The Cheesecake Factory Incorporated CAKE reported first-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. Both top and bottom lines increased from the prior-year quarter’s figures.
The company attributed its strong first-quarter performance to effective operational execution and a continued emphasis on staffing and retention. This focus has directly supported improved guest satisfaction scores, both sequentially and year over year, and contributed to overall restaurant performance and sales growth.
Management highlighted that enhanced execution played a key role in margin expansion, all while maintaining the brand’s commitment to quality and value in a competitive environment. On the marketing front, the company’s recent menu update — featuring over 20 new items — generated significant media attention, resulting in more than 700 placements and over 8 billion potential PR impressions, nearly double the exposure achieved in the same quarter last year. This underscores the brand’s strong marketing capabilities and effective use of social, broadcast, print and digital platforms to deepen guest engagement and elevate brand visibility.
CAKE’s Q1 Earnings & Revenue Discussion
For the quarter under review, the company reported adjusted earnings per share (EPS) of 93 cents, beating the Zacks Consensus Estimate of 81 cents by 14.8%. In the year-ago period, the company reported adjusted EPS of 73 cents. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Quarterly revenues of $927.2 million beat the consensus estimate of $926 million by 0.2%. The top line increased 4% on a year-over-year basis.
The Cheesecake Factory Incorporated Price, Consensus and EPS Surprise
The Cheesecake Factory Incorporated Price, Consensus and EPS Surprise
The Cheesecake Factory Incorporated price-consensus-eps-surprise-chart | The Cheesecake Factory Incorporated Quote
CAKE’s Q1 Comps
In the reported quarter, comps at Cheesecake Factory restaurants inched up 1% year over year against a 0.6% decline reported in the prior-year quarter. We predicted comps to increase 1.2% year over year.
North Italia comps declined 1% year over year against 3% growth reported in the year-ago quarter. Our model expected the metric to rise 0.8% year over year.
CAKE’s Costs in Detail
The cost of food and beverage, as a percentage of revenues, contracted 100 basis points (bps) year over year to 21.8% in the fiscal first quarter. We expected the metric to be 22.4% of revenues in the quarter.
Labor expenses, as a percentage of total revenues, amounted to 35.7%, down 30 bps year over year. We expected the metric to be 35.4% of revenues in the quarter.
Other operating costs, as a percentage of total revenues, were 26.7%, up 40 bps year over year. In the quarter, we anticipated the metric to be 26.8% of revenues.
General and administrative expenses accounted for 6.5% of revenues, down 30 bps year over year. Our model predicted the metric to be 6.5% of revenues in the fiscal first quarter.
In the fiscal first quarter, pre-opening expenses accounted for 0.8% of revenues, up 20 bps year over year.
Balance Sheet of CAKE
As of April 1, 2025, Cheesecake Factory’s cash and cash equivalents totaled $135.4 million compared with $84.2 million as of 2024-end. Long-term debt (net of issuance costs) was $627.3 million compared with $452.1 million as of Dec. 31, 2024. As of April 1, 2025, the company had a total available liquidity of $501.9 million.
Management declared a quarterly cash dividend of 27 cents per share. The dividend will be payable on May 27 to its shareholders of record as of May 14, 2025. In the fiscal first quarter, CAKE repurchased approximately 2.6 million shares for $141.4 million.
CAKE’s Store Developments
In the first quarter of fiscal 2025, the company expanded its footprint with eight new restaurant openings, including three North Italia locations, three Flower Child locations and two FRC restaurants. Following the quarter's end, three additional restaurants were opened, consisting of one Flower Child location and two FRC restaurants.
In 2025, the company anticipates accelerating growth by adding up to 25 restaurants across its portfolio.
CAKE’s Zacks Rank
Cheesecake Factory currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Restaurant Releases
Domino's Pizza, Inc. DPZ reported first-quarter fiscal 2025 results with earnings beating the Zacks Consensus Estimate, while revenues missed the same. The company reported adjusted EPS of $4.33, up from $3.58 reported in the year-ago quarter. Revenues of $1.11 billion increased 2.5% on a year-over-year basis.
Domino's reported benefits from the Hungry for MORE strategy during the quarter, registering growth in market share across the U.S. and international segments. DPZ continued to manage controllable factors well despite a tough global environment. The strategy supported an increase in sales, store openings and profits. These factors are important for long-term value creation for franchisees and shareholders.
Brinker International, Inc. EAT reported third-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The company reported adjusted EPS of $2.66, up from $1.24 reported in the year-ago quarter. Revenues of $1.43 billion increased 27.2% on a year-over-year basis.
Brinker’s quarterly performance benefited from strong fundamentals, leading to better guest experience and steady business growth. The ongoing increase in traffic continues to drive the company’s performance.
YUM! Brands, Inc. YUM reported first-quarter 2025 results, with adjusted earnings beating the Zacks Consensus Estimate and revenues missing the same. The company reported adjusted EPS of $1.30, up from $1.15 reported in the year-ago quarter. Revenues of $1.79 billion increased 12% on a year-over-year basis.
The company’s performance reflects solid contributions from the KFC and Taco Bell divisions. On the digital front, the company reported meaningful progress, with digital sales nearing $9 billion and accounting for 55% of total sales. Franchisee feedback on Yum!’s proprietary digital platform, Byte by Yum!, remained positive, reinforcing the brand’s strategic push toward tech-driven growth.
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