Jack in the Box Inc.

What they do

The company operates and franchises Jack in the Box quick-service restaurants, primarily in the western and southern United States, plus restaurants in Guam and Mexico. It earns retail sales at company-operated restaurants and rental revenue, royalties, franchise fees, and advertising contributions from franchisees. As of July 5, 2026, 149 restaurants (7% of the system) were company-operated and 1,966 (93%) were franchised.

Revenue drivers

• Franchise royalties, rent and fees — Royalties, marketing fees and percentage rent are calculated as a percentage of franchise sales, which are not recorded as company revenue; franchisees operated 1,966 of 2,115 Jack in the Box restaurants (93%) at July 5, 2026.
• Company-operated restaurant sales — Retail sales at 149 company-operated Jack in the Box restaurants were $96.3 million in the third quarter of 2026 versus $94.1 million a year earlier.
• Del Taco (divested) — Del Taco operated 576 restaurants as of September 28, 2025 (444, or 77%, franchised), but the company agreed on October 15, 2025 to sell Del Taco Holdings Inc. for $115.0 million in cash; the sale closed December 22, 2025.

Recent performance

Third quarter 2026 (12 weeks ended July 5, 2026) total revenues fell 1.8% to $257.7 million from $262.4 million a year earlier, driven by same-store sales declines and fewer restaurants. System same-store sales declined 1.1%, with franchise same-store sales down 1.2% and company-owned down 0.9%; fewer transactions were partly offset by higher price. Net earnings from continuing operations were $21.0 million versus $22.8 million a year ago, and diluted EPS from continuing operations was $1.08 with operating EPS of $0.96. Adjusted EBITDA was $61.2 million versus $57.1 million, while restaurant-level margin slipped to 17.6% from 17.9% and franchise-level margin fell to $60.3 million (37.4%) from $66.2 million (39.3%).

Strategy

Management is executing the 'Jack on Track' plan, which includes a restaurant closure program, technology modernization and a focused development strategy; 40 restaurants were closed year-to-date through the third quarter of 2026 with Q3 net restaurant change of negative 13. Other stated pillars are building brand loyalty through the reimage program and the CRAVED marketing strategy, driving operations excellence through training and digital guest experience, and growing restaurant profits through cost savings. Management said its refinancing is complete, and interim CEO Mark King said the focus is now on improving restaurant performance, strengthening franchisee profitability and execution.

Risks

• Same-store sales decline — System same-store sales fell 1.1% in Q3 2026 and 4.2% year-to-date, driven primarily by a decline in transactions.
• Restaurant closures and net unit decline — Year-to-date 2026 the system closed 40 restaurants against 19 openings, leaving 2,115 units versus 2,168 a year earlier, which reduces rent and royalty revenue.
• Labor cost and availability — The 10-K states that increases in labor costs, including regulatory wage, scheduling and benefits actions and higher health care and workers' compensation costs, could adversely affect the business.
• Consumer discretionary spending — The 10-K states that the restaurant industry depends on consumer discretionary spending and that a decline in consumer confidence or family 'food away from home' spending could cause financial results to decline.

Outlook

Management said that with the refinancing complete it is fully focused on improving restaurant performance and executing priorities to strengthen franchisee profitability and execution. Interim CEO Mark King said there is more work ahead but that the path forward is becoming clearer. No numerical guidance is provided in the earnings release; the company also disclosed a higher Q3 2026 effective tax rate of 36.9% versus 20.9%, tied in part to a valuation allowance.