Texas Roadhouse, Inc.

Previous wording

Texas Roadhouse, Inc. is a growing restaurant company operating predominantly in the casual dining segment. Our late founder, W. Kent Taylor, started the Company in 1993 with the opening of the first Texas Roadhouse restaurant in Clarksville, Indiana. Since then, we have grown to three concepts with 822 restaurants in 49 states, one U.S. territory, and ten foreign countries. As of March 31, 2026, our 822 restaurants included:

Current wording

Texas Roadhouse, Inc. is a growing restaurant company operating predominantly in the casual dining segment. Our late founder, W. Kent Taylor, started the Company in 1993 with the opening of the first Texas Roadhouse restaurant in Clarksville, Indiana. Since then, we have grown to three concepts with 832 restaurants in 49 states, one U.S. territory, and ten foreign countries. As of June 30, 2026, our 832 restaurants included:

Previous wording

Throughout this report, the 13 weeks ended March 31, 2026 and April 1, 2025, are referred to as Q1 2026 and Q1 2025, respectively. Fiscal year 2026 will be 52 weeks in length, with the quarters 13 weeks in length. Fiscal year 2025 was 52 weeks in length, with the quarters 13 weeks in length.

Current wording

Throughout this report, the 13 weeks ended June 30, 2026 and July 1, 2025, are referred to as Q2 2026 and Q2 2025, respectively. The 26 weeks ended June 30, 2026 and July 1, 2025, are referred to as 2026 YTD and 2025 YTD, respectively. Fiscal year 2026 will be 52 weeks in length, with the quarters 13 weeks in length. Fiscal year 2025 was 52 weeks in length, with the quarters 13 weeks in length.

Previous wording

expense related to executive officers and Support Center employees, salary and share-based compensation expense related to regional and market partners, software hosting fees, professional fees, group insurance, and the realized and unrealized holding gains and losses related to the investments in our deferred compensation plan.

Current wording

infrastructure to support future growth. This includes salary, incentive-based, and share-based compensation expense related to executive officers and Support Center employees, salary and share-based compensation expense related to regional and market partners, software hosting fees, professional fees, group insurance, and the realized and unrealized holding gains and losses related to the investments in our deferred compensation plan.

Previous wording

Total revenue increased $185.5 million or 12.8% to $1,633.2 million in Q1 2026 compared to $1,447.6 million in Q1 2025 primarily due to increases in comparable restaurant sales and store weeks. Comparable restaurant sales and store weeks increased 7.1% and 5.7%, respectively, at company restaurants in Q1 2026 compared to Q1 2025. The increase in comparable restaurant sales was due to an increase in guest traffic along with an increase in per person average check. The increase in store weeks was due to new store openings and the acquisition of franchise restaurants.

Current wording

Total revenue increased $167.9 million or 11.1% to $1,680.0 million in Q2 2026 compared to $1,512.1 million in Q2 2025 primarily due to increases in comparable restaurant sales and store weeks. Comparable restaurant sales and store weeks increased 6.2% and 5.0%, respectively, at company restaurants in Q2 2026 compared to Q2 2025. The increase in comparable restaurant sales was due to an increase in guest traffic along with an increase in per person average check. The increase in store weeks was due to new store openings and the acquisition of franchise restaurants.

Previous wording

Net income increased $9.8 million or 8.6% to $123.4 million in Q1 2026 compared to $113.7 million in Q1 2025 primarily due to higher restaurant margin dollars, as described below, partially offset by higher depreciation and amortization expenses and higher general and administrative expenses. Diluted earnings per share increased 9.6% to $1.87 in Q1 2026 from $1.70 in Q1 2025 due to the increase in net income and the impact of share repurchases.

Current wording

Net income decreased $2.2 million or 1.7% to $121.9 million in Q2 2026 compared to $124.1 million in Q2 2025 as the increase in restaurant margin dollars, as described below, was more than offset by increases in pre-opening, depreciation and amortization, and general and administrative expenses. Diluted earnings per share decreased 0.7% to $1.85 in Q2 2026 from $1.86 in Q2 2025 due to the decrease in net income partially offset by the impact of share repurchases.

Previous wording

Restaurant margin dollars increased $25.1 million or 10.5% to $264.4 million in Q1 2026 compared to $239.3 million in Q1 2025 primarily due to higher sales. Restaurant margin, as a percentage of restaurant and other sales, decreased to 16.3% in Q1 2026 compared to 16.6% in Q1 2025. The decrease in restaurant margin, as a percentage of restaurant and other sales, was primarily due to commodity inflation of 6.2% and wage and other labor inflation of 3.8% partially offset by higher sales.

Current wording

Restaurant margin dollars increased $17.8 million or 6.9% to $275.1 million in Q2 2026 compared to $257.3 million in Q2 2025 primarily due to higher sales. Restaurant margin, as a percentage of restaurant and other sales, decreased to 16.4% in Q2 2026 compared to 17.1% in Q2 2025. The decrease in restaurant margin, as a percentage of restaurant and other sales, was primarily due to commodity inflation of 7.0% and wage and other labor inflation of 3.9% partially offset by higher sales.

Previous wording

Capital allocation spend included capital expenditures of $80.2 million, franchise acquisitions of $71.8 million, dividends of $49.4 million, and repurchases of common stock of $28.2 million.

Current wording

Cash provided by operating activities was $180.1 million and capital allocation spend included capital expenditures of $98.7 million, dividends of $49.3 million, and repurchases of common stock of $42.6 million.

Previous wording

Restaurant and other sales increased 12.9% in Q1 2026 compared to Q1 2025. The following table summarizes certain key drivers and/or attributes of restaurant sales at company restaurants for the periods presented. Company restaurant count activity is shown in the restaurant unit activity table above.

Current wording

Restaurant and other sales increased 11.2% in Q2 2026 compared to Q2 2025 and 12.1% in 2026 YTD compared to 2025 YTD. The following table summarizes certain key drivers and/or attributes of restaurant sales at company restaurants for the periods presented. Company restaurant count activity is shown in the restaurant unit activity table above.

Previous wording

The increase in restaurant sales for Q1 2026 was primarily attributable to an increase in comparable restaurant sales and an increase in store weeks. The increase in comparable restaurant sales was driven by an increase in guest traffic count along with an increase in our per person average check as shown in the table below. The increase in store weeks was driven by new store openings and the acquisition of franchise restaurants.

Current wording

The increase in restaurant sales for Q2 2026 and 2026 YTD was primarily attributable to an increase in comparable restaurant sales and an increase in store weeks. The increase in comparable restaurant sales was driven by an increase in guest traffic count along with an increase in our per person average check as shown in the table below. The increase in store weeks was driven by new store openings and the acquisition of franchise restaurants.

Previous wording

To-go sales as a percentage of restaurant sales were 14.6% in Q1 2026 compared to 13.6% in Q1 2025.

Current wording

To-go sales as a percentage of restaurant sales were 14.3% in Q2 2026 compared to 13.3% in Q2 2025. To-go sales as a percentage of restaurant sales were 14.4% in 2026 YTD compared to 13.4% in 2025 YTD.

Previous wording

Per person average check includes the benefit of a menu price increase of approximately 1.4% and 1.7% implemented in Q2 2025 and Q4 2025, respectively. In addition, we implemented a menu price increase of approximately 1.9% at the beginning of Q2 2026.

Current wording

Per person average check includes the benefit of a menu price increase of approximately 1.9% implemented in Q2 2026 and menu price increases of approximately 1.4% and 1.7% implemented in Q2 2025 and Q4 2025, respectively.

Previous wording

In Q1 2026, we opened four Texas Roadhouse company restaurants and acquired five domestic franchise Texas Roadhouse restaurants. In 2026, we expect store week growth of 5% to 6% across all concepts.

Current wording

In 2026 YTD, we opened nine Texas Roadhouse company restaurants, three Bubba’s 33 company restaurants, and one Jaggers company restaurant. In 2026, we expect store week growth of 5% to 6%, including the benefit from franchise acquisitions.

Previous wording

Royalties and franchise fees decreased $0.8 million or 11.3% in Q1 2026 compared to Q1 2025. The decrease in Q1 2026 compared to Q1 2025 was primarily due to decreased royalties related to the franchise stores that were acquired.

Current wording

Royalties and franchise fees decreased $1.0 million or 12.6% in Q2 2026 compared to Q2 2025 and decreased by $1.8 million or 12.0% in 2026 YTD compared to 2025 YTD. The decreases were primarily due to decreased royalties related to the franchise stores that were acquired.

Previous wording

Food and beverage costs, as a percentage of restaurant and other sales, increased to 35.3% in Q1 2026 compared to 34.1% in Q1 2025. The increase was primarily driven by commodity inflation of 6.2% in Q1 2026, due to higher beef costs, partially offset by the benefit of a higher average guest check.

Current wording

Food and beverage costs, as a percentage of restaurant and other sales, increased to 35.4% in Q2 2026 compared to 34.0% in Q2 2025 and increased to 35.3% in 2026 YTD compared to 34.0% in 2025 YTD. The increases were primarily driven by commodity inflation of 7.0% in Q2 2026 and 6.6% in 2026 YTD, due to higher beef costs, partially offset by the benefit of a higher average guest check.

Previous wording

In 2026, we expect commodity inflation of 6% to 7%, with prices locked for approximately 65% of our remaining forecasted costs and the remainder subject to floating market prices.

Current wording

In 2026, we expect commodity inflation of approximately 5%, with prices locked for approximately 60% of our remaining forecasted costs and the remainder subject to floating market prices.

Previous wording

Restaurant labor expenses, as a percentage of restaurant and other sales, decreased to 32.9% in Q1 2026 compared to 33.3% in Q1 2025. The decrease was primarily driven by the benefit of a higher average guest check and labor productivity partially offset by wage and other labor inflation of 3.8% in Q1 2026.

Current wording

Restaurant labor expenses, as a percentage of restaurant and other sales, decreased to 32.5% in Q2 2026 compared to 32.9% in Q2 2025 and decreased to 32.7% in 2026 YTD compared to 33.1% in 2025 YTD. The decreases were primarily driven by the benefit of a higher average guest check and labor productivity partially offset by wage and other labor inflation of 3.9% in both Q2 2026 and 2026 YTD.

Previous wording

Restaurant rent expense, as a percentage of restaurant and other sales, decreased to 1.5% in Q1 2026 compared to 1.6% in Q1 2025. The decrease was primarily driven by the increase in average unit volume partially offset by higher rent expense at our newer restaurants.

Current wording

Restaurant rent expense, as a percentage of restaurant and other sales, was 1.5% for all periods presented. In Q2 2026 and 2026 YTD, higher rent expense at our newer restaurants was offset by the increase in average unit volume.

Previous wording

Restaurant other operating expenses, as a percentage of restaurant and other sales, decreased to 14.0% in Q1 2026 compared to 14.4% in Q1 2025. The decrease was primarily driven by the increase in average unit volume and lower general liability insurance expense partially offset by higher credit card fees.

Current wording

Restaurant other operating expenses, as a percentage of restaurant and other sales, decreased to 14.2% in Q2 2026 compared to 14.5% in Q2 2025 and decreased to 14.1% in 2026 YTD compared to 14.5% in 2025 YTD. The decreases were primarily driven by lower general liability insurance and incentive compensation expense, as well as the increase in average unit volume, partially offset by higher credit card fees and utilities expenses.

Previous wording

Pre-opening expenses were $6.6 million in Q1 2026 compared to $6.8 million in Q1 2025. Pre-opening costs will fluctuate from quarter to quarter based on specific pre-opening costs incurred for each restaurant, the number and timing of restaurant openings, and the number and timing of restaurant managers hired.

Current wording

Pre-opening expenses were $8.5 million in Q2 2026 compared to $5.5 million in Q2 2025 and $15.1 million in 2026 YTD compared to $12.3 million in 2025 YTD. The increases were driven by an increase in our pipeline of new store openings. Pre-opening costs will fluctuate from quarter to quarter based on specific pre-opening costs incurred for each restaurant, the number and timing of restaurant openings, and the number and timing of restaurant managers hired.

Previous wording

Depreciation and amortization expenses, as a percentage of total revenue, increased to 3.5% in Q1 2026 compared to 3.4% in Q1 2025. The increase was driven by higher depreciation expense at our newer restaurants and intangible asset amortization expense related to the acquisition of franchise restaurants partially offset by the increase in average unit volume.

Current wording

Depreciation and amortization expenses, as a percentage of total revenue, increased to 3.5% in both Q2 2026 and 2026 YTD compared to 3.4% in both Q2 2025 and 2025 YTD. The increases were driven by higher depreciation expense at our newer restaurants and intangible asset amortization expense related to the acquisition of franchise restaurants partially offset by the increase in average unit volume.

Previous wording

Impairment and closure costs, net were not significant in Q1 2026 and Q1 2025.

Current wording

Impairment and closure costs, net were $0.2 million in both Q2 2026 and 2026 YTD, compared to $0.1 million in both Q2 2025 and 2025 YTD. Impairment and closure costs, net in all periods presented primarily included costs related to restaurant relocations.

Previous wording

General and administrative expenses, as a percentage of total revenue, decreased to 3.7% in Q1 2026 compared to 3.9% in Q1 2025. The decrease was primarily driven by the increase in average unit volume and lower rent expense due to the purchase of our Support Center in 2025 partially offset by higher incentive and stock compensation expense.

Current wording

General and administrative expenses, as a percentage of total revenue, increased to 4.3% in Q2 2026 compared to 4.2% in Q2 2025 and was 4.0% in 2026 YTD and in 2025 YTD, respectively. In Q2 2026 and 2026 YTD compared to Q2 2025 and 2025 YTD, higher legal settlement expense and higher incentive and stock compensation expense was partially offset by lower rent expense due to the purchase of our Support Center in 2025 and the increase in average unit volume.

Previous wording

Interest income, net was $0.5 million in Q1 2026 compared to $1.3 million in Q1 2025. The decrease was driven by decreased earnings on our cash and cash equivalents and borrowings on our credit facility.

Current wording

Interest income, net was $1.0 million in both Q2 2026 and Q2 2025 and was $1.6 million in 2026 YTD compared to $2.3 million in 2025 YTD. The decrease in 2026 YTD compared to 2025 YTD was driven by decreased earnings on our cash and cash equivalents and borrowings on our credit facility.

Previous wording

Equity income was $0.1 million in Q1 2026 compared to $0.2 million Q1 2025. The decrease was driven by fewer affiliates due to the acquisition of six of these affiliates in the prior year.

Current wording

Equity income was $0.2 million in Q2 2026 compared to $1.4 million Q2 2025 and was $0.3 million in 2026 YTD compared to $1.7 million in 2025 YTD. The decreases were driven by lapping a $1.2 million gain on the acquisition of three of the affiliates in Q2 2025 and fewer affiliates due to the acquisition of six of these affiliates in the prior year.

Previous wording

Our effective tax rate was 14.3% in Q1 2026 compared to 14.8% in Q1 2025. The decrease in the tax rate was driven by an increase in the impact of the FICA tip tax credit partially offset by a decrease in the excess tax benefit on stock compensation, the expiration of the workers’ opportunity tax credit, and an increase in non-deductible officers’ compensation.

Current wording

Our effective tax rate was 13.5% in Q2 2026 compared to 14.9% in Q2 2025 and was 13.9% in 2026 YTD compared to 14.8% in 2025 YTD. The decreases in the tax rates were driven primarily by an increase in the impact of the FICA tip tax credit partially offset by a decrease in the excess tax benefit on stock compensation and an increase in non-deductible officers’ compensation.

Previous wording

In 2026, we expect an effective tax rate of 14% to 15% based on forecasted operating results.

Current wording

In 2026, we expect an effective tax rate of approximately 14% based on forecasted operating results.

Previous wording

In our Texas Roadhouse reportable segment, restaurant margin dollars increased $23.9 million or 10.6% in Q1 2026. The increase was due to higher sales partially offset by higher food and beverage costs due to commodity inflation. In addition, restaurant margin, as a percentage of restaurant and other sales, decreased to 16.3% in Q1 2026 from 16.7% in Q1 2025. Restaurant margin percentage was primarily impacted by commodity inflation partially offset by higher sales.

Current wording

In our Texas Roadhouse reportable segment, restaurant margin dollars increased $17.0 million or 7.1% in Q2 2026 and increased $40.9 million or 8.8% in 2026 YTD. The increases were due to higher sales partially offset by higher food costs due to commodity inflation. In addition, restaurant margin, as a percentage of restaurant and other sales, decreased to 16.5% in Q2 2026 from 17.1% in Q2 2025 and decreased to 16.4% in 2026 YTD from 16.9% in 2025 YTD. Restaurant margin percentage was primarily impacted by commodity inflation partially offset by higher sales.

Previous wording

In our Bubba’s 33 reportable segment, restaurant margin dollars increased $1.2 million or 9.6% in Q1 2026. The increase was due to higher sales partially offset by higher food and beverage costs and an increase in general liability insurance expense. In addition, restaurant margin, as a percentage of restaurant and other sales, decreased to 15.2% in Q1 2026 from 16.1% in Q1 2025. Restaurant margin percentage was primarily impacted by the increased expenses noted above, which were partially offset by higher sales.

Current wording

In our Bubba’s 33 reportable segment, restaurant margin dollars increased $0.5 million or 3.2% in Q2 2026 and increased $1.7 million or 6.2% in 2026 YTD. The increases were due to higher sales partially offset by higher food costs and higher restaurant labor expenses. In addition, restaurant margin, as a percentage of restaurant and other sales, decreased to 15.3% in Q2 2026 from 16.7% in Q2 2025 and decreased to 15.2% in 2026 YTD from 16.4% in 2025 YTD. Restaurant margin percentage was primarily impacted by the increased expenses noted above, which were partially offset by higher sales.

Previous wording

Net cash provided by operating activities was $259.1 million in Q1 2026 compared to $237.7 million in Q1 2025. This increase was primarily due to increases in net income, depreciation and amortization expenses, and deferred income taxes partially offset by an unfavorable change in working capital.

Current wording

Net cash provided by operating activities was $439.2 million in 2026 YTD compared to $366.0 million in 2025 YTD. This increase was primarily due to increases in net income, depreciation and amortization expenses, deferred income taxes, and a favorable change in working capital.

Previous wording

Net cash used in investing activities was $146.8 million in Q1 2026 compared to $155.6 million in Q1 2025. The decrease was primarily due to proceeds from sale leaseback transactions in Q1 2026.

Current wording

Net cash used in investing activities was $242.0 million in 2026 YTD compared to $259.5 million in 2025 YTD. The decrease was primarily due to the acquisition of 17 franchise restaurants in 2025 YTD compared to five in 2026 YTD and an increase in proceeds from sale leaseback transactions partially offset by an increase in capital expenditures.

Previous wording

We require capital principally for the development of new company restaurants, the refurbishment or relocation of existing restaurants, and the acquisition of franchise restaurants. We either lease our restaurant site locations under operating leases for periods of five to 30 years (including renewal periods) or purchase the land when appropriate. As of March 31, 2026, we had developed 156 of the 723 company restaurants on land that we own.

Current wording

We require capital principally for the development of new company restaurants, the refurbishment or relocation of existing restaurants, and the acquisition of franchise restaurants. We either lease our restaurant site locations under operating leases for periods of five to 30 years (including renewal periods) or purchase the land when appropriate.

Previous wording

Net cash used in financing activities was $32.5 million in Q1 2026 compared to $106.3 million in Q1 2025. The decrease was primarily due to borrowing $50.0 million on our credit facility and a decrease in share repurchases.

Current wording

Net cash used in financing activities was $129.5 million in 2026 YTD compared to $174.9 million in 2025 YTD. The decrease was primarily due to net borrowings of $50.0 million on our credit facility and a decrease in indirect repurchases of shares for minimum tax withholdings related to our stock compensation program partially offset by an increase in share repurchases and an increase in quarterly dividend payments.

Previous wording

On February 18, 2026, our Board approved the payment of a quarterly cash dividend of $0.75 per share of common stock compared to the quarterly dividend of $0.68 per share of common stock declared in 2025. The payment of quarterly dividends totaled $49.4 million and $45.2 million in Q1 2026 and Q1 2025, respectively.

Current wording

On February 18, 2026, our Board approved the payment of a quarterly cash dividend of $0.75 per share of common stock compared to the quarterly dividend of $0.68 per share of common stock declared in 2025. The payment of quarterly dividends totaled $98.7 million and $90.3 million in 2026 YTD and 2025 YTD, respectively.

Previous wording

On February 19, 2025, our Board approved a stock repurchase program for the repurchase of up to $500.0 million of our common stock. This stock repurchase program has no expiration date and replaces the previous stock repurchase program which was approved in 2022.

Current wording

On February 19, 2025, our Board approved a stock repurchase program for the repurchase of up to $500.0 million of our common stock. This stock repurchase program has no expiration date and replaced the previous stock repurchase program which was approved in 2022.

Previous wording

During Q1 2026, we paid $28.2 million, excluding excise taxes, to repurchase 161,215 shares of our common stock. During Q1 2025, we paid $50.2 million, excluding excise taxes, to repurchase 281,091 shares of our common stock. As of March 31, 2026, $351.8 million remained under our authorized stock repurchase program.

Current wording

During 2026 YTD, we paid $70.8 million, excluding excise taxes, to repurchase 415,133 shares of our common stock. During 2025 YTD, we paid $60.0 million, excluding excise taxes, to repurchase 342,789 shares of our common stock. As of June 30, 2026, $309.2 million remained under our authorized stock repurchase program.

Previous wording

As of March 31, 2026, we had $50.0 million in outstanding borrowings under the credit facility and had $397.6 million of availability, net of $2.4 million of outstanding letters of credit, respectively. As of December 30, 2025, we had no outstanding borrowings under the previous credit facility and had $447.6 million of availability, net of $2.4 million of outstanding letters of credit.

Current wording

As of June 30, 2026, we had $50.0 million in outstanding borrowings under the credit facility and had $397.6 million of availability, net of $2.4 million of outstanding letters of credit. As of December 30, 2025, we had no outstanding borrowings under the credit facility and had $447.6 million of availability, net of $2.4 million of outstanding letters of credit.

Previous wording

As of March 31, 2026 and December 30, 2025, we were contingently liable for $7.6 million and $7.8 million, respectively, for five lease guarantees. These amounts represent the maximum potential liability of future payments under the guarantees. In the event of default, the indemnity and default clauses in our assignment agreements govern our ability to pursue and recover damages incurred. No material liabilities have been recorded as of March 31, 2026 and December 30, 2025 as the likelihood of default was deemed to be less than probable and the fair value of the guarantees is not considered significant.

Current wording

As of June 30, 2026 and December 30, 2025, we were contingently liable for $7.5 million and $7.8 million, respectively, for five lease guarantees. These amounts represent the maximum potential liability of future payments under the guarantees. In the event of default, the indemnity and default clauses in our assignment agreements govern our ability to pursue and recover damages incurred. No material liabilities have been recorded as of June 30, 2026 and December 30, 2025 as the likelihood of default was deemed to be less than probable and the fair value of the guarantees is not considered significant.