Operator: Good day, and welcome to the Brinker Q4 f 2026 Earnings Call. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions and comments following the presentation. It is now my pleasure to turn the floor over to your host, Kim Sanders, Vice President of Investor Relations. Ma'am, the floor is yours.

Kim Sanders: Thank you, Holly, and good morning, everyone, and thank you for joining us on today's call. Here with me today are Kevin D. Hochman, chief executive officer and president of Brinker International and president of Chili's and Michaela Ware, chief financial officer. Results for our fourth quarter were released earlier this morning and are available on our website at brinker.com. As usual, Kevin and Micah will first make prepared comments related to our strategic initiatives and operating performance. We will open the call for your questions. Before beginning our comments, I would like to remind everyone of our safe harbor regarding forward looking statements. During our call, management may discuss certain items which are not based entirely on historical facts. Any such items should be considered forward looking statements within the meaning of the Private Securities Litigation Reform Act of 2000. All such statements are subject to risks and uncertainties which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include factors more completely described in this morning's press release and the company's filings with the SEC. And of course, on the call, we may refer to certain non GAAP financial measures, that management uses in its review of the business and believes will provide insight into the company's ongoing operations. And with that said, I will turn the call over to Kevin.

Kevin D. Hochman: Thank you, Kim, and good morning, everyone. Thank you for joining us as we discuss our financial and operating performance for the fourth quarter as well as provide guidance for fiscal 2027. Q4 Chili's same store sales of +6 marked our 20 fourth 20 first consecutive quarter of same store sales growth and again significantly outpaced the industry. This strong result was rolling a +24 from last year, and a +15% from 2 years ago for a 3 year cumulative comp of 50%. There are lots of different ways to look at our results, but the key conclusion is that Chili's turnaround is real, Fiscal 26 saw this brand increase its lead as the number 1 casual dining traffic brand, and the results are sustaining year after year. Important to note in this difficult operating environment that instead of using precious resources and investments on initiatives to drive short term sales, we at Chili's focus our resources for long term sustainable growth. Improving food service and atmosphere and the team member experience, as well as positioning our brand to be more relevant, easy, and distinctive. These experience improvements coupled with our everyday value leadership represented by a per person average spend that is $3 to $4 below competition, are supporting a powerful flywheel of traffic, sales growth, margin expansion, and then reinvestment into our business. And this steady approach is why the business will continue to win. American consumer demands experience and great value, and they are showing up for those brands who consistently deliver that. Third party syndicated data confirms Chili's continues to be ranked in the top tier across key measures like value, quality, service, and overall experience. We still have room to improve, but our progress gives us confidence that we will sustain traffic gains and repeat business. We are very appreciative and proud that Chili's is 1 of the small handful of brands the American consumer trusts and we are willing to increase their visits to. And we will work hard for our guests to maintain both our value leadership and improving our guest experience year after year. Now I will give some updates on the Chili's business. We are now 4 months post Big Crispy launch, and we can share some more detail on how it is performing. The launch has been a success, overdelivering on our lofty estimates going in. We were selling 20 chicken sandwiches per restaurant per day. Pre Big Crispy launch, By the end of Q4, we were selling 55 sandwiches per restaurant per day. An increase of 175%. And that number continues to build in the current quarter. For perspective, the Big Crispy is bigger than the 2024 Big Smasher launch and the 2025 Big QP launch, as you all know, those were 2 very successful launches. The customer reviews and social media comments have been excellent. Declaring Chili's victorious for size, price, value, and taste versus fast food. The Big Crispy is now a signature sandwich, and another important chapter in our better than fast food story. That will continue to position Chili's uniquely as a restaurant destination. In addition to culinary upgrades, our team continues to deliver world class marketing to drive traffic Q4 highlights include the successful Big Crispy launch, the remake of our famous 1.99 thousand baby back ribs jingle commercial featuring pop star Lizzo, and a continued success with our margarita of the month program. As a reminder, our marketing strategy is driving sales overnight and brand over time. it is clear the marketing is driving sales. But they are also doing an amazing job strengthening the brand's positioning over time. We are 2.5 years removed from the initial viral cheese pull, in early 24, and YouGov's third party data reported that Q4 was Chile's highest level of buzz across all cohorts ever recorded. Chile's is everywhere. It continues to be America's hottest restaurant brand, and the sustained relevance of the brand proves this repositioning has legs beyond 1 social event. Now let's talk about operations. We continue to focus our efforts on both removing friction as well as improving restaurant throughput, as this is a key piece of our sustainable growth flywheel. In addition to listening to our managers' ideas on how to make operations easier, now have the north of $6 million team, our highest volume restaurant leaders to formally source ideas from too. I think the important thing to note is north of $6 million leaders typically have the additional perspective of increasing throughput because of their incredibly high volumes. We recently made some very significant changes to free up managers time to coach teams to be with guests on the floor, The first is the ruthless simplification of our shift line checks, a set of tasks the manager is mandated to perform to know their team is ready to take on guests. We have taken that bidaily process down from 8 pages to 1 page, and freed up 30 minutes of manager time per day. Think about that as 22 years of manager time freed up annually across our system. And that is time much better spent side by side coaching their teams and in the dining room with our guests. Second important change we made is upgrading hot schedules. Our tool managers use to schedule labor to make it easier to schedule the right number of team members per shift. We know the number 1 thing that can set up a shift for success is properly written labor schedules, and anything that makes the task easier to do correctly is a big win for our managers improves our ability to take on more and more traffic. And lastly, the VPs of operations have chosen their obsession metric for fiscal year 2027. This year, they have chosen traffic for a 3rd year in a row. Have added a second metric, profit improvement. They chose a second to begin developing a stronger ownership culture on rest expense with things like R&M. Recently made profits a bigger percentage of their bonus structure, so it is even more important to field leadership to nail the flow through of all the incremental sales. Before I close out Chili's commentary, I do wanna touch on 1 more important thing, Last quarter, I talked about a new initiative we have started with the objective of speeding up restaurant cycle time, meaning looking at everything that goes into the total time of kitchen prep and the dining experience, finding ways to remove time to serve as another traffic building block. Most cycle time improvements may seem small, will continue to compound to make meaningful impacts as well as improve the guest and team member experience. Remember, this is about attacking anything that gets in the way of a smooth dining experience which should also improve overall guest satisfaction. The first of these initiatives have now been successfully rolled out. Supermarket simple for loyalty reward reduction. Newly rolled out system, the guest simply puts the rewards telephone number into the Ziosk, and at the end of the meal, the discount that is available, like free chips and salsa, is automatically removed from the check. Then the Zios tells the guest how much they saved by being a rewards member, kind of like what happens when you put your loyalty number in at the supermarket. The Zios software upgrade will reduce the manager time needed to resolve check issues, deliver faster table terms, and more importantly, improve the guest dining experience. To summarize, Chili's long term growth year after year is a result of deliberate set of choices we make to deploy resources and capital to improve the guest and team member experience, while driving same store sales now and over time. The traffic growth reinvestment flywheel continues to spin to create sustainable profitable growth. I will give a short update on Maggiano's, a reminder that given the success we have had focusing on Chili's, Maggiano's now only represents 8% of sales. For perspective, Chili's Outside Of The US, which is a licensed model, is expected to live 4% of Brinker profits this fiscal, and that will actually surpass Maggiano's profit contribution. While we are seeing some green shoots with financial results improvement, and guest value scores, the turnaround at Maggiano's has been mixed. We have made progress on operational and culinary improvements, but some of that progress has been offset by losses with our core guests from our prior strategy. So we are headed in the right direction. The turnaround is happening slower than what we had planned. We think we are on the right strategy, but we need to be more focused on delivering a few important changes that could have the biggest impact. These updates are all contemplated in the fiscal 27 Brinker guidance we provided today. Before I close, I wanna share 2 weeks ago, we had our annual general managers conference in Arlington, Texas. To summarize the event, the restaurant leaders are proud of their results, excited about the plans for fiscal 27, and ready to lead their teams for another year of growth significantly ahead of the industry. Because of their leadership and their success, almost 80% of GMs now earn more than $100 thousand this past fiscal, that number keeps growing annually. Our stated goal to those GMs 4 years ago was make their jobs more fun, easier, and more rewarding, you could sure feel that in the room. That we have collectively delivered on that commitment. Manager turnover has been well ahead of the industry for years now, and now hourly turnover recently moved ahead of the industry, too. Also recognized our GM of the year, PJ Tremblay, leader of the East Fort Myers Chili's, and our above restaurant leader of the year, Dale Bullotta. The VP who leads our California region. I also wanna recognize Dale's colleague, the legendary vice president in the Northeast Region, Todd Pierce, was inducted into our Chili's Hall of Fame along with 35-year director of operations in South Florida, Tony Viola. Congratulations to all 4 of these amazing leaders, and thank you for your years of making guests feel special and leading our restaurant teams. To close, Chili's delivered another strong quarter rolling very big numbers from the prior 2 years. The macro headwinds the industry is experiencing are still there, but Chili's is positioned to continue winning in this environment with improvements in food and service coupled with our industry leading value. That formula has proven quarter after quarter to be resilient in driving traffic, and outperforming the industry. And with all of the initiatives we have planned for fiscal 27 to continue improving the fundamentals, we are poised to have another year of profitable growth that significantly outpaces the industry. I will hand the call over to Micah to walk you through fiscal 26 fourth quarter numbers. Go ahead, Micah.

Michaela Ware: Thank you, Kevin, and good morning. As we close fiscal 26, today's results highlight major milestones in Chili's growth journey. The completion of 5 consecutive years of same store sales growth, positively lapping all 4 quarters of double digit same store sales growth this past fiscal year including 2 quarters that were above 30%, 2 consecutive years of traffic gains, and average annual unit volumes increasing from just over $4.5 million at the end of last fiscal year to $5 million this year. Together, these results demonstrate the continued momentum and sustainability of our focus on the fundamental strategy. For the year, we reported total revenue growth of 7.9%, restaurant operating margin improvement of 30 basis points, and adjusted EPS growth of 20.6%. Turning to the fourth quarter, we continue to see strong year over year top line growth, traffic well above industry averages, and restaurant margin expansion at Chili's. Brinker reported total revenues of $1.536 billion with consolidated comp sales of +5%. Our adjusted diluted EPS for the quarter was $3.07, up from $2.49 last year, a 23% increase. Chili's comps were +5.6% in the quarter. Driven by price of 4.3% and positive traffic of 1.5%. Partially offset by negative mix of 0.2%. Chili's continues to gain momentum through its strong everyday value platform led by the success of the Big Smasher, the Big QP, and now the Big Crispy Chicken Sandwich. July sales and traffic have significantly accelerated versus the fourth quarter further widening our lead over the casual dining industry. For Maggiano's, the brand reported comp sales for the quarter of -2.5% with -5.3% traffic, -0.1% of mix, partially offset by price of 2.9%. At the Brinker level, restaurant operating margins were 18%, a 20-basis-point improvement year over year, primarily driven by sales leverage, partially offset by unfavorable food and beverage costs as well as higher advertising and insurance cost. Food and beverage cost for the quarter increased by 80 basis points driven by 4.4% commodity inflation, primarily from higher beef cost and a temporary spike in tomato prices following a late freeze in Florida. Tomato costs remained elevated longer than expected but have since normalized and will not impact Q1 cost. Labor for the quarter was favorable 90 basis points year over year. Top line sales growth offset wage rate inflation of approximately 3.1%. Additional investments in labor and higher health insurance cost. Restaurant expenses for the quarter were favorable 10 basis points year over year with sales leverage and lower repairs and maintenance cost partially offset by higher advertising cost and general inflation impacting expenses such as utilities, rent, to-go supplies, and delivery fees. Advertising expenses for the fourth quarter were 3% of sales and increased 20 basis points year over year to help support the rollout of the Big Crispy Chicken Sandwich campaign. G&A for the quarter came in at 3.9% of total revenues, 10 basis points favorable to prior year due to sales leverage and lower performance bonus accruals, partially offset by an increase in restaurant center support resources. Depreciation and amortization for the quarter came in at 3.6% of total revenues and decreased 40 basis points year over year due to sales leverage and the lapping of accelerated depreciation from the prior year due to the retirement of the CTX Impinger ovens. Fourth quarter adjusted EBITDA was approximately $228 million, a 7.1% increase from prior year. Our adjusted tax rate declined year over year to 17.6% from 19.5% primarily due to a benefit from our state income tax filing adjustments and a higher benefit from the tie from the FICA tip credit. Capital expenditures for the quarter were approximately $58.3 million driven by capital maintenance spend. In our new 11 reimages in fiscal 2026. Based on the learnings from these restaurants, we plan to complete another 60 to 80 during fiscal 27. In fiscal 28, we will start a planned cadence of 10% of the fleet annually. Regarding new unit growth plans, our growth will be modest in fiscal 27, but we already have sites in the pipeline to ramp up significantly in fiscal 28 with expectations for our new run rate to be in place for fiscal 29. We expect to share more details on our strategy and plans at our September 17 Investor Day. Our strong free cash flow provides sufficient liquidity to our disciplined capital allocation strategy, allowing us to invest in our restaurants, keep debt levels low, and return excess cash to shareholders. We continue to support this approach by repurchasing $100 million of common stock under our share repurchase program in the fourth quarter bringing our total for the year to almost $400 million. In support of our capital allocation strategy, our Brinker board of directors authorized additional amounts under our current share repurchase program in August bringing the total amount available to $750 million. Subsequent to year end, we redeemed our outstanding $350 million of 8.25% bonds using the liquidity on our $1 billion revolver which will provide interest expense savings in fiscal 27 and the flexibility to continue to reduce leverage if we choose. In this morning's press release, we shared that fiscal 27 guidance includes a 53rd operating week in the fourth quarter, We estimate the impact of the additional operating week to be an increase of approximately 2% in total revenues and $0.70 in incremental earnings per share. Regarding the guidance we expect, F27 annual revenues in the range of $6.15 billion to $6.27 billion adjusted diluted EPS in the range of $12.60 to $13.40 Weighted average shares in the range of 42 million to 43 million. And capital expenditures in the range of $265 million to $285 million. Assumptions underlying this guidance include planned commodity and wage inflation in the low single digits, with commodity inflation higher in the first quarter before moderating as the year progresses. A tax rate of approximately 19%, and 3 net new company owned restaurant openings. Guidance also contemplates the planned acquisition of 12 Chili's franchise restaurants located in Alabama and Mississippi. Including the real estate of 6 of the locations. The transaction is expected to close at the end of August. As previously mentioned, fiscal 27 is off to a strong start in July and August, and we are confident our plans will enable us to continue to significantly outperform the industry in both sales and traffic, while delivering another consecutive year of same store sales growth. Before I wrap up, I will just say this. The results we delivered this year give us a lot of confidence in where Chili's is headed. The strategy is working, and we believe there is still plenty of runway ahead. Keep building on the momentum by bringing in new guests, giving them more reasons to come back, and staying focused on the things that matter most. Strong execution in our restaurants, great value, and world class marketing and innovation. I look forward to providing further details at our upcoming investor day, scheduled in Dallas for Thursday, September 17. With our comments now complete, I will turn the call back to Holly to moderate questions. Holly?

Operator: Certainly. This time, we will be conducting a question-and-answer session. If you have any questions or comments, please press 1 on your phone at this time. We ask that while posing your question, you please pick up your handset if listening on speakerphone to provide optimum sound quality. Please hold while we poll for questions. Your first question for today is from Dennis Geiger with UBS.

Dennis Geiger: Thank you, and congrats on another great quarter and year, guys. I wanted to ask a bit more on fiscal 2027 guidance. I know we can back into select items. Is there anything more to share on specific assumptions for Chili's same store sales for the year? And then just shifting over to margins and earnings flow through, helpful with the inflation, but anything more on some of the key pieces there as far as reinvestment opportunities go maybe versus prior years?

Michaela Ware: Sure. Hi, Dennis. So what we have done and what is implied in this guidance is we built in a little bit of upside for July But, basically, for the remainder of the year, we have assumed mid single digit same store sales and positive traffic for Chili's. So we feel really confident that we can continue to deliver those results. If this momentum continues that we started in the beginning of this fiscal year, there is absolutely, opportunity to exceed those expectations. But that is what, we have built into the guidance. As far as the margins go and the flow through, you know, we are very protective of our value proposition. We have been very mindful of that. We are very aware of driving positive traffic over time. So we have built in inflation. I talked about the inflation. For commodities and for labor. there is also some inflation and some other pieces of the P&L For example, we have some inflation in rent. We have some inflation in advertising. Inflation in our insurance cost. So we have been just really mindful of baking in all those expenses and making sure that we are not putting too much pressure on the guest and the pricing strategy on the top line. So we feel really good about the numbers that we have built in. I think we have been you know, very conservative about the inflation that we put in, so we feel good about delivering the results in the double-digit EPS that we promised.

Dennis Geiger: Thanks, Micah. Congrats.

Kevin D. Hochman: Thank you, Dennis.

Operator: Your next question is from David Palmer with Evercore ISI.

David Palmer: Great. Thank you. Good morning, and congrats on the accelerating sales I had a question about that. I wonder what reasons you would give for this pretty big acceleration you are seeing in July and August. I have heard a lot of theories, but we would love your analysis. And what part or parts do you think are more clearly not sustainable in your mind?

Kevin D. Hochman: Yeah. So, you know, we have seen lists like this in the past during this turnaround. David and, like, what we seem to be is we bring people in, and then he just kinda becomes their habit, and we just do not look back. So you know, to answer your question more specifically about what we is driving it right now, number 1 is chicken sandwich. So the chicken sandwich continues to build. it is doing everything that we thought it would do. It was part of our plan to continue the better than fast food campaign. Continue to drive our value leadership in the industry, but most importantly, continue to give the guest unbelievable abundant value that tastes great, and that is exactly what it is doing. We have had a couple of other things that happened from a social standpoint. So we had some pretty good success with our bombshell mark. Which was the mark of the month in July that we saw some younger guests come in for. And then we also seized upon a social media thing that we did not do. So guest started asking for Moltens on top of skillet cookies. The marketing team wanted to get after it immediately. We say, hey. Let's make sure we are operationally ready to do that before we turn that on. So we were hard at work making sure we had the proper supplies on cookies and molten and ice cream. And then we recently put that into the business allowing the servers to have keys to ring it up properly as well as train the teams on how to make it. Consistently versus just looking at social media on how to make it. And that is also been very successful. it is actually reversed our incidence decline on desserts between that and then also upgrading a couple of our other desserts. So we feel like it is just a collection and then, obviously, the continued operational initiatives on removing friction and improving throughput. They are very hard things to pinpoint. Because like I said in my prepared comments, the throughput stuff is a collection of small things that add up. But, like, for example, when we make the redemption of our loyalty rewards supermarket simple, it reduces the number of times the manager has to come and change checks, that turns tables faster. And we know especially on the weekend, turning tables is traffic in the till. So it is a collection of all the things that we are doing, and we have been relatively consistent continuing to deliver comps on top of comps on top of comps, and it is because our strategy is built to just continue to plow through all this.

David Palmer: Great. I will pass it on. Thank you.

Operator: Your next question for today is from Jeffrey Farmer with Gordon Haskett.

Jeff Farmer: Greg, good morning. Michaela, what is your expectation for the restaurant level margin in 2027? And how should we be thinking about the benefit from the 53rd week?

Michaela Ware: that is a great question. So what I would say on a 52-week basis, I am gonna expect 20 to 40 basis points of margin improvement. You know, depending on where it falls in that range, the 53rd week could get you up to 50 basis points of margin improvement year over year. So that is that is where we are now, Jeffrey.

Jeff Farmer: Okay. And then just 1 more quick 1. As it relates to the it sounds like you guys are made the change in the compensation structure for the restaurant level manager. How are you guys thinking about the impact that would have on the business?

Kevin D. Hochman: Yeah. So a couple things that to answer that question. Gordon. So I am sorry. Yeah. So number 1, you know, we are trying to simplify the amount of reports and the measurements that managers use so that they can focus more on the behaviors which is in terms of coaching the team members as well as being in the dining room with the guests. So they are still gonna have access to the GWAP metric. And they will be able to see it, like, on a weekly basis, and they will be able to get verbatims and from guest comments. Use AI to help cultivate that for them so they do not have to go through all of the verbatims. We are not gonna give them GWAP per shift. On a daily basis because we found that they were kind of overly consumed with the daily metric. They were using that more often with their teams. Posting them up, and the team members did not feel great about it. And so even though we have been making incredible progress on GWAP, the guests were the problem. We felt like it was taking them away from the things that we wanted to do. So we are not gonna have them look at it on a daily basis. We remove that from the bonus. The bonus is totally focused now on sales and profits. We did codesign this with them. We started with our vice presidents of operations and we trickled it down. And overall, the feedback's been incredibly positive. it is like, hey. We could focus on the behaviors that we need to focus on. And we do not necessarily have to look at this thing and be consumed with reporting. We also dramatically simplified the reports that they get on a daily basis. We got this kind of laundry list of reports down to 2 main reports that help them with throughput, labor scheduling, and some other key things like guest metrics that they need to be able to see. So I feel like that change is gonna make them focus number 1, most importantly, on the behaviors to deliver a great guest experience. And then number 2, because profits are a higher percentage of their total bonus, we think that is gonna help us with that middle of the P&L. To be able to flow through more of the dollars that we get with incremental sales. And does not mean we are not gonna continue to invest in the business. So Micah talked about that in her prepared comments, but we feel like this is just a continuation of dramatic simplification in order to allow the restaurant teams to do their job, which is making guests feel special.

Jeff Farmer: Okay. You for that.

Operator: Your next question is from Andrew Strelzik with BMO.

Andrew Strelzik: Hey, good morning. Thanks for taking the question. And maybe following up on that last answer, you know, if you feel like you are gonna be able to get more flow through because of the change in the compensation structure, why is 20 to 40 basis points still the right starting point for margin expansion?

Michaela Ware: So, Andrew, I will start with that. So like I said, 20 to 40 basis points is what we have built in the model. And again, we have been very mindful of how much price we are taking. So, you know, our pricing strategy had been 3% to 5%. We are on the lower end of that. And we actually have, you know, just a lot of inflationary pressure. So I talked about the commodities. Even though they are in the single digits, that is gonna start at the beginning of the year. Probably, I am gonna give you some nice round numbers where commodities will probably be 4% in Q1. 3% inflation in Q2, 2% inflation in Q3, and 1% in Q4. that is what we are we are modeling now. So we do have a little bit of earlier pressure on that. Also, we have had some inflation in some other areas such as insurance, such as delivery fees. Things like that, we have built in that we are not necessarily passing all the way through to the guest. So we have been very mindful of driving long term traffic over time. When I take a step back and just look at the whole model, we know if we deliver mid single digit same store sales, over time, we deliver 20 to 40 basis points of, margin improvement, and we deliver, you know, double-digit EPS growth, that we are gonna deliver significant earnings and growth to the shareholders if we can deliver those consistently over time. So we are not as concerned do not wanna overpressure the guests in the short term. You have heard a lot of our competitors have that same mindset where you do not wanna overprice the guest right now. We have a lot of inflation that we are facing, so we are being more conservative in those assumptions. Now as the year progresses out, if our sales exceed our expectations or some of those inflation assumptions, are a little bit less, I think we have the opportunity to outperform on those metrics. But that is what we have guided and worked into the model for now to start the year.

Andrew Strelzik: Got it. Okay. That makes sense. And maybe if I zoom out, on the margins, obviously, you transformed restaurant level margins of the business. Is there a level at which you think about kind of shifting how much flows through versus how much you reinvest kind of like a ceiling on restaurant margins for this business over time as you kind of continued to make these continuous improvements? How you think about that? Thank you.

Michaela Ware: You know what, Andrew? That is also an excellent point that I should have made too. So as you called out, we had, since this turnaround started, over 600 basis points of margin improvement over time. So we have significantly improved the margin profile of this business. Now that is a reason why because we have an investor growth strategy that as we move forward, you are gonna see the margin growth moderate a little bit. And, really, what that means is we are not trying to flow through every dollar. We are trying to make sure that we are mindful to invest back in food service and atmosphere. What that means is we are investing back in the guest experience, the team member experience, and we do not wanna overprice the guest. And we wanna make sure we continue to make that value proposition as strong as it can be because we know that is a secret to driving positive traffic over time. there is not a cap. So I said all of that. You did say, is there a cap? We do think if we continue to grow the top line in the AUVs, we still think we can expand it. it is just not gonna be as material as it has been during this turnaround. So there will be a point you know, as the as the AUVs grow. But right now, we still have plenty of capacity. Our restaurants are only at 80% capacity of our historical guest counts. We have plenty of capacity to continue to grow traffic and grow some margins.

Kevin D. Hochman: And just 1 thing I would add is, like, when we first started this turnaround, you know, what I told the leadership team was, boy, we were, like, $3 million AUVs. if we just get to $4 million AUVs. we will have enough labor to service the guest. We will have we will have better restaurant margins. Like, we will have enough money to plow back into the business. That happened. And now we are getting to 5-- we are $5 million now. and just get more of that. And like, the end of the day, when we study these north of $6 million restaurants, they have dramatically higher margins than the balance of the system. So as long as we continue to invest in the business, and grow those AUVs and delight the guest, good things will happen with margin. And every year, you know, we start out the year with a pretty reasonable expect--or a reasonable guidance on our margin growth, but then we, you know, we have blown through it. We have blown through it because we keep delivering on the top line because we are winning with the guests. So I do not know why we would change that approach. And know, I would expect that if we deliver on the upside on sales based on the acceleration that we have seen, in the first part of the year. And, you know, I would expect to see that also expand on restaurant margin.

Andrew Strelzik: Great. Thank you very much.

Operator: Your next question for today is from John Ivankoe with JPMorgan.

John Ivankoe: The first thing, housekeeping and the second may be a little bit more important. In terms of the remodels at 60 to 80 units, I know you have looked at a number of different packages in terms of you know, what you would spend per unit. Where are we--you are kind of--landing in 27 on a per remodel basis? And is that the right number to assume going forward as well with normal type of inflation?

Michaela Ware: So, John, that is a number that we are still finalizing right now. But what I will tell you is, you know, we have taken our capital guidance up. The majority of that increase year over year is due to the reimages. And we said we are gonna do, between 60 and 80. So you will get an estimate there. We are continuing to refine that number. We are gonna talk about it on Investor Day and give some more details around it then. But I am pretty happy with the number. The first 250 are probably a little bit elevated because we talked about those being some of the 1 restaurants that probably need a little bit of extra love. They also have, a lot of those are older prototypes, some of the early reimages, if they have the lower ceilings in the bar, we do an extra step where we open up the bar and actually remove a wall. So that also has an incremental cost. So over time, I think this number is gonna continue to evolve and come down as we get more scale. Then we kind of work through the balance of the system. But, again, more details on Investor Day, but the bulk of that increase in the year over year CapEx is for the reimage.

John Ivankoe: Well, we are definitely we are definitely looking forward to the 17th. Okay. So let me ask another question on the menu. We have talked in the past about maybe opportunity. Maybe today would not be the time, but, we talked about the opportunity to kind of relaunch salads bowls, and maybe improving steak, you know, to kind of take another modern re-hit at guiltless grill for how people are eating today. So can you kind of talk about any major any major menu categories that could be addressed in the near term and could lead to future sales growth beyond 2027?

Kevin D. Hochman: Yeah. We have shuffled a little bit of our priorities, in 2027 based on just what is happening in the, you know, in the Zeitgeist. So let me just tell you what food innovation will be for 2027, and then share with you what we are planning for 2028. So number 1, we are gonna continue to ride the chicken sandwich all year. So that was certainly up in the air as we were launching. The plan was if it does well, we are gonna continue to drive it. And so that is the plan from an out of store marketing standpoint. And then we are gonna continue each quarter to remind the teams on how to make the best sandwiches. it is not an easy thing to make a hand breaded sandwich, so we are gonna stay focused on that operationally. Secondly, we are in process of revamping the menu. So we have launched the new kids menu. And we and this is about how do we just continue to get young families into Chili's You know, we know that kids are talking about Chili's. We see there is a very common thing we see in social media where kids' team wins x, they wanna all go to Chili's. So we think this is the time is right to go after the kids menu. So we have a new kids menu. We brought back grilled chicken tenders, which is a parent and kid favorite. And then next quarter, we are gonna be adding Mini Moltens back to that lineup as well as cheese quesadillas. And then we have recently launched a new floats with our new Blue Bell ice cream. So we have upgraded our ice cream to a much more premium ice cream. Then we have also added, you know, a top--a mocktail for kids Shirley Temple that is made with Sprite. So the new kids menu, part of that has happened now, and the rest of it will be finished next quarter. We finished renovating our pasta platform, so we have added sausage as a protein. We are hearing our chicken and sausage in our Q2 menu. And then we retrained teams on what we call pasta perfection. We did that last quarter. So the pasta is now gonna be featured in Q2 in a bigger way. And then we also have a new cooking process to make it a little bit hotter. And then on a dessert standpoint, we have got a couple of things coming, which we have not done in a while. We just recently upgraded our skillet cookie. So if you go in a restaurant now, you will probably see it being advertised in our little table tent. it is been upgraded with more premium ingredients, chocolate, brown sugar, and butter to make them ooier and gooier. We have obviously upgraded the ice cream, which I talked about earlier. To Blue Bell ice cream. And then lastly, we added this social media phenomenon, the molten on top of the cookie, and that is now something that we are selling in the restaurants. And then next quarter, we are actually gonna bring back cheesecake as a nonchocolate option for folks that want dessert. The other thing I would tell you about desserts that we are learning operationally is a lot of times in casual dining, servers do not sell dessert because they wanna turn the tables on a busy Friday or Saturday. And we think we have an unlock on that 1. The feedback that we have been getting from the servers is, hey. When I get the dessert, it goes to the bottom of the kitchen display system zone 3. that is where we make desserts. So it might take 15 minutes to make a dessert. So I really do not wanna sell a dessert if it is gonna take 15 minutes. And so what we are doing is we are gonna start we are once we are gonna test it first to bump the desserts to the top of the screen, that desserts get priority so we actually can get that sale. So there is a lot of good things happening on the menu. In 28, that is when we are gonna launch. In the fun half, we are gonna launch salads. So we pushed that out a little bit based on what is happening. And then we will have steaks and Guiltless Grill hopefully in the back half of 2028 also.

John Ivankoe: A lot going on. Thank you so much.

Operator: Your next question is from Brian Harbour with Morgan Stanley.

Brian Harbour: Yeah. Thanks. Good morning. Micah, just a quick clarification. So is it correct that you will you expect to run, like, rough 3% price through this year? And then do you have any kind of directional color on, like, mix impact that you are expecting?

Michaela Ware: Yes. So what I would say as far as price goes, like I said, for the full year, it is gonna be on the lower end, maybe just over 3%. If you are thinking about the cadence by quarter, it is gonna be a little elevated in Q1. So I would model, again, nice round numbers. 3 if you wanted just some general numbers on how the pricing will go at Chili's. As far as mix goes, like we said, it was slightly negative in Q4. We had the point 2. That was driven by alcohol and appetizers. For the full year, the assumption, I would say it is based basically flattish. So we see, Kevin talked about, we have had a little momentum in the dessert category. But, really, our strategy this year is to focus on driving traffic We have talked about that a little bit with the flow through, but it is really about the chicken sandwich. The chicken sandwich is designed to drive traffic. And we have built up all these other businesses, over the years, and those are all built into the run rate. And now we are really leaning into this 1, to drive traffic, and that is exactly what it is doing. So flattish mix for the year. You got the price just over 3%, and the balance of your sales will be from traffic.

Brian Harbour: Okay. Got it. Maybe I will talk about this next month, but I guess any of the, like, you know, north of $6 million initiatives, you know, that you would expect to see visibly this fiscal year or, I guess, like, you know, any of those that you are kind of giving yourself credit for sooner at this point?

Michaela Ware: Well, let me let me tell you 1 thing we have done. So, really, we look at north of $6 million to really study their throughput. And so as traffic continues to increase, we wanna capture all that traffic. We just talked about we are really excited about the start of the fiscal year. And when we think about the labor model, that is the main place that we are learning from them. So for example, in Q4, we just talked about, you know, that flow through was a little bit I talked about tomatoes. You know, we saw that food and beverage is up a little bit and also beef. But in our labor model, I will say, hey. We thought that labor would be a little bit more efficient. We have been telling our operators to staff for the sales they want. So we did have a little bit of let's say they were not as efficient as we wanted in labor, but thank God--as we--thank goodness we did that because traffic ramped up so quickly July and August that they were all ready for it, and they are capturing it. So we have actually built in a lot of that, where they exceeded the labor model last year. We built that in, to the model this year. Now a lot of it built in the year over the year already because they overspent, but we learned all that, again, from where are they leaning into this labor model, we are working on getting the base labor model exactly how we have it. I mean, it is a great problem to have that every year, we are growing the business so quickly that we are adjusting that labor model. To make sure that we can capture all the guests and have the throughput improved. But that is kinda where we are focused on.

Kevin D. Hochman: Yeah. You know, and like I said in my prepared comments, it is gonna be a lot of little initiatives that can help with throughput. You know, the major 1, I think, that we are mostly focused on in the front half is gonna be host stand. So this is this idea that, like, when we are on a wait, the average wait of our guest is 15 to 20 minutes. And even if we cannot reduce that, we are gonna try to reduce that. Even if we could not reduce that, even just managing the host stand better, makes a huge difference for that guest. Like, there is very different ways you can experience 15 to 20 minutes, and 1 way it can be a delighter and another way can be just the opposite. So gonna focus on how they use the software to seat a guest and to manage the seating of the restaurant. Retraining the host on, you know, how to better work with the guest, on weights. We are obviously gonna work on how do we get tables seated faster, how do we get tables bus faster. So there is a whole host of initiative coming in Q2. Then there is gonna be just things throughout the year. So for example, 1 of the pieces of feedback we have been getting from North 6 restaurants is some have tried to put in a second soda machine, but the reality is we just have a bottleneck on refills. We give a lot of free refills to our guests. And so during a busy Friday, Saturday night, that can get that is basically can get clogged both servers and food runners trying to get drinks. And so we have got some initiatives that will help us with the KDS to unclog that. So there is a lot of little things like that will improve throughput, but it is very clear that those 2 at the 6 restaurants, that take on so much more traffic than our rest of our restaurants, They have the similar sized boxes, but they do things differently, and we are gonna just continue to roll those things out. Plus take new ideas from those north of $6 million restaurants and what we need to work on from a system standpoint.

Operator: Your next Brian, are you good? Okay. Your next question is from Brian Vaccaro with Raymond James.

Brian Vaccaro: Just on the quarter today, just to kind of make sure we are all on the same page and setting reasonable first quarter expectations, would you be willing to share what the quarter to date comp is at Chili's or provide a guardrail there? And in the fourth quarter, could you also share what the 3 for me mix was and the split between the $10.99 and higher tiers? Yep.

Michaela Ware: Sure. So, Brian, what I will say and what I said in my prepared comments is that we did significantly accelerate in July and August. And so if Chili's was 6% in Q4, that means it is higher than that in Q1. So I am happy to talk about all of that when the when the quarter ends. We will go over, you know, all of the results in quarter 1, but we are just really, really pleased with the strong start. To the year and the and the traffic drivers. And so, again, like Kevin said, chicken sandwich is outperforming. The Margarita of the Month has been fantastic. It continues to help us drive traffic. And the triple dipper, I wanted to mention that, that the triple dipper is something that has grown our business year after year after year. And continues to grow today and is up even in, you know, Q1 year over year. So we are happy with that. that is also built into our everyday value. Proposition. So, that is the first thing. The second thing you just asked is on the 3forMe mix, and I am very pleased to say that it is very stable. So in Q3, it was just under 21%, and in Q4, it is just over 21% of our guests are opting in on the total platform for 3 for me. And of that 21%, about 40%--of those 40% of the people are opting into the $10.99 tier which is very stable. that is what we reported you know, every quarter. So what I think the takeaway would be 3 for me continues to be very stable. We are very pleased that the chicken sandwich and before that, the QP and the smasher, they drive in new guests. But the guests--some guests opt in to the $10.99 that want it, but the majority of the guests then eat all over the menu and enjoy you know, anything else they upgrade to whatever they want on the premium option. So that strategy continues to play out, and we are very, very pleased with it.

Brian Vaccaro: that is very helpful. Thank you. And I guess as a as a follow-up, if I could, just on the topic of accelerating unit growth and which you have obviously talked about in recent quarters and this morning, could you just give us a sneak peek on just the opportunity you see there in the U.S.? It would seem that there are some pretty large states in the Midwest, the Pacific Northwest, and I saw acquiring in Alabama this morning. As well. there is a lot--there are several states out there where the storage per pop you know, might be 1.5 to 2 instead of, you know, 3.5 plus, like, the system average. So any, you know, early thoughts on the TAM in the U.S. that you could be thinking about?

Michaela Ware: Yep. What I will tell you about is we do think there is an opportunity to build to definitely build more Chili's. We talked about kinda the new unit growth. As a percent of revenues ramping up. So we are gonna share all those details We gotta save something for investor day. But what I will tell you, Brian, is that what I really love about it is we still have opportunity to expand in our 3 biggest states. California, Texas, and Florida. We have a lot of opportunity in the Southeast to expand, like you said. I mean, we really have opportunity all over the United States. And so there is a lot of markets where we can continue to build out Chili's. In just kind of those gray areas that we have not built yet. there is a little bit of white space still in the Pacific Northwest where we know we have opportunity there. So we have a great opportunity. I think we are gonna be able to grow units over many, many years at Chili's and have, a nice growth rate to build into our growth algorithm and a nice lever to pull for years to come.

Brian Vaccaro: So we are excited about you know, the total opportunity for Chili's. Alright. Well, look forward to the Analyst Day. Thanks for your time. Okay. Thank you.

Operator: Your next question for today is from Andrew Charles with TD Cowen.

Andrew Charles: Great. Thanks so much. You know, Micah, I had 2 different questions about the guidance. So just first, what contributes to the $0.70, I think, sort of, week impact? It a pretty, large, impact relative to the revenue guidance. You know, is the interest savings piece of it from the--from the new debt structure, a piece of it. Just curious more about how the 70¢ came to be.

Michaela Ware: Yeah. So what I would tell you is at a very high level, this is how we did and we will continue to refine that as the year goes on. But it is just an incremental week of sales, so you will look at what our sales volumes are at the end of the year. And it is just a flow through assumption. it is gonna be, you know, probably at restaurant level restaurant level margins is probably gonna be in that, you know, 30% to 35% range, and that is a and that is a net income probably be in the 20% to 25% range. So it is just a flow through assumption on that final week of sales.

Andrew Charles: Okay. And then the other piece is how does the impact of the 12-store franchise acquisition, how does that impact EPS guidance? And if you could also provide the purchase price you guys are paying for that as well, it would be helpful.

Michaela Ware: So let me tell you how it impacted the guidance. And so I am glad you asked that so I could clarify. So we did we did get the 12 restaurants back. They are they are a little bit lower performing than the brand average. And, also, remember, we have to net out the royalties we were already getting. So the incremental revenues from those restaurants probably around $30 million year over year. And then it is gonna have a flat impact to EPS, basically, because it is a very small acquisition and, you know, with the opportunity of share purchase versus buying those back, it is probably a flat EPS impact. I do not know if I am gonna share all the price on that. Think we will get some more details as it comes, but, you know, we did not put it in now. But we got a really great price on those restaurants, and we are really happy to welcome them back.

Andrew Charles: Very good. Thank you for that.

Operator: Your next question is from Sara Senator.

Sara Senatore: With Bank of America. Maybe just a quick follow-up on that and then a question about Maggiano's. You know, I noticed your acquiring real estate. Is that a signal about how you are thinking about growth ahead in terms of approaching unit growth. I know there have been periods of real estate acquisition, but also sale leaseback. So just as I contemplate how you think about kind of the outlook as you are accelerating unit growth. So that was 1 quick question. And then I do have a follow-up.

Michaela Ware: Okay. So, really, our approach to, growing chilies in the future is gonna be that we are we are open. Now I will tell you the majority of the opportunities are gonna be to continue to lease, our locations and have operating leases, which is what we are gonna continue to do. But I guess what I would signal is if there is an that we could purchase the land if it makes sense, we are not against that if it helps us to continue to grow Chili's and it makes sense in certain areas. When we did the deal with Valente, they own that real estate. And we were happy to take it back. We will continue to hold it. We will look at it to see what we think the long term is. I do not know that we have a lot of sale leasebacks in our future. We prefer probably just to, you know, hold the--to hold the real estate. Some of these are older units. We do not wanna burden them with some, you know, really high and long rents on there. So that is not gonna be a big strategy moving forward. But what I would say is, primarily, we are gonna lease. If the opportunity comes to buy, we are not against it. But we are not overhauling our strategy to be an all buy an all buy strategy by any means.

Sara Senatore: Got it. Thank you. And then, I guess, maybe just 2 quick modeling questions. 1 is, the negative mix, is that sort of a continuation of the check management you saw in April? And then can you give any color on Maggiano's? You mentioned it was being contemplated in the 2027 guidance. I know Kevin's point is less than 4% of operating profit, but just curious about that. Thank you.

Michaela Ware: Yeah. So as we move forward on mix, I think because the chicken sandwich is just going so great, we are just really, again, just modeling, I would say, flattish for the next year. The negative point too was, just a continuation of, like we said, a little bit of check management with alcohol and appetizers. Like, also, Kevin talked about desserts. Those are those are hanging in there a little bit better. So we feel good about mix. And, again, I like to remind everyone that we have spent so many years building of the mix up when we built up the CRISPR business. We built up the triple dipper business, Fajita, the Rib, and all those are maintaining, which is wonderful. And so that is why we are back to this flattish. But there is a little bit of a check management, but it is it is very, very small. As far as Maggiano's goes, I will give you some high level assumptions. And what we have done is we have basically assumed in this guidance that Maggiano's is gonna have flat revenues and flat--and flat profits year over year. That just gives us a little bit of room so that we have seen some green shoots, like Kevin said, so that we just have room to have Maggiano's be able to kind of have the pressure off of them where they can just really focus on improving their food, service, and atmosphere, and they can get that traffic rolling again. But those are the assumptions at high level built in for Maggiano's.

Sara Senatore: Thank you.

Operator: Your next question is from Christopher Carrill with KeyBanc Capital Markets.

Chris Carril: Hi, good morning, and thanks for the question. Just on the chicken sandwich platform, can you maybe expand a little bit more in terms of what you saw around guest demand around the different tiers and price levels you offer, you know, maybe relative to your expectations. And, Kevin, you gave us some detail around the number of chicken sandwiches sold per day and how that is continuing to build. So can you talk maybe about how, like, advertising and awareness drove that growth versus maybe other factors, how the trajectory of chicken sandwich compares to what you saw with Big Smasher and Big QP? Thanks.

Michaela Ware: I will start with the 3 for me question on the chicken sandwich. So you know, we are very mindful about maintaining our $10.99 level of the 3 for me. So when something new comes in, the other 1 moves out. And so in this case, the Big Smasher moved out of $10.99. And the, Big Crispy moved in at $10.99 and Big QP out. Like I said, those levels have stayed very similar. So as far as the 3 for me goes, we are selling about a similar amount as we did before of the big QP and the big smasher. The rest of the chicken sandwiches and the increases that Kevin talked about are really on the base menu because we have all the sauce versions. We have the premium, the deluxe. And so that is where we are selling the bulk of our incremental chicken sandwiches are on I would say, the base menu.

Kevin D. Hochman: Yeah. And then as far as, like, the driving trial and awareness, the curve when you look at the curve, it looks almost exactly like the QP and the Smasher curve, just higher. So, like, it started off at a certain level, and then it kinda a few months in, it starts to accelerate, which is what we saw on the others too. So that makes us feel good that, like, it is kind of behaving like the other 2. So that is why we will just continue to drive advertising on it. Like, I mean, a lot of folks have seen it you know, quite a few times in, like, in the investment community or in our walls, our 4 walls, but, like, the reality is the vast majority of our guests, you know, have not seen a Chili's ad. I hate to tell the marketing team. So, as they continue to drive and build the awareness of it with a very similar campaign, that awareness will compound over time. So that is why we stay on these things. We do not, you know, do it for 4 weeks and then on to something else. that is had incredible success for us. Since we have started the free for me campaign, so we do not plan to change that. As long as the item is, the customer's responding well to the item, which is what it appears to be on the Big Crispy, You know, we are gonna continue to drive that, and then we will reassess whether in year 2 of Big Crispy, do we continue to advertise that? We bring new news to Big Crispy, or do we move to another item to talk about? But we do that. We have done the same thing every year for the last almost 4 years now, and we have had success. So we do not plan on changing that formula. We think that is creating value certainty for the guest and really repositioning us in the market. Great. Thank you. I will pass it along.

Operator: Your next question is from Jon Tower with Citi.

Jon Tower: Great. Thanks for taking the question. You know, Kevin, you earlier talked about the cycle time efforts and, what you got lined up for 2027 in terms of what you are tackling. I am just curious, like, how you are thinking beyond that Are there larger chunks or areas that you can go after in 2028 and beyond? I am just trying to get an idea of how long this runway is for you to kinda continue to improve the cycle times.

Kevin D. Hochman: Yeah. You know, I think there are 2 areas I think that we know, we will continue to work on that we are gonna learn about, which is, like, the actual dining experience. So, in that 1, I think there is a ton of upside just because it is a big part of the business. And we continue to uncover basically, places where things bottleneck. And so just going to continue to walk through those things. So for example, you know, host stand's a big 1 that is a major initiative for us, but, like, we also know that the or, you know, the order time is a little bit of a blockage. And so when we are--we are finally finishing rolling out the new UX for the order tablet, that is gonna speed up ordering. And you know, what we are learning at the soft drink station, the fact that it is harder to get refills as fast, and that is gonna speed up time. And then this idea of dessert bottlenecks and what so when people do order dessert, it ends up being a long time. that is gonna improve cycle time, but it is also going to improve the server being more willing to sell desserts. Right? So I think we are just gonna continue to uncover things from a from a dining room standpoint, and I know, I think we got at least 3 years of runway on that 1.

Michaela Ware: The other 1, which we have not even scratched the surface on, is to go. it is 25% of our business, and we have a huge opportunity to figure out how to get friction out of that to make it seamless. When you look at the players in QSR, that win on digital, meaning they create, habits of their guests that they can rely on to get a quick take home meal it is all about a fast app a seamless pickup experience, and accurate pack out. And we think those 3 things we can go nail over the next couple years, and we think that we are uniquely positioned in casual dining to go after those transactions because if you look at the things that we are winning with, it is all around the better than fast food campaign. So these are things that think about when they think about take home meals. So burgers and chicken sandwiches and chicken tenders. Some of our Tex Mex offerings. Like, these are all things that we think are positioning ourselves well. We have gotta figure out that operation. I think that is a huge task. We are gonna talk a little bit more about it when you guys come in for investor day. But that is the next big frontier I am excited about because there is so many more transactions in QSR. That we could go after with the off premise occasion. Awesome.

Jon Tower: Thank you for that. I guess, 1 more follow-up. I guess I have asked this question before in previous calls. I am curious if you have any data behind it now. In terms of the guest behavior. You know, a lot of those guests that had been lapsed and now have come back to Chili's over the years. how they are using the brand perhaps differently than maybe you thought or maybe they are using the brand, or the menu as you had expected. I am curious if you have got kind of that customer journey how they have been coming back in.

Kevin D. Hochman: Yeah. We do not really have that detail. I mean, the level that we have with the token data is basically that we are bringing a lot of new guests in. So a little bit more than half of the tokens that we see each month are new. And then when we track them, we now we do it within 9 months. We can understand what their repeat behavior is, and it looks a lot like existing guests. So that is basically what we know.

Michaela Ware: We, you know, we have some, you know, broad things of younger guests you know, tend to order more triple dippers. Older guests tend to order more of the 3 for me. So we have some of that. But, like, we do not really it is hard, it would be--I do not know how to answer your I do not have the data to answer your specific question of, like, are how are lapsed users when they come back to the brand using the brand differently?

Kevin D. Hochman: We do not have it to that. You know what, John?

Michaela Ware: But what we do know is, we continue to draw on new guests every quarter, and then we talk about how 3 for me is pretty stable. So we are not seeing, like, an over index to value. And all of the categories are they have grown over time, but then they are all pretty stable. And so we are not seeing any huge mix shifts in the menu with new guests. it is kinda like we said, you know, we are attracting new guests in, and they quickly fall and look like existing guests over time and then just keep coming back. But they are utilizing the menu basically the same. We are not seeing any big changes in the run rates of all the different particular categories or, like, a run up in 3 for me. Awesome.

Jon Tower: Thank you for the time.

Operator: Your next question is from Margaret-May Binshtok with Wolfe Research.

Margaret-May Binshtok: Good morning. Thanks for taking my question. Just a 2 parter. I wanted to ask. I know you guys have talked about the success of the Big Crispy platform, but anything to call out in terms of the incremental traffic? Is that a younger guest? Anything between the different co income cohorts, the type of guest that is bringing in? And then the second part, just wanted to ask, since you guys launched the margarita of the month Club earlier this year, have you seen any sort of sequential improvement in alcohol incidents? Thank you.

Michaela Ware: Thanks for the question, Margaret-May, So you know what the great thing is about Chili's and about burgers and chicken sandwiches? Everybody loves them. So our traffic's been up, and we are growing all. Growing all income levels, low, medium, high. We are growing all of our different demographics. And so, you know, historically, we had a little pop in our younger guests with the initial success of the triple dipper. We have maintained that. And, you know, we continue to grow and attract all the different demographics and cohorts. So we are really pleased. The chicken sandwich, again, has behaved just like the burgers. it is a huge segment, and it is broadly appealing to everyone. And so we are not seeing 1 particular group drive, the traffic. it is all the groups, which we love. Because it is not very specific to 1 group. it is very broadly appealing.

Kevin D. Hochman: And as far as the Margot of the month club goes, it is been a huge success for us just in general as a as an everyday value platform for us. So I know our guests really appreciate that $6 margarita. it is fun. it is colorful. They enjoy seeing what is next. it is culturally relevant. The 1 we had in July, Kevin mentioned it, it was really successful. So I would say, overall, the Margarita of the Months have been very successful. They are driving Margarita incidents that are driving traffic. Now if you take a bigger step back and look at the whole alcohol category, know, we are feeling a little pressure like everybody else. You know, as the whole category you know, for the category as a whole. We continue to sell market share. We are at the top end of market share but we are feeling a little bit of that macro pressure like everyone else is. But Margarita the month specifically, great value in helping us drive traffic. And then 1 other thing I would add is I think, you know, maybe 5 years ago, the prior team viewed margarita of the month as just like a, you know, how do we get more drink attachment. And it does play a great role to do that. Still does. So you know, we tested it years ago when I first got here, which was to take it off the table, and it was a mistake. So we know that it drives drink attachment even if the broader macro trends are against alcohol attachment and what is going on with gas prices. So but the second thing I think that is important to note is the new marketing team has done a phenomenal job of figuring out what are different margaritas of the month we can use to drive traffic You know, we saw that with last November with our witch-themed 'ritas. We saw it with the most recent bombshell mark in July. And so I think they are doing a better not every month's gonna be this big traffic creating margaritas. These guys are very planful about which ones they are gonna do. And how they are gonna surround it with advertising and social. But they have done an exceptional job of creating a second growth lever on Margarita of the Month. So it is not just about attachment. And entry price point, but it is also now about traffic driving for certain marks. And I think that is gonna continue. I when I look at the innovation they have planned, think it is not gonna be every month, but often they are gonna be looking at things that are actually going to drive the total box traffic, not just alcohol attachment. Thank you.

Operator: We have reached the end of the question-and-answer session. I will now turn the call over to Kim Sanders for closing remarks.

Kim Sanders: That concludes our call for today. We appreciate everyone joining us and look forward to presenting an update on our long term growth plans at our upcoming Investor Day in September, updating you on our first quarter fiscal year 27 results in October. Have a wonderful day.

Operator: This concludes today's conference call. You may disconnect your phone lines at this time, and have a wonderful day. Thank you for your participation.