Bloomin' Brands Shares Gain 3.8% as Third-Quarter Earnings Beat Forecasts Despite Cautious Q4 Guidance

Bloomin’ Brands, Inc. (NASDAQ:BLMN) shares advanced 3.8% following the release of its third-quarter 2026 financial results, as the restaurant operator reported a smaller-than-expected adjusted loss and revenue slightly ahead of Wall Street forecasts. However, the company’s fourth-quarter earnings guidance fell below analyst expectations, while management lowered its full-year comparable restaurant sales outlook.

The company, which operates Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar, reported an adjusted loss of $0.17 per share, compared with analysts’ expectations for a loss of $0.23 per share.

Quarterly revenue increased 1.7% year over year to $927.0 million, up from $911.9 million in the corresponding period last year and slightly above the consensus estimate of $925.6 million.

Despite the earnings beat, the results highlighted continued challenges surrounding customer traffic, restaurant operating margins and the outlook for consumer spending.

Third-Quarter Revenue Rises 1.7% as Adjusted Loss Beats Estimates

Bloomin’ Brands delivered a stronger-than-anticipated adjusted earnings performance during the third quarter, with its loss per share coming in $0.06 better than analysts had forecast.

The adjusted loss of $0.17 per share compared favourably with the consensus estimate of a $0.23 loss, while revenue exceeded expectations by approximately $1.4 million.

Total revenue of $927.0 million represented an increase of 1.7% from the $911.9 million reported in the prior-year quarter.

The results reflected modest revenue growth across the company’s restaurant operations, supported by higher comparable sales at its US locations.

However, the company continued to face pressure from declining customer traffic, with increases in average spending helping to offset fewer restaurant visits.

The performance demonstrated the importance of pricing and customer spending patterns to Bloomin’ Brands’ financial results as it works to improve restaurant operations.

Outback Steakhouse Turnaround Shows Continued Progress

Chief Executive Officer Mike Spanos highlighted progress in the company’s ongoing efforts to improve the performance of Outback Steakhouse.

“We are pleased with our third-quarter performance and the continued progress of the Outback turnaround, including five consecutive quarters of year-over-year improvements in guest satisfaction scores at Outback,” Spanos said.

The Outback Turnaround initiative remains an important part of Bloomin’ Brands’ strategy to strengthen restaurant performance and improve the customer experience.

The company reported that Outback Steakhouse achieved a 1.9% increase in comparable restaurant sales during the quarter.

Management’s comments suggested that efforts to improve guest satisfaction were producing measurable results, although customer traffic trends continued to present challenges.

The five consecutive quarters of improving guest scores provided evidence of progress in the restaurant chain’s operational initiatives.

However, sustained improvements in customer visits and restaurant profitability will remain important measures of the turnaround’s longer-term success.

Bonefish Grill Leads Comparable Sales Growth

Comparable restaurant sales across Bloomin’ Brands’ US operations increased 1.9% during the third quarter.

Bonefish Grill delivered the strongest performance among the brands highlighted in the results, reporting a 5.3% increase in comparable sales.

Outback Steakhouse also recorded a 1.9% improvement, contributing to the company’s overall domestic sales growth.

Despite these gains, customer traffic across US restaurants declined 1.8% compared with the corresponding period last year.

The reduction in visits was offset by a 3.7% increase in average spending per customer, primarily reflecting pricing adjustments.

The figures indicated that higher menu prices continued to support revenue growth even as fewer customers visited the company’s restaurants.

While the increase in average spending helped maintain positive comparable sales, the decline in traffic highlighted the importance of attracting and retaining customers in a competitive restaurant market.

The company will need to balance pricing strategies with customer demand as it seeks to sustain sales growth across its brands.

Restaurant Operating Margins Face Pressure

Bloomin’ Brands’ third-quarter financial results included a $13.2 million adjustment related to gift card breakage revenue following a change in an accounting estimate.

Gift card breakage refers to the portion of gift card balances that a company expects customers will not redeem.

The adjustment affected reported results and was excluded from the company’s underlying restaurant-level operating margin calculation.

Excluding the item, adjusted restaurant-level operating margin was 9.3%, compared with 9.5% in the corresponding period of 2025.

The decline of 0.2 percentage points indicated modest pressure on restaurant profitability despite the increase in comparable sales.

The margin performance suggested that higher customer spending had not fully translated into improved underlying restaurant-level profitability.

Managing operating costs and improving restaurant efficiency will therefore remain important priorities as Bloomin’ Brands continues implementing its turnaround initiatives.

Fourth-Quarter Earnings Forecast Falls Below Wall Street Expectations

For the fourth quarter of 2026, Bloomin’ Brands expects adjusted earnings per share between $0.07 and $0.12.

The midpoint of the guidance range, approximately $0.095 per share, falls below the analyst consensus estimate of $0.14.

The forecast suggests that management anticipates a more challenging earnings environment during the final quarter of the year than analysts had previously expected.

Although the company delivered better-than-anticipated third-quarter results, the cautious outlook indicates that profitability pressures could continue.

The guidance also highlights the challenges associated with maintaining earnings growth while restaurant traffic remains under pressure.

Investors will monitor whether Bloomin’ Brands can improve customer demand and maintain operating efficiency during the final months of 2026.

Full-Year Earnings Guidance Remains Broadly in Line With Estimates

Bloomin’ Brands expects adjusted earnings per share of $0.97 to $1.02 for the full year 2026.

The midpoint of the forecast range, approximately $0.995, is slightly above the analyst consensus estimate of $0.97.

The outlook suggests that the company expects its full-year adjusted earnings performance to remain broadly consistent with market expectations despite the weaker fourth-quarter forecast.

However, management lowered its guidance for US comparable restaurant sales.

The company now expects full-year comparable sales growth of 1% to 1.5%, compared with its previous forecast of 1% to 2%.

The revised range maintains the lower end of the earlier guidance but reduces the upper end by 0.5 percentage points.

The adjustment indicates a more cautious assessment of sales growth during the remainder of the year.

The lower forecast also reflects the importance of customer traffic trends and consumer spending patterns to the company’s financial performance.

Bloomin’ Brands Continues Operating More Than 1,450 Restaurants

Bloomin’ Brands operates more than 1,450 restaurants across its portfolio of casual dining and upscale restaurant brands.

Its principal chains include Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar.

The company’s performance depends on maintaining customer demand across these different restaurant concepts while controlling operating expenses and improving profitability.

Outback Steakhouse remains a central focus of management’s operational improvement strategy, with the company reporting continued progress in guest satisfaction.

Meanwhile, Bonefish Grill’s stronger comparable sales performance provided a positive contribution to third-quarter results.

The company faces the challenge of translating improvements in customer experience and average spending into sustained growth in restaurant visits and operating margins.

Investors Weigh Earnings Beat Against Softer Sales Outlook

Bloomin’ Brands’ 3.8% share price increase reflected a positive response to its third-quarter earnings performance, despite the company’s cautious outlook for the final quarter of 2026.

The restaurant operator exceeded analysts’ expectations for adjusted earnings and revenue, while reporting positive comparable sales growth across its US business.

Progress in the Outback Steakhouse turnaround and strong comparable sales at Bonefish Grill provided additional positive indicators.

However, declining customer traffic, slightly weaker underlying restaurant-level margins and reduced full-year comparable sales guidance highlighted continuing operational challenges.

The company’s fourth-quarter adjusted earnings forecast also fell short of Wall Street expectations, suggesting that profitability could remain under pressure.

Investors will continue to assess Bloomin’ Brands’ ability to improve restaurant traffic, maintain customer satisfaction gains and strengthen operating margins as it progresses through its turnaround strategy.

Bloomin’ Brands stock price