Q2 2026 Bloomin' Brands Inc Earnings Call Transcript
Key Points
- Outback's guest metric scores improved for the fourth consecutive quarter, with notable year-over-year gains in service, atmosphere, value, intent to return, food, and brand trust.
- Q2 US comparable restaurant sales were positive 230 basis points, with Bonefish Grill leading with a strong 810 basis point comp sales increase and positive traffic growth of 450 basis points.
- The new service model at Outback, reducing server-to-table ratio to 4 tables per server during peak hours, has been successfully rolled out and is receiving positive guest feedback, with absolute service scores over 90% top box.
- Improved mix trends at Outback, driven by guests trading up to premium steak cuts and engaging with combo offerings, have reduced the expected turnaround investment from $50 million to $36 million.
- The company is on track with its restaurant refresh program, completing approximately 31 Outback refreshes through July and expecting to complete around 85 for the full year, with a positive traffic lift of 100-200 basis points observed post-refresh.
- Outback's traffic declined 190 basis points in Q2, and the company chose not to lap some dilutive traffic offerings from the prior year, particularly in third-party delivery, which negatively impacted traffic.
- Commodity inflation remains elevated at 5.7% in Q2, with full-year expectations of 4.5-5.5%, putting pressure on COGS and margins.
- The company expects a negative adjusted diluted EPS in Q3 2026, ranging from -$0.27 to -$0.22, due to negative earnings outlook and a tax expense of approximately $5 million.
- The equity method investment in Brazil continues to be a drag, with a loss of approximately $900,000 in Q2 and full-year losses expected to be $3-4 million.
- Despite improvements in guest scores, traffic conversion remains a challenge, with management acknowledging that success is not linear and that sustainable traffic growth will take time.
Greetings and welcome to the Blumen Brands Fiscal Second Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow management's prepared remarks. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. Please note this event is being recorded.
It is now my pleasure to introduce your host, Tara Kurian, Senior Vice President, IRFPNA and International.
Thank you, Ms. Kurian. You may begin.
'--
Thank you, and good morning, everyone. With me on today's call are Mike Spanos, our Chief Executive Officer, and Eric Christel, Executive Vice President and Chief Financial Officer. By now, you should have access to our fiscal second quarter 2026 earnings release and our investor presentation slides, both of which can be found on our website at
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