10-Q · May 4, 2026
The Cheesecake Factory reported a solid Q1 2026 with revenues of $978.8 million, surpassing estimates and reflecting a 5.6% year-over-year growth. Earnings per share (EPS) also beat expectations at $1.05 compared to the…
Earnings analysis · 10-Q
CAKE earnings analysis
Filed August 3, 2026 · Our reading of the company's report
The latest report
Cheesecake Factory's Q2 results improved meaningfully, with revenue up 7.7% to $1.0296 billion, GAAP EPS up 23.7% to $1.41 and operating margin expanding 80 basis points to 7.6%. Growth was led by 5.8% core-brand…
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Cheesecake Factory's Q2 results improved meaningfully, with revenue up 7.7% to $1.0296 billion, GAAP EPS up 23.7% to $1.41 and operating margin expanding 80 basis points to 7.6%. Growth was led by 5.8% core-brand comparable sales and strong Flower Child and Other FRC sales, although North Italia comparable sales fell approximately 3% on a 5% traffic decline. Six-month operating cash flow rose to $188.9 million and management maintained its plan for as many as 26 openings and approximately $210 million of fiscal-2026 capex, with no explicit EPS or revenue range in the 10-Q.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.41
What stood out
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Revenue and EPS accelerated
Q2 revenue rose 7.7% year over year to $1.0296 billion from $955.8 million, and increased 5.2% sequentially from $979.0 million in Q1 2026. GAAP diluted EPS rose 23.7% year over year to $1.41 from $1.14 and was up 38.2% sequentially from $1.02.
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Operating margin expanded sharply
Operating margin expanded 80 basis points year over year to 7.6% from 6.8%, and 200 basis points sequentially from 5.6%. Labor expense declined to 34.1% of revenue from 34.9%, reflecting 0.6 percentage points of sales leverage and productivity gains.
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Core brand delivered traffic-led comps
The core Cheesecake Factory segment grew sales 6.8% to $729.5 million, supported by 5.8% comparable-sales growth, comprising 3.1% higher average check and 2.7% higher traffic. Comparable-sales growth added $38.9 million versus Q2 2025.
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Emerging concepts outgrew portfolio
Flower Child sales increased 17.5% to $56.6 million, with approximately 13% comparable-sales growth and 10.8% higher sales per operating week. Other FRC sales grew 15.4% to $104.0 million.
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Cash generation improved materially
Six-month operating cash flow increased $53.1 million year over year to $188.9 million. Less $86.3 million of property additions, six-month free cash flow was approximately $102.6 million, versus approximately $51.4 million a year earlier.
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Liquidity supported after debt maturity
Liquidity remains substantial: cash and equivalents were $195.2 million at June 30, 2026, and revolver net availability was $366.5 million with no outstanding revolver borrowings. The company repaid the remaining $69.0 million of 2026 Notes at maturity.
What to watch
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North Italia traffic remains pressured
North Italia comparable sales declined approximately 3% year over year, driven by a 5% traffic decrease that only partly offset a 2% increase in average check. Segment sales still rose 8.4% to $98.4 million because operating weeks increased 10.2%.
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Commodity inflation can pressure margins
Food and beverage cost rose to 21.8% of revenue from 21.6%, as higher meat, produce and seafood costs added 0.7 percentage points, partly offset by 0.4 points of lower dairy pricing. A hypothetical 1% food-cost increase would negatively affect quarterly cost of sales by $2.2 million.
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Large development plan requires execution
The company expects approximately $210 million of fiscal-2026 capital expenditures while targeting as many as 26 restaurant openings; only 7 restaurants were opened in the first six months. Opening timing, construction costs and permitting remain execution risks.
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Capital deployment reduced cash balance
Cash and cash equivalents decreased $20.5 million during the first six months to $195.2 million, despite $188.9 million of operating cash flow, reflecting $86.3 million of capex, $69.0 million of convertible-debt repayment, $29.9 million of dividends and $29.4 million of share purchases.
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No formal risk-factor updates disclosed
Item 1A states that the risk factors disclosed in the December 30, 2025 Form 10-K remain applicable; the filing does not identify any newly added or revised risk factors. The company had no commodity hedging contracts as of June 30, 2026.
Management's outlook
The filing maintains expectations to open as many as 26 restaurants in fiscal 2026 and anticipates approximately $210 million of capital expenditures. It does not provide a numeric EPS or revenue range; management states that cash, operating cash flow and revolver availability should provide adequate liquidity for the next 12 months and foreseeable future.
Earlier filings 4
10-K · February 23, 2026
The Cheesecake Factory (CAKE) presents a large, multi-brand casual dining platform with 368 restaurants (216 The Cheesecake Factory, 48 North Italia, 43 Flower Child, 55 Other FRC) and 35 international licensed units.…
10-Q · November 4, 2024
The Cheesecake Factory reported Q3 revenues of $865,471,000 (13 weeks ended October 1, 2024), up $35,261,000 (+4.2%) versus the year‑ago quarter, with operating income of $33,700,000 and diluted EPS of $0.61. Gross…
10-Q · May 8, 2024
The Cheesecake Factory reported first-quarter revenues of $891,223,000, up $25,109,000 (+2.9%) versus the year‑ago quarter, with operating income rising to $39,293,000 and diluted EPS of $0.68. Gross margin expanded to…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.