The Cheesecake Factory Incorporated

What they do

The company owns and operates restaurants under The Cheesecake Factory (216 locations), North Italia (48), Flower Child (43) and additional Fox Restaurant Concepts brands (55) as of February 23, 2026, plus 35 licensed The Cheesecake Factory restaurants internationally. The Cheesecake Factory menu has approximately 225 items, with alcohol at 11% of restaurant sales and off-premise at about 21% in fiscal 2025. Its bakery division runs two facilities supplying restaurants, international licensees and third-party bakery customers. The business was founded from a Los Angeles bakery in 1972, with the first Cheesecake Factory restaurant opened in 1978.

Revenue drivers

• The Cheesecake Factory restaurants — The largest segment, 216 domestic locations as of February 23, 2026, with a broad menu across lunch, dinner, late-night and brunch day parts; alcohol was 11% and off-premise about 21% of restaurant sales in fiscal 2025.
• North Italia — 48 locations as of February 23, 2026, part of the company's growth portfolio alongside Flower Child and Other FRC brands.
• Flower Child — 43 locations as of February 23, 2026, a smaller growth concept in the company's brand portfolio.
• Other FRC and bakery — 55 Other FRC locations plus two bakery facilities that sell cheesecakes and baked goods to restaurants, international licensees and third-party customers.

Recent performance

Second quarter fiscal 2026 total revenues were $1,029.6 million versus $955.8 million in the second quarter of fiscal 2025, with net income of $68.4 million and diluted EPS of $1.41. Adjusted net income and adjusted diluted EPS were $69.7 million and $1.44, excluding a $1.4 million pre-tax net expense for FRC acquisition-related items, asset impairments and lease terminations. Comparable restaurant sales at The Cheesecake Factory increased 5.8% year-over-year. The company opened four restaurants in the quarter (two North Italia, one Flower Child, one FRC) and one additional Cheesecake Factory location after quarter-end.

Strategy

Management is growing the smaller brands while continuing to open The Cheesecake Factory locations: it expects as many as 26 new restaurants in fiscal 2026, including five to six Cheesecake Factory, six to seven North Italia, seven Flower Child and as many as seven FRC restaurants. It points to menu innovation, its rewards program and marketing to drive traffic and awareness, alongside operator focus on labor productivity and food efficiency. Capital returns remain part of the plan, with roughly 158,600 shares repurchased for $9.3 million in the quarter and a quarterly dividend of $0.30 per share declared. The company also repaid the remaining $69.0 million of 0.375% convertible senior notes due 2026 during the quarter.

Risks

• Discretionary spending sensitivity — The company states dining out is a discretionary expenditure influenced by economic conditions, consumer confidence and purchasing habits, so traffic and average check can weaken with the economy.
• Inflation and cost pressure — Supply chain challenges and significant commodity and wage inflation affected results in recent years, and the company says further wage, product and services cost inflation remains possible.
• Tariffs and trade policy — Evolving government policies and global trade and tariff dynamics could raise costs, disrupt supply chains or delay new restaurant openings.
• Execution on new units — The planned 2026 openings across Cheesecake Factory, North Italia, Flower Child and FRC carry risks and uncertainties around timing, permitting, construction costs and new-restaurant performance.

Outlook

The company continues to expect to open as many as 26 new restaurants in fiscal 2026, including five to six The Cheesecake Factory, six to seven North Italia, seven Flower Child and as many as seven FRC restaurants. Management said second-quarter revenue, margins and earnings exceeded its expectations and pointed to momentum from menu innovation, the rewards program and marketing. It also flagged that geopolitical and macroeconomic events, including trade and tariff dynamics, could affect costs, supply chain, staffing and opening timing.