BRINKER INTERNATIONAL, INC
For the period ended Jun 25, 2025. Filed Aug 15, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Aug 15, 2025
EAT$206.57-2.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-06-26; filed 2024-08-21.
0000703351-24-000030
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-06-25; filed 2025-08-15.
0000703351-25-000035
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 99 previous paragraphs and 103 current paragraphs.
57 unchanged; 30 reworded; 16 added; 12 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 19 previous and 19 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
Operating Environment
Current report
•Food and beverage costs were flat, due to 1.5% of favorable menu pricing, offset by 1.1% of unfavorable menu item mix and 0.4% of unfavorable commodity costs driven by poultry, meat, produce, and dairy.
Current report
(1)Finance lease amortization increased primarily due to new tabletop and tablet devices in our restaurants.
Current report
(2)Other includes accelerated depreciation of certain equipment over the remaining expected useful life as a result of management’s decision to abandon and replace the equipment.
Current report
(1)Corporate technology initiatives increased primarily due to ERP system subscription costs and amortization of software implementation costs.
Current report
(1)Litigation & claims, net in the current year primarily relates to legal contingencies, inclusive of certain extraordinary one-time settlements related to employment and intellectual property claims, and alcohol service-related cases.
Current report
Interest expenses decreased $11.9 million primarily due to lower average outstanding debt balances, partially offset by higher interest on financed leased equipment.
Current report
H.R. 1., also known as the One Big Beautiful Bill Act (“OBBBA”), was enacted on July 4, 2025. The legislation includes several provisions that may impact the timing and magnitude of certain tax deductions. Key provisions include the permanent extension of several business tax benefits originally introduced under the 2017 Tax Cuts and Jobs Act. We are currently evaluating the provisions of the OBBBA to assess their potential impact on our financial position, results of operations and cash flows.
Current report
•Chili’s Food and beverage costs were flat, due to 1.5% of favorable menu pricing, offset by 1.1% of unfavorable menu item mix, and 0.4% of unfavorable commodity costs driven by higher poultry, meat, produce, and dairy.
Current report
•Chili’s Restaurant expenses were favorable 3.1%, due to 4.2% of sales leverage, partially offset by 0.5% of higher repairs and maintenance, 0.4% of higher advertising, and 0.2% of higher rent.
Current report
(1)Finance lease amortization increased primarily due to new tabletop and tablet devices in our restaurants.
Current report
(2)Other includes accelerated depreciation of certain equipment over the remaining expected useful life as a result of management’s decision to abandon and replace the equipment.
Current report
•Maggiano’s Food and beverage costs were favorable 0.1%, due to 1.3% of favorable menu pricing partially offset by 0.8% of unfavorable commodity costs driven by dairy and poultry and 0.4% of unfavorable menu item mix.
Current report
On May 1, 2025, we amended our $900.0 million revolving credit facility to increase the capacity to $1.0 billion. The Company incurred and capitalized $3.6 million of debt issuance costs associated with the revolving credit facility during fiscal 2025, which are included in Other assets in the Consolidated Balance Sheets.
Current report
In October 2024, the $350.0 million of 5.00% senior notes matured and were repaid in full using borrowings under the revolving credit facility.
Current report
Subsequent to fiscal 2025 year end, our Board of Directors authorized an additional $400.0 million under our share repurchase program, allowing for a total available authority of $507.0 million.
Removed paragraphs (12)
Previous report
External Impacts to Our Operating Environment
Previous report
(2)Gift card breakage decreased primarily due to a change in estimate related to a higher forecasted gift card redemption rates.
Previous report
•Food and beverage costs were favorable 2.7%, due to 2.1% from increased menu pricing, 0.4% of favorable commodity costs driven by lower poultry and meat costs, and 0.2% of favorable menu item mix.
Previous report
•Restaurant expenses were unfavorable 1.0%, due to 1.7% of higher advertising, 0.7% of higher repairs and maintenance, 0.2% of higher workers’ compensation and general liability insurance, and 0.5% of higher other restaurant expenses, partially offset by 1.3% of sales leverage and 0.8% of lower delivery fees and to-go supplies.
Previous report
(1)Performance-based compensation increased in fiscal 2024 due to higher business performance compared to targets in the current fiscal year.
Previous report
(2)Stock-based compensation increased primarily due to an increase in expense related to the fiscal 2023 performance share grant, as business performance is expected to exceed the plan target. Additionally, incremental expenses were incurred in fiscal 2024 related to the fiscal 2022 performance share grant as business performance above expectations resulted in achievement of the minimum performance target for the grant. The cumulative expense for this grant was reversed in fiscal 2023 based on forecasted business performance being well below the minimum target.
Previous report
Interest expenses increased $10.1 million primarily due to a higher interest rate on the 8.250% notes issued on June 27, 2023, compared to the interest rate on the 3.875% notes which matured and were repaid on May 15, 2023, partially offset by the lower average revolver balance during fiscal 2024.
Previous report
•Chili’s Food and beverage costs were favorable 2.8%, due to 2.2% from increased menu pricing, 0.4% of lower commodity costs driven by poultry and meat, and 0.2% of favorable menu item mix.
Previous report
(1)Performance-based compensation increased in fiscal 2024 due to higher business performance compared to targets in the current fiscal year.
Previous report
•Maggiano’s Food and beverage costs were favorable 1.7%, due to 1.7% from increased menu pricing and 0.2% of favorable commodity pricing partially offset by 0.2% of unfavorable menu item mix.
Previous report
On October 1, 2024, our $350.0 million of 5.000% senior notes will mature. As a result of our intent and ability to refinance these notes through our existing revolving credit facility, the notes are classified as long-term debt in the Consolidated Balance Sheets on June 26, 2024.
Previous report
Share Repurchase Program
Reworded paragraphs (30)
Previous wording
During the recent years, our operating results were impacted by geopolitical and other macroeconomic events, leading to higher than usual inflation on wages and food and beverage costs. Geopolitical and other macroeconomic events have led, and in the future may lead to, wage inflation, staffing challenges, product cost inflation and/ disruptions in the supply chain that impact our restaurants’ ability to obtain the products needed to support their operation. Such events could also negatively affect consumer spending potentially reducing guest traffic and/or reducing the average amount guests spend in our restaurants.
Current wording
During the recent years, our operating results were impacted by geopolitical and other macroeconomic events, leading to higher than usual inflation on wages and food and beverage costs. Geopolitical and other macroeconomic events have led, and in the future may lead to, wage inflation, staffing challenges, product cost inflation and/or disruptions in the supply chain that impact our restaurants’ ability to obtain the products needed to support their operation. Such events could also negatively affect consumer spending potentially reducing guest traffic and/or reducing the average amount guests spend in our restaurants.
Previous wording
•Company sales include revenues generated by the operation of Company-owned restaurants including food and beverage sales, net of discounts, Maggiano’s banquet service charge income, gift card breakage, delivery, digital entertainment revenues, merchandise income and are net of gift card discount costs from third-party gift card sales.
Current wording
•Company sales include revenues generated by the operation of Company-owned restaurants including food and beverage sales, net of discounts, Maggiano’s banquet service charge income, delivery, gift card breakage, digital entertainment revenues, merchandise income and are net of gift card discount costs from third-party gift card sales.
Previous wording
•Franchise revenues include royalties, franchise advertising fees, franchise and development fees and gift card equalization.
Current wording
•Franchise revenues include royalties, franchise advertising fees, franchise and development fees, and other service fees.
Previous wording
(1)Comparable restaurant sales increased due to menu price increases and favorable menu item mix, partially offset by lower traffic.
Current wording
(1)Comparable restaurant sales increased due to higher traffic, favorable menu item mix, and menu price increases.
Previous wording
(3)Franchise revenues increased primarily due to higher franchise advertising fees. Our Chili’s and Maggiano’s franchisees generated sales of approximately $856.2 million and $11.8 million respectively in fiscal 2024 compared to $876.0 million and $10.6 million respectively in fiscal 2023.
Current wording
(2)Franchise revenues increased primarily due to higher royalties. Our Chili’s and Maggiano’s franchisees generated sales of approximately $967.4 million and $16.9 million respectively in fiscal 2025 compared to $856.2 million and $11.8 million respectively in fiscal 2024.
Previous wording
•Restaurant labor was favorable 0.4%, due to 1.9% of sales leverage and 0.3% of lower other restaurant labor costs, partially offset by 1.1% of higher hourly labor driven by both wage rates and staffing levels, 0.4% of increased manager salaries, and 0.3% of higher manager bonus expense.
Current wording
•Restaurant labor was favorable 1.4%, due to 4.0% of sales leverage and 0.2% of lower other labor expenses, partially offset by 2.1% of higher hourly labor driven by increased staffing levels and wage rates, 0.4% of higher manager salaries, and 0.3% of higher manager bonus.
Previous wording
•Maggiano’s Restaurant expenses were unfavorable 1.3%, due to 0.8% of higher repairs and maintenance, 0.4% of higher supplies, 0.2% of higher workers’ compensation and general liability insurance, 0.2% of higher advertising, and 0.4% of higher other restaurant expenses partially offset by 0.4% of sales leverage and 0.3% of lower delivery fees and to-go supplies.
Current wording
•Restaurant expenses were favorable 2.8%, due to 3.8% of sales leverage and 0.1% of lower other restaurant expenses, partially offset by 0.5% of higher repairs and maintenance, 0.4% of higher advertising, and 0.2% of higher rent.
Previous wording
Depreciation and amortization increased $2.3 million as follows:
Current wording
Depreciation and amortization increased $35.8 million as follows:
Previous wording
General and administrative expenses increased $29.2 million as follows:
Current wording
General and administrative expenses increased $38.3 million as follows:
Previous wording
The change in the effective income tax rate from fiscal 2023 to fiscal 2024 is primarily due to higher Income before income taxes and the resulting deleverage of the FICA tip tax credit, which did not change significantly in fiscal 2024 compared to fiscal 2023. Refer to Note 9 - Income Taxes for more information.
Current wording
The change in the effective income tax rate from fiscal 2024 to fiscal 2025 is primarily due to higher Income before income taxes and the resulting deleverage of the FICA tip tax credit. Refer to Note 9 - Income Taxes for more information.
Previous wording
Maggiano’s Total revenues increased 1.8% primarily due to favorable comparable restaurant sales driven by increased menu pricing partially offset by lower traffic. Refer to the “Revenues” section above for further details about Maggiano’s revenues changes.
Current wording
Chili’s Total revenues increased 24.6% primarily due to favorable comparable restaurant sales driven by higher traffic, favorable menu item mix, and menu pricing. Refer to the “Revenues” section above for further details about Chili’s revenues changes.
Previous wording
•Chili’s Restaurant labor was favorable 0.4%, due to 2.2% of sales leverage and 0.3% of lower other restaurant labor costs, partially offset by 1.3% of higher restaurant hourly labor driven by both wage rates and staffing levels and 0.5% of higher manager salaries and 0.3% of higher manager bonus expenses.
Current wording
•Chili’s Restaurant labor was favorable 1.5%, due to 4.5% of sales leverage, partially offset by 2.3% of higher hourly labor driven by increased staffing levels and wage rates and 0.4% of higher manager salaries and 0.3% of higher manager bonus.
Previous wording
Chili’s Depreciation and amortization increased $2.4 million as follows:
Current wording
Chili’s Depreciation and amortization increased $34.8 million as follows:
Previous wording
Chili’s General and administrative increased $7.3 million as follows:
Current wording
Chili’s General and administrative increased $7.6 million as follows:
Previous wording
Chili’s Total revenues increased 7.5% primarily due to favorable comparable restaurant sales driven by increased menu pricing and favorable menu item mix, partially offset by lower traffic. Refer to the “Revenues” section above for further details about Chili’s revenues changes.
Current wording
Maggiano’s Total revenues increased 1.1% primarily due to favorable comparable restaurant sales driven by increased menu pricing and favorable menu item mix, partially offset by lower traffic. Refer to the “Revenues” section above for further details about Maggiano’s revenues changes.
Previous wording
•Maggiano’s Restaurant labor was favorable 0.3%, due to 0.4% of sales leverage and 0.1% of lower other restaurant labor costs, partially offset by 0.2% of higher manager bonus.
Current wording
•Maggiano’s Restaurant labor was favorable 0.8%, due to 0.5% of lower hourly labor, 0.4% of lower manager bonus, 0.2% of sales leverage, and 0.1% of lower other labor expenses, partially offset by 0.4% of higher manager salaries.
Previous wording
•Chili’s Restaurant expenses were unfavorable 0.9%, due to 2.0% of higher advertising, 0.7% of higher repairs and maintenance, 0.2% of higher workers’ compensation and general liability insurance, and 0.2% of higher other restaurant expense, partially offset by 1.4% of sales leverage and 0.8% of lower delivery fees and to-go supplies.
Current wording
•Maggiano’s Restaurant expenses were unfavorable 0.9%, due to 0.5% of higher advertising, 0.3% of higher repairs and maintenance, 0.3% higher rent, and 0.1% of higher other restaurant expenses, partially offset by 0.3% of sales leverage.
Previous wording
Proceeds from the sale of gift cards are recorded as deferred revenues and recognized as revenues when the gift cards are redeemed by the holders. Breakage income represents the value associated with the portion of gift cards sold that will most likely never be redeemed and is estimated based on our historical gift card redemption patterns and actuarial estimates. Breakage revenues are recognized proportionate to the pattern of related gift card redemptions. We recognize breakage income in Franchise revenues in the Consolidated Statements of Comprehensive Income.
Current wording
Proceeds from the sale of gift cards are recorded as deferred revenues and recognized as revenues when the gift cards are redeemed by the holders. Breakage income represents the value associated with the portion of gift cards sold that will most likely never be redeemed and is estimated based on our historical gift card redemption patterns and actuarial estimates. Breakage revenues are recognized proportionate to the pattern of related gift card redemptions. We recognize breakage income in Company sales in the Consolidated Statements of Comprehensive Income.
Previous wording
Our principal sources of liquidity are net cash provided by operating activities and borrowings if any, under our $900.0 million revolving credit facility as further discussed below. Our main requirements for liquidity are to support our working capital, capital expenditures for new and existing restaurants, obligations under our operating leases, and interest payments on our debt. Our operations have typically not required significant working capital. Substantially all of our sales are tendered in cash and cash equivalents, which are received before related trade payables for food and beverage products, supplies, labor and services become due.
Current wording
Our principal sources of liquidity are net cash provided by operating activities and borrowings if any, under our $1.0 billion revolving credit facility as further discussed below. Our main requirements for liquidity are to support our working capital, capital expenditures for new and existing restaurants, obligations under our operating leases, and interest payments on our debt. Our operations have typically not required significant working capital. Substantially all of our sales are tendered in cash and cash equivalents, which are received before related trade payables for food and beverage products, supplies, labor and services become due.
Previous wording
Net cash provided by operating activities increased due to an increase in operating income and the timing of other operational receipts and payments, partially offset by an increase in the payment of income taxes in the current year.
Current wording
Net cash provided by operating activities increased due to an increase in operating income partially offset by an increase in payments of income taxes and the timing of other operational receipts and payments.
Previous wording
Net cash used in investing activities increased compared to the prior year. Increased spend on Chili’s capital maintenance, new equipment purchases and Maggiano’s remodels were partially offset by decreased spend on Chili’s remodels and construction of new restaurants.
Current wording
Net cash used in investing activities increased primarily due to new equipment purchases and increased spend on Chili’s capital maintenance.
Previous wording
Net cash used in financing activities increased primarily due to $161.3 million of net repayment activity in fiscal 2024 compared to $110.0 million of net repayment activity in fiscal 2023 on the revolving credit facility. Additionally in fiscal 2023, proceeds from issuance of the $350.0 million 8.250% notes were partially offset by the payoff of the $300.0 million 3.875% notes.
Current wording
Net cash used in financing activities increased primarily due to the payoff of the $350.0 million 5.00% notes and an increase in share repurchases in fiscal 2025 compared to net repayment activity on the revolving credit facility of $161.3 million in fiscal 2024.
Previous wording
Our $900.0 million revolving credit facility, as amended, matures on August 18, 2026 and bears interest at a rate of SOFR plus an applicable margin of 1.60% to 2.35% and an undrawn commitment fee of 0.25% to 0.35%, both based on a function of our debt-to-cash-flow ratio. As of June 26, 2024, there was $900.0 million of borrowing capacity under the revolving credit facility.
Current wording
The $1.0 billion revolving credit facility, as amended, matures on May 1, 2030 and bears interest at a rate of SOFR plus an applicable margin of 1.25% to 2.00% and an undrawn commitment fee of 0.20% to 0.30%, both based on a function of our debt-to-cash-flow ratio. As of June 25, 2025, our interest rate was 5.82% consisting of SOFR of 4.32% plus the applicable margin and spread adjustment of 1.50%. As of June 25, 2025, there were no amounts outstanding under the revolving credit facility.
Previous wording
On June 27, 2023, we issued$350.0 million of 8.250% senior notes due July 15, 2030. The 2030 Notes require semi-annual interest payments in arrears, on each January 15 and July 15.
Current wording
Our $350.0 million 8.25% notes mature July 15, 2030, and require semi-annual interest payments in arrears, on each January 15 and July 15.
Previous wording
As of June 26, 2024, we were in compliance with our covenants pursuant to the $900.0 million revolving credit facility and under the terms of the indentures governing our 5.000% and 8.250% notes. Refer to Note 7 - Debt within Part II, Item 8 - Financial Statements and Supplementary Data for further information about our notes and revolving credit facility.
Current wording
As of June 25, 2025, we were in compliance with our covenants pursuant to the $1.0 billion revolving credit facility and under the terms of the indentures governing our 8.25% notes. Refer to Note 7 - Debt within Part II, Item 8 - Financial Statements and Supplementary Data for further information about our notes and revolving credit facility.
Previous wording
Our Board of Directors approved a $300.0 million share repurchase program in August 2021. Our share repurchase program is used to return capital to shareholders and to minimize the dilutive impact of stock options and other share-based awards. We evaluate potential share repurchases under our plan based on several factors, including our cash position, share price, operational liquidity, proceeds from divestitures, borrowings and planned investment and financing needs. The Company repurchased 0.7 million shares of our common stock for $21.0 million in fiscal 2024. The Company did not repurchase any shares under the repurchase program in fiscal 2023. On June 26, 2024, we had $183.0 million of authorized repurchases remaining under the share repurchase program.
Current wording
Our Board of Directors approved a $300.0 million share repurchase program in August 2021. Our share repurchase program is used to return capital to shareholders and to minimize the dilutive impact of stock options and other share-based awards. We evaluate potential share repurchases under our plan based on several factors, including our cash position, share price, operational liquidity, proceeds from divestitures, borrowings and planned investment and financing needs. As part of our share repurchase program, we repurchased 1.0 million shares of our common stock for $76.0 million in fiscal 2025 and 0.7 million shares of our common stock for $21.0 million in fiscal 2024. As of June 25, 2025, we had $107.0 million of authorized repurchases remaining under the share repurchase program.
Previous wording
As a result of uncertainties in the near-term macro environment, including supply chain challenges, and commodity and labor inflation, we continue to focus on cash flow generation and maintaining a solid and flexible financial position to execute our long-term strategy of investing in our business. We continue to monitor the macro environment and will adjust our overall approach to capital allocation, including share repurchases, as events and macroeconomic trends unfolds.
Current wording
In light of an unpredictable macroeconomy, including commodity and labor inflation and supply chain disruptions, we continue to focus on cash flow generation and maintaining a solid and flexible financial position to execute our long-term strategy of investing in our business. We continue to assess the macro environment and will adjust our overall approach to capital allocation, including share repurchases, based on market conditions and trends.
Previous wording
(1)Long-term debt consists of principal amounts owed on the 5.000% and 8.250% notes and the revolving credit facility. The $350.0 million 5.000% notes mature on October 1, 2024, and the $350.0 million 8.250% notes mature on July 15, 2030. As of June 26, 2024, there was no outstanding balance on the $900.0 million credit facility.
Current wording
(1)Long-term debt consists of principal amounts owed on the 8.25% notes which mature on July 15, 2030. As of June 25, 2025, there was no outstanding balance on the $1.0 billion revolving credit facility.
Previous wording
(2)Interest consists of remaining interest payments on the 5.000% and 8.250% fixed rate notes totaling $196.5 million and remaining interest payments on the variable rate revolver totaling $46.0 million. We have assumed that there will be no outstanding balance on the revolver until October 1, 2024 when the 5.000% notes will be paid using availability under the revolver, increasing the outstanding balance to $350.0 million until the maturity date of August 18, 2026 using our variable interest rate of 6.94% as of June 26, 2024.
Current wording
(2)Interest consists of remaining interest payments on the 8.25% fixed rate notes.
Previous wording
(4)Purchase obligations are defined as an agreement to purchase goods or services that is enforceable and legally binding on us and that specifies all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. Our purchase obligations primarily consist of long-term obligations for the purchase of fountain beverages, software and professional services contracts, as well as non-cancellable insurance premiums, and exclude agreements that are cancellable without significant penalty.
Current wording
(4)Purchase obligations are defined as an agreement to purchase goods or services that is enforceable and legally binding on us and that specifies all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. Our purchase obligations primarily consist of long-term obligations for software and professional services contracts, as well as non-cancellable insurance premiums, and exclude agreements that are cancellable without significant penalty.