Bloomin’ Brands’ Outback Turnaround Is Starting To Show

Bloomin’ Brands opened one company-owned Outback Steakhouse in the second quarter, closed three others and recorded $2.9 million in accelerated depreciation on equipment upgrades tied to the chain’s turnaround. Through the first six months of the year, those equipment-related charges reached $6.2 million.

Those changes came as the Tampa-based restaurant company reported $1.016 billion in second-quarter revenue, up 1.3% from a year earlier. Adjusted earnings increased to 39 cents per share from 32 cents, while restaurant-level operating margin rose to 12.4% from 12%. CEO Mike Spanos said the results reflected continued progress on the company’s “Outback Turnaround,” focused on food, service, experience and affordability.

The restaurant count shows how that turnaround is reshaping the business. One franchised Outback also closed during the quarter, bringing the chain’s U.S. system to 659 restaurants from 662 at the end of March. Bloomin’ closed one Fleming’s Prime Steakhouse & Wine Bar as well, leaving the company with five U.S. restaurant closures against one opening during the quarter. Impairment and restaurant-closing costs reached $4 million, up from $1.5 million a year earlier, and totaled $9.5 million through the first half compared with $1.9 million during the same period in 2025.

At Outback, comparable sales increased 1.4% after declining 0.6% a year earlier, but traffic fell 2.8%. A 4.2% increase in average check more than offset the decline in customer visits. Carrabba’s Italian Grill and Fleming’s followed the same basic pattern, with comparable sales rising 1.7% and 1.6%, respectively, while traffic declined 2.5% at Carrabba’s and 2.8% at Fleming’s.

Bonefish Grill moved differently. Comparable sales increased 8.1%, traffic rose 4.5% and average check increased 3.6%. Across Bloomin’s U.S. portfolio, comparable sales rose 2.3% even as traffic declined 1.9%, with average check increasing 4.2%.

Pricing helped lift margins, along with productivity initiatives and lower pre-opening and health insurance costs. Bloomin’ said those gains were partly absorbed by higher commodity, labor and other operating costs, as well as increased advertising expense.

Bloomin’ also reduced spending outside the restaurants. General and administrative expense fell to $53.7 million during the quarter from $59.5 million a year earlier and to $106 million through six months from $120.9 million, a reduction of nearly $15 million. The company describes G&A primarily as nonrestaurant costs associated with supporting its restaurants and corporate activities, although the earnings release does not disclose how much of the decline came from staffing or other expenses at its Tampa headquarters.

Unallocated corporate operating expense fell to $37.4 million from $46.4 million during the quarter and to $74.1 million from $86.2 million through the first half. Over the same six months, total debt declined by nearly $85 million, from $787.4 million at the end of December to $702.8 million at the end of June, while cash and cash equivalents increased to $66.6 million from $59.5 million. Bloomin’ says cash generated by its restaurants and gift-card sales is generally used to service debt and fund capital expenditures.

The stronger quarter led Bloomin’ to raise its full-year outlook. The company now expects adjusted earnings of 90 cents to $1 per share, up from its previous forecast of 75 cents to 90 cents, and GAAP earnings of 85 cents to 95 cents, up from 70 cents to 85 cents. It narrowed its U.S. comparable-sales forecast to growth of 1% to 2%, from a previous range of 0.5% to 2.5%.

For Outback, the remaining weakness is visible in the same numbers producing the improvement. Comparable sales are growing again, but during the second quarter that growth came from a higher average check while traffic continued to fall.