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Brinker International Inc. (EAT) stock jumped Wednesday after the Chili's parent reported better-than-expected fiscal first-quarter 2027 results and raised its full-year earnings and revenue forecasts.
The restaurant operator reported adjusted earnings of $2.77 per share, beating analysts' expectations of $2.45. Earnings rose from $1.93 per share a year earlier.
Quarterly revenue increased 9.4% year over year to $1.476 billion, topping the consensus estimate of $1.457 billion.
Brinker reported net income of $113.3 million, up from $99.5 million a year earlier. GAAP earnings rose to $2.64 per share from $2.17.
Operating income climbed to $151 million from $117.9 million. Operating margin expanded to 10.2% from 8.7%.
Adjusted EBITDA increased to $209.1 million from $172.4 million.
Restaurant operating margin improved to 17.7% from 16.2%, reflecting stronger sales and improved operating efficiency.
Chili's continued to drive Brinker's growth, with comparable restaurant sales rising 10.1% during the quarter.
The chain recorded its 22nd consecutive quarter of comparable sales growth, supported by higher customer traffic, menu pricing and strong demand for its Big Crispy chicken sandwich.
Chili's company sales increased to $1.367 billion from $1.236 billion a year earlier.
Customer traffic rose 6.4%, while menu pricing contributed 3.7% to comparable sales growth.
Meanwhile, Maggiano's Little Italy reported a 3.4% decline in comparable restaurant sales, reflecting weaker customer traffic.
Maggiano's revenue fell to $94.9 million from $99.5 million a year earlier.
CEO Kevin Hochman credited Chili's sustained momentum to competitive pricing, marketing and operational improvements that attract new customers and encourage repeat visits.
Brinker raised its fiscal 2027 adjusted earnings forecast to $13.30 to $13.90 per share, up from its previous outlook of $12.60 to $13.40. Analysts expect $13.28 per share.
The company also increased its annual revenue forecast to $6.23 billion to $6.33 billion from $6.15 billion to $6.27 billion. Wall Street expects $6.288 billion.
The forecast includes a 53rd operating week in the fourth quarter, which Brinker expects to add approximately 2% to annual revenue and 70 cents to adjusted earnings per share.
The company maintained its capital expenditure forecast of $265 million to $285 million.
Operating cash flow rose to $169.1 million from $120.8 million a year earlier.
Free cash flow increased to $105.7 million from $62.2 million.
Brinker said it used operating cash flow to repurchase $125 million of its common stock during the quarter.
The company also redeemed $350 million of outstanding 8.25% notes using funds from its revolving credit facility to lower its cost of capital.
Brinker operated 1,641 company-owned and franchised restaurants as of Sept. 23, compared with 1,630 a year earlier.
EAT Price Action: Brinker International shares were up 5.30% at $207.15 during premarket trading on Wednesday, according to market data.
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