Dive Brief:
- Chili’s posted 21.4% same-store sales growth in the first quarter of its 2026 fiscal year, which ended September 24, according to a Brinker earnings release. The sales growth was driven by a 13% increase in traffic.
- The sales performance lapped a 14% same-store sales jump in the year-ago quarter. Chili’s has posted double-digit same-store sales growth for six consecutive quarters.
- Chili’s has been the headline leader in a casual dining surge. Major brands such as Applebee’s, The Cheesecake Factory and Olive Garden have leveraged casual dining experiences to outcompete QSRs and fast casuals, whose pricing advantages have eroded in recent years.
Dive Insight:
Chili’s recent sales numbers have been powered by promotions that position the brand as directly price competitive with fast food. In recent months, the chain added a new burger, the Big QP, to its $10.99 3 For Me menu. It has been the centerpiece of its value play relative to QSRs.
CFO Mika Ware, on the company’s Wednesday earnings call, attributed some of Chili’s success to a consistent focus on core menu value, rather than a reliance on temporary LTOs or promotions to drive traffic.
The Chili’s renaissance also has deeper roots. Brinker has worked for years to remake the brand through operational improvements and changes to its kitchen and improvements to service. Brinker CEO Kevin Hochman said these changes, which include fixing up its stores and replacing tables damaged by cleaning procedures during the COVID-19 pandemic, would lead to continued sales growth throughout the remainder of its 2026 fiscal year.
“Our consistent investments in food, service, and atmosphere, combined with strong plans, give us confidence we can build on this growth and successfully lap the high sales comparisons in Q2 & Q3,” Hochman said in the earnings release.
Ware said Chili's expects its sales growth to moderate during fiscal 2026 as it laps previous quarters with more than 20% sales growth.
“We still anticipate that the first quarter will be our strongest on a year-over-year basis,” Ware said. “Chili's quarter-to-date sales are in the high single digits, and our expectations are Chili’'s same-store sales will normalize, on average, in the mid-single digit range for the balance of the fiscal year.”
Hochman said on the earnings call that the chain is seeing traffic growth among all income cohorts, and that it has gained market share with lower-income households.
“Our customer base is very representative of the U.S. consumer, across all income cohorts,” Hochman said. “But our cohort growing the fastest is actually now households with income under $60,000. It's clear that the better than fast food campaign we've been hammering over the past two years has positioned Chili's as an important value leader.”
Other casual dining chains have made a turn towards value plays on full meals, similar to Chili’s 3-for-Me platform.
Denny’s, Applebee’s and IHOP are all emphasizing either full meal or entree-based value deals. And QSRs are responding to the same pressures as Chili’s and may be responding indirectly to its messaging.
McDonald’s is cutting prices on core menu items and introducing new products. Wendy’s added chicken tenders and more premium beverage options. Chipotle, meanwhile, is facing pressure to amplify its value message through marketing.
Brinker is trying to replicate the success of its Chili’s turnaround at Maggiano’s, which saw a significant 6.4% loss in same-store sales.
