The Cheesecake Factory Incorporated

It is now my pleasure to turn today's conference over to Etienne Marcus, Vice President of Finance and Investor Relations. Please go ahead.

Good afternoon, and welcome to our third quarter fiscal 2025 earnings call. On the call with me today are David Overton, our Chairman and Chief Executive Officer, David Gordon, our President, and Matt Clark, our Executive Vice President and Chief Financial Officer. Before we begin, let me quickly remind you that during this call, items will be discussed that are not based on historical facts and are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could be materially different from those stated or implied in forward-looking statements as a result of the factors detailed in today's press release, which is available on our website at investors.thecheesecakefactory.com and in our filings with the Securities and Exchange Commission. All forward-looking statements made on this call speak only as of today's date. The company undertakes no duty to update any forward-looking statements. In addition, during this conference call, we will be presenting results on an adjusted basis, which exclude acquisition-related items and impairment of assets and lease termination expenses. Explanations of our use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures appear in a press release on our website as previously described. David Overton will begin today's call with some opening remarks. David Gordon, provide an operational update. Matt will then review our third quarter financial results and provide commentary on our financial outlook before opening up the call to questions. With that, I'll turn the call over to David Overton.

Thank you, Etienne. Our third quarter results were solid, with consolidated revenues within our guidance range and earnings and profitability finishing above the high end of our expectations. Our performance was led by the Cheesecake Factory restaurant delivering positive comparable sales results amid a more challenging and competitive environment, underscoring the strength and resilience of our brand. While we, along with the broader restaurant industry, are navigating a softer macro and consumer environment, our overall performance remains stable in line with expectations. These results highlight the healthy demand for our high-quality concepts, the strength of our operators, and the durability of our business model. Specifically, comparable sales at the Cheesecake Factory restaurants increased 0.3% for the third quarter, with annualized unit volumes averaging over $12 million. We believe our strategic focus on menu innovation remains a key point of differentiation supporting our broad consumer appeal and strong relevance with guests. Our new menu offerings are resonating well, reflecting the success of our culinary innovation. We will continue to lean into this core strength to keep our menu highly relevant while providing exceptional value without relying on discounting. Supported by improved retention, our operators once again executed at a high level driving year-over-year improvements in labor productivity and wage management, resulting in meaningful profitability growth. The Cheesecake Factory's restaurant-level profit margin increased 60 basis points year-over-year to 16.3%, with margin improvement also realized at North Italia and Flower Child. Turning to development, in the third quarter, we opened two FRC restaurants, and two cheesecake restaurants opened in Mexico under a licensing agreement. Subsequent to quarter end, we opened one additional FRC restaurant. With 19 restaurant openings so far this year, we're well positioned to meet our objective of opening as many as 25 new restaurants in 2025. Looking ahead to 2026, we plan to further accelerate development with as many as 26 new restaurant openings across our portfolio of concepts. As we move forward, we will remain focused on delivering exceptional food, service, and hospitality, the hallmarks of our success, while continuing to execute against our long-term growth strategy. With that, I will now turn the call over to David Gordon to provide an operational update.