CHEESECAKE FACTORY INC

Previous wording

These statements may be contained in our filings with the SEC, in our press releases, in other written communications, and in oral statements made by or with the approval of one of our authorized officers. These statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (together with the Securities Act, the “Acts”). This includes, without limitation, statements regarding corporate social responsibility (“CSR”) and in our CSR report, the effects of geopolitical and macroeconomic factors on our financial condition and our results of operations, financial guidance and projections, as well as expectations of our future financial condition, results of operations, sales, target growth rates, cash flows, quarterly dividends, share repurchases, capital structure and leverage, corporate strategy, potential price increases, plans, targets, goals, objectives, performance, growth potential, competitive position and business, and statements regarding our ability to: leverage our competitive strengths, including developing and investing in new restaurant concepts and expanding The Cheesecake Factory® brand to other retail opportunities; maintain our aggregate sales volumes; deliver comparable sales growth; provide a differentiated experience to customers; outperform the casual dining industry and increase our market share; leverage sales increases and manage flow through; manage market risks and cost pressures, including increasing wage rates and insurance costs, and increase margins; grow earnings; remain relevant to consumers; attract and retain qualified management and other staff; increase shareholder value; find suitable sites and manage increasing construction costs; profitably expand our concepts domestically and in Canada, and work with our licensees to expand The Cheesecake Factory internationally; support the growth of North Italia, Flower Child and additional brands within our Fox Restaurant Concepts (“Other FRC”) restaurants; and utilize our capital effectively. These forward-looking statements may be affected by various factors including: economic, public health and political conditions that impact consumer confidence and spending, including trade policy, changes in interest rates, periods of heightened inflation and market instability, and armed conflicts; supply chain disruptions; demonstrations, political unrest, potential damage to or closure of our restaurants and potential reputational damage to us or any of our brands; pandemics and related containment measures, including the potential for quarantines or restriction on in-person dining; acceptance and success of The Cheesecake Factory in international markets; acceptance and success of North Italia, Flower Child and Other FRC concepts; the risks of doing business abroad thro…

Excerpt shortened here; the source contains the full paragraph.

Current wording

These statements may be contained in our filings with the SEC, in our press releases, in other written communications, and in oral statements made by or with the approval of one of our authorized officers. These statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (together with the Securities Act, the “Acts”). This includes, without limitation, statements regarding corporate social responsibility (“CSR”) and in our CSR report, the effects of geopolitical and macroeconomic factors on our financial condition and our results of operations, financial guidance and projections, as well as expectations of our future financial condition, results of operations, sales, target growth rates, cash flows, quarterly dividends, share repurchases, capital structure and leverage, corporate strategy, potential price increases, plans, targets, goals, objectives, performance, growth potential, competitive position and business, and statements regarding our ability to: leverage our competitive strengths, including developing and investing in new restaurant concepts and expanding The Cheesecake Factory® brand to other retail opportunities; maintain our aggregate sales volumes; deliver comparable sales growth; provide a differentiated experience to customers; outperform the casual dining industry and increase our market share; leverage sales increases and manage flow through; manage market risks and cost pressures, including increasing wage rates and insurance costs, and increase margins; grow earnings; remain relevant to consumers; attract and retain qualified management and other staff; increase shareholder value; find suitable sites and manage increasing construction costs; profitably expand our concepts domestically and in Canada, and work with our licensees to expand The Cheesecake Factory internationally; support the growth of North Italia, Flower Child and additional brands within our Fox Restaurant Concepts (“Other FRC”) restaurants; and utilize our capital effectively. These forward-looking statements may be affected by various factors including: economic, public health and political conditions that impact consumer confidence and spending, including government shutdowns, trade policy, changes in interest rates, periods of heightened inflation and market instability, and armed conflicts; supply chain disruptions; demonstrations, political unrest, potential damage to or closure of our restaurants and potential reputational damage to us or any of our brands; pandemics and related containment measures, including the potential for quarantines or restriction on in-person dining; acceptance and success of The Cheesecake Factory in international markets; acceptance and success of North Italia, Flower Child and Other FRC restaurants; the risks of d…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

The Cheesecake Factory Incorporated is a leader in experiential dining. We are culinary forward and relentlessly focused on hospitality. We currently own and operate 363 restaurants throughout the United States and Canada under brands including The Cheesecake Factory® (216 locations), North Italia® (46 locations), Flower Child® (42 locations) and additional brands within our FRC portfolio (52 locations). Internationally, 34 The Cheesecake Factory® restaurants operate under licensing agreements. Our bakery division operates two facilities that produce quality cheesecakes and other baked products for our restaurants, international licensees and third-party bakery customers.

Current wording

The Cheesecake Factory Incorporated is a leader in experiential dining. We are culinary forward and relentlessly focused on hospitality. We currently own and operate 366 restaurants throughout the United States and Canada under brands including The Cheesecake Factory® (216 locations), North Italia® (46 locations), Flower Child® (42 locations) and additional brands within our FRC portfolio (55 locations). Internationally, 35 The Cheesecake Factory® restaurants operate under licensing agreements. Our bakery division operates two facilities that produce quality cheesecakes and other baked products for our restaurants, international licensees and third-party bakery customers.

Previous wording

Revenues increased 5.7% to $955.8 million for the fiscal quarter ended July 1, 2025 compared to $904.0 million for the comparable prior year period, primarily due to additional revenue related to new restaurant openings and an increase in comparable restaurant sales.

Current wording

Revenues increased 4.8% to $907.2 million for the fiscal quarter ended September 30, 2025 compared to $865.5 million for the comparable prior year period, primarily due to additional revenue related to new restaurant openings and an increase in comparable restaurant sales.

Previous wording

The Cheesecake Factory Restaurants sales increased 1.0% to $683.3 million for the second quarter of fiscal 2025, compared to $676.7 million for the second quarter of fiscal 2024. Average sales per restaurant operating week increased 1.8% to $245,335 in the second quarter of fiscal 2025 from $240,989 in the second quarter of fiscal 2024. Total operating weeks at The Cheesecake Factory Restaurants decreased 0.8% to 2,785 in the second quarter of fiscal 2025 compared to 2,808 in the prior year. The Cheesecake Factory comparable sales increased by 1.2%, or $8.1 million, from the second quarter of fiscal 2024 primarily driven by an increase in average check of 2.3% (based on an increase of 4.4% in menu pricing, partially offset by a 2.1% negative change from menu mix), partially offset by decreased customer traffic of 1.1%. We implemented menu price increases of approximately 2.4% and 2.0% in the first quarter of fiscal 2025 and the third quarter of fiscal 2024, respectively. We are in the process of implementing approximately a 1.5% menu price increase in the third quarter of fiscal 2025. Sales through the off-premise channel comprised approximately 21% of our restaurant sales during both the second quarter of fiscal 2025 and fiscal 2024. We account for each off-premise order as one customer for traffic measurement purposes. Therefore, average check is generally higher for off-premise orders as most are for more than one customer.

Current wording

The Cheesecake Factory Restaurants sales increased 0.6% to $651.4 million for the third quarter of fiscal 2025, compared to $647.8 million for the third quarter of fiscal 2024. Average sales per restaurant operating week increased 0.4% to $231,971 in the third quarter of fiscal 2025 from $231,011 in the third quarter of fiscal 2024. Total operating weeks at The Cheesecake Factory Restaurants increased 0.1% to 2,808 in the third quarter of fiscal 2025 compared to 2,804 in the prior year. The Cheesecake Factory comparable sales increased by 0.3%, or $2.1 million, from the third quarter of fiscal 2024 primarily driven by an increase in average check of 2.8% (based on an increase of 4.5% in menu pricing, partially offset by a 1.7% negative change from menu mix), partially offset by decreased customer traffic of 2.5%. We implemented menu price increases of approximately 2.4% and 1.5% in the first and third quarters of fiscal 2025, respectively. Sales through the off-premise channel comprised approximately 21% of our restaurant sales during both the third quarter of fiscal 2025 and fiscal 2024. We account for each off-premise order as one customer for traffic measurement purposes. Therefore, average check is generally higher for off-premise orders as most are for more than one customer.

Previous wording

North Italia sales increased 20.3% to $90.8 million for the second quarter of fiscal 2025, compared to $75.5 million for the second quarter of fiscal 2024. Average sales per restaurant operating week increased 1.6% to $153,689 in the second quarter of fiscal 2025 from $151,330 in the second quarter of fiscal 2024. Total operating weeks at North Italia increased 18.4% to 591 in the second quarter of fiscal 2025 compared to 499 in the prior year. North Italia comparable sales decreased approximately 1% from the second quarter of fiscal 2024. The decrease from fiscal 2024 was primarily driven by decreased customer traffic of 4%, partially offset by an

Current wording

North Italia sales increased 16.1% to $83.5 million for the third quarter of fiscal 2025, compared to $71.9 million for the third quarter of fiscal 2024. Average sales per restaurant operating week decreased 1.5% to $139,601 in the third quarter of fiscal 2025 from $141,771 in the third quarter of fiscal 2024. Total operating weeks at North Italia increased 17.9% to 598 in the third quarter of fiscal 2025 compared to 507 in the prior year. North Italia comparable sales decreased approximately 3% from the third quarter of fiscal 2024. The decrease from fiscal 2024 was primarily driven by decreased customer traffic of 6%, partially offset by an increase in average check of 3% (based on an increase of 4% in menu pricing, partially offset by a 1% negative impact from mix). We

Previous wording

increase in average check of 3% (based on an increase of 4% in menu pricing, partially offset by a 1% negative impact from mix). We implemented menu price increases of approximately 2.0% and 2.3% in the second quarter of fiscal 2025 and the fourth quarter of fiscal 2024, respectively.

Current wording

implemented menu price increases of approximately 2.0% and 2.3% in the second quarter of fiscal 2025 and the fourth quarter of fiscal 2024, respectively. We are in the process of implementing approximately a 1.5% price increase in the fourth quarter of fiscal 2025.

Previous wording

Flower Child sales increased 34.8% to $48.2 million for the second quarter of fiscal 2025, compared to $35.7 million for the second quarter of fiscal 2024. Flower Child sales per restaurant operating week increased 6.4% to $91,400 in the second quarter of fiscal 2025 from $85,867 in the second quarter of fiscal 2024. Total operating weeks at Flower Child increased 26.7% to 527 in the second quarter of fiscal 2025 compared to 416 in the prior year. Flower Child comparable sales increased approximately 4% from the second quarter of fiscal 2024. The increase from the second quarter of fiscal 2024 includes an increase of 1.5% in menu pricing.

Current wording

Flower Child sales increased 31.4% to $48.1 million for the third quarter of fiscal 2025, compared to $36.6 million for the third quarter of fiscal 2024. Flower Child sales per restaurant operating week increased 3.4% to $88,159 in the third quarter of fiscal 2025 from $85,225 in the third quarter of fiscal 2024. Total operating weeks at Flower Child increased 27.0% to 546 in the third quarter of fiscal 2025 compared to 430 in the prior year. Flower Child comparable sales increased approximately 7% from the third quarter of fiscal 2024. The increase from the third quarter of fiscal 2024 includes an increase of 3% in menu pricing.

Previous wording

Other FRC sales increased 22.5% to $90.2 million for the second quarter of fiscal 2025, compared to $73.6 million for the second quarter of fiscal 2024. Other FRC average sales per restaurant operating week increased 2.0% to $136,841 in the second quarter of fiscal 2025 from $134,131 in the second quarter of fiscal 2024. Average sales per restaurant operating week were impacted by new restaurant openings, as well as the concept mix and an increase in comparable sales. Total operating weeks at Other FRC increased 20.0% to 659 in the second quarter of fiscal 2025 compared to 549 in the prior year.

Current wording

Other FRC sales increased 16.5% to $78.0 million for the third quarter of fiscal 2025, compared to $67.0 million for the third quarter of fiscal 2024. Other FRC average sales per restaurant operating week decreased 0.8% to $115,581 in the third quarter of fiscal 2025 from $116,493 in the third quarter of fiscal 2024. Average sales per restaurant operating week were impacted by new restaurant openings, as well as the concept mix and a decrease in comparable sales. Total operating weeks at Other FRC increased 17.4% to 675 in the third quarter of fiscal 2025 compared to 575 in the prior year.

Previous wording

Restaurants become eligible to enter the comparable sales base in their 19 th month of operation. As of July 1, 2025, there were three The Cheesecake Factory Restaurants, 11 North Italia restaurants and 12 Flower Child locations not yet in their respective comparable sales bases. International licensed locations and restaurants that are no longer in operation, including those which we have relocated, are excluded from comparable sales calculations.

Current wording

Restaurants become eligible to enter the comparable sales base in their 19 th month of operation. As of September 30, 2025, there were five The Cheesecake Factory Restaurants, eight North Italia restaurants and 11 Flower Child locations not yet in their respective comparable sales bases. International licensed locations and restaurants that are no longer in operation, including those which we have relocated, are excluded from comparable sales calculations.

Previous wording

Food and beverage costs consist of raw materials and ingredients used in the food and beverage products sold in our restaurants and to our third-party bakery customers. As a percentage of revenues cost of sales was 21.6% and 22.3% in the second quarters of fiscal 2025 and 2024, respectively, primarily due to favorable commodity inflation across most categories (0.6%).

Current wording

Food and beverage costs consist of raw materials and ingredients used in the food and beverage products sold in our restaurants and to our third-party bakery customers. As a percentage of revenues cost of sales was 21.8% and 22.6% in the third quarters of fiscal 2025 and 2024, respectively, primarily due to favorable commodity inflation across most categories (0.5%).

Previous wording

As a percentage of revenues, labor expenses, which include restaurant-level labor costs and bakery production labor, including associated fringe benefits, were 34.9% and 35.1% in the second quarters of fiscal 2025 and 2024, respectively. This decrease was primarily due to menu price increases in excess of wage rate inflation, and improved staffing levels and productivity (0.7%), partially offset by higher group medical costs due to larger claim activity (0.5%).

Current wording

As a percentage of revenues, labor expenses, which include restaurant-level labor costs and bakery production labor, including associated fringe benefits, were 35.6% and 35.9% in the third quarters of fiscal 2025 and 2024, respectively. This decrease was primarily due to menu price increases in excess of wage rate inflation and improved staffing levels and productivity (0.3%).

Previous wording

Other operating costs and expenses consist of all other restaurant-level operating costs, the major components of which are occupancy expenses (rent, common area expenses, insurance, licenses, taxes and utilities), dining room and to-go supplies, repairs and maintenance, janitorial expenses, credit card processing fees, marketing including delivery commissions, and incentive compensation, as well as bakery production overhead. As a percentage of revenues, other operating costs and expenses were 26.8% and 26.4% in the second quarter of fiscal 2025 and 2024, respectively. This variance was primarily driven by higher facility related costs (0.3%).

Current wording

Other operating costs and expenses consist of all other restaurant-level operating costs, the major components of which are occupancy expenses (rent, common area expenses, insurance, licenses, taxes and utilities), dining room and to-go supplies, repairs and maintenance, janitorial expenses, credit card processing fees, marketing including delivery commissions, and incentive compensation, as well as bakery production overhead. As a percentage of revenues, other operating costs and expenses were 28.2% and 27.7% in the third quarter of fiscal 2025 and 2024, respectively. This variance was primarily driven by higher facility - related costs (0.4%).

Previous wording

Impairment of Assets and Lease Termination Expenses

Current wording

Impairment of Assets and Lease Termination*(Income)/*Expenses

Previous wording

During the second quarter of fiscal 2025, we recorded impairment of assets and lease termination expenses of $0.2 million primarily related to lease termination costs for one The Cheesecake Factory location. During the second quarter of fiscal 2024, we recorded impairment of assets and lease terminations income of $0.2 million primarily related to lease termination income for one Flower Child location.

Current wording

During the third quarter of fiscal 2025, we recorded impairment of assets and lease termination income of $0.1 million primarily related to a lease termination accrual for one Other FRC location. During the third quarter of fiscal 2024, we recorded impairment of assets and lease terminations income of $3.5 million primarily related to lease termination income, net for two The Cheesecake Factory restaurants and our Social Monk location.

Previous wording

Preopening costs were $9.0 million and $7.0 million in the second quarter of fiscal 2025 and 2024, respectively. We opened two The Cheesecake Factory, one North Italia, three Flower Child and two Other FRC locations in the second quarter of fiscal 2025 compared to one The Cheesecake Factory, one North Italia, two Flower Child and one Other FRC locations in the second quarter of fiscal 2024. Restaurant-level preopening costs include all costs to relocate and compensate restaurant management staff members during the preopening period, costs to recruit and train hourly restaurant staff members, and wages, travel and lodging costs for our opening training team and other support staff members. Also included in preopening costs are expenses for maintaining a roster of

Current wording

Preopening costs were $6.6 million and $7.0 million in the third quarter of fiscal 2025 and 2024, respectively. We opened two Other FRC locations in the third quarter of fiscal 2025 compared to one Flower Child and three Other FRC locations in the third quarter of fiscal 2024. Restaurant-level preopening costs include all costs to relocate and compensate restaurant management staff members during the preopening period, costs to recruit and train hourly restaurant staff members, and wages, travel and lodging costs for our opening training team and other support staff members. Also included in preopening costs are expenses for maintaining a roster of trained managers for pending openings and the associated temporary housing and other costs necessary to relocate managers

Previous wording

trained managers for pending opening and the associated temporary housing and other costs necessary to relocate managers in alignment with future restaurant opening and operating needs. Preopening costs can fluctuate significantly from period to period based on the number, mix and timing of restaurant openings and the specific preopening costs incurred for each restaurant.

Current wording

in alignment with future restaurant opening and operating needs. Preopening costs can fluctuate significantly from period to period based on the number, mix and timing of restaurant openings and the specific preopening costs incurred for each restaurant.

Previous wording

Our effective income tax rate was 11.9% and 6.9% for the second quarter of fiscal 2025 and 2024, respectively. The increase was primarily due to leverage on higher annual forecasted income before taxes, predominantly related to employment credits (2.4%), non-deductible costs in fiscal 2025 associated with the repurchase of our 2026 Notes (2.2%), an increase in non-deductible executive compensation (1.1%) and a change to our reserve for uncertain tax positions (0.9%). These factors were offset by higher employment credits in the second quarter of fiscal 2025 (1.2%).

Current wording

Our effective income tax rate was 10.1% and 5.8% for the third quarter of fiscal 2025 and 2024, respectively. The increase was primarily due to leverage on higher annual forecasted income before taxes, predominantly related to employment credits (1.4%), non-deductible costs in fiscal 2025 associated with the repurchase of our 2026 Notes (1.6%), an increase in non-deductible executive compensation (1.5%) and a change to our reserve for uncertain tax positions (2.7%). These factors were offset by higher employment credits in the third quarter of fiscal 2025 (3.0%).

Previous wording

Revenues increased 4.9% to $1,883.0 million for the first six months ended July 1, 2025 compared to $1,795.3 million for the comparable prior year period, primarily due to additional revenue related to new restaurant openings and an increase in comparable restaurant sales.

Current wording

Revenues increased 4.9% to $2,790.2 million for the first nine months ended September 1, 2025 compared to $2,660.7 million for the comparable prior year period, primarily due to additional revenue related to new restaurant openings and an increase in comparable restaurant sales.

Previous wording

The Cheesecake Factory Restaurants sales increased 0.9% to $1,356.0 million for the for the first six months of fiscal 2025, compared to $1,344.5 million for the first six months of fiscal 2024. Average sales per restaurant operating week increased 1.5% to $243,009 in the first six months of fiscal 2025 from $239,446 in the first six months of fiscal 2024. Total operating weeks at The Cheesecake Factory restaurants decreased 0.6% to 5,580 in the first six months of fiscal 2025 compared to 5,615 in the prior year. The Cheesecake Factory comparable sales increased by 1.1%, or $14.6 million, from the first six months of fiscal 2024 primarily driven by an increase in average check of 2.2% (based on an increase of 4.4% in menu pricing, partially offset by a 2.2% negative change from menu mix), partially offset by decreased customer traffic of 1.1%. Sales through the off-premise channel comprised approximately 21% of our restaurant sales during both the first six months of fiscal 2025 and fiscal 2024.

Current wording

The Cheesecake Factory Restaurants sales increased 0.8% to $2,007.4 million for the first nine months of fiscal 2025, compared to $1,992.2 million for the first nine months of fiscal 2024. Average sales per restaurant operating week increased 1.1% to $239,314 in the first nine months of fiscal 2025 from $236,637 in the first nine months of fiscal 2024. Total operating weeks at The Cheesecake Factory restaurants decreased 0.4% to 8,388 in the first nine months of fiscal 2025 compared to 8,419 in the prior year. The Cheesecake Factory comparable sales increased by 0.9%, or $16.6 million, from the first nine months of fiscal 2024 primarily driven by an increase in average check of 2.5% (based on an increase of 4.5% in menu pricing, partially offset by a 2.0% negative change from menu mix), partially offset by decreased customer traffic of 1.6%. Sales through the off-premise channel comprised approximately 21% of our restaurant sales during both the first nine months of fiscal 2025 and fiscal 2024.

Previous wording

North Italia sales increased 19.0% to $174.2 million for the first six months of fiscal 2025, compared to $146.4 million for the first six months of fiscal 2024. Average sales per restaurant operating week increased 1.2% to $151,382 in the first six months of fiscal 2025 from $149,528 in the first six months of fiscal 2024. Total operating weeks at North Italia increased 17.6% to 1,151 in the first six months of fiscal 2025 compared to 979 in the prior year. North Italia comparable sales decreased approximately 1% from the first six months of fiscal 2024. The decrease from fiscal 2024 was primarily driven by decreased customer traffic of 4%, partially offset by an increase in average check of 3% (based on an increase of 4% in menu pricing, partially offset by a 1% negative impact from mix).

Current wording

North Italia sales increased 18.1% to $257.7 million for the first nine months of fiscal 2025, compared to $218.3 million for the first nine months of fiscal 2024. Average sales per restaurant operating week increased 0.3% to $147,354 in the first nine months of fiscal 2025 from $146,881 in the first nine months of fiscal 2024. Total operating weeks at North Italia increased 17.7% to 1,749 in the first nine months of fiscal 2025 compared to 1,486 in the prior year. North Italia comparable sales decreased approximately 1% from the first nine months of fiscal 2024. The decrease from fiscal 2024 was primarily driven by decreased customer traffic of 4%, partially offset by an increase in average check of 3% (based on an increase of 4% in menu pricing, partially offset by a 1% negative impact from mix).

Previous wording

Flower Child sales increased 30.5% to $91.6 million for the first six months of fiscal 2025, compared to $70.2 million for the first six months of fiscal 2024. Flower Child sales per restaurant operating week increased 6.1% to $89,920 in the first six months of fiscal 2025 from $84,775 in the first six months of fiscal 2024. Total operating weeks at Flower Child increased 23.1% to 1,019 in the first six months of fiscal 2025 compared to 828 in the prior year. Flower Child comparable sales increased approximately 5% from fiscal 2024. The increase from fiscal 2024 includes an increase of 2% in menu pricing.

Current wording

Flower Child sales increased 30.9% to $139.8 million for the first nine months of fiscal 2025, compared to $106.8 million for the first nine months of fiscal 2024. Flower Child sales per restaurant operating week increased 5.0% to $89,191 in the first nine months of fiscal 2025 from $84,929 in the first nine months of fiscal 2024. Total operating weeks at Flower Child increased 24.6% to 1,567 in the first nine months of fiscal 2025 compared to 1,258 in the prior year. Flower Child comparable sales increased approximately 5% from fiscal 2024. The increase from fiscal 2024 includes an increase of 2% in menu pricing.

Previous wording

Other FRC sales increased 20.1% to $177.6 million for the first six months of fiscal 2025, compared to $147.9 million for the first six months of fiscal 2024. Other FRC average sales per restaurant operating week increased 0.9% to $138,212 in the first six months of fiscal 2025 from $137,040 in the first six months of fiscal 2024. Average sales per restaurant operating week were impacted by new restaurant openings, as well as the concept mix and an increase in comparable sales. Total operating weeks at Other FRC increased 19.1% to 1,285 in the first six months of fiscal 2025 compared to 1,079 in the prior year.

Current wording

Other FRC sales increased 19.0% to $255.6 million for the first nine months of fiscal 2025, compared to $214.9 million for the first nine months of fiscal 2024. Other FRC average sales per restaurant operating week increased 0.4% to $130,418 in the first nine months of fiscal 2025 from $129,897 in the first nine months of fiscal 2024. Average sales per restaurant operating week were impacted by new restaurant openings, as well as the concept mix and a decrease in comparable sales. Total operating weeks at Other FRC increased 18.5% to 1,960 in the first nine months of fiscal 2025 compared to 1,654 in the prior year.

Previous wording

As a percentage of revenues cost of sales was 21.7% and 22.6% in the first six months of fiscal 2025 and 2024, respectively, primarily due to favorable commodity inflation across most categories (0.6%) and a shift in sales mix (0.2%).

Current wording

As a percentage of revenues cost of sales was 21.7% and 22.6% in the first nine months of fiscal 2025 and 2024, respectively, primarily due to favorable commodity inflation across most categories (0.6%).

Previous wording

As a percentage of revenues, labor expenses, were 35.3% and 35.5% in the first six months of fiscal 2025 and 2024, respectively. This decrease was primarily due to menu price increases in excess of wage rate inflation, and improved staffing levels

Current wording

As a percentage of revenues, labor expenses were 35.4% and 35.7% in the first nine months of fiscal 2025 and 2024, respectively. This decrease was primarily due to menu price increases in excess of wage rate inflation and improved staffing levels and productivity (0.6%), partially offset by higher group medical costs due to larger claim activity (0.3%).

Previous wording

As a percentage of revenues, other operating costs and expenses were 26.7% and 26.3% in the first six months of fiscal 2025 and 2024, respectively. This variance was primarily driven by higher facility related costs (0.2%).

Current wording

As a percentage of revenues, other operating costs and expenses were 27.2% and 26.9% in the first nine months of fiscal 2025 and 2024, respectively. This variance was primarily driven by higher facility - related costs (0.3%).

Previous wording

During the first six months of fiscal 2025, we recorded impairment of assets and lease termination expenses of $0.6 million primarily related to lease termination costs for one The Cheesecake Factory and one Other FRC location. During the first six months of fiscal 2024, we recorded impairment of assets and lease terminations expense of $1.9 million primarily related to impairment of assets for one The Cheesecake Factory location and lease termination costs for one The Cheesecake Factory and one Flower Child location.

Current wording

During the first nine months of fiscal 2025, we recorded impairment of assets and lease termination expenses of $0.5 million primarily related to lease termination costs for one The Cheesecake Factory and one Other FRC location. During the first nine months of fiscal 2024, we recorded impairment of assets and lease terminations income of $1.6 million primarily related to lease termination income, net for two The Cheesecake Factory restaurants, one Grand Lux Cafe location, one Flower Child location and our Social Monk location.

Previous wording

Preopening costs were $17.1 million and $12.9 million in the first six months of fiscal 2025 and 2024, respectively. We opened two The Cheesecake Factory, four North Italia, six Flower Child and four Other FRC locations in the first half of fiscal 2025 compared to one The Cheesecake Factory, three North Italia, three Flower Child and three Other FRC locations in the first half of fiscal 2024.

Current wording

Preopening costs were $23.8 million and $19.9 million in the first nine months of fiscal 2025 and 2024, respectively. We opened two The Cheesecake Factory, four North Italia, six Flower Child and six Other FRC locations in the first nine months of fiscal 2025 compared to one The Cheesecake Factory, three North Italia, four Flower Child and six Other FRC locations in the first nine months of fiscal 2024.

Previous wording

Our effective income tax rate was 9.3% and 8.8% for the first six months of fiscal 2025 and 2024, respectively. The increase was primarily due to leverage on higher annual forecasted income before taxes, predominantly related to employment credits (2.3%), non-deductible costs in fiscal 2025 associated with the repurchase of our 2026 Notes (1.4%), a change to our reserve for uncertain tax positions (0.6%) and an increase in non-deductible executive compensation (0.4%). These factors were partially offset by a tax windfall in the first six months of fiscal 2025 as compared to a tax shortfall in the comparable prior period related to equity compensation (2.8%) and higher employment tax credits in the first six months of fiscal 2025 (1.5%).

Current wording

Our effective income tax rate was 9.5% and 8.0% for the first nine months of fiscal 2025 and 2024, respectively. The increase was primarily due to leverage on higher annual forecasted income before taxes, predominantly related to employment credits (1.4%), non-deductible costs in fiscal 2025 associated with the repurchase of our 2026 Notes (1.5%), a change to our reserve for uncertain tax positions (1.1%) and an increase in non-deductible executive compensation (0.6%). These factors were partially offset by a tax windfall in the first nine months of fiscal 2025 as compared to a tax shortfall in the comparable prior period related to equity compensation (2.5%) and higher employment credits in the first nine months of fiscal 2025 (1.1%).

Previous wording

Our corporate financial objectives are to maintain a sufficiently strong and conservative balance sheet to support our operating initiatives and unit growth while maintaining financial flexibility to provide the financial resources necessary to protect and enhance the competitiveness of our restaurant and bakery brands and to provide a prudent level of financial capacity to manage the risks and uncertainties of conducting our business operations under various economic and industry cycles. Typically, cash flows

Current wording

Our corporate financial objectives are to maintain a sufficiently strong and conservative balance sheet to support our operating initiatives and unit growth while maintaining financial flexibility to provide the financial resources necessary to protect and enhance the competitiveness of our restaurant and bakery brands and to provide a prudent level of financial capacity to manage the risks and uncertainties of conducting our business operations under various economic and industry cycles. Typically, cash flows generated from operating activities are our principal source of liquidity, which we use to finance our restaurant expansion plans, ongoing maintenance of our restaurants and bakery facilities and investment in our corporate and information technology infrastructures.

Previous wording

During the first six months of fiscal 2025, our cash and cash equivalents increased by $64.6 million to $148.8 million. The following table presents, for the periods indicated, a summary of our key cash flows from operating, investing and financing activities (in millions):

Current wording

During the first nine months of fiscal 2025, our cash and cash equivalents increased by $105.8 million to $190.0 million. The following table presents, for the periods indicated, a summary of our key cash flows from operating, investing and financing activities (in millions):

Previous wording

Cash flows from operations increased by $41.4 million from the first six months of fiscal 2024 primarily due to net income after excluding the non-cash activity, inventory movement and higher accrued expenses, partially offset by lower payable balances. Typically, our requirement for working capital has not been significant since our restaurant customers pay for their food and beverage purchases in cash or cash equivalents at the time of sale, and we are able to sell many of our restaurant inventory items before payment is due to the suppliers of such items.

Current wording

Cash flows from operations increased by $52.1 million from the first nine months of fiscal 2024 primarily due to net income after excluding the non-cash activity, higher accrued expenses, timing of operating lease commencements, inventory movement and income tax payments, partially offset by lower payable balances and higher accounts and other receivable balance. Typically, our requirement for working capital has not been significant since our restaurant customers pay for their food and beverage purchases in cash or cash equivalents at the time of sale, and we are able to sell many of our restaurant inventory items before payment is due to the suppliers of such items.

Previous wording

Capital expenditures for new restaurants, including locations under development, were $44.0 million and $38.9 million for the first six months of fiscal 2025 and 2024, respectively. Capital expenditures also included $33.6 million and $24.8 million for our existing restaurants and $6.8 million and $2.6 million for bakery and corporate capacity and infrastructure investments, in the first six months of fiscal 2025 and 2024, respectively.

Current wording

Capital expenditures for new restaurants, including locations under development, were $62.7 million and $76.1 million for the first nine months of fiscal 2025 and 2024, respectively. Capital expenditures also included $48.6 million and $38.1 million for our existing restaurants and $9.8 million and $6.3 million for bakery and corporate capacity and infrastructure investments, in the first nine months of fiscal 2025 and 2024, respectively.

Previous wording

We opened 16 restaurants in the first six months of fiscal 2025 comprised of two The Cheesecake Factory, four North Italia, six Flower Child and four Other FRC locations compared to ten restaurants in the first six months of fiscal 2024 comprised of one The Cheesecake Factory, three North Italia, three Flower Child and three Other FRC locations. We expect to open as many as 25 new restaurants in fiscal 2025 across our portfolio of concepts. We anticipate approximately $190 million to $200 million in capital expenditures to support this level of unit development, as well as required maintenance on our restaurants. This estimate includes new restaurant construction expenses, some of which may be classified as operating lease assets instead of additions to property and equipment in the statement of cash flows.

Current wording

We opened 18 restaurants in the first nine months of fiscal 2025 comprised of two The Cheesecake Factory, four North Italia, six Flower Child and six Other FRC locations compared to 14 restaurants in the first nine months of fiscal 2024 comprised of one The Cheesecake Factory, three North Italia, four Flower Child and six Other FRC locations. We expect to open as many as 25 new restaurants in fiscal 2025 across our portfolio of concepts. We anticipate approximately $190 million to $200 million in capital expenditures to support this level of unit development, as well as required maintenance on our restaurants. This estimate includes new restaurant construction expenses, some of which may be classified as operating lease assets instead of additions to property and equipment in the statement of cash flows.

Previous wording

On October 6, 2022, we entered into a Fourth Amended and Restated Loan Agreement (the “Loan Agreement” and the revolving credit facility provided thereunder, the “Revolver Facility”). The Loan Agreement amends and restates in its entirety our prior credit agreement. The Revolver Facility, which terminates on October 6, 2027, provides us with revolving loan commitments that total $400 million, of which $50 million may be used for issuances of letters of credit. The Revolver Facility contains a commitment increase feature that, subject to certain conditions precedent, could provide for an additional $200 million in revolving

Current wording

On October 6, 2022, we entered into a Fourth Amended and Restated Loan Agreement (the “Loan Agreement” and the revolving credit facility provided thereunder, the “Revolver Facility”). The Loan Agreement amends and restates in its entirety our prior credit agreement. The Revolver Facility, which terminates on October 6, 2027, provides us with revolving loan commitments that total $400 million, of which $50 million may be used for issuances of letters of credit. The Revolver Facility contains a commitment increase feature that, subject to certain conditions precedent, could provide for an additional $200 million in revolving loan commitments. Our obligations under the Revolver Facility are unsecured. Certain of our material subsidiaries have guaranteed our obligations under the Revolver Facility. In the first quarter of fiscal 2025, we repaid $110.0 million on the Revolver Facility. As of September 30, 2025, we had net availability for borrowings of $366.5 million, based on no outstanding debt balance and $33.5 million in standby letters of credit under the Revolver Facility.

Previous wording

On February 28, 2025, we issued $575.0 million in aggregate principal amount of convertible senior notes (“2030 Notes”), which will mature on March 15, 2030, unless earlier repurchased, redeemed or converted. The net proceeds from the sale of the 2030 Notes were approximately $558.5 million after deducting issuance costs of $16.5 million. As of July 1, 2025, the 2030 Notes had a balance of $559.6 million, net of unamortized issuance costs of $15.4 million. As of July 1, 2025, the conversion rate for the Notes was 14.1377 shares of common stock per $1,000 principal amount of the 2030 Notes, which represents a conversion price of approximately $70.73 per share of common stock. See Note 5 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report for further discussion on our debt.)

Current wording

On February 28, 2025, we issued $575.0 million in aggregate principal amount of convertible senior notes (“2030 Notes”), which will mature on March 15, 2030, unless earlier repurchased, redeemed or converted. The net proceeds from the sale of the 2030 Notes were approximately $558.5 million after deducting issuance costs of $16.5 million. As of September 30, 2025, the 2030 Notes had a balance of $560.4 million, net of unamortized issuance costs of $14.6 million. As of September 30, 2025, the conversion rate for the Notes was 14.1377 shares of common stock per $1,000 principal amount of the 2030 Notes, which represents a conversion price of approximately $70.73 per share of common stock. (See Note 5 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report for further discussion on our debt.)

Previous wording

On June 15, 2021, we issued $345.0 million in aggregate principal amount of convertible senior notes (“2026 Notes”), which will mature on June 15, 2026, unless earlier repurchased, redeemed or converted. The net proceeds from the sale of the 2026 Notes were approximately $334.9 million after deducting issuance costs of $10.1 million. On February 28, 2025, we used part of the net proceeds from the issuance of the 2030 Notes to repurchase approximately $276.0 million aggregate principal amount of the 2026 Notes in a privately-negotiated transaction for aggregate consideration of $289.8 million, which included a premium of $13.8 million. As of July 1, 2025, the 2026 Notes had a gross principal balance of $69.0 million and a balance of $68.6 million, net of unamortized issuance costs of $0.4 million. As of July 1, 2025, the conversion rate for the 2026 Notes was 14.0195 shares of common stock per $1,000 principal amount of the 2026 Notes, which represents a conversion price of approximately $71.33 per share of common stock. In connection with the cash dividend that was declared by our Board on July 23, 2025, on August 11, 2025 we will adjust the conversion rate (which is expected to increase) and the conversion price (which is expected to decrease) of the 2026 Notes in accordance with the terms. (See Note 5 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report for further discussion on our debt.)

Current wording

On June 15, 2021, we issued $345.0 million in aggregate principal amount of convertible senior notes (“2026 Notes”), which will mature on June 15, 2026, unless earlier repurchased, redeemed or converted. The net proceeds from the sale of the 2026 Notes were approximately $334.9 million after deducting issuance costs of $10.1 million. On February 28, 2025, we used part of the net proceeds from the issuance of the 2030 Notes to repurchase approximately $276.0 million aggregate principal amount of the 2026 Notes in a privately-negotiated transaction for aggregate consideration of $289.8 million, which included a premium of $13.8 million. As of September 30, 2025, the 2026 Notes had a gross principal balance of $69.0 million and a balance of $68.7 million, net of unamortized issuance costs of $0.3 million. As of September 30, 2025, the conversion rate for the 2026 Notes was 14.0812 shares of common stock per $1,000 principal amount of the 2026 Notes, which represents a conversion price of approximately $71.02 per share of common stock. In connection with the cash dividend that was declared by our Board on October 22, 2025, on November 11, 2025 we will adjust the conversion rate (which is expected to increase) and the conversion price (which is expected to decrease) of the 2026 Notes in accordance with the terms. (See Note 5 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report for further discussion on our debt.)

Previous wording

Common stock dividends of $26.8 million and $26.7 million were paid in the first six months of fiscal 2025 and 2024, respectively. As further discussed in Note 12 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report, in July 2025, our Board declared a quarterly dividend to be paid in August 2025. Future decisions to pay or to increase or decrease dividends are at the discretion of the Board and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of the Loan Agreement and applicable law, and other such factors that the Board considers relevant.

Current wording

Common stock dividends of $39.4 million and $39.8 million were paid in the first nine months of fiscal 2025 and 2024, respectively. As further discussed in Note 12 of Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this report, in October 2025, our Board declared a quarterly dividend to be paid in November 2025. Future decisions to pay or to increase or decrease dividends are at the discretion of the Board and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of the Loan Agreement and applicable law, and other such factors that the Board considers relevant.

Previous wording

Under authorization by our Board to repurchase up to 61.0 million shares of our common stock, we have cumulatively repurchased 59.7 million shares at a total cost of $1,971.2 million, excluding excise tax, through July 1, 2025. In the first quarter of fiscal 2025, we used approximately $130.0 million of the net proceeds from the 2030 Note issuance to repurchase approximately 2.4 million shares of our common stock. In total, we repurchased 2.6 million shares at a cost of $141.5 million, excluding excise tax, during the first six months of fiscal 2025. We repurchased 0.5 million shares at a cost of $16.4 million, excluding excise tax, during the first six months of fiscal 2024.

Current wording

Under authorization by our Board to repurchase up to 61.0 million shares of our common stock, we have cumulatively repurchased 59.7 million shares at a total cost of $1,972.4 million, excluding excise tax, through September 30, 2025. In the first quarter of fiscal 2025, we used approximately $130.0 million of the net proceeds from the 2030 Note issuance to repurchase approximately 2.4 million shares of our common stock. In total, we repurchased 2.6 million shares at a cost of $142.7 million, excluding excise tax, during the first nine months of fiscal 2025. We repurchased 0.5 million shares at a cost of $17.5 million, excluding excise tax, during the first nine months of fiscal 2024.