BRINKER INTERNATIONAL, INC

1. BASIS OF PRESENTATION

References to “Brinker,” the “Company,” “we,” “us,” and “our” in this Form 10-Q refer to Brinker International, Inc. and its subsidiaries and any predecessor companies of Brinker International, Inc. Our Consolidated Financial Statements (Unaudited) as of September 23, 2026 and June 24, 2026, and for the thirteen week periods ended September 23, 2026 and September 24, 2025, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

We own, develop, operate and franchise the Chili’s® Grill & Bar (“Chili’s”) and Maggiano’s Little Italy® (“Maggiano’s”) restaurant brands. As of September 23, 2026, we owned, operated or franchised 1,641 restaurants, consisting of 1,174 Company-owned restaurants and 467 franchised restaurants, located in the United States,28 other countries andtwo United States territories. Our restaurant brands, Chili’s and Maggiano’s, are both operating segments and reporting units.

Use of Estimates

The preparation of the Consolidated Financial Statements (Unaudited) is in conformity with generally accepted accounting principles in the United States (“GAAP”) and requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements (Unaudited), and the reported amounts of revenues and costs and expenses in the reporting periods. Actual results could differ from those estimates.

The information furnished herein reflects all adjustments (consisting only of normal recurring accruals and adjustments) which are, in our opinion, necessary to fairly state the interim operating results, financial position and cash flows for the respective periods. However, these operating results are not necessarily indicative of the results expected for the full fiscal year. Certain information and footnote disclosures, normally included in annual financial statements prepared in accordance with GAAP, have been omitted pursuant to SEC rules and regulations. The Notes to Consolidated Financial Statements (Unaudited) should be read in conjunction with the Notes to Consolidated Financial Statements contained in our June 24, 2026 Form 10-K. We believe the disclosures are sufficient for interim financial reporting purposes. All amounts in the Notes to Consolidated Financial Statements (Unaudited) are presented in millions unless otherwise specified.

Foreign Currency Translation

The Foreign currency translation adjustment represents the unrealized impact of translating the financial statements of our Canadian restaurants from their respective functional currency (Canadian dollars) to United States dollars and are reported as a component of Comprehensive income and recorded in Accumulated other comprehensive loss on our Consolidated Balance Sheets (Unaudited).

Recently Issued Accounting Standards

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires, for each relevant expense caption on the income statement, detailed disclosure amounts for purchases of inventory, employee compensation, depreciation, and intangible asset amortization. In addition, this ASU requires companies to include amounts already required by GAAP in the same disclosure, provide a qualitative description of remaining amounts not separately disaggregated, and disclose the amount of total selling expenses along with the companies’ definition of selling expenses. The amendment is effective for fiscal years beginning after December 15, 2026, which would require us to adopt the provisions in our fiscal 2028 Form 10-K. The amendments should be applied prospectively; however, retrospective application is permitted. Management continues to evaluate this ASU to determine its impact on our disclosures.

2. CHILI’S RESTAURANT ACQUISITION

On August 27, 2026, we completed the acquisition of certain assets and liabilities of 12 Chili’s restaurants in Alabama and Mississippi, including the real estate for six of the locations, from Valenti Southeast Management, LLC, and Valenti Southeast Realty, LLC, (collectively, the “former franchisee”). Pro forma information is not presented due to the immaterial impact of the financial results of the acquired restaurants in the Consolidated Financial Statements (Unaudited).

The total consideration paid at closing was $27.1 million, subject to post-closing adjustments, and was funded with borrowings from our existing credit facility. We accounted for this acquisition as a business combination. The results of operations, and assets and liabilities, of these restaurants are included in the Consolidated Financial Statements (Unaudited) from the date of purchase.

The following table shows the fair value of net assets acquired and the resulting goodwill:

(1)Current assets includes petty cash, inventory, restaurant supplies, and prepaid expenses.

(2)The fair value of the land acquired was determined based on a market approach utilizing the Sales Comparison methodology and the fair valuations of the remaining property and equipment were determined using a cost approach that utilized estimates of current replacement cost, functional and economic obsolescence.

(3)Operating lease liabilities are measured at the present value of the remaining lease payments as if the acquired leases were new leases at the acquisition date. Operating lease assets were measured at the same amount as the operating lease liabilities as the acquired leases were determined to be at market. The key inputs and assumptions include the respective lease terms and the corresponding incremental borrowing rate.

(4)Reacquired franchise rights have a weighted average amortization period of approximately 16.1 years and were valued based on an income approach using the Multi-Period Excess Earnings methodology. Key inputs and assumptions included projected future operating margins, discount rate, and long-term growth rate.

(5)Current liabilities includes the gift card liability assumed and accrued property taxes.

(6)Goodwill is expected to be deductible for tax purposes and includes the value of the assembled workforce of the acquired restaurants.

3. REVENUE RECOGNITION

Deferred Franchise and Development Fees

Our deferred franchise and development fees consist of the unrecognized fees received from franchisees. Recognition of these fees in subsequent periods is based on satisfaction of the contractual performance obligations of the active contracts with franchisees. We also expect to earn subsequent period royalties and advertising fees related to our franchise contracts; however, due to the variability and uncertainty of these future revenues which depend upon a sales-based measure, these future revenues are not yet estimable as the performance obligations remain unsatisfied. Deferred franchise and development fees are classified within Other accrued liabilities for the current portion expected to be recognized within the next 12 months, and Other liabilities for the long-term portion in the Consolidated Balance Sheets (Unaudited).

The following table reflects the changes in deferred franchise and development fees between June 24, 2026 and September 23, 2026:

The following table illustrates franchise and development fees expected to be recognized in the future related to performance obligations that were unsatisfied or partially unsatisfied as of September 23, 2026:

Deferred Gift Card Revenues

Total deferred revenues related to our gift cards include the full value of unredeemed gift card balances less recognized breakage and the unamortized portion of third party fees. The following table reflects the changes in the Gift card liability between June 24, 2026 and September 23, 2026:

4. FAIR VALUE MEASUREMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability, in an orderly transaction between market participants at the measurement date under market conditions. Fair value measurements are categorized in three levels based on the types of significant inputs used, as follows:

Financial Instruments

The fair values of cash and cash equivalents, accounts receivable and accounts payable approximate their carrying amounts because of the short maturity of these items.

The carrying amount of debt outstanding related to our revolving credit facility approximates fair value as the interest rate on this instrument approximates current market rates (Level 2).

Non-Financial Assets

We review the carrying amounts of non-financial assets, primarily long-lived property and equipment, finance lease assets, operating lease assets, reacquired franchise rights, goodwill and transferable liquor licenses annually or when events or circumstances indicate that the fair value may not substantially exceed the carrying amount. We determine the fair values of property and equipment, including finance lease assets, operating lease assets and reacquired franchise rights based on Level 3 fair value measurements. The fair values of transferable liquor licenses are based on prices in the open market for licenses in the same or similar jurisdictions and are categorized as Level 2. We record an impairment charge for the excess of the carrying amount over the fair value. Any impairment charges are included in Other (gains) and charges in the Consolidated Statements of Comprehensive Income (Unaudited). During the thirteen week periods ended September 23, 2026 and September 24, 2025, no indicators of impairment were identified.

Intangibles, net in the Consolidated Balance Sheets (Unaudited) includes both indefinite-lived intangible assets such as transferable liquor licenses and definite-lived intangible assets such as reacquired franchise rights. Accumulated amortization associated with definite-lived intangible assets at September 23, 2026 and June 24, 2026, was $21.5 million and $21.1 million, respectively.

5. ACCRUED LIABILITIES

Other accrued liabilities consist of the following:

6. LEASES

We typically lease our restaurant facilities through ground leases (where we lease land only, but construct the building and improvements) or retail leases (where we lease the land/retail space and building). In addition to our restaurant facilities, we also lease our corporate headquarters location and certain equipment.

The components of lease expenses included in the Consolidated Statements of Comprehensive Income (Unaudited) were as follows:

Supplemental cash flow information related to leases:

(1) The thirteen week period ended September 23, 2026 included operating lease additions associated withsix of the 12 restaurants purchased from a former franchisee. Refer to Note 2 - Chili’s Restaurant Acquisition for further details.

Finance lease assets are recorded in Property and equipment, at cost, and the net balance as of September 23, 2026 and June 24, 2026 was $92.1 million and $83.5 million, respectively.

7. DEBT

Long-term debt consists of the following:

(1)Current installments of long-term debt consist of finance leases and are recorded within Other accrued liabilities in the Consolidated Balance Sheets (Unaudited). Refer to Note 5 - Accrued Liabilities for further details.

Revolving Credit Facility

The $1.0 billion revolving credit facility 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 September 23, 2026, our interest rate was 5.15% consisting of SOFR of 3.90% plus the applicable margin of 1.25%.

As of September 23, 2026, $593.4 million of credit was available under the revolving credit facility. Availability under the revolving credit facility was reduced by a $31.6 million letter of credit. Refer to Note 8 - Commitments and Contingencies for further information about our letters of credit.

The revolving credit facility contains various financial covenants that, among other things, require the maintenance of certain leverage ratios. As of September 23, 2026, we were in compliance with our covenants pursuant to the $1.0 billion revolving credit facility.

8.25% Notes

On July 15, 2026, we redeemed all $350.0 million of our 8.25% notes at a redemption price equal to the sum of 104.125% of the principal amount plus accrued and unpaid interest, for a total cash outflow of $378.9 million, which was funded with borrowings from the revolving credit facility. Because the 8.25% notes were redeemed prior to maturity, the transaction was accounted for as a debt extinguishment and the carrying amount of the 8.25% notes was derecognized. We recognized a loss on extinguishment of $17.6 million, representing the excess of the reacquisition price over the net carrying amount, which included unamortized debt issuance costs. The loss on debt extinguishment is included in Interest expenses in the Consolidated Statements of Comprehensive Income (Unaudited) as it is directly attributable to the early redemption of the 8.25% notes and consists of financing-related costs.

8. COMMITMENTS AND CONTINGENCIES

Lease Commitments and Guarantees

We have, in certain cases, divested brands or sold restaurants to franchisees and have not been released from lease guarantees for the related restaurants. As of September 23, 2026 and June 24, 2026, we have outstanding lease guarantees or are secondarily liable for an estimated $6.7 million and $7.5 million, respectively. These amounts represent the estimated future rent payments under the leases, but outstanding rent payments can exist outside of our knowledge as a result of the landlord and tenant relationship being between two third parties. These leases have been assigned to the buyers and expire at the end of the respective lease terms, which range from fiscal 2027 through fiscal 2035. In the event of default under a lease by an owner of a divested brand, the indemnity and default clauses in our agreements with such third parties and applicable laws govern our ability to pursue and recover amounts we may pay on behalf of such parties. We have received notices of default and have been named a party in lawsuits pertaining to some of these leases in circumstances where the current lessee did not pay its rent obligations and management is closely monitoring any exposure.

Letters of Credit

We provide letters of credit to various insurers to collateralize obligations for outstanding claims. As of September 23, 2026, we had $35.6 million in undrawn standby letters of credit outstanding. All standby letters of credit are renewable within the next 11 months.

Legal Proceedings

Evaluating contingencies related to litigation is a process involving judgment on the potential outcome of future events, and the ultimate resolution of litigated claims may differ from our current analysis. Accordingly, we review the adequacy of accruals and disclosures pertaining to litigated matters each quarter in consultation with legal counsel and we assess the probability and range of possible losses associated with contingencies for potential accrual in the Consolidated Financial Statements (Unaudited).

We are engaged in various legal proceedings and have certain unresolved claims pending. Liabilities have been established based on our best estimates of our potential liability in certain of these matters. Based upon consultation with legal counsel, management is of the opinion that there areno matters pending or threatened which are expected to have a material adverse effect, individually or in the aggregate, on the consolidated financial condition or results of operations.

9. INCOME TAXES

The federal statutory tax rate was 21.0% for the thirteen week periods ended September 23, 2026 and September 24, 2025.

The change in the effective income tax rate in the thirteen week period ended September 23, 2026 compared to the thirteen week period ended September 24, 2025 is primarily due to higher Income before income taxes and resulting deleverage of the FICA tip tax credit.

10. SHAREHOLDERS’ EQUITY

Share Repurchases

On August 10, 2026 our Board of Directors approved an increase in authorized share repurchases of $718.0 million, increasing our total authorization to $750.0 million. Our share repurchase program is used to return capital to shareholders and to minimize the dilution to our shares outstanding that results from equity compensation grants. 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. Repurchased shares are reflected as an increase in Treasury stock within Shareholder’s equity in the Consolidated Balance Sheets (Unaudited).

In the thirteen week period ended September 23, 2026, we repurchased 0.8 million shares of our common stock for $165.2 million, including 0.6 million shares purchased for $125.0 million as part of our share repurchase program and 0.2 million shares purchased from team members to satisfy tax withholding obligations on the vesting of restricted shares. These withheld shares of common stock are not considered common stock repurchases under our authorized common stock repurchase plan. As of September 23, 2026, approximately $700.0 million of share repurchase authorization remains under the current share repurchase program.

Subsequent to the end of the first quarter fiscal 2027, we repurchased an additional 0.3 million shares of our common stock for $65.0 million.

Stock-based Compensation

The following table presents restricted share awards granted under the Company’s various equity compensation plans and the related weighted average fair value per share amounts.

11. NET INCOME PER SHARE

Basic net income per share is computed by dividing Net income by the Basic weighted average shares outstanding for the reporting period. Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. For the calculation of Diluted net income per share, the Basic weighted average shares outstanding is increased by the dilutive effect of restricted share awards and stock options. Restricted share awards and stock options with an anti-dilutive effect are not included in the Diluted net income per share calculation. There were less than 0.1 million awards excluded from the calculation of diluted net income per share due to anti-dilutive effect for the periods presented. Basic weighted average shares outstanding are reconciled to Diluted weighted average shares outstanding as follows:

12. OTHER GAINS AND CHARGES

Other (gains) and charges in the Consolidated Statements of Comprehensive Income (Unaudited) consist of the following:

•Gift card inventory write-offs relate to the decision to dispose of obsolete multi-brand physical gift card inventory associated with a divested brand.

•Severance and other benefit charges relate to changes in our management team and organizational structure.

•Litigation & claims, netrelates to legal contingencies.

•Restaurant closure asset write-offs and charges includes costs associated with the closure of a Maggiano’s restaurant in the current year and certain Chili’s and Maggiano’s restaurants in the prior year.

•Acquisition-related costs, netrelates to 12 Chili’s restaurants acquired from a former franchisee. Refer to Note 2 - Chili’s Restaurant Acquisition for further details.

•Lease modification gain, netprimarily includes gains related to the reduction of lease liabilities associated with the purchase of the underlying real estate for certain Chili’s restaurants.

•Casualty losses, net in the prior year relates to proceeds received from the fiscal 2021 Winter Storm claim.

13. SEGMENT INFORMATION

Our chief operating decision maker (“CODM”) is the President and Chief Executive Officer. Our CODM uses Operating income as the measure for assessing performance and allocating resources of our segments. Our operating segments are Chili’s and Maggiano’s. The Chili’s segment includes the results of our Company-owned Chili’s restaurants, which are principally located in the United States, within the full-service casual dining segment of the industry. The Chili’s segment also includes results of our Canadian Company-owned restaurants and royalties and other fees from our franchised locations in the United States,28 other countries andtwo United States territories. The Maggiano’s segment includes the results of our Company-owned Maggiano’s restaurants in the United States as well as royalties and other fees from our domestic franchise business. Costs related to our restaurant support teams for the Chili’s and Maggiano’s brands, including operations, brand recruiting, finance, marketing, culinary innovation and franchise are included in the results of our operating segments. The Corporate segment includes unallocated costs such as information technology, human capital management, accounting, legal, purchasing, and restaurant development.

Company sales for each operating segment include revenues generated by the operation of Company-owned restaurants including food and beverage sales, net of discounts, delivery service fee income, gift card breakage, digital entertainment revenues, merchandise income, Maggiano’s banquet service charge income, and are net of gift card discount costs from third-party gift card sales. Franchise revenues for each operating segment include royalties, franchise advertising fees, franchise and development fees, and other service fees.

Operating income includes revenues and expenses directly attributable to segment-level results of operations. Restaurant expenses primarily includes restaurant rent, repairs and maintenance, advertising, supplies, utilities, delivery fees, payment processing fees, franchise and property taxes, workers’ compensation and general liability insurance, and to-go supplies.

We do not rely on any major customers as a source of sales, and the customers and long-lived assets of our operating segments are predominantly located in the United States. There were no material transactions between our operating segments.

The following tables reconcile our segment results to our consolidated results reported in accordance with GAAP: