The Cheesecake Factory delivered third quarter results that met most Wall Street expectations, with revenue growth driven by modest comparable sales gains at its flagship brand and ongoing margin improvements across its portfolio. Management highlighted the continued effectiveness of menu innovation, such as new appetizer and bowl offerings, which contributed to higher check mixes without increasing average guest spend. CEO David Overton pointed to “the strength and resilience of our brands” in a softer consumer environment, while operational efficiency and improved staff retention helped support healthy profitability.
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The Cheesecake Factory (CAKE) Q3 CY2025 Highlights:
- Revenue: $907.2 million vs analyst estimates of $911.9 million (4.8% year-on-year growth, 0.5% miss)
- EPS (GAAP): $0.66 vs analyst estimates of $0.61 (8.9% beat)
- Adjusted EBITDA: $65.49 million vs analyst estimates of $64.59 million (7.2% margin, 1.4% beat)
- Operating Margin: 4.1%, in line with the same quarter last year
- Locations: 399 at quarter end, up from 375 in the same quarter last year
- Same-Store Sales were flat year on year (1.5% in the same quarter last year)
- Market Capitalization: $2.36 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From The Cheesecake Factory’s Q3 Earnings Call
- Andrew Barish (Jefferies) asked about the drivers behind increased consumer caution and whether trends were regional or related to guest spending. CFO Matthew Clark said the softness was mostly in traffic, with stable check averages, and noted impacts from the government shutdown.
- Brian Vaccaro (Raymond James) inquired about commodity inflation and margin outlook for the next quarter. Clark explained that beef costs were rising, but productivity gains and group medical timing would help offset some pressures, keeping margins relatively stable.
- Jon Tower (Citigroup) questioned the promotion of lower-priced menu items and future pricing strategy. President David Gordon said the company would continue leveraging menu innovation and loyalty to highlight value, while Clark noted planned moderation in price increases.
- Sharon Zackfia (William Blair) asked about the timing and drivers of expected sales improvement in 2026. Clark pointed to cumulative menu changes, easier year-over-year comparisons, and hopes for improved macroeconomic conditions as contributing factors.
- Christine Cho (Goldman Sachs) sought insight on why Flower Child outperformed peers and how North Italia is addressing value perception. Gordon cited menu variety and strong price points at Flower Child, while North Italia is promoting bundled value offers and seasonal menu updates.
Catalysts in Upcoming Quarters
Looking ahead, our analyst team is monitoring (1) the pace of loyalty program adoption and the rollout of the new rewards app, (2) the impact of ongoing menu innovation on guest traffic and check mix, and (3) whether new restaurant openings, particularly for Flower Child and North Italia, can drive incremental growth. Execution on cost control and adaptation to consumer sentiment shifts will also be critical watchpoints.
The Cheesecake Factory currently trades at $47.66, down from $54.40 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free for active Edge members).
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