KURA SUSHI USA, INC.

Previous wording

In addition to historical information, the following discussion and analysis contains forward-looking statements, such as statements about our plans, objectives, expectations, and intentions, which are based on current expectations and that involve risks, uncertainties and assumptions as set forth and described in the “Special Note Regarding Forward-Looking Statements” and “Risk Factors” sections of the Annual Report. You should review those sections in our Annual Report for a discussion of important factors, including the continuing development of our business and other factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this Quarterly Report on Form 10-Q.

Current wording

In addition to historical information, the following discussion and analysis contains forward-looking statements, such as statements about our plans, objectives, expectations, and intentions, which are based on current assumptions and involve risks, uncertainties and assumptions as set forth and described in the “Special Note Regarding Forward-Looking Statements” and “Risk Factors” sections of the Annual Report. You should review those sections in our Annual Report for a discussion of important factors, including the continuing development of our business and other factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this Quarterly Report on Form 10-Q.

Previous wording

During the six months ended February 28, 2025, we opened nine restaurants and expanded our restaurant base to 73 restaurants in twenty states and Washington, DC. Subsequent to February 28, 2025, we opened two additional restaurants totaling 75 restaurants. We expect to open a total of 14 new restaurants in fiscal year 2025 and therefore, we expect our revenue and restaurant operating costs to increase in fiscal year 2025. We also expect our general and administrative expenses to increase on a dollar basis in fiscal 2025 to support the growth of the company.

Current wording

During the nine months ended May 31, 2025, we opened thirteen restaurants and expanded our restaurant base to 76 restaurants in twenty states and Washington, DC. Subsequent to May 31, 2025, we opened two additional restaurant totaling 78 restaurants in 21 states and Washington, DC. We expect to open a total of 15 new restaurants in fiscal year 2025 and therefore, we expect our revenue and restaurant operating costs to increase in fiscal year 2025. We also expect our general and administrative expenses to increase on a dollar basis in fiscal 2025 to support the growth of the company.

Previous wording

We have evaluated and will continue to evaluate the impact of import laws and tariffs on our operations. As of February 28, 2025, there was no material impact on our business, financial condition, results of operations or cash flows. However, we expect tariffs may impact our operations in certain areas, such as food and beverage costs, construction and equipment costs and other restaurant operating costs, for the remainder of fiscal 2025.

Current wording

We have evaluated and will continue to evaluate the impact of import laws and tariffs on our operations. As of May 31, 2025, there was no material impact on our business, financial condition, results of operations or cash flows. However, tariffs could impact our operations in certain areas, such as food and beverage costs, construction and equipment costs and other restaurant operating costs, for the remainder of fiscal 2025.

Previous wording

Labor and related expenses. Labor and related expenses include all restaurant-level management and hourly labor costs, including wages, employee benefits, stock-based compensation for restaurant-level employees and payroll taxes. Similar to the food and beverage costs that we incur, labor and related expenses are expected to grow proportionally as our sales grow. Factors that influence fluctuations in our labor and related expenses include minimum wage and payroll tax legislation, the frequency and severity of workers’ compensation claims, healthcare costs and the performance of our restaurants.

Current wording

Labor and related expenses. Labor and related expenses include all restaurant-level management and hourly labor costs, including wages, employee benefits, stock-based compensation for restaurant-level employees and payroll taxes. Similar to the food and beverage costs that we incur, labor and related expenses are expected to grow proportionally as our sales grow. Factors that influence fluctuations in our labor and related expenses include minimum wage and payroll tax legislation, the frequency and severity of workers’ compensation claims, healthcare costs and by the performance of our restaurants.

Previous wording

The following tables present selected comparative results of operations for the three and six months ended February 28, 2025 and February 29, 2024. Our financial results for these periods are not necessarily indicative of the financial results that we will achieve in future periods. Certain totals for the tables below may not recalculate or sum to 100% due to rounding.

Current wording

The following tables present selected comparative results of operations for the three and nine months ended May 31, 2025 and May 31, 2024. Our financial results for these periods are not necessarily indicative of the financial results that we will achieve in future periods. Certain totals for the tables below may not recalculate or sum up to 100% due to rounding.

Previous wording

Sales. Sales were $64.9 million for the three months ended February 28, 2025 compared to $57.3 million for the three months ended February 29, 2024, representing an increase of $7.6 million, or 13.3%. The increase in sales was primarily driven by the sales resulting from fourteen new restaurants opened subsequent to February 29, 2024, as well as increases in menu prices during the same period. Comparable restaurant sales decreased 5.3% for the three months ended February 28, 2025, as compared to the three months ended February 29, 2024 primarily due to a reduction in traffic.

Current wording

Sales. Sales were $74.0 million for the three months ended May 31, 2025 compared to $63.1 million for the three months ended May 31, 2024, representing an increase of $10.9 million, or 17.3%. The increase in sales was primarily driven by the sales resulting from thirteen new restaurants that opened subsequent to May 31, 2024, as well as increases in menu prices during the same period. Comparable restaurant sales decreased 2.1%, consisting of negative traffic of 2.9% and a price/mix of 0.8% for the three months ended May 31, 2025, as compared to the three months ended May 31, 2024.

Previous wording

Food and beverage costs. Food and beverage costs were $18.6 million for the three months ended February 28, 2025 compared to $16.9 million for the three months ended February 29, 2024, representing an increase of $1.7 million, or 10.0%. The increase in food and beverage costs was primarily driven by costs associated with sales from fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, food and beverage costs decreased to 28.7% in the three months ended February 28, 2025 as compared to 29.6% in the three months ended February 29, 2024, primarily due to increases in menu prices and supply chain initiatives, which was partially offset by food cost inflation.

Current wording

Food and beverage costs. Food and beverage costs were $20.9 million for the three months ended May 31, 2025 compared to $18.4 million for the three months ended May 31, 2024, representing an increase of $2.5 million, or 13.8%. The increase in food and beverage costs was primarily driven by costs associated with sales from thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, food and beverage costs decreased to 28.3% in the three months ended May 31, 2025 as compared to 29.2% in the three months ended May 31, 2024, primarily due to increases in menu prices and supply chain initiatives, which was partially offset by food cost inflation.

Previous wording

Labor and related costs. Labor and related costs were $22.6 million for the three months ended February 28, 2025 compared to $18.9 million for the three months ended February 29, 2024, representing an increase of $3.7 million, or 19.4%. This increase in labor and related costs was primarily driven by additional labor costs incurred from fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, labor and related costs increased to 34.8% in the three months ended February 28, 2025 as compared to 33.0% in the three months ended February 29, 2024. The increase in cost as a percentage of sales was primarily due to increases in wage rates subsequent to February 29, 2024.

Current wording

Labor and related costs. Labor and related costs were $24.5 million for the three months ended May 31, 2025 compared to $20.5 million for the three months ended May 31, 2024, representing an increase of $4.0 million, or 19.2%. This increase in labor and related costs was primarily driven by additional labor costs incurred from thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, labor and related costs increased to 33.1% in the three months ended May 31, 2025 as compared to 32.6% in the three months ended May 31, 2024. The increase in cost as a percentage of sales was primarily due to increases in wage rates subsequent to May 31, 2024, partially offset by increases in menu prices and operational efficiencies.

Previous wording

Occupancy and related expenses. Occupancy and related expenses were $5.1 million for the three months ended February 28, 2025 compared to $4.0 million for the three months ended February 29, 2024, representing an increase of $1.1 million, or 29.0%. The increase was primarily a result of additional lease expense related to the opening of fourteen new restaurants subsequent to February 29, 2024. As a percentage of sales, occupancy and related expenses increased to 7.9% in the three months ended February 28, 2025 as compared to 6.9% in the three months ended February 29, 2024, primarily driven by sales deleverage.

Current wording

Occupancy and related expenses. Occupancy and related expenses were $5.5 million for the three months ended May 31, 2025 compared to $4.3 million for the three months ended May 31, 2024, representing an increase of $1.2 million, or 28.3%. The increase was primarily a result of additional lease expense related to the opening of thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, occupancy and related expenses increased to 7.5% in the three months ended May 31, 2025 as compared to 6.8% in the three months ended May 31, 2024, primarily driven by sales deleverage.

Previous wording

Depreciation and amortization expenses. Depreciation and amortization expenses incurred as part of restaurant operating costs were $3.3 million for the three months ended February 28, 2025 compared to $2.7 million for the three months ended February 29, 2024, representing an increase of $0.6 million, or 22.0%. The increase consists of depreciation of property and equipment related to the fourteen new restaurants that opened subsequent to February 29, 2024. As a percentage of sales, depreciation and amortization expenses at the restaurant level was 5.1% for the three months ended February 28, 2025 as compared to 4.7% in the three months ended February 29, 2024. Depreciation and amortization expenses incurred at the corporate level were $0.1 million for both the three months ended February 28, 2025 and February 29, 2024, and as a percentage of sales were both 0.2%, respectively.

Current wording

Depreciation and amortization expenses. Depreciation and amortization expenses incurred as part of restaurant operating costs were $3.5 million for the three months ended May 31, 2025 compared to $3.1 million for the three months ended May 31, 2024, representing an increase of $0.4 million, or 10.4%. The increase consists of depreciation of property and equipment related to the thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, depreciation and amortization expenses at the restaurant level was 4.7% for the three months ended May 31, 2025 as compared to 5.0% in the three months ended May 31, 2024. Depreciation and amortization expenses incurred at the corporate level were $0.1 million for both the three months ended May 31, 2025 and May 31, 2024, and as a percentage of sales were 0.1% and 0.2%, respectively.

Previous wording

Other costs. Other costs were $8.8 million for the three months ended February 28, 2025 compared to $8.2 million for the three months ended February 29, 2024, representing an increase of $0.6 million, or 7.1%. The increase was primarily driven by an increase in costs related to the fourteen new restaurants that opened subsequent to February 29, 2024. As a percentage of sales, other costs decreased to 13.5% in the three months ended February 28, 2025 as compared to 14.3% in the three months ended February 29, 2024, primarily driven by lower marketing, recruiting and travel expenses.

Current wording

Other costs. Other costs were $10.9 million for the three months ended May 31, 2025 compared to $8.9 million for the three months ended May 31, 2024, representing an increase of $2.0 million, or 22.0%. The increase was primarily driven by an increase in costs related to the thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, other costs increased to 14.7% in the three months ended May 31, 2025 as compared to 14.1% in the three months ended May 31, 2024, primarily driven by utilities and repairs and maintenance, partially offset by lower marketing expenses.

Previous wording

Interest income. Interest income was $859 thousand for the three months ended February 28, 2025 compared to $754 thousand for the three months ended February 29, 2024. The increase was primarily driven by investing incremental cash from our follow-on offering completed in November 2024 into money market funds and long-term investments, partially offset by lower interest rates.

Current wording

Interest income. Interest income was $812 thousand for the three months ended May 31, 2025 compared to $686 thousand for the three months ended May 31, 2024. The increase was primarily driven by investing incremental cash from our follow-on offering completed in November 2024 into money market funds and investments, partially offset by lower interest rates.

Previous wording

Income tax expense. Income tax expense was $38 thousand for the three months ended February 28, 2025 compared to an income tax expense of $50 thousand for the three months ended February 29, 2024. For further discussion of our income taxes, see “Note 9. Income Taxes” in the Notes to Condensed Financial Statements.

Current wording

Income tax expense. Income tax expense was $55 thousand for the three months ended May 31, 2025 compared to an income tax expense of $60 thousand for the three months ended May 31, 2024. For further discussion of our income taxes, see “Note 9. Income Taxes” in the Notes to Condensed Financial Statements.

Previous wording

Sales. Sales were $129.4 million for the six months ended February 28, 2025 compared to $108.8 million for the six months ended February 29, 2024, representing an increase of $20.6 million, or 18.9%. The increase in sales was primarily driven by the sales resulting from fourteen new restaurants opened subsequent to February 29, 2024, as well as increases in menu prices during the same period. Comparable restaurant sales decreased 1.6% for the six months ended February 28, 2025, as compared to the six months ended February 29, 2024, primarily due to a reduction in traffic.

Current wording

Sales. Sales were $203.3 million for the nine months ended May 31, 2025 compared to $171.8 million for the nine months ended May 31, 2024, representing an increase of $31.5 million, or 18.3%. The increase in sales was primarily driven by the sales resulting from thirteen new restaurants that opened subsequent to May 31, 2024, as well as increases in menu prices during the same period. Comparable restaurant sales decreased 1.7%, consisting of negative traffic of 4.2% and a price/mix of 2.5% for the nine months ended May 31, 2025, as compared to the nine months ended May 31, 2024, primarily due to a reduction in traffic.

Previous wording

Food and beverage costs. Food and beverage costs were $37.3 million for the six months ended February 28, 2025 compared to $32.3 million for the six months ended February 29, 2024, representing an increase of $5.0 million, or 15.5%. The increase in food and beverage costs was primarily driven by costs associated with sales from fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, food and beverage costs decreased to 28.8% in the six months ended February 28, 2025 as compared to 29.7% in the six months ended February 29, 2024, primarily due to increases in menu prices and supply chain initiatives, which was partially offset by food cost inflation.

Current wording

Food and beverage costs. Food and beverage costs were $58.2 million for the nine months ended May 31, 2025 compared to $50.7 million for the nine months ended May 31, 2024, representing an increase of $7.5 million, or 14.9%. The increase in food and beverage costs was primarily driven by costs associated with sales from thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, food and beverage costs decreased to 28.6% in the nine months ended May 31, 2025 as compared to 29.5% in the nine months ended May 31, 2024, primarily due to increases in menu prices and supply chain initiatives, which was partially offset by food cost inflation.

Previous wording

Labor and related costs. Labor and related costs were $43.8 million for the six months ended February 28, 2025 compared to $35.3 million for the six months ended February 29, 2024, representing an increase of $8.5 million, or 24.0%. This increase in labor and related costs was primarily driven by additional labor costs incurred from fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, labor and related costs increased to 33.9% in the six months ended February 28, 2025 as compared to 32.5% in the six months ended February 29, 2024. The increase in cost as a percentage of sales was primarily due to increases in wage rates subsequent to February 29, 2024.

Current wording

Labor and related costs. Labor and related costs were $68.3 million for the nine months ended May 31, 2025 compared to $55.9 million for the nine months ended May 31, 2024, representing an increase of $12.4 million, or 22.2%. This increase in labor and related costs was primarily driven by additional labor costs incurred from thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, labor and related costs increased to 33.6% in the nine months ended May 31, 2025 as compared to 32.5% in the nine months ended May 31, 2024. The increase in cost as a percentage of sales was primarily due to increases in wage rates subsequent to May 31, 2024, partially offset by increases in menu prices and operational efficiencies.

Previous wording

Occupancy and related expenses. Occupancy and related expenses were $9.9 million for the six months ended February 28, 2025 compared to $7.9 million for the six months ended February 29, 2024, representing an increase of $2.0 million, or 25.3%. The increase was primarily a result of additional lease expense related to the opening of fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, occupancy and related expenses increased to 7.6% in the six months ended February 28, 2025, compared to 7.2% in the six months ended February 29, 2024, primarily driven by sales deleverage.

Current wording

Occupancy and related expenses. Occupancy and related expenses were $15.4 million for the nine months ended May 31, 2025 compared to $12.2 million for the nine months ended May 31, 2024, representing an increase of $3.2 million, or 26.4%. The increase was primarily a result of additional lease expense related to the opening of thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, occupancy and related expenses increased to 7.6% in the nine months ended May 31, 2025, compared to 7.1% in the nine months ended May 31, 2024, primarily driven by sales deleverage.

Previous wording

Depreciation and amortization expenses. Depreciation and amortization expenses incurred as part of restaurant operating costs were $6.4 million for the six months ended February 28, 2025 compared to $5.2 million for the six months ended February 29, 2024, representing an increase of $1.2 million, or 23.3%. The increase consists of depreciation of property and equipment related to fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, depreciation and amortization expenses at the restaurant level remained reasonably consistent at 4.9% for the six months ended February 28, 2025 as compared to 4.8% for the six months ended February 29, 2024. Depreciation and amortization expenses incurred at the corporate level were $0.2 million for both the six months ended February 28, 2025 and February 29, 2024, and as a percentage of sales were both 0.2%, respectively.

Current wording

Depreciation and amortization expenses. Depreciation and amortization expenses incurred as part of restaurant operating costs were $9.8 million for the nine months ended May 31, 2025 compared to $8.3 million for the nine months ended May 31, 2024, representing an increase of $1.5 million, or 18.5%. The increase consists of depreciation of property and equipment related to thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, depreciation and amortization expenses at the restaurant level were 4.8% for both the nine months ended May 31, 2025 and May 31, 2024. Depreciation and amortization expenses incurred at the corporate level were $0.3 million for both the nine months ended May 31, 2025 and May 31, 2024, and as a percentage of sales were both 0.2%, respectively.

Previous wording

Other costs. Other costs were $18.1 million for the six months ended February 28, 2025 compared to $15.6 million for the six months ended February 29, 2024, representing an increase of $2.5 million, or 15.8%. The increase was primarily driven by an increase in costs related to fourteen new restaurants opened subsequent to February 29, 2024. As a percentage of sales, other costs decreased to 14.0% in the six months ended February 28, 2025 from 14.4% in the six months ended February 29, 2024, primarily driven by lower marketing, recruiting and travel expenses.

Current wording

Other costs. Other costs were $29.0 million for the nine months ended May 31, 2025 compared to $24.5 million for the nine months ended May 31, 2024, representing an increase of $4.5 million, or 18.3%. The increase was primarily driven by an increase in costs related to thirteen new restaurants that opened subsequent to May 31, 2024. As a percentage of sales, other costs remained consistent at 14.3% for both the nine months ended May 31, 2025 and May 31, 2024, primarily driven by lower marketing and travel expenses, offset by higher utilities expense.

Previous wording

General and administrative expenses. General and administrative expenses were $19.7 million for the six months ended February 28, 2025 compared to $16.8 million for the six months ended February 29, 2024, representing an increase of $2.9 million, or 17.5%. This increase was primarily due to the litigation settlement of $2.1 million and compensation-related costs of $1.1 million partially offset by $0.3 million decrease in professional fees. As a percentage of sales, general and administrative expenses decreased to 15.2% in the six months ended February 28, 2025 from 15.4% in the six months ended February 29, 2024, primarily driven by sales leverage, partially offset by the $2.1 million litigation settlement expense.

Current wording

General and administrative expenses. General and administrative expenses were $28.5 million for the nine months ended May 31, 2025 compared to $25.6 million for the nine months ended May 31, 2024, representing an increase of $2.9 million, or 11.0%. This increase was primarily due to the increase in compensation-related costs of $1.9 million, incremental litigation settlement expense of $1.3 million and $0.4 million in other expenses, partially offset by a decrease of $0.7 million in professional fees. As a percentage of sales, general and administrative expenses decreased to 14.0% in the nine months ended May 31, 2025 from 14.9% in the nine months ended May 31, 2024, primarily driven by sales leverage, lower compensation-related costs, professional fees and travel expenses, partially offset by higher litigation expense.

Previous wording

Interest income. Interest income was $1.4 million for the six months ended February 28, 2025 compared to $1.6 million for the six months ended February 29, 2024. The decrease was primarily driven by lower interest rates.

Current wording

Interest income. Interest income was $2.2 million for the nine months ended May 31, 2025 compared to $2.3 million for the nine months ended May 31, 2024. The decrease was primarily driven by lower interest rates.

Previous wording

Income tax expense. Income tax expense was $77 thousand for the six months ended February 28, 2025 compared to $88 thousand for the six months ended February 29, 2024. For further discussion of our income taxes, see “Note 9. Income Taxes” in the Notes to Condensed Financial Statements.

Current wording

Income tax expense. Income tax expense was $132 thousand for the nine months ended May 31, 2025 compared to $148 thousand for the nine months ended May 31, 2024. For further discussion of our income taxes, see “Note 9. Income Taxes” in the Notes to Condensed Financial Statements.

Previous wording

Sales represents sales of food and beverages in restaurants, as shown on our condensed statements of operations and comprehensive loss. Several factors affect our restaurant sales in any given period, including the number of restaurants in operation, guest traffic and average check.

Current wording

Sales represents sales of food and beverages in restaurants, as shown on our condensed statements of operations and comprehensive income (loss). Several factors affect our restaurant sales in any given period, including the number of restaurants in operation, guest traffic and average check.

Previous wording

The following table reconciles net loss to EBITDA and Adjusted EBITDA:

Current wording

The following table reconciles net income (loss) to EBITDA and Adjusted EBITDA:

Previous wording

Stock-based compensation expense includes non-cash stock-based compensation, which is comprised of restaurant-level stock-based compensation included in labor and related costs and of corporate-level stock-based compensation included in general and administrative expenses in the condensed statements of operations and comprehensive loss. For further details of stock-based compensation, see “Note 5. Stock-based Compensation” in the notes to condensed financial statements included in this Quarterly Report on Form 10-Q.

Current wording

Stock-based compensation expense includes non-cash stock-based compensation, which is comprised of restaurant-level stock-based compensation included in labor and related costs and of corporate-level stock-based compensation included in general and administrative expenses in the condensed statements of operations and comprehensive income (loss). For further details of stock-based compensation, see “Note 5. Stock-based Compensation” in the notes to condensed financial statements included in this Quarterly Report on Form 10-Q.

Previous wording

Restaurant-level Operating Profit (Loss) is defined as operating income (loss) plus depreciation and amortization; stock-based compensation expense; pre-opening costs and general and administrative expenses which are considered normal, recurring, cash operating expenses and are essential to support the development and operations of our restaurants; non-cash lease expense; asset disposals, closure costs and restaurant impairments; less corporate-level stock-based compensation expense recognized within general and administrative expenses. Restaurant-level Operating Profit (Loss) margin is defined as Restaurant-level Operating Profit (Loss) divided by sales. Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin are non-GAAP measures which are intended as supplemental measures of our performance and are neither required by, nor presented in accordance with, GAAP. We believe that Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and operating results, as this measure depicts normal, recurring cash operating expenses essential to supporting the development and operations of our restaurants. However, these measures may not provide a complete understanding of the operating results of the

Current wording

Restaurant-level Operating Profit (Loss) is defined as operating income (loss) plus depreciation and amortization; stock-based compensation expense; pre-opening costs and general and administrative expenses which are considered normal, recurring, cash operating expenses and are essential to support the development and operations of our restaurants; non-cash lease expense; asset disposals, closure costs and restaurant impairments; less corporate-level stock-based compensation expense recognized within general and administrative expenses. Restaurant-level Operating Profit (Loss) margin is defined as Restaurant-level Operating Profit (Loss) divided by sales. Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin are non-GAAP measures which are intended as supplemental measures of our performance and are neither required by, nor presented in accordance with, GAAP. We believe that Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and operating results, as this measure depicts normal, recurring cash operating expenses essential to supporting the development and operations of our restaurants. However, these measures may not provide a complete understanding of the operating results of the Company as a whole and such measures should be reviewed in conjunction with our GAAP financial results. We expect

Previous wording

Company as a whole and such measures should be reviewed in conjunction with our GAAP financial results. We expect Restaurant-level Operating Profit (Loss) to increase in proportion to the number of new restaurants we open and our comparable restaurant sales growth.

Current wording

Restaurant-level Operating Profit (Loss) to increase in proportion to the number of new restaurants we open and our comparable restaurant sales growth.

Previous wording

In addition, when evaluating Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin, you should be aware that in the future we may incur expenses similar to those excluded when calculating these measures. Our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Our computation of Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin in the same fashion. Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP.

Current wording

In addition, when evaluating Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin, you should be aware that in the future we may incur expenses similar to those excluded when calculating these measures. Our presentation of these measures should not be construed as an inference that our future results will not be affected by unusual or non-recurring items. Our computation of Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin in the same fashion. Restaurant-level Operating Profit (Loss) and Restaurant-level Operating Profit (Loss) margin have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP.

Previous wording

Stock-based compensation expense includes non-cash stock-based compensation, which is comprised of restaurant-level stock-based compensation included in labor and related costs and of corporate-level stock-based compensation included in general and administrative expenses in the condensed statements of operations and comprehensive loss. For further details of stock-based compensation, see “Note 5. Stock-based Compensation” in the notes to condensed financial statements included in this Quarterly Report on Form 10-Q.

Current wording

Stock-based compensation expense includes non-cash stock-based compensation, which is comprised of restaurant-level stock-based compensation included in labor and related costs and of corporate-level stock-based compensation included in general and administrative expenses in the condensed statements of operations and comprehensive income (loss). For further details of stock-based compensation, see “Note 5. Stock-based Compensation” in the notes to condensed financial statements included in this Quarterly Report on Form 10-Q.

Previous wording

Comparable restaurant sales performance refers to the change in year-over-year sales for the comparable restaurant base. We include restaurants in the comparable restaurant base that have been in operation for at least 18 full calendar months prior to the start of the accounting period presented due to new restaurants experiencing a period of higher sales upon opening. For restaurants that were temporarily closed the comparative period was also adjusted.

Current wording

Comparable restaurant sales performance refers to the percent change in year-over-year sales for the comparable restaurant base. We include restaurants in the comparable restaurant base that have been in operation for at least 18 full calendar months by the end of the accounting period presented due to new restaurants experiencing a period of higher sales upon opening. For restaurants that were temporarily closed the comparative period was also adjusted accordingly.

Previous wording

The number of restaurant openings reflects the number of restaurants opened during a particular reporting period. Before we open new restaurants, we incur pre-opening costs. New restaurants may not be profitable, and their sales performance may not follow historical patterns. The number and timing of restaurant openings has had, and is expected to continue to have, an impact on our results of operations. The following table shows the growth in our restaurant base:

Current wording

The number of restaurant openings reflects the number of restaurants opened during a particular reporting period. Before we open new restaurants, we incur pre-opening costs. New restaurants may not be profitable, and their sales performance may not follow historical patterns. The number and timing of restaurant openings have had, and is expected to continue to have, an impact on our results of operations. The following table shows the growth in our restaurant base:

Previous wording

We believe that cash provided by operating activities, cash, and cash equivalents on hand will be sufficient to fund our lease obligations, capital expenditures and working capital needs for at least the next 12 months. We also maintain a Revolving Credit

Current wording

We believe that cash provided by operating activities, cash on hand, cash equivalents and short-term investments will be sufficient to fund our lease obligations, capital expenditures and working capital needs for at least the next 12 months. We also maintain a Revolving Credit Agreement with Kura Japan, of which the maturity date has been extended to April 10, 2028 pursuant to the Third Amendment with Kura Japan.

Previous wording

During the six months ended February 28, 2025, we had no borrowings under the Revolving Credit Agreement and have $45.0 million of availability remaining. As of February 28, 2025, we did not have any material off-balance sheet arrangements.

Current wording

During the nine months ended May 31, 2025, we had no borrowings under the Revolving Credit Agreement and have $45.0 million of availability remaining. As of May 31, 2025, we did not have any material off-balance sheet arrangements.

Previous wording

On November 13, 2024, we completed an underwritten public offering of common stock pursuant to our universal shelf registration statement on Form S-3, selling an aggregate of 800,328 shares of Class A common stock, including the exercise in full of the underwriters’ option to purchase 104,390 additional shares, at the price of $85.00 per share less an underwriting discount of $4.25 per share. We received aggregate net proceeds of $64.4 million after deducting the underwriting discounts and commissions and offering expenses payable by us. The proceeds are to be used for general corporate purposes, including capital expenditures, working capital, and other business purposes. No payments were made by us to directors, officers or persons owning 10% or more of the our common stock or to their associates, or to our affiliates.

Current wording

On November 13, 2024, we completed an underwritten public offering of common stock pursuant to our universal shelf registration statement on Form S-3, selling an aggregate of 800,328 shares of Class A common stock, including the exercise in full of the underwriters’ option to purchase 104,390 additional shares, at the price of $85.00 per share less an underwriting discount of $4.25 per share. We received aggregate net proceeds of $64.4 million after deducting the underwriting discounts and commissions and offering expenses payable by us. The proceeds are to be used for general corporate purposes, including capital expenditures, working capital, and other business purposes. No payments were made by us to directors, officers or persons owning 10% or more of our common stock or to their associates, or to our affiliates.

Previous wording

Net cash provided by operating activities during the six months ended February 28, 2025 was $8.6 million, primarily due to a net loss of $4.7 million, non-cash charges of $6.6 million for depreciation and amortization, $2.2 million for stock-based compensation, and net cash outflows of $4.4 million from changes in operating assets and liabilities.

Current wording

Net cash provided by operating activities during the nine months ended May 31, 2025 was $15.3 million, primarily due to a net loss of $4.2 million, non-cash charges of $10.2 million for depreciation and amortization, $3.5 million for stock-based compensation, and net cash outflows of $5.6 million from changes in operating assets and liabilities.

Previous wording

Net cash provided by operating activities during the six months ended February 29, 2024 was $6.2 million, primarily due to a net loss of $3.0 million, non-cash charges of $5.4 million for depreciation and amortization, $2.0 million for stock-based compensation and net cash outflows of $1.9 million from changes in operating assets and liabilities.

Current wording

Net cash provided by operating activities during the nine months ended May 31, 2024 was $14.9 million, primarily due to a net loss of $3.6 million, non-cash charges of $8.6 million for depreciation and amortization, $3.2 million for stock-based compensation, and $3.4 million in non-cash lease expense, and net cash outflows of $3.4 million from changes in operating assets and liabilities.

Previous wording

Net cash used in investing activities during the six months ended February 28, 2025 was $39.4 million, primarily due to $25.3 million in purchases of long-term investments, $23.1 million in purchases of property and equipment and $0.9 million in purchases of liquor licenses offset by $10.0 million of redemptions of long-term investments. The increase in purchases of property and equipment in the six months ended February 28, 2025 is primarily related to capital expenditures for future restaurant openings, maintaining our existing restaurants and other projects.

Current wording

Net cash used in investing activities during the nine months ended May 31, 2025 was $84.2 million, primarily due to $70.2 million in purchases of investments, $36.7 million in purchases of property and equipment and $1.0 million in purchases of liquor licenses offset by $24.0 million in redemptions of long-term investments. The increase in purchases of property and equipment in the nine months ended May 31, 2025 is primarily related to capital expenditures for current and future restaurant openings, maintaining our existing restaurants and other projects.

Previous wording

Net cash used in investing activities during the six months ended February 29, 2024 was $20.6 million, primarily due to $3.5 million in purchases of short-term investments, $22.8 million in purchases of property and equipment and $0.1 million in purchases of liquor licenses offset by $5.9 million of redemption of short-term investments. The increase in purchases of property and equipment in the six months ended February 29, 2024 is primarily related to capital expenditures for future restaurant openings, maintaining our existing restaurants and other projects.

Current wording

Net cash used in investing activities during the nine months ended May 31, 2024 was $27.3 million, primarily due to $3.3 million in purchases of short-term investments, $34.0 million in purchases of property and equipment and $0.2 million in purchases of liquor licenses offset by $10.5 million in redemptions of short-term investments. The increase in purchases of property and equipment in the nine months ended May 31, 2024 is primarily related to capital expenditures for current and future restaurant openings, renovations and maintaining our existing restaurants and other projects.

Previous wording

Net cash provided by financing activities during the six months ended February 28, 2025 was $65.0 million and is primarily due to aggregate net proceeds from the issuance of stock of $64.4 million after deducting the underwriting discounts and commissions and offering expenses, $0.9 million of proceeds from exercise of stock options offset by $0.3 million in taxes paid on vested RSUs.

Current wording

Net cash provided by financing activities during the nine months ended May 31, 2025 was $65.0 million and is primarily due to aggregate net proceeds from the issuance of stock of $64.4 million after deducting the underwriting discounts and commissions and offering expenses, $0.9 million of proceeds from exercise of stock options offset by $0.3 million in taxes paid on vested RSUs.

Previous wording

Net cash provided by financing activities during the six months ended February 29, 2024 was $1.5 million and is primarily due to $1.9 million of proceeds from exercise of stock options offset by $0.4 million in taxes paid on vested RSUs.

Current wording

Net cash provided by financing activities during the nine months ended May 31, 2024 was $2.0 million and is primarily due to $2.3 million of proceeds from exercise of stock options offset by $0.2 million in taxes paid on vested RSUs.