Chili’s Parent Wants a Bigger Slice of Fast Food’s Digital Business — CEO Calls Takeout the ‘Next Big Frontier’

Anusuya Lahiri

Sun, August 16, 2026 at 11:30 PM GMT+3 6 min read

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Brinker International, Inc. stock jumped Wednesday after the Chili's parent reported mixed fiscal fourth-quarter results but issued a stronger-than-expected fiscal 2027 outlook.

The rally was likely magnified by elevated short interest, with 18% of the public float sold short, signaling substantial bearish positioning that may have fueled a squeeze.

Brinker reported adjusted earnings of $3.07 per share, narrowly missing the $3.09 analyst estimate. Total revenue rose to $1.536 billion from $1.462 billion a year earlier, edging past the $1.534 billion estimate.

GAAP net income rose to $131.1 million, or $2.99 per diluted share, from $107 million, or $2.30 per share, a year earlier. Adjusted earnings increased 23% from $2.49 per share.

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Chili's Extends Same-Store Sales Growth

Brinker CEO Kevin Hochman said Chili's ended fiscal 2026 with five straight years of same-store sales growth, producing a 71% cumulative increase over that period.

Hochman said Chili's is benefiting from strong brand relevance, compelling value, simpler operations and major restaurant investments. He said those factors have strengthened the brand's competitive position and support sustainable, profitable growth.

Company comparable restaurant sales increased 5% during the quarter. Chili's comparable sales rose 5.6%, while Maggiano's comparable sales fell 2.5%.

Chili's growth reflected a 4.3% benefit from pricing and a 1.5% increase in traffic, partly offset by a 0.2% negative mix impact. Management said sales and traffic accelerated further in July.

The company said its Big Crispy chicken sandwich has exceeded expectations. Chili's was selling about 55 sandwiches per restaurant per day by the end of the quarter, up from 20 before the launch.

During the earnings call, Hochman called takeout Chili's "next big frontier," pointing to a sizable opportunity to capture more fast-food transactions.

Takeout already accounts for 25% of Chili's business, but Hochman said the company has "not even scratched the surface" of the opportunity.

Brinker plans to improve its app, streamline pickup and boost order accuracy as it looks to make Chili's a stronger digital and take-home meal competitor.

Operating Profit And Margins Improve

Brinker's operating income rose to $167 million from $142.7 million a year earlier. Operating margin expanded to 10.9% from 9.8%, while adjusted restaurant operating margin rose to 18% from 17.8%.

Higher sales leverage helped offset pressure from food and beverage costs, advertising and insurance.

Food and beverage costs increased 80 basis points during the quarter as commodity inflation reached 4.4%, mainly due to higher beef costs and a temporary spike in tomato prices. Wage inflation was about 3.1%, though labor costs were favorable by 90 basis points year over year.

Adjusted EBITDA increased to $227.6 million from $212.4 million a year earlier.

Brinker International Guides Above Estimates

For fiscal 2027, Brinker expects adjusted earnings of $12.60 to $13.40 per share, above the $12.52 analyst estimate.

The company forecast revenue of $6.15 billion to $6.27 billion, compared with the $6.145 billion estimate. The outlook includes a 53rd operating week, which Brinker expects to add about 2% to revenue and 70 cents to adjusted earnings per share.

Management said the outlook assumes mid-single-digit same-store sales growth and positive traffic at Chili's for most of the fiscal year. It also expects low-single-digit commodity and wage inflation.

Brinker expects restaurant-level margin to expand 20 to 40 basis points on a 52-week basis. Including the extra week, improvement could reach about 50 basis points.

Cash Flow Supports Buybacks And Restaurant Investment

Brinker generated $789.4 million in operating cash flow in fiscal 2026 and spent $231.9 million on property and equipment, implying about $557.5 million in free cash flow.

The company ended the fiscal year with $110 million in cash and cash equivalents.

Brinker repurchased about $400 million of common stock during fiscal 2026. Its board also increased the amount authorized under the existing share repurchase program to $750 million.

For fiscal 2027, Brinker plans capital expenditures of $265 million to $285 million as it steps up investment in Chili's restaurant remodels. The company expects to complete 60 to 80 Chili's reimages during the year.

Photo via Shutterstock

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