Bloomin' Brands, Inc. Third Quarter 2026 Earnings Conference Call - BLOOMIN' BRANDS INC

Greetings, and welcome to the Blumen Brands, Inc. 3rd Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow management's prepared remarks. Please note that today's event is being recorded. It is now my pleasure to introduce your host, Tara Kurian, Senior Vice President, IRFP&A, and International. Thank you, and you may begin. Thank you, and good morning, everyone. With me on today's call are Mike Spanos, our Chief Executive Officer, and Eric Christel, Executive Vice President and Chief Financial Officer. By now, you should have access to our fiscal third quarter 2026 earnings release and our investor presentation slides, both of which can be found on our website at www.bloominbrands.com in the Investors section. Throughout this conference call, we will be presenting results on an adjusted basis. An explanation of our use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures appear in our earnings release and investor presentation on our website as previously described. Before we begin formal remarks, I'd like to remind everyone that part of our discussion today will include forward-looking statements, including a discussion of recent trends. These statements are subject to numerous risks and uncertainties that could cause actual results to differ in a material way from our forward-looking statements. Some of these risks are mentioned in our earnings release. Others are discussed in our SEC filings, which are available at www.sec.gov. During today's call, we'll provide a brief recap of our financial performance for the fiscal third quarter 2026, current thoughts on fiscal 2026 guidance, and an update on our turnaround strategy. Once we've completed these remarks, we'll open the call up for questions. With that, I would now like to turn the call over to Mike. Thanks, Tara, and good morning, everyone. I will discuss our third quarter results and provide an update on our turnaround. Eric will then review our financial results and Q4 and full year guidance. Before I review our results, I want to briefly discuss an event that occurred earlier this week. One of our Outback domestic franchisees, OutWest, filed for bankruptcy protection. This is specific to OutWest and is not reflective of our other franchisees or company-owned operations. As part of the bankruptcy process, Outwest is selling their 61 restaurants. We are working collaboratively with OutWest to ensure there is no immediate impact to guests, restaurant teams, or day-to-day operations, and these restaurants continue to operate normally. As we announced earlier this week, Bloomin' Brands entered into a stocking horse purchase agreement for the 61 restaurants. We believe this agreement aligns with our strategy to invest in the base business. Should our bid be accepted, we look forward to welcoming OutWest to the Bloomin'' Brands team. We anticipate this process to take a couple months, and we will be able to provide more details on our next earnings call. Turning to our third quarter results, our Q3 U.S. comparable restaurant sales were up 190 basis points with traffic down 180 basis points. Average check was up 370 basis points, we continue to see less mixed headwind as we improve affordability offer returns. Our focus remains on strengthening the what you get for what you pay for value equation by delivering quality food, craveable service, and affordable price points across our brands. While we recognize both sales and traffic metrics were below the industry black box metric, we know our success will not be linear and we remain committed to driving sustainable and profitable traffic growth over the long term. Outback's Q3 comp sales were up 190 basis points with traffic down 150 basis points. Outback Technomic guest scores improved year over year for the fifth consecutive quarter. Compared with Q3 last year, Outback's guest scores increased across service by three points, atmosphere by three point, intent to return by three, value by two points, and food by one point. What excites me most is both the continued improvement and seeing Outback guest metrics at parity or higher than our key competitors. These results reinforce the turnaround strategy and our focus on consistent execution. We are getting better every day. Carrabba's comp sales were up 60 basis points with traffic down 290 basis points. The brand is all about bringing people together with authentic Italian cooking and heartfelt hospitality. The team is focused on execution and elevating in-restaurant dining, including experiential wine dinners, day-of-week offers with Tuesday $6 sangrias, pizza and poor Wednesdays, and dinner value offers. We will continue to leverage off-premise as a convenience and recruitment channel. Bonefish's comp sales were up 530 basis points with traffic down 80 basis points. The second half of 2026 reflects more difficult traffic laps for Bonefish, offset by better average check trends. The brand continued to generate strong sales growth through its modern coastal experience with an energetic bar. Guests continue to respond to Martini Monday, Bang Bang Shrimp Wednesday, and the Prefix Lunch Everyday Value Offer. These offers complement the core menu that delivers variety across land and seafood proteins. fleming's comp sales were flat with traffic down 190 basis points the team is focused on consistent execution and service to deliver elevated hospitality as well as approachable offers such as tomahawk tuesday steakboard sunday and a three-course dinner value the team relaunched social hour to provide guests with a casual bar experience with shareable options lastly fleming opened atlanta midtown last month and riverside california opens next week turning to an update on our turnaround focused on outback steakhouse the turnaround is anchored on four strategic platforms as previously communicated which are first deliver a remarkable dine-in experience second drive brand relevancy third reignite a culture of ownership and fun fourth invest in our restaurants these platforms are supported by non-guest facing productivity savings, balanced capital allocation, and a strong management team. Starting with an update on the first platform to deliver a remarkable dining experience. The first step was the launch of our steak lineup in November of last year. With a year of data, we continue to see our steak scoring in the top box. Consistent with Technomic, our Zios guest scores are showing noteworthy improvements year-over-year across food quality, steak temperature, value, service, and intent to return. Additionally, last year we reintroduced annual steak certifications for our multi-unit leaders in conjunction with the steak lineup. Outback President Pat Haffner will again lead teams to the annual steak certification training next month. Each multi-Unit leader is required to pass steak certification tests before they coach, train, and certify their restaurant leadership. We acknowledge that close is never good enough for Outbackers and remain dedicated to our leadership and stake authority. Moving to the next element of a remarkable dining experience, craveable service. Last quarter, we successfully rolled out our new service model to all Outbacks, reducing our ratio to four tables per server during peak hours. In August, we also rolled out front-of-house training on our enhanced hospitality experience model to deliver a fun, casual, aussie, no-rules-just-right experience. Guest feedback continues to reinforce we've made the right changes. Similar to what we saw in Q2, absolute service scores in Q3 were over 90% top box, with a nearly two-point increase year-over-year. Q3 value scores also improved nearly two points year-ever-year, Guests are telling us they see the difference in our stake quality, craveable service, and value, improving the what-you-get-for-what-you pay-for value equation. Our second strategic platform is driving brand relevancy to differentiate Outback. In October, we launched our Best Stakes Ever campaign, which embraces our Aussie brand roots and showcases our stake authority and the affordability of Aussie 3Course. For a limited time, we introduced the 6-ounce sirloin in the entry price tier of Aussie 3 course at $15.99. Initial reactions to both the campaign and the limited time offer have been very encouraging. As a test and learn culture, we will use these early learnings to inform next year's plans and the evolution of the Aussie 3 course brand platform. We increased our marketing spend this year primarily within the second half of 2026 that aligns with the launch of our Best Stakes Ever campaign. As we mentioned at the start of the turnaround, we are moving more of our marketing dollars towards social and digital. By the end of this year, we will be approximately 60% digital and 40% linear TV compared to 30% digital and 70% linear tv historically. Reignite a culture of ownership and fun is our third strategic platform. Our people are the key to our turnaround, and we are focused on having strong leadership throughout our restaurants, starting with our managing partners. We implemented an updated MP compensation model in April this year, which was to ensure a competitive base salary at the local market level and keep compensation tied to the growth of sales and profit of the restaurant. Changes have been positively received by our partners. Our fourth and last strategic platform, invest in our restaurants. We are on track with our goal to touch nearly all the Outback restaurants by the end of 2028 through targeted interior and exterior refresh initiatives. These refreshes are designed to improve the ambiance and the guest dining experience with expected average spend between $350,000 and $400,000 per refresh location. We have completed approximately 61 Outback refreshes through the end-of-October and remain on track to complete around 85 for the full year of 2026. Separately, as we mentioned on the last earnings call, we completed the rollout of our chargrill expansion across Outback. We now have the optimal cooking platform for our steak and non-steak proteins. Let me turn it over to Eric to review our financial performance for Q3 and guidance for the balance of fiscal 2026? Thank you, Mike, and good morning, everyone. I would like to start by providing a recap of our continuing operations financial performance for the fiscal third quarter of 2026. Q3 total revenues were $944 million compared to $929 million last year. This quarter's total revenue includes approximately $13 million in gift card revenue, resulting from a change in accounting estimate. Excluding that item, total revenues were essentially flat compared to last year, as Mike mentioned, U.S. comparable sales were positive 1.9%, and traffic was negative 1.8%. Average check increased by 370 basis points, with pricing partially offset by negative mix as we continue to invest in affordability offers for our guests. Off-premises sales were 25% of total U.S. sales in the quarter, consistent with Q3 last year. Outback's off-premise mix was 27% in the quarter, and Carrabba's was 34%. Q3 adjusted diluted loss was $0.17 per share compared to an adjusted dilute loss of $0,03 per share last year. The difference between GAAP and adjusted GAAP operating results reflects approximately 12 million of adjustments in Q3 2026, primarily related to the gift card accounting breakage adjustment I mentioned previously. Q3-adjusted operating margin was 0.3% versus 0.8% last year. The approximately 50 basis point decline was primarily driven by lower restaurant margin and higher general and administrative expense as a percentage of revenue, excluding the gift card breakage adjustment. Adjusted restaurant margin was 9.3%, down approximately 20 basis points year over year. All of Outback's planned turnaround investments are included in restaurant expenses, including food quality, service model, managing partner compensation, hospitality, front-of-house training, new uniforms, and an increase in advertising, which drove higher restaurant expenses. Additionally, COGS inflation was 4.6%, and labor inflation was 3.5%. Other restaurant operating expense improved approximately 60 basis points, driven by productivity initiatives and better P&L cost controls, offset by an increase in advertising spend by approximately $4 million year over year. General and administrative was higher this year driven by a lap of lower equity compensation from last year. We recognize the loss of approximately $2 million in Q3 from our 33% retained ownership in Brazil. That ownership is classified as an equity method investment. We still expect the full year loss to be approximately $3 to $4 million. Turning to the balance sheet, at the end of Q3, net debt was approximately $677 million, and our lease-adjusted net leverage ratio was 3.8. This compares to net debt of $896 million and a lease-Adjusted Net Leverage Ratio of 4.3 in Q3 of last year. During the quarter, we successfully completed a $1.2 billion refinancing of our revolving credit facility, proactively capitalizing on favorable bank market conditions and our recent business performance. The new five-year revolving crédit facility reduces refinancing risk, provides long-term financing flexibility, and better staggers our debt maturities. Year-to-date, capital expenditures were $115 million. We expect full-year capital expenditures to be approximately $185 million. Consistent with our previous communication, our capital allocation priorities are to, one, invest in the base business, and two, pay down debt. The teams are committed to these priorities to provide a platform for the turnaround and a strong balance sheet to support growth. Turning to our guidance this year, as it relates to the full year fiscal 2026. We expect U.S. comparable restaurant sales to be between 1% and 1.5%. Average check is still expected to be approximately 3.5% We are tightening and raising adjusted diluted earnings per share to be Between $0.97 and $1.02. Our previous guidance was Between $.90 and $.01. As a reminder, we are in a tax benefit situation driven by FICA tip credits relative to earnings. We expect an adjusted tax benefit in the range of approximately $14 to $16 million for the full year. As it relates to the fourth quarter of 2026, we expect U.S. comparable restaurant sales to be between 0 and 1 percent. Comp sales in the fourth corner is impacted by, first, an approximate 2 percent headwind to traffic from holiday shifts, including Christmas and lapping a holiday promotional offer from last year. And second, we made a strategic decision to delay previously planned Q4 pricing actions at both Outback and Bonefish, which did lower Q4 comp sales from our prior expectations. We expect Q4 adjusted diluted earnings per share to be between $0.07 and $012. As it relates to OutWest, we do not anticipate a material impact on our Q4 results. As Mike mentioned, this is the beginning of a bankruptcy process. We do not expect any changes to our strategy or to our capital allocation priorities, nor do we expect a potential acquisition to have a measurable impact on our lease-adjusted net leverage target of 3.0 by the end of 2028. We will be able to provide further detail on our next earnings call. Let me now turn it back over to Mike. Thanks, Eric. The key takeaway is that the Outback Steakhouse brand remains strong. Our commitment to consistency of execution is building momentum for the Outback turnaround. We remain focused on our say versus do quotient. We are implementing and executing what we said we would do. Guest and Outbacker feedback tells us our strategy is sound, which is to, one, deliver a remarkable dine-in experience to improve steak quality, enhance service, and consistency of execution. Two, drive brand relevancy to differentiate Outback. Three, reignite a culture of ownership and fun with a commitment to our people. Four, invest in our restaurants to refresh approximately 100% of Outbacks by 2028. Investment in the turnaround is supported by non-guest-facing productivity savings with a balanced capital allocation, led by an outstanding set of leaders that are seasoned restaurant operators. We are committed to our strategy to provide long-term, sustainable profit growth and improving every day in how we operate our business. We will continue to be transparent in our progress. I want to close today's call by thanking all of our teams in the restaurants and Restaurant Support Center. Our current results and our future potential would not be possible without the dedication, hard work, and commitment of our outbackers, our MECOs, our anglers, and our associates to deliver a remarkable guest experience every day. With that, let me open up the call for questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If your question has been addressed and you would like to withdraw it, please press star, then two. At this time, we will pause momentarily to assemble our roster. And today's first question comes from Alex Slagle with Jefferies. Please go ahead. Thanks. Good morning. Just mentioned some of it. I wanted to add on the 4Q, same sort of sales. I guess really just the full year being tightened slightly despite the 3Q coming in at the upper end of expectations. I guess you knew the calendar shifts, so essentially all of this is related to the delay in pricing is what it seems, if you could confirm that, and then just your thought process on pricing and sort of what you're seeing in decisions to delay that. Yeah, hey, good morning, Alex. It's Mike. First, to the latter part of your question, we've been consistent. We want to be balanced in our pricing and our revenue management. There's a balance of what we deal with from an inflationary standpoint and also meeting the guests where they are, and that hasn't changed. And that is part of why we decided to delay pricing, specifically in Outback. Specific to your question about Q4, in terms of early reads on Q4 I feel real good about where we're at. We are cautiously optimistic. We remain committed to the in-restaurant consistency of execution. We do see probably three things impacting Q4 in terms of the comp sales. The first two, which is about two points ahead, went on the traffic. You've got a holiday shift between Halloween but Christmas moves to a Friday, and we lose one operating day the last week of the quarter. The other item, which I already mentioned, is just this conscious decision not to chase dilutive traffic. We've talked about that in previous calls. And we do have some laps from Q4 of last year where we had some holiday promotions that overmixed, and we're not going to chase those. And then lastly, as I just communicated, we made this very thoughtful decision to delay pricing actions at Outback and Bonefish. And it's the latter part of your question. We just feel it's the right thing to do. It's consistent with our strategic guidance and not taking more pricing than we need. And that's how it rolls up. Okay, that's helpful. Thank you. And then I guess on beef, I don't know if you're going to start negotiations soon, sort of early reads on 27, kind of how you see these inflation settings over the next few quarters. Yeah, hey, it's Eric. Unfortunately, just based on the timing, we're not there yet. We'll definitely have that for you in February. This year, we are still seeing high single-digit on beef, so no new news. Okay. Thanks. Thank you. And our next question is from John Ivanko with JP Morgan. Please go ahead. um hi uh thank you you know i wanted to kind of talk about you know october if i can and um just excuse me for this um the overall kind of launch of best stakes ever whether um you know that social media campaign really achieved what you wanted obviously there is a shift in social which we would very rarely see year over year i mean going from um you're going from 60 percent of your mix, from 30% of your mix. You're nearly doubling social. So, I guess if we were to kind of rewind the clock and think about what maybe we could have done differently, did we absolutely nail, you know, the social digital influencer campaign? Or might we have an opportunity to make some tweaks and, you now, have some better results that I would argue you deserve? Thank you. Yeah, hey, good morning, John. So, one, I'm really pleased with our Best Stakes Ever campaign. It's been really good to see in terms of, one. What's been nice is we're seeing an absolute visible conversation about our business, about our stake quality, what we've done. and it gets back to the brand, which is fun, casual, Aussie-themed steakhouse. And in addition to that, you've seen that we've also had some affordability offers in the communication between Aussie 3 Course and then the equity, as you mentioned. But I think the other point, John, we were very conscious to be thoughtful in this sequencing. We didn't want to do the best steaks ever or really increase the market until we felt great about our consistency of execution. our service model, the total guest experience. And that's why in October, to your point, we really punched that up in a big way. I am very encouraged with our initial results between consumer engagements and what we're seeing in traffic. Just financially, just as a reminder, we increased our marketing by $10 million in 26, and that is back half loaded. The only other things I would say, John, which is important to your question, I feel real good about our social. There's a bit of, I'll start with the who. We have been very strategically targeting who our guest personas and who the consumer is. And that in itself gets us to where we think about competitive, conquesting audiences, how you think about high-performing contextual environments. That's important. The second is the where. We've been really good knowing where the high-impact environments are, streaming TV, streaming sports, online video, YouTube, Mastat. These are really good places to get the right consumer attention. The how is we've been really good. We're quite good and nimble in taking advantage of auction-based digital CPMs, and we're very good in our ongoing optimization. So our returns are really Good. We'll continue to optimize and learn, John, but feel really good about it. But I wanted to give you that detail because we're in that level of granularity in terms of the returns on our marketing, and that's important to us. That's very helpful. Thank you so much. You bet. The next question is from Brian Harbour with Morgan Stanley. Please go ahead. Thanks. Good morning, guys. I guess just with respect to the pricing discussion, what are you thinking it will be next year? Was this sort of just a matter of you know, based on the environment right now, let's kind of hold off. But then when we go forward, you know where are you thinking pricing should be? Yeah, hey, Brian, it's Mike Mourning. It gets back to what Alex asked me, that we're just being balanced. I've been consistent that we are going to be balanced in terms of how much pricing we take, where is the consumer, and how that impacts the P&L. Well, when you look at – I'll stick to this year. When you look at Q4, our pricing is roughly 4%. Our average check is 3.5%. In full year, our average check is going to be about 3. 5%. We just don't feel we need to take more pricing than inflation. It really boils down to that. Yep, makes sense. What have been the main areas where you've seen, you know, some productivity savings so far? Yeah, in terms of non-guest-facing productivity, and Eric can jump in, we've had a number of areas I'm excited about, and it all goes back to non-guest-facing product. That's the principle because we don't want to take anything out of food quality or service, and that's important. As a matter of fact, by the way, we're almost nearly self-funding the investment and Outback with non-guest-facing productivity. So the first one I'd like to start to is really our labor tool. Our hot schedules has been very exciting because not only is that helping us shed labor on the shoulders, it's helping us know when to flex labor up on peak. So it's a traffic enabler. It's also a productivity lever. The second one, which I think has been really good, is just we're able to use a lot of technology in terms of bringing items into the restaurants that partners don't have to think about in terms of how they think about their water usage, their utilities, other types of costs that come in. We're giving them tools and processes via technology that's helping. The third is we've got a great supply chain team. They've done some phenomenal job leveraging our scale to get better deals. I've talked about toys and our drinks where our procurement team got after it cut the cost by 50%. Same toy, same everything, just the process, you know, that gives you seven digits of productivity. And then the last thing is we've had suppliers step up with us. And this is an important point. As we've made investments in food, in service, we've Had suppliers say we want to be part of the investment because you're putting the money in the right places, which drives sustainable, profitable long term results. So it's all the above. The only thing I would add is we also feel good about next year. You know, nothing's changed. Similar levels of commitment to get to around $30 million in productivity for next year, The next question is from Jeff Farmer with Gordon Haskett. Please go ahead. Thanks. Just sort of dialing back on the same-store sales again for Q3. Was there anything notable as it relates to either regional or demographic seems-for-sales trends that you saw for the core Outback concept? No. No. Hey, Jeff, it's Mike. What I would say, no, we didn't. What I Would Just Say is we've been pretty consistent on this. In terms of the consumer, we're cautious. We're cautiously optimistic of the customer. You know, there's some macro choppiness. But what we're seeing with the consumer is casual dining is still an affordable luxury. Consumers, they're resilient financially. They are cautious. And they continue to be discerning about when, where, and how often they dine out. So it just gets to the what you get for what you pay for dynamic. And when we get it right, people are showing up. The only thing I would say in terms of sensitivity, which we flagged in previous quarters, There's a little bit of sensitivity on check with households that are under that $75K range. And it's a Little bit on the older guests where we're seeing some check management. That's probably the only specific thing I would say we saw at Outback, to your point. Okay. And then just as a follow-up, I appreciate that you probably can't say too much, but I'm going to ask it anyway. So thinking about Out West as sort of a collection of franchise restaurants, is there anything you can offer color as relates to that group of restaurants, same-store sales, AUV, margin performance, whatever metric you want to look at, how that group was performing relative to your company-owned restaurants, anything that stands out? Jeff, I appreciate the question. I'll answer it this way. and I've got to be thoughtful because there is a process that's going on, and I'm going to be respectful of that process. But here's what I would tell you. That situation at Out West, it's a really great team out there. That was a very unique and specific situation to that set of locations. And if you had followed our Qs and our Ks, you would have seen us disclosing information about the idiosyncratic nature of that business and the lending aspect. And that situation was going to run its course by the end of December of this year. We put that out there publicly. Our other franchisees, they're healthy, they're operating well, they'RE investing in the business, they'RE growing their employee base, they'RE growIng their store accounts. This one's quite unique. So, you know, we've got to get through the process. If we are designated as the stalking horse in terms of the future state, we're going to welcome the OutWest team, and they're good stores, and we think there's good potential there. All right. Thank you. Our next question is from Sarah Senator with Bank of America. Please go ahead. Hi. Good morning. This is Ashley on for Sarah. Thanks for taking my question. You know, with the 61 refreshes done so far this year, getting to about 85 means roughly two dozen more in 4Q. And this is kind of during a stretch where you'd plan to slow down for peak season. Is 85 still the target, or does some of that slip into 2027 potentially? Yeah, no, we feel really, really good about hitting that 85. It's really just timing, right? So the ones that will close in Q4, all of them were started, or most of them were started in Q3. So we don't feel like that's going to carry over into next year. We'll have a, essentially the expectation is another approximately 100 for next year, so nothing changes. Gotcha. Thank you. And then just to follow up on that, I know historically you talked about like 100 to 200 bps traffic lift that came from Outbacks that had heavier remodels over the last few years. Just how confident are you that the lighter refresh gets you, you know, somewhat of a similar lift? And are you seeing anything in early guest scores at the first refresh units that kind of point to that direction? Yeah. Hey, Ashley, it's Mike. First all that information or that data before was actually didn't imply or infer that they were, as you called it, heavier remodels. Those are based on refreshes or lighter remodeles that we saw at Carrabba's and we've seen throughout the industry, where we saw about 100 to 200 basis points lift in traffic over a course of about 12 to 18 months. That's the first thing. Second is yes. If you look at our leading indicators, you look at ambiance, you look at the atmosphere, those scores have grown and they grew again in Q3. And I think it's indicative not only of the refreshes, but it's indicative of the cumulative effect of what we're doing. We're getting that flywheel moving. You're seeing those green shoots in those guest indicators. Great. Thank you. The next question comes from Andrew Strelzyk with BMO. Please go ahead. Great. Thanks for taking the questions. First, I wanted to ask about the change in the Outback labor model at peak. What are you seeing as a result of that change after having a full quarter with that rolled out? And any operational metrics you can share would be great. yeah hey andrew it's it's mike um i i'll start with what i just mentioned actually if you look at our leading indicators our guest metric scores and technomic we saw the fifth straight quarter of improvement service was the biggest jump and actually if vous look at us now in an absolute score by the way this is with all the technomics scores but especially on service we are comparable or higher than our peers on absolute technology scores now. And I think that's an absolute proof point that what we did on the service model is working. When you look at our Ziosk scores, which we track, those also grew significantly. Intent to return, service, every metric that's associated with it grew. Importantly, our outbackers, as we've tracked it, they're making the same amount of money or slightly more in this model because they're not giving up as much in tip share, and we're seeing a slight increase in percentage increases in the tip levels as we've gone to this model. And you've also just got, to your point about peak, it's a really good one. For server, they're just not dealing with the stress they used to deal with. You've got four tables at peak. If you're running at six, which was historically where we're at, and somebody calls out sick during peak on a Friday or Saturday night. That's a pretty bad night as a server when you've got about 10 tables. So we've made those improvements. The guests are acknowledging it, and our outbackers are acknowledging it. Okay, great. And my second question, I wanted to ask about kind of the longer-term opportunity at Carrabba's, which continues to be on a nice run of positive comps, left another really strong period from the year ago this quarter. How are you thinking about the growth potential there. Anything incrementally into 27 that you're thinking about doing with that brand, any color would be great. Thanks. Yeah, I agree. I really feel good about the Carrabba's brand. It's a very good brand, has a lot of potential. The headline focus in Carrabbas is in restaurant execution. And that gets to the fact that 34% of their business today is off-premise, that off-remise business has got to play a role. It's convenience and it's recruitment of a younger different cohort, and I want those OPD guests coming in restaurants. But at the end of the day, Carabas is about serious, authentic Italian food with warm hospitality, which we have great land and sea proteins in there, and we're going to continue to punch that up. Great. Thank you very much. And the next question is from Dennis Geiger with UBS. Please go ahead. Great. Thanks, guys. First, a quick follow-up on Jeff's earlier question about what you're seeing with your customer. But I'm curious, especially in recent months as it relates to your performance maybe versus the category, you're clearly executing on your playbook, seeing results from that. you would flag, though, about the category itself, steak away from home? Do you think there's been any impact from some moderation in beef inflation at grocery where maybe that's having some impact, whether it's on you folks at all or the broader away from home category? Hey, Dennis. It's Mike. I've been consistent on this. On steak category overall, it's a very resilient and growing category. There's a lot of growth in the steak category for everyone. Second, when you look at our in-restaurant experience as a consumer, what you show up and get in terms of food service experience versus what you're doing at home on the grill, and if you screw it up at home, on the grilled, it's on you. If we screw it in the restaurant, it is on us. By the way, you get that steak with two sides, and you get just a way better experience. I think the relative value is driving more consumers in that direction because away-from-home food has continued to grow. I've been studying consumers and guests since 1993 when I got off active duty in the Marine Corps, and that has not stopped. And when you look at the fact GDP and the labor market remains strong, I think casual dine remains an affordable luxury. That's good color. It makes good sense. And then just on value, if there's much more to add on where value is, the Aussie 3 course, I know you probably can't say too much about next year yet, but if any thoughts on adjustments into value next year, if you feel like at this point you've kind of cracked the code and are generally where you want to be from a value and value strategy perspective? Well, I like the question. When I start with our C3 course, it actually has become a platform and a sub-brand of Outback. We've got great brand equity in our C4 course. Our guests know it means craveable food, great service with compelling affordability. It really hits on what we want in terms of giving guests what they want, and we've seen that in our value scores. Our value scores have also continued to grow five quarters in a row, And I do believe it's because of that trust that we're getting from the guests and an increase in intent to return. You know, the other thing I would say is we look at it, we're a test and learn culture, and we're going to continue to look at the price points and the tiers and the offers within that. We did some regional tests during quarter three, and we'RE doing some live national tests right now in terms of the price points in the value, and we're evaluating it. And right now, we're very pleased and encouraged with what we're seeing in terms of guest engagement and traffic improvements. Great. Thank you. And the next question is from Brian Vaccaro with Raymond James. Please go ahead. Hi. Good morning, and thanks very much. I wanted to circle back on the fourth quarter comp guidance. And I guess if you look at the third quarter, you saw outback two-year comps improve sequentially, but the 4Q blended guide seems to imply a little bit of a giveback on a two- year basis. So I wanted to ask, is that entirely due to the promo and calendar shift? Or maybe you could also just clarify, does your blended comp guide embed negative comps for any brand? Yeah. So, Brian, what I'll start with, we've not guided by brand, nor will we at this point. However, I like your question. To answer your question, the answer is yes, meaning when I say yes, what we're calling for Q4 is due to the items that we called out. I would not read into it that we're really seeing a change in the consumer or what's going on. Again, this is repetitive, what I said before, but when you look at Q4, we're cautiously optimistic. We're just seeing three things driving the change in our comp sales guide for fourth quarter. As I said, you've got a holiday shift that started with Halloween that played out exactly as we thought. Christmas moves to a Friday. We lose an operating day. That's number one. The second is, as we've called out, We had this holiday promotion in Q4 in 25. We just decided we were going to chase it. We're going to go after dilutive traffic. And then the last is we just made the decision to delay pricing moves at Outback and Bonefish, more so Outback in terms of we're going move that into Q1 of 2025. We just think that's the right thing to do in terms, like I said, we're going to be balanced. We don't think we need to take more pricing versus the inflationary rates. That's what it is. we've seen the consumer consumers in there is based on what we're seeing okay okay that's helpful thank you and i guess my follow-up you mentioned the outback off-premise mix ticking up a little bit year on year i think it was 27 versus 26 which is fairly minor but it does seem to reflect an acceleration maybe in the off-remise trends uh particularly is that accurate and if so what might be driving some of the the re-acceleration if you want to call it that in your off-premise business. Thank you. Yeah, hey, it's Eric. I don't think that's the case. We can follow up, but I don'T think that's really a driver of either Q3 or Q4 for Outback. Okay, all right. I'm, yeah, 27 versus... Yeah, we can maybe follow up offline. Yeah, WEA did call out Q2 for both Paradas and Outback that they were lapping in Q2 prior year off-remises promotions, but that was largely a first half phenomena really in the second half it really we don't see that impact yeah okay brian i brian your question maybe i'll add on to it what you what everyone should take away is off-premise to us is a channel convenience and recruitment that's how we're treating it we're going to continue to be disciplined in our off-remise pricing index versus in restaurant pricing that has not changed. We are a little more thoughtful in terms of how we leverage marketing within off-premise, but that's part of that recruitment and convenience aspect of the channel. All right. Thank you. And I guess if I could just one more on the Q4 guide. Eric, you mentioned just the tax benefit in the year. Can you just level set the fourth quarter for us, given there's a lot of adjustments in the first three quarters, that would be great. Thanks again. Yeah, we're seeing about a $2 to $3 billion tax benefit for Q4, and that compares to about a five million expense in Q3. So full year, we are in the $14 to $16 million tax benefit zone. Great. Thank you. Okay. Thank You. And this does conclude today's question and answer session. I would now like to turn the conference back over to Mike Spanos for any closing remarks. Thank you once again for your investment in support of women brands. I want to close by thanking our people for their passion and commitment to each other and our guests. Thank you. The conference is now concluded. Thank you for attending today's presentation, and you may now disconnect.