower Child, the other FRC brands and our bakery division.

Based on quantitative thresholds set forth in ASC 280, “Segment Reporting,” The Cheesecake Factory Restaurants, North Italia and the other FRC brands are the only businesses that meet the criteria of a reportable operating segment .

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Segment information is presented below (in thousands):

For the thirteen weeks ended September 30, 2025

Costs and expenses:

Food and beverage costs

Labor expenses

Other operating costs and expenses

General and administrative expenses

Depreciation and amortization expenses

Impairment of assets and lease termination (income)/expenses

Acquisition-related contingent consideration, compensation and amortization (income)/expenses

Preopening costs

Total costs and expenses

Income/(loss) from operations

Capital expenditures

For the thirteen weeks ended October 1, 2024

Costs and expenses:

Food and beverage costs

Labor expenses

Other operating costs and expenses

General and administrative expenses

Depreciation and amortization expenses

Impairment of assets and lease termination (income)/expenses

Acquisition-related contingent consideration, compensation and amortization expenses

Preopening costs

Total costs and expenses

Income/(loss) from operations

Capital expenditures

For the thirty-nine weeks ended September 30, 2025

For the thirteen weeks ended March 31, 2026

Costs and expenses:

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Capital expenditures

For the thirty-nine weeks ended October 1, 2024

For the thirteen weeks ended April 1, 2025

Costs and expenses:

4 unchanged sentences

Depreciation and amortization expenses

Impairment of assets and lease termination (income)/expenses

Impairment of assets and lease termination expenses

Acquisition-related contingent consideration, compensation and amortization expenses

4 unchanged sentences

The following table presents information related to segment assets (in thousands):

September 30, 2025

March 31, 2026

December 30, 2025

2 unchanged sentences

Subsequent Events

On October 22, 2025 , our Board declared a quarterly cash dividend of $ 0.27 per share to be paid on November 25, 2025 to the stockholders of record of each share of our common stock at the close of business on November 11, 2025 .

On April 23, 2026 , our Board declared a quarterly cash dividend of $ 0.30 per share to be paid on May 26, 2026 , to the stockholders of record of each share of our common stock at the close of business on May 13, 2026 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements