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Mar 26, 2025
Denny's Q1 2025 Earnings Report
Denny's reported results for the first quarter ended March 26, 2025, showing a slight increase in total operating revenue but a decrease in operating income and net income compared to the prior year.
Key Takeaways
Denny's Corporation experienced a challenging first quarter in 2025 due to macro headwinds impacting consumer spending. While total operating revenue saw a modest increase, operating income and net income decreased significantly. The company's Denny's brand saw a decline in domestic system-wide same-restaurant sales, while the Keke's brand showed positive growth and expanded into a new state.
Total operating revenue increased slightly to $111.6 million from $110.0 million in the prior year quarter.
Operating income decreased to $5.2 million from $10.0 million in the prior year quarter.
Net income was $0.3 million, or $0.01 per diluted share, a significant drop from $4.7 million, or $0.09 per diluted share, in the prior year quarter.
Denny's domestic system-wide same-restaurant sales decreased by 3.0%, while Keke's domestic system-wide same-restaurant sales increased by 3.9%.
Revenue by Segment
Forward Guidance
For the full year 2025 (53 operating weeks), Denny's expects recent shifts in consumer sentiment to moderate. They provided guidance for domestic system-wide same-restaurant sales, restaurant openings and closures, commodity and labor inflation, general and administrative expenses, adjusted EBITDA, and share repurchases.
Positive Outlook
- Expectation for moderation of recent shifts in consumer sentiment.
- Planned consolidated restaurant openings of 25 to 40.
- Anticipated labor inflation between 2.5% and 3.5%.
- Guidance for Adjusted EBITDA between $80 million and $85 million.
- Planned share repurchases between $15 million and $25 million.
Challenges Ahead
- Denny's domestic system-wide same-restaurant sales expected between (2.0%) and 1.0%.
- Planned consolidated restaurant closures between 70 and 90.
- Anticipated commodity inflation between 3.0% and 5.0%.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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