Dine Brands Global, Inc.

Previous wording

You should read the following Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in conjunction with the consolidated financial statements and the related notes that appear elsewhere in this report and the MD&A contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Statements contained in this report may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Please refer to the section of this report under the heading “Cautionary Statement Regarding Forward-Looking Statements” for more information. Except where the context indicates otherwise, the words “we,” “us,” “our,” “Dine Brands Global” and the “Company” refer to Dine Brands Global, Inc., together with its subsidiaries that are consolidated in accordance with United States generally accepted accounting principles (“U.S. GAAP”).

Current wording

You should read the following Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in conjunction with the condensed consolidated financial statements and the related notes that appear elsewhere in this report and the MD&A contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Statements contained in this report may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Please refer to the section of this report under the heading “Cautionary Statement Regarding Forward-Looking Statements” for more information. Except where the context indicates otherwise, the words “we,” “us,” “our,” “Dine Brands Global” and the “Company” refer to Dine Brands Global, Inc., together with its subsidiaries that are consolidated in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”).

Previous wording

The financial tables appearing in this MD&A present amounts in millions of dollars that are rounded from our consolidated financial statements presented in thousands of dollars. As a result, the tables may not foot or crossfoot due to rounding.

Current wording

The financial tables appearing in this MD&A present amounts in millions of dollars that are rounded from our condensed consolidated financial statements presented in thousands of dollars. As a result, the tables may not foot or crossfoot due to rounding.

Previous wording

The effective tax rate for the three and six months ended June 30, 2025 was higher than the rate of the comparable prior periods primarily due to a lower tax deduction related to stock-based compensation, resulting from the changes in our stock price.

Current wording

The effective tax rate for the three months ended September 30, 2025 was comparable to the prior year period. The effective tax rate for the nine months ended September 30, 2025 was higher than the rate of the prior comparable period primarily due to a lower tax deduction related to stock-based compensation, resulting from the changes in our share price.

Previous wording

The following table highlights the primary components of the decrease in our income before income taxes for the three and six months ended June 30, 2025, compared to our income before income taxes for the comparable prior periods (in millions):

Current wording

The following table highlights the primary components of the decrease in our income before income taxes for the three and nine months ended September 30, 2025, compared to our income before income taxes for the comparable prior year periods (in millions):

Previous wording

Total gross profit for the three months ended June 30, 2025 decreased compared with the same period of the prior year due to decreased revenue from franchise, company restaurant and rental operations. In addition, income before income taxes for the three months ended June 30, 2025 decreased compared with the prior year period primarily due to a decrease in gross profit, an increase in G&A expenses and a loss on extinguishment of debt in the current period. The increase in G&A expenses is primarily attributable to an increase in compensation-related expenses and an increase in professional service fees, both due in part to the G&A expenses related to company restaurant operations as well as dual brand and remodel initiatives. The loss on extinguishment of debt for the three months ended June 30, 2025 relates to the write-off of the unamortized debt issuance costs of the 2019 Class A-2-II Notes that were voluntarily fully repaid in June 2025.

Current wording

In addition, income before income taxes for the three months ended September 30, 2025 decreased compared with the prior year period primarily due to a decrease in gross profit, an increase in G&A expenses and an increase in interest expense in the current period. The increase in G&A expenses is primarily attributable to an increase in compensation-related expenses (predominantly incentive compensation) and an increase in travel and conference expenses. The increase in interest expense is primarily due to a refinancing transaction completed in June 2025.

Previous wording

Total gross profit for the six months ended June 30, 2025 decreased compared with the same period of the prior year due to decreased revenue from franchise, rental and company restaurant operations. In addition, income before income taxes for the six months ended June 30, 2025 decreased compared with the prior year period due to a decrease in gross profit, an increase in closure and impairment charges and an increase in G&A expenses. The increase in closure and impairment charges was primarily attributable to the strategic realignment of the IHOP Cincinnati market resulting in the acquisition and closure of certain IHOP restaurants in March 2025. The increase in G&A expenses is primarily due to an increase in professional service and legal fees and costs related to company restaurant operations as well as dual brand and remodel initiatives, partially offset by a decrease in stock-based compensation and a decrease in software maintenance costs.

Current wording

In addition, income before income taxes for the nine months ended September 30, 2025 decreased compared with the prior year period due to a decrease in gross profit, an increase in G&A expenses, an increase in closure and impairment charges and an increase in interest expense. The increase in G&A expenses is primarily due to an increase in professional service and legal fees, an increase in travel and conference expenses and an increase in compensation-related expenses (predominantly incentive compensation offset by a decrease in severance expense) as well as costs related to company restaurant operations and our dual brand initiative, partially offset by a decrease in software maintenance costs. The increase in closure and impairment charges was primarily attributable to the strategic realignment of the IHOP Cincinnati market resulting in the acquisition and closure of certain IHOP restaurants in March 2025 and revisions to existing closure reserves. The increase in interest expense is primarily due to a refinancing transaction completed in June 2025.

Previous wording

See“Consolidated Results of Operations - Comparison of the Three and Six Months Ended June 30, 2025 and 2024” for additional discussion of the changes shown above.

Current wording

See“Consolidated Results of Operations - Comparison of the Three and Nine Months Ended September 30, 2025 and 2024” for additional discussion of the changes shown above.

Previous wording

Our key performance indicators for the three and six months ended June 30, 2025 were as follows:

Current wording

Our key performance indicators for the three and nine months ended September 30, 2025 were as follows:

Previous wording

(1) Franchise and area license restaurant closings, net of openings, during the three and six months ended June 30, 2025.

Current wording

(1) Franchise and area license restaurant closings, net of openings, during the three and nine months ended September 30, 2025.

Previous wording

(2) Change in the weighted average number of franchise, area license and company-owned restaurants open during the three and six months ended June 30, 2025, compared to the weighted average number of those open during the same periods of 2024.

Current wording

(2) Change in the weighted average number of franchise, area license and company-owned restaurants open during the three and nine months ended September 30, 2025, compared to the weighted average number of those open during the same periods of 2024.

Previous wording

Applebee’s system-wide domestic same-restaurant sales increased 4.9% for the three months ended June 30, 2025 and 1.3% for the six months ended June 30, 2025 as compared to the same periods of 2024. The increase in same-restaurant sales was primarily due to an increase in traffic and average check.

Current wording

Applebee’s system-wide domestic same-restaurant sales increased 3.1% for the three months ended September 30, 2025 and 1.9% for the nine months ended September 30, 2025 as compared to the same periods of 2024. The increase in same-restaurant sales was due to an increase in traffic and average check.

Previous wording

Based on data from Black Box Intelligence, a restaurant sales reporting firm (“Black Box”), Applebee's increase in same-restaurant sales for the three months ended June 30, 2025 outperformed, and for the six months ended June 30, 2025 underperformed the casual dining segment of the restaurant industry (excluding Applebee's) as compared with the same respective periods of 2024.

Current wording

Based on data from Black Box Intelligence, a restaurant sales reporting firm (“Black Box”), Applebee's increase in same-restaurant sales for the three and nine months ended September 30, 2025 underperformed the casual dining category of the restaurant industry (excluding Applebee's) as compared with the same respective periods of 2024.

Previous wording

IHOP's system-wide domestic same-restaurant sales decreased 2.3% for the three months ended June 30, 2025 as compared to the same period of 2024, primarily due to a decrease in average check. IHOP's system-wide domestic same-restaurant sales decreased 2.5% for the six months ended June 30, 2025 as compared to the same period of 2024, primarily due to a decrease in average check and a decrease in traffic.

Current wording

IHOP's system-wide domestic same-restaurant sales decreased 1.5% for the three months ended September 30, 2025 as compared to the same period of 2024, primarily due to a decrease in average check. IHOP's system-wide domestic same-restaurant sales decreased 2.2% for the nine months ended September 30, 2025 as compared to the same period of 2024, primarily due to a decrease in average check, partially offset by an increase in traffic.

Previous wording

Based on data from Black Box, IHOP's same-restaurant sales for the three and six months ended June 30, 2025 underperformed the family dining segment of the restaurant industry (excluding IHOP) as compared with the same respective periods of 2024.

Current wording

Based on data from Black Box, IHOP's same-restaurant sales for the three and nine months ended September 30, 2025 underperformed the family dining category of the restaurant industry (excluding IHOP) as compared with the same respective periods of 2024.

Previous wording

Fuzzy's system-wide domestic same-restaurant sales decreased 11.8% for the three months ended June 30, 2025 and 12.0% for the six months ended June 30, 2025 as compared to the same respective periods of 2024. The decrease in same-restaurant sales was primarily due to a decrease in traffic and a decrease in average check.

Current wording

Fuzzy's system-wide domestic same-restaurant sales decreased 1.5% for the three months ended September 30, 2025 and 8.7% for the nine months ended September 30, 2025 as compared to the same respective periods of 2024. The decrease in same-restaurant sales was primarily due to a decrease in traffic, partially offset by an increase in average check.

Previous wording

The following table sets forth the number of “Effective Restaurants” in the Applebee’s, IHOP and Fuzzy's systems and information regarding the percentage change in sales at those restaurants compared to the same period of the prior year. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company and, as such, the percentage change in sales at Effective Restaurants is based on non-GAAP sales data. However, we believe that presentation of this information is useful in analyzing our revenues because franchisees and area licensees pay us royalties and advertising fees that are based on a percentage of their sales, and, where applicable, rental payments under leases that are based on a percentage of their sales. Management also uses this information to make decisions about plans for future development of additional restaurants as well as evaluation of current operations.

Current wording

The following table sets forth the number of “Effective Restaurants” in the Applebee’s, IHOP and Fuzzy's systems and information regarding the percentage change in sales at those restaurants compared to the same period of the prior year. Sales at restaurants that are owned by franchisees and area licensees are not revenues of the Company. However, franchisees and area licensees pay us royalties and advertising fees that are based on a percentage of their sales, and, where applicable, rental payments under leases that are based on a percentage of their sales. Management also uses this information to make decisions about plans for future development of additional restaurants as well as evaluation of current operations.

Previous wording

(a) “Effective Restaurants” are the weighted average number of restaurants open in each fiscal period, adjusted to account for restaurants open for only a portion of the period. Information is presented for all Effective Restaurants in the Applebee’s, IHOP and Fuzzy's systems, which consist of restaurants owned by franchisees and area licensees as well as those owned by the Company. Effective Restaurants do not include units operated as ghost kitchens (small kitchens with no store-front presence, used to fill off-premise orders).

Current wording

(a) “Effective Restaurants” are the weighted average number of restaurants open in each fiscal period, adjusted to account for restaurants open for only a portion of the period. Information is presented for all Effective Restaurants in the Applebee’s, IHOP and Fuzzy's systems, which consist of restaurants owned by franchisees and area licensees as well as those owned by the Company.

Previous wording

(b) “System-wide sales” are retail sales at Applebee’s and Fuzzy's restaurants operated by franchisees and IHOP restaurants operated by franchisees and area licensees, as reported to the Company, in addition to retail sales at company-owned Applebee's, IHOP and Fuzzy's restaurants. System-wide sales do not include retail sales of ghost kitchens. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. An increase in franchisees' reported sales will result in a corresponding increase in our royalty revenue, while a decrease in franchisees' reported sales will result in a corresponding decrease in our royalty revenue. Unaudited reported sales for Applebee's, IHOP and Fuzzy's franchise restaurants, IHOP area license restaurants, and Applebee's, IHOP and Fuzzy's company-owned restaurants were as follows:

Current wording

(b) “System-wide sales” are retail sales at Applebee’s and Fuzzy's restaurants operated by franchisees and IHOP restaurants operated by franchisees and area licensees, as reported to the Company, in addition to retail sales at company-owned Applebee's, IHOP and Fuzzy's restaurants. Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. An increase in franchisees' reported sales will result in a corresponding increase in our royalty revenue, while a decrease in franchisees' reported sales will result in a corresponding decrease in our royalty revenue. Unaudited reported sales for Applebee's, IHOP and Fuzzy's franchise restaurants, IHOP area license restaurants, and Applebee's, IHOP and Fuzzy's company-owned restaurants were as follows:

Previous wording

(c) “Sales percentage change” reflects, for each category of restaurants, the percentage change in sales in any given fiscal period compared to the prior period for all restaurants in that category.

Current wording

(c) “Sales percentage change” reflects, for each category of restaurants, the percentage change in sales in any given fiscal period compared to the prior year period for all restaurants in that category.

Previous wording

(d) “Domestic same-restaurant sales percentage change” reflects the percentage change in sales in any given fiscal period, compared to the same weeks in the prior period, for domestic restaurants that have been operated during both periods that are being compared and have been open for at least 18 months. Because of new restaurant openings and restaurant closures, the domestic restaurants open throughout both fiscal periods being compared may be different from period to period.

Current wording

(d) “Domestic same-restaurant sales percentage change” reflects the percentage change in sales in any given fiscal period, compared to the same weeks in the prior year period, for domestic restaurants that have been operated during both periods that are being compared and have been open for at least 18 months. Because of new restaurant openings and restaurant closures, the domestic restaurants open throughout both fiscal periods being compared may be different from period to period.

Previous wording

The restaurant counts and activity presented above include 20 dual-branded international and one dual-branded domestic Applebee's and IHOP restaurants at June 30, 2025, and 10 dual-branded international Applebee's and IHOP restaurants at June 30, 2024, which are separately counted in each of our brands' restaurant counts and activity. Dual-branded restaurants are defined as restaurants that reside in one location and operate two of our restaurant concepts under two separate franchise agreements.

Current wording

The restaurant counts and activity presented above include 23 dual branded international and six dual branded domestic Applebee's and IHOP restaurants at September 30, 2025, and 13 dual branded international and no dual branded domestic Applebee's and IHOP restaurants at September 30, 2024, which are separately counted in each of our brands' restaurant counts and activity. Dual branded restaurants are defined as restaurants that reside in one location and operate two of our restaurant concepts under two separate franchise agreements.

Previous wording

During the three and six months ended June 30, 2025, we operated 47 Applebee's restaurants across Georgia, Texas, Arkansas, Illinois, Kentucky, Tennessee, Mississippi and Missouri acquired in November 2024 and 10 IHOP restaurants in Ohio and Kentucky acquired in March 2025. During the three months ended June 30, 2025 we also operated 12 Applebee's restaurants across Kentucky, Indiana, Arkansas, and Oklahoma acquired in May 2025. During the three and six months ended June 30, 2024, we did not operate any Applebee's and IHOP restaurants.

Current wording

During the three and nine months ended September 30, 2025, we owned 47 Applebee's restaurants across Georgia, Texas, Arkansas, Illinois, Kentucky, Tennessee, Mississippi and Missouri acquired in November 2024, 10 IHOP restaurants in Ohio and Kentucky in March 2025, and 12 Applebee's restaurants across Kentucky, Indiana, Arkansas and Oklahoma acquired in May 2025. Including our one Fuzzy's company-owned restaurant, our total number of company-owned restaurants represents 2% of total system restaurant count as of September 30, 2025. During the three and nine months ended September 30, 2024, we did not own any Applebee's or IHOP restaurants.

Previous wording

While we currently intend to own and operate these restaurants for the near term, we will assess and monitor opportunities to refranchise these restaurants under favorable circumstances. From time to time, we may acquire restaurants from franchisees for a variety of reasons which is consistent with and should not be considered a change in our business strategy to operate as a highly franchised company.

Current wording

While we currently intend to own and operate these restaurants for the near term, we will assess and monitor opportunities to refranchise these restaurants under favorable circumstances. From time to time, we may acquire restaurants from franchisees for a variety of reasons which is consistent with, and should not be considered a change in, our business strategy to operate largely as a franchisor.

Previous wording

Total revenue for the three and six months ended June 30, 2025 increased compared with the same periods of the prior year, primarily due to the operation of 47 Applebee's restaurants acquired in November 2024 and ten IHOP restaurants acquired in March 2025 (and to a lesser extent for the six-month period, 12 Applebee's restaurants acquired in May 2025), partially offset by the decreases in franchise and rental operations revenue. The decrease in franchise operations revenue was primarily attributable to the decreases in IHOP and Fuzzy's domestic same-restaurant sales, the decrease in the number of effective franchise restaurants and the decrease in proprietary product sales partially offset by an increase in Applebee's domestic same-restaurant sales. Rental operations revenue for the three months ended June 30, 2025 decreased compared with the same period of the prior year, primarily due to lease terminations. Rental operations revenue for the six months ended June 30, 2025 decreased compared with the same period of the prior year, primarily due to lease terminations and a decrease in percentage rent due to lower system sales.

Current wording

Total revenue for the three and nine months ended September 30, 2025 increased compared with the same periods of the prior year, primarily due to the operation of 47 Applebee's restaurants acquired in November 2024 and ten IHOP restaurants acquired in March 2025 (and to a lesser extent for the nine-month period, 12 Applebee's restaurants acquired in May 2025), partially offset by the decreases in franchise and rental operations revenue. The decrease in franchise operations revenue was primarily attributable to the decreases in IHOP and Fuzzy's domestic same-restaurant sales, the decrease in the number of effective franchise restaurants and the decrease in proprietary product sales, partially offset by an increase in Applebee's domestic same-restaurant sales. Rental operations revenue for the three and nine months ended September 30, 2025 decreased compared with the same periods of the prior year, primarily due to operating lease terminations.

Previous wording

Total gross profit for the three months ended June 30, 2025 decreased compared with the same period of the prior year, primarily due to decreased gross profit from franchise operations and decreased gross profit from company restaurant operations. The franchise operations gross profit decreased primarily due to lower Applebee's and IHOP franchise operations gross profit (see Franchise Operations section below for further details). The company restaurant operations gross profit decreased primarily due to the operation of the 59 Applebee's restaurants and ten IHOP restaurants acquired over the last eight months as mentioned above which the Company is investing in and working towards improving their operations.

Current wording

Total gross profit for the three months ended September 30, 2025 decreased compared with the same period of the prior year, primarily due to company restaurant and franchise operations. The company restaurant operations gross profit decreased primarily due to the operation of the 59 Applebee's restaurants and ten IHOP restaurants acquired over the last 11 months as mentioned above which the Company is investing. The franchise operations gross profit decreased primarily due to a lower number of effective franchise restaurants and decreases in IHOP and Fuzzy’s domestic franchise same-restaurant sales as well as a decrease in IHOP’s proprietary product gross profit, offset by a 3.1% increase in Applebee’s domestic franchise same-restaurant sales (see Franchise Operations section below for further details).

Previous wording

Total gross profit for the six months ended June 30, 2025 decreased compared with the same period of the prior year, primarily due to decreased gross profit from franchise operations as well as decreased gross profit from rental and company restaurant operations. The franchise operations gross profit decreased primarily due to lower Applebee's and IHOP franchise operations gross profit (see Franchise Operations section below for further details). The decrease in rental operations gross profit for the six months ended June 30, 2025 was primarily due to decreased rental revenue as described above. The company restaurant operations gross profit decreased primarily due to the operation of the 59 Applebee's restaurants and ten IHOP restaurants acquired over the last eight months as mentioned above.

Current wording

Total gross profit for the nine months ended September 30, 2025 decreased compared with the same period of the prior year, primarily due to franchise operations, company restaurant and rental operations. The franchise operations gross profit decreased primarily due to a lower number of effective franchise restaurants and decreases in IHOP and Fuzzy’s domestic franchise same-restaurant sales as well as increases in bad debt expense and refranchising costs and a decrease in IHOP’s proprietary product gross profit, offset by a 1.9% increase in Applebee’s domestic franchise same-restaurant sales, an increase in termination fees and a decrease in franchisor advertising contribution (see Franchise Operations section below for further details). The company restaurant operations gross profit decreased primarily due to the operation of the 59 Applebee's restaurants and ten IHOP restaurants acquired over the last 11 months as mentioned above. The decrease in rental operations gross profit for the nine months ended September 30, 2025 was primarily due to decreased rental revenue as described above.

Previous wording

Applebee's franchise expenses for the three and six months ended June 30, 2025 increased $4.8 million and $6.0 million, respectively, compared with the same period of the prior year primarily due to an increase in bad debt expense mainly resulting from a recovery of bad debt expense in the same period of the prior year as well as an increase in refranchising costs.

Current wording

Applebee's franchise expenses for the three and nine months ended September 30, 2025 increased $1.0 million and $7.0 million, respectively, compared with the same periods of the prior year primarily due to an increase in bad debt expense mainly resulting from a recovery of bad debt expense in the same periods of the prior year as well as an increase in refranchising costs.

Previous wording

IHOP franchise fee revenue for the three months ended June 30, 2025 decreased 4.9% as compared with the same period of the prior year, primarily due to a decrease in proprietary product sales and the unfavorable impact on royalties of a 2.2% decrease in domestic franchise same-restaurant sales and a decrease in the number of effective franchise restaurants partially offset by an increase in termination fees.

Current wording

IHOP franchise fees revenue for the three months ended September 30, 2025 decreased 3.0% as compared with the same period of the prior year, primarily due to a decrease in proprietary product sales, the unfavorable impact on royalties of a 1.4% decrease in domestic franchise same-restaurant sales and a decrease in the number of effective franchise restaurants, partially offset by improved collections from international franchisees.

Previous wording

IHOP franchise expense for the three months ended June 30, 2025 decreased $0.8 million as compared with the same period of the prior year, primarily due to a decrease in franchisor advertising contribution.

Current wording

IHOP franchise expense for the three months ended September 30, 2025 decreased $0.8 million as compared with the same period of the prior year, primarily due to a decrease in the cost of proprietary product sales and a decrease in bad debt expense.

Previous wording

IHOP franchise expenses for the six months ended June 30, 2025 decreased $1.5 million as compared with the same period of the prior year, primarily due to a decrease in franchisor advertising contribution and a decrease in the cost of proprietary product sales, partially offset by an increase in bad debt expense and an increase in franchisee IT support costs.

Current wording

IHOP franchise expenses for the nine months ended September 30, 2025 decreased $2.4 million as compared with the same period of the prior year, primarily due to a decrease in the cost of proprietary product sales and a decrease in franchisor advertising contribution.

Previous wording

Fuzzy's franchise expenses for the three and six months ended June 30, 2025 decreased $1.5 million and $2.4 million, respectively, as compared with the same periods of the prior year primarily due to a decrease in franchisor advertising contribution and a decrease in bad debt expense.

Current wording

Fuzzy's franchise expenses for the nine months ended September 30, 2025 decreased $2.3 million as compared with the same period of the prior year primarily due to a decrease in franchisor advertising contribution and a decrease in bad debt expense.

Previous wording

Advertising revenues and expenses for the three and six months ended June 30, 2025 decreased compared to the same periods of the prior year primarily due to fewer effective franchise restaurants due in part to our acquisition of company restaurants (whose contributions to the respective brand's national advertising fund are reflected as company restaurant expenses instead of advertising revenue) and the decreases in IHOP and Fuzzy's domestic franchise same-restaurant sales, partially offset by the increase in Applebee's domestic franchise same-restaurant sales.

Current wording

Advertising revenues and expenses for the three and nine months ended September 30, 2025 decreased compared to the same periods of the prior year primarily due to fewer effective franchise restaurants due in part to our acquisition of company restaurants (whose contributions to the respective brand's national advertising fund are reflected as company restaurant expenses instead of advertising revenue) and the decreases in IHOP and Fuzzy's domestic franchise same-restaurant sales, partially offset by the increase in Applebee's domestic franchise same-restaurant sales.

Previous wording

Rental operations gross profit for the six months ended June 30, 2025 decreased as compared to the same period of the prior year, primarily due to lease terminations and a decrease in percentage rent due to lower system sales.

Current wording

Rental operations gross profit for the nine months ended September 30, 2025 decreased as compared to the same period of the prior year, primarily due to lease terminations and a decrease in percentage rent due to lower system sales.

Previous wording

As discussed under "Events Impacting Comparability of Financial Information," company restaurant operations for the six months ended June 30, 2025 included 47 Applebee's restaurants acquired in November 2024, 10 IHOP restaurants acquired in March 2025, 12 Applebee's restaurants acquired in May 2025, and one Fuzzy's restaurant. Company restaurant operations for the six months ended June 30, 2024 included one Fuzzy's restaurant. Company segment restaurant expenses may include costs associated with acquired restaurants in the process of being refranchised. There were no acquired restaurants expenses during the six months ended June 30, 2024.

Current wording

As discussed under "Events Impacting Comparability of Financial Information," company restaurant operations for the nine months ended September 30, 2025 included 47 Applebee's restaurants acquired in November 2024, 10 IHOP restaurants acquired in March 2025, 12 Applebee's restaurants acquired in May 2025, and one Fuzzy's restaurant. Company restaurant operations for the nine months ended September 30, 2024 included one Fuzzy's restaurant. There were no acquired restaurant expenses during the nine months ended September 30, 2024.

Previous wording

Financing revenues primarily consist of interest income from the financing of IHOP equipment leases and franchise fees as well as interest income on notes receivable due from franchisees. Financing expenses are sales and use taxes related to IHOP equipment leases. Financing revenue and gross profit for the three and six months ended June 30, 2025 declined compared to the same period of the prior year, primarily due to progressive decline in interest income as note balances are repaid.

Current wording

Financing revenues primarily consist of interest income from the financing of IHOP equipment leases and franchise fees as well as interest income on notes receivable due from franchisees. Financing expenses are sales and use taxes related to IHOP equipment leases. Financing revenue and gross profit for the three and nine months ended September 30, 2025 declined compared to the same period of the prior year, primarily due to progressive decline in interest income as note balances are repaid.

Previous wording

G&A expenses, including costs related to company restaurant operations, for the six months ended June 30, 2025 increased 3.1% compared to the same period of the prior year, primarily due to an increase in professional service and legal fees and costs related to company restaurant operations as well as dual brand and remodel initiatives, partially offset by a decrease in stock-based compensation and a decrease in software maintenance costs.

Current wording

G&A expenses, including costs related to company restaurant operations, for the nine months ended September 30, 2025 increased 5.4% compared to the same period of the prior year, primarily due to an increase in professional service and legal fees, an increase in travel and conference expenses and an increase in compensation-related expenses (predominantly incentive compensation offset by a decrease in severance expense) as well as costs related to company restaurant operations and our dual brand initiatives, partially offset by a decrease in software maintenance costs.

Previous wording

Interest expense, net for the six months ended June 30, 2025 decreased compared to the same period of the prior year, primarily due to a decrease in interest rates on our Credit Facility.

Current wording

Interest expense, net for the three and nine months ended September 30, 2025 increased compared to the same periods of the prior year, primarily due to the refinancing transaction of the Series 2025-1 Fixed Rate Senior Secured Notes, partially offset by a decrease in interest rates on our Credit Facility.

Previous wording

The Company repaid the entire outstanding balance of approximately $594.0 million of its 2019 Class A-2-II Notes during the three months ended June 30, 2025 and recognized a $0.9 million loss on extinguishment of debt from the write-off of the related remaining issuance costs.

Current wording

The Company repaid the entire outstanding balance of approximately $594.0 million of its 2019 Class A-2-II Notes during the nine months ended September 30, 2025 and recognized a $0.9 million loss on extinguishment of debt from the write-off of the related remaining issuance costs.

Previous wording

Closure and impairment charges for the three months ended June 30, 2025 increased $0.7 million compared to the same period of the prior year primarily attributable to revisions to existing closure reserves, including accretion, for IHOP restaurants closed prior to 2025.

Current wording

Closure and impairment charges for the three months ended September 30, 2025 increased $0.2 million compared to the same period of the prior year primarily attributable to revisions to existing closure reserves for IHOP restaurants closed prior to 2025.

Previous wording

Closure and impairment charges for the six months ended June 30, 2025 increased $5.9 million compared to the same period of the prior year primarily attributable to the strategic realignment of the IHOP Cincinnati market resulting in the acquisition and closure of certain IHOP restaurants in March 2025 and revisions to existing closure reserves including accretion.

Current wording

Closure and impairment charges for the nine months ended September 30, 2025 increased $6.2 million compared to the same period of the prior year primarily attributable to the strategic realignment of the IHOP Cincinnati market resulting in the acquisition and closure of certain IHOP restaurants in March 2025 and revisions to existing closure reserves including accretion.