What's in Store for These 3 Restaurant Stocks in Q4 Earnings?

The restaurant industry enters the fourth-quarter 2025 earnings season amid an increasingly value-conscious consumer environment. As the year progressed, operators placed greater emphasis on affordability, bundled offerings and targeted promotions to drive growth. Traffic trends are likely to be central to respective companies' performance, with operators prioritizing guest counts over pricing-led comparable sales growth.

Companies in the broader Retail-Wholesale sector, such as Papa John's International, Inc. PZZA, Sweetgreen, Inc. SG and Shake Shack Inc. SHAK, are set to report their respective fourth-quarter earnings on Feb. 26.

Per the latest Earnings Outlook, total earnings of the Zacks Retail-Wholesale sector are expected to rise 2.9% year over year in the fourth quarter of 2025. In the third quarter of 2025, the sector’s earnings were up 16.6% year over year. Meanwhile, revenues for the sector are expected to rise 6.4% year over year. In the previous quarter, the sector’s revenues gained 7% year over year.

Factors at Play

The restaurant industry is likely to have benefited from targeted marketing initiatives, continued service digitization and disciplined unit expansion in the fourth quarter of 2025. Operators intensified national and local campaigns centered on value messaging, bundled offerings and limited-time menu innovations, reinforcing respective brand relevance in a competitive landscape.

Emphasis on loyalty ecosystems and mobile ordering platforms is likely to have supported personalized outreach and data-driven engagement in the fourth quarter. Strategic investments in staffing models, store-level deployment and process refinement — including the rollout of in-store order sequencing tools and algorithm-based prioritization systems — are expected to have enhanced throughput and operational consistency, supporting top-line momentum.

Increased focus on menu innovation and pricing optimization bodes well. Companies have been refining price ladders and identifying key category thresholds to maintain affordability. Balanced promotional activity, coupled with improved product mix and targeted digital incentives, may have strengthened value perception and elevated brand consideration among price-sensitive consumers. Ongoing new restaurant openings — particularly in high-traffic suburban corridors and select international markets — are expected to have contributed incremental systemwide sales growth, reinforcing long-term development visibility.

However, macroeconomic pressures remained a persistent overhang. Consumer sentiment softened during the quarter, particularly among lower-income households and family-oriented cohorts, where discretionary spending continues to face scrutiny. Elevated living costs and cautious budgeting behavior likely influenced traffic patterns. Additionally, input cost volatility and currency fluctuations likely affected reported results. While commodity inflation has shown signs of stabilization in select categories, labor expenses and promotional intensity likely remained elevated, limiting margin expansion. Foreign exchange headwinds in key global markets may have weighed on respective companies fourth-quarter earnings.

Sneak Peek Into Upcoming Earnings Releases

Among a number of stocks, to identify those with the potential to beat earnings estimates, the following Zacks methodology can be used. The Zacks model suggests that a company needs to have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Here are three bundled stocks that are set to report their fourth-quarter earnings. You can see the complete list of today’s Zacks #1 Rank stocks here.

Papa John's is scheduled to report results before the opening bell.

Papa John's fourth-quarter performance is likely to be supported by a strengthened value proposition and continued execution of its transformation initiatives. The company’s barbell strategy — balancing compelling promotional offers such as the 50% off carryout deal and Buy One Get One promotions with premium product innovation — is expected to have supported transaction trends. Ongoing investments in its modernized first-party digital ordering platform and CRM-driven personalization capabilities are likely to have aided its performance in the to-be-reported quarter.

However, a softer consumer backdrop and a highly promotional QSR environment in North America are likely to have weighed on comparable sales and margin performance. Continued transaction pressure among lower-income and small-ticket customers, coupled with incremental marketing investments to reinforce value messaging, may have limited profitability in the quarter. Additionally, competitive intensity and mix shifts toward lower-priced offerings could have tempered average ticket growth.

The Zacks Consensus Estimate for Papa John's fourth-quarter 2025 revenues is pegged at $514.9 million, indicating a decline of 3% from the year-ago figure. Earnings per share (EPS) are pegged at 33 cents, indicating a fall of 47.6% from the 63 cents reported in the year-ago quarter.

Papa John's International, Inc. Price and EPS Surprise

Papa John's International, Inc. price-eps-surprise | Papa John's International, Inc. Quote

The company has an Earnings ESP of +11.38% and a Zacks Rank #3 at present.

Sweetgreen is scheduled to report results after the closing bell.

Sweetgreen’s fourth-quarter performance is likely to be supported by continued execution of its Sweet Growth Transformation Plan and a sharper focus on operational discipline. Initiatives such as Project One Best Way, throughput enhancements and the rollout of Scan to Pay are expected to have aided its performance in the fourth quarter. Marketing efforts centered on brand relevance, a protein-focused campaign and new menu additions, along with increased personalization through SG Rewards, are likely to have supported guest engagement and revenue trends in the to-be-reported quarter.

However, a challenging consumer backdrop, particularly in key urban markets, is likely to have weighed on comparable sales. Elevated protein costs, portion investments and tariff-related expenses may have pressured margins.

The Zacks Consensus Estimate for Sweetgreen’s fourth-quarter 2025 revenues is pegged at $159.7 million, indicating a decline of 0.8% from the year-ago figure. Loss per share is pegged at 31 cents, indicating a fall of 24% from a loss of 25 cents reported in the year-ago quarter. 

Sweetgreen, Inc. Price and EPS Surprise

Sweetgreen, Inc. price-eps-surprise | Sweetgreen, Inc. Quote

The company has an Earnings ESP of +7.47% and a Zacks Rank #3 at present.

Shake Shack is scheduled to report results before the opening bell.

The company’s fourth-quarter performance is likely to have benefited from its menu innovation and ongoing unit expansion, partly offset by a challenging consumer backdrop. Its focus on driving traffic through targeted marketing, limited-time offerings and continued refinement of its digital ordering capabilities is expected to have aided comparable sales in the to-be-reported quarter. Expansion across domestic company-operated restaurants and licensed international markets is likely to have contributed to top-line growth in the fourth quarter.

However, elevated commodity costs alongside higher labor and occupancy expenses are likely to have pressured restaurant-level margins in the fourth quarter. Persistent macroeconomic uncertainty and cautious consumer spending trends, especially among lower-income cohorts, could have weighed on traffic growth.

The Zacks Consensus Estimate for Shake Shack’s fourth-quarter 2025 revenues is pegged at $402.4 million, indicating growth of 22.4% from the year-ago figure. EPS is pegged at 36 cents, indicating a rise of 38.5% from 26 cents reported in the year-ago quarter.

Shake Shack, Inc. Price and EPS Surprise

Shake Shack, Inc. price-eps-surprise | Shake Shack, Inc. Quote

The company currently has an Earnings ESP of -2.98% and a Zacks Rank #5 (Strong Sell).

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This article originally published on Zacks Investment Research (zacks.com).

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