LOCO

El Pollo Loco’s results for Q2 were met with a positive market reaction, reflecting the company’s operational and strategic advancements. Management attributed the quarter’s performance to the success of recent menu innovations, such as Loco Tenders and loaded quesadillas, combined with the effectiveness of targeted digital promotions and loyalty programs. CEO Elizabeth Goodwin Williams highlighted that these initiatives attracted new, younger guests while driving increased check sizes and off-peak sales. The company also saw continued improvement in guest satisfaction metrics, with operational enhancements contributing to healthy restaurant-level margins despite ongoing produce cost inflation. Is now the time to buy LOCO? Find out in our full research report (it’s free). Revenue: $129.6 million vs analyst estimates of $130.3 million (3% year-on-year growth, 0.5% miss) Adjusted EPS: $0.30 vs analyst estimates of $0.28 (7.8% beat) Adjusted EBITDA: $19.11 million vs analyst estimates of $18.52 million (14.7% margin, 3.2% beat) Operating Margin: 14.4%, up from 9% in the same quarter last year Locations: 511 at quarter end, up from 499 in the same quarter last year Same-Store Sales rose 3.9% year on year (-0.3% in the same quarter last year) Market Capitalization: $462.6 million While we enjoy listening to the management’s commentary, our favorite part of earnings calls is 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. Todd Brooks (Benchmark) asked about the strength and performance of new markets outside California. CEO Elizabeth Goodwin Williams responded that new openings, particularly in Idaho and Washington, are exceeding system averages and boosting franchisee confidence. Brooks (Benchmark) followed up regarding national expansion and franchisee interest. Williams stated that interest is now nationwide, with possible non-contiguous expansion depending on ongoing franchise partner discussions. Brooks (Benchmark) inquired about criteria for selecting franchise partners in new markets. Williams explained that the company prioritizes experienced multi-unit operators with a strong cultural fit and enthusiasm for the brand. Matthew Curtis (D.A. Davidson) asked about drivers of July’s comp acceleration and the outlook for Q3 comps. Williams attributed the boost to successful product launches, digital engagement, and media presence during the World Cup, while CFO Ira Fils noted Q3 guidance reflects more normalized trends. Jeremy Hamblin (Craig Hallum) questioned the impact of produce cost inflation on margins and capital expenditure timing. Fils detailed that produce accounted for most of the COGS pressure but noted improvement, and explained that lower CapEx is primarily due to timing shifts in the remodel program. Looking ahead, the StockStory team will be monitoring (1) the performance of new menu items and their ability to drive incremental sales, (2) the pace and profitability of franchise expansion in new, non-contiguous markets, and (3) continued progress in digital engagement and loyalty program growth. Successful execution in these areas will be key to sustaining momentum amid ongoing cost pressures. El Pollo Loco currently trades at $15.21, down from $16.37 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members). ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies. Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 4:30 p.m. ET Chief Financial Officer - Ira Fils Chief Executive Officer - Elizabeth Goodwin Williams Operator: Day, ladies and gentlemen. Thank you for standing by. Welcome to the El Pollo Loco Second Quarter 26 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode. There will be an opportunity to ask questions following the presentation. Please note that this conference is being recorded today, 08/06/2026. And now, I would like to turn the conference over to Ira Fils, company's Chief Financial Officer. Ira Fils: Thank you, operator, and good afternoon. By now, everyone should have access to our second quarter 26 earnings release. Which can be found at www.elpolloloco.com in the Investor Relations section. Before we begin our formal remarks, I need to remind everyone that our discussions today will include forward-looking statements, including statements related to our new products and growth opportunities, strategic and operational initiatives, expectations regarding sales and margins, potential changes to our product platforms, capital expenditure plans, the ability of our franchisees to drive growth, expectations regarding commodity and wage inflation, remodel plans, and our 2026 guidance. Among others. These forward looking statements are not guarantees of future performance and therefore, you should not put undue reliance on them. These statements are also subject to numerous risks and uncertainties that could cause actual results to differ materially from what we currently expect. For a more detailed discussion of the risks that could impact our future operating results and financial condition, we refer you to our recent SEC filings including our form 10 k for the year ended 12/31/2025, as well as our Form 10 Q for the second quarter of 26. Which we expect to file tomorrow. And encourage you to review at your earliest convenience. During today's call, we will discuss non GAAP measures which we use for financial and operating decision making and as a means to evaluate period-to-period comparison. And which we believe can be useful to investors evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP and reconciliations to comparable GAAP measures are available in our earnings release. Which is available in the Investor Relations section of our website. With respect to the adjusted EBITDA outlook we will be providing on today's call, Please note that we have not provided a reconciliation to the most directly comparable forward looking GAAP financial measure because without unreasonable efforts, we are unable to predict reasonable certainty the amount of or timing of non GAAP adjustments that are used to calculate income from operations and company operated revenue on a forward looking basis. Now I would like to turn it over to our CEO, Liz Williams. Elizabeth Goodwin Williams: Thank you, Ira, and good afternoon, everyone. We are pleased with our second quarter results of system wide same store sales growth of 3.9%, and restaurant level margin of 19.5%. Which demonstrate the sustainability of the improvement we have made over the past 2 years. what is more encouraging is that we achieved this performance through a combination of sales layers and operational improvements. Which gives us confidence in the long term sustainability of our growth. More specifically, our top line performance this quarter was driven by a combination of our strategic pillars notably with strong brand activation and menu innovation, a targeted focus on providing value, through our digital channels and operational excellence. With that, let me walk you through our progress across our strategic pillars. Let's start with brand that wins. Which continues to be anchored by menu innovation. First, our local tenders, which launched at the end of the first quarter brought new guests to the brand. Many of whom had not considered El Pollo Loco before. And they broadened our appeal beyond our core. Fire grilled chicken loyalists. Notably, our tenders generated significant buzz and excitement. From social media conversation to word-of-mouth, this craveable product done with our own twist put El Pollo Loco, back in the conversation in a way that we have not seen in years. Our high quality Mexican seasoned loco tenders paired with our new Pollo Loco sauce drove trial across income and age cohorts. But notably with a new, younger consumer. They were additive to check and popular in snacking and late evening dayparts. As these were always planned as an LTO, we are taking the learnings and already thinking of ways to bring them back in the future. We believe we have only scratched the surface of what is possible with loco tenders. Following tenders, in late June, we introduced loaded quesadillas. Available in 2 flavors, queso with our creamy cilantro sauce, and street corn with our creamy chipotle sauce. Both with our citrus marinated fire grilled chopped chicken breast wrapped in a warm flour tortilla and grilled to order. We designed these for portability and value. Giving guests a satisfying eat they can enjoy on the go at a price of less than $10 a la carte or $10.99 for a combo meal. Which includes chips, salsa, and a drink. We also gave our local rewards members early exclusive access ahead of the general launch. The early guest response has been strong, and we believe loaded quesadillas strengthens our lineup within handheld and on the go occasions. We also introduced a new coffee platform to the menu this quarter with our Chata coffee lineup, featuring our signature horchata iced coffee and cold foam. We designed our new beverages to capture an afternoon pick me up occasion which we believe is a meaningful and underserved daypart for our brand. Alongside items like our tenders, and quesadillas, we see this as part of a broader snacking occasion that brings guests into our restaurant outside of traditional mealtime. And also helps in building check. We are just getting started with beverages and look forward to even more innovation in the upcoming quarters. As we head into the second half of the year, we are encouraged by the strength of our innovation pipeline. 2 new double chicken burrito bowls will be coming this fall, as well as a new pumpkin spice churro and caramel apple Chata coffee. We also continue to test new salads, wraps, and sandwiches as we prepare for 2027. In short, we remain committed to keeping our menu craveable, relevant, and fresh. Giving guests new reasons to visit. Our let's get local campaign continues to build momentum and has found new ways to put our new menu items in front of our guests. Often by showing up where our brand has not historically been invited. In late June, around National Go Skateboarding Day, we launched our queso videos for kickflips, activation. Featuring Olympic skateboarder, Paige Henn, this content resonated well beyond our usual audience, drawing praise from across the skateboarding world. Including from the editor in chief of Thrasher Magazine, 1 of the most recognized voices in that community. We followed that with our hold it like it is hot campaign which put our new Chata coffee, loaded quesadillas, and black beans into real everyday moments to highlight how portable and delicious these products are. We continue to expand our presence with brand partnerships working with brands like Igloo Coolers, SandCloud, and Tapatio all throughout the quarter as we were showing up in live sports. From our media presence during the World Cup games to free food giveaways for at home watch parties, We were there. We believe this combination of timely, culturally relevant marketing and strong menu innovation is exactly the kind of engine that builds lasting brand loyalty and something that we will continue to lean into as we carry the momentum through the rest of the year. Turning to our loyalty and digital business, which continues to contribute to our top line performance. Digital sales, including our app, web and kiosk channels, represented approximately 28% of system sales and were up 13% year over year and our local rewards members continue to be an important growth driver for the brand. These members visited approximately 3x more annually than non loyalty members. We use a strategic approach with our loyalty offers based on segmentation and purchase behavior. These targeted offers deployed throughout the quarter together with more frequent communications, drove not only frequency growth, but also check growth. Among our loyalty members outpacing nonloyalty guests by more than double. As a reminder, we center our loyalty program around 3 things. Giving members everyday value, tailoring offers based on purchase behavior, and giving our most loyal guests access to exclusive experiences. Starting with everyday value, our weekly loco Friday drops providing great offers and value each Friday on some of our best menu items. And our Sunday spreads and abundant value on family chicken meals have continued to be consistent performers for the program. These all member deals, combined with our segmented offers, based upon purchase history have both contributed to the frequency and check growth. In addition to these deals, our exclusive giveaways early access to menu items, and prizes have created engagement, in our loyalty program. As we look ahead, in early Q3, we launched LocoDay, a summer themed promotion featuring exclusive prizes, deals, and a grand prize VIP experience at the iHeart Music Festival. Early engagement in the promotion has exceeded expectations, and we look forward to future growth of our loyalty program. Finally, our off-premise digital business inclusive of delivery, continues to gain strength as we have launched segmented deals targeting new customers at the snack and late-evening dayparts. For lunch, we have expanded our roster of third party partners focused on group and catering services. In total, our off premise digital business represents almost 17% of sales, and has increased 12% year over year. While we are pleased with the growth, we believe there is still significant opportunity to grow this channel. At the intersection of digital and operational excellence is technology. We continue to make great progress in modernizing our capabilities. From in restaurant training to analyzing consumer feedback, to a more effective help desk for our restaurant general managers, Our use of technology and AI tools is improving our insights and capability. In just a few months, we have made great strides in our capabilities with the addition of Vadim Harisher, who joined us earlier this year as our Chief Technology Officer. His leadership in digital, data, and technology is unlocking opportunity and insights across the business. And we look forward to sharing more about our technology advancements in future calls. Moving on to operational excellence and our hospitality mindset. I am pleased with the continued progress we made this quarter in improving guest experience and overall customer satisfaction. System satisfaction scores continue to move in the right direction on a year over year basis. And we saw improvement across the board from order accuracy to speed of service to overall friendliness. This kind of consistent incremental progress is exactly what we set out to build. And it reflects the discipline our teams have in driving operational excellence every day. As we look forward to national expansion with new restaurant openings, we will continue to build our operational people capability as this is the single most critical item in ensuring consistency and execution across our restaurants. We know there is room to have even more of a consistent guest experience. That builds long term loyalty, and we are focused on the investment in people, tools, training, and technology to get us there. Shifting to financial metrics. We are proud to have coupled our sales momentum with winning unit economics. In Q2, we delivered another solid restaurant level margin of 19.5%. Comfortably within our 18% to 20% long term target range. We are pleased with this result especially in light of the significant cost pressure in produce during the quarter. Even with this headwind, our underlying cost discipline continues. Which speaks to the margin focus we have built over the past several years. We will continue to manage the levers within our control closely including labor productivity, waste reduction, and disciplined menu pricing. And we are watching our key commodities as we move through the back half of the year. As we said last quarter, we will also balance the goals of driving year over year margin expansion with the need for value offers and investment in innovation, technology, and unit growth. We believe we can do all of these and be in the healthy margin range. Let me now touch on our new unit growth pillar. First, we were pleased to welcome Tara Hinkle in late June to the El Pollo Loco family as our new Chief Development Officer. Tara joined us with extensive industry experience and expertise that spans development operations, market planning, franchise recruiting, and finance, with experience from brands like Taco Bell, Starbucks, and Coffee Bean & Tea Leaf. We remain confident in our goal of opening 18 to 20 new restaurants system wide this year. Nearly double our 25 pace. Our new restaurants continue to open with strength, which reinforces our confidence in the appeal for fire grilled chicken and the El Pollo Loco brand. As we continue our nationwide expansion. A good proof point of this progress came at the end of June, when our franchise partner opened our first restaurant in Idaho. Making the entry into our tenth state. The Idaho restaurant is run by an experienced franchise group with more than 25 years in the El Pollo Loco system. And we already have a second location scheduled to open later this fall. With 3 to 4 more planned in the market, as it develops. Less than 2 years ago, El Pollo Loco operated in just 7 states. Since then, we have added Washington, New Mexico, and now Idaho. 3 new states in under 24 months. As we look forward, the vast majority of our openings will continue to be outside of California. Our new unit growth continues to benefit from the second generation sites where we are achieving lower development costs than the typical ground up build. Together with our value engineering initiatives, we remain focused on overall new unit economics. As we look forward, to becoming a national brand, we are encouraged by the discussions and the level of interest with prospective franchise partners. Over the past couple of months, we have hosted discovery days at our restaurant support center, with new franchise groups representing opportunities across the country. These visits have been positive, and we are in discussion on various development agreements. We expect to have more details to share on future calls and remain confident that our development pipeline is building nicely and our continued expansion across the country. On the Restaurant Refresh initiative, we remain pleased with our results. On average, we continue to see a mid single digit sales lift in the locations we have refreshed, consistent with what we have shared on prior calls. We will continue to be thoughtful about pacing this initiative in a way that is supports our team without disrupting day to day operations. In summary, we are proud of our quarterly performance and the work we have done over the last 2.5 years in transforming the El Pollo Loco brand. Our menu innovations are driving real trial and repeat. And our marketing and loyalty engines are amplifying that momentum. Our operations scores continue to improve, and we are back to healthy margin expansion and unit growth. With that, let me turn the call over to Ira for a more detailed discussion of our second quarter financial results. Ira Fils: Thank you, Liz. Good afternoon, everyone. For the second quarter ended 07/01/2026, total revenue was $129.6 million compared $125.8 million in the second quarter of 2025. Company operated restaurant revenue increased 3.7% $108.1 million from $104 million in the same period last year. A $3.8 million increase in company operated restaurant sales was driven by 3% growth in company operated comparable restaurant sales as well as sales from the 3 company restaurants opened since the second quarter of 2025. The growth in comparable restaurant sales included a 4.2% increase in average check size, partially offset by a 1.1% decrease in transactionss. During the second quarter, our effective price increased versus 2025 was approximately 3.4%. Franchise revenue decreased 3.8% to $12.9 million during the second quarter driven by $1.1 million decrease in franchise IT pass through revenue related to the franchise rollout of our new point of sale system completed in 2025. Franchise revenue did benefit from a 4.5% increase in comparable restaurant sales and revenue associated with 11 franchise operated restaurant openings subsequent to the second quarter of 2025. The 4.5% increase in comparable franchise store sales consisted of a 5.3% increase in average check size. Partially offset by a 0.8% decrease in transactionss. For the second quarter, system wide same store sales were up 3.9% with system wide transactions down 0.9%. We are very pleased to report that the positive sales momentum we experienced in Q2 has continued into the third quarter. System wide comparable store sales for the third quarter to date through 07/29/2026 increased 5.8% consisting of a 4.4% increase in company operated restaurants and a 6.6% increase in franchise restaurants. Looking ahead, we believe same store sales for the third quarter will be in the 3.5 to 4.5% range. Turning to expenses. Food and paper costs as a percentage of company restaurant sales increased approximately 90 basis points year over year to 25.4%. Primarily due to commodity inflation of 4.1% primarily produce, combined with increased discounts and menu mix shifts. These increases were partially offset by higher menu price. We expect commodity inflation to be in the 2.5% to 3.5% range for the full year 2026. Labor and related expenses as a percentage of company restaurant sales decreased about 90 basis points year over year to 29.9% as we continue to benefit from improvements in operating efficiencies along with lower health insurance and workers' compensation costs. In addition, labor as a percentage of sales benefited from leverage on the 3% company owned comparable store sales. Wage inflation during the second quarter was under 1%, for all our company owned locations. For the full year 2026, we expect wage inflation of between 1.5 to 2.5 percent. Occupancy and other operating expenses as a percentage of company restaurant sales decreased 30 basis points year over year to 25.3%. Primarily due to lower liability insurance costs lower utilities, and lower other controllable expense. Which offset increases from higher delivery and mobile ordering fees and higher repairs and maintenance expense. Our restaurant contribution margin for the second quarter improved to 19.5% compared to 19.1% in the year ago period. As we continue our path of margin improvement, we expect our restaurant level margin for the full year 2026 to be between 18.25% to 18.75%. An increase from the 17.8% we ran for the full year of 2025. In addition, we expect our restaurant margins in the third quarter of 2026 to be between 18-18.5%. Which is in line with the 18.3% we posted in the third quarter of 2025. General and administrative expenses decreased $7.1 million compared $13.5 million in the prior year. The decrease was primarily due to $6.3 million received from a legal settlement lower shareholder activism related expenses, and lower restructuring and executive transition related costs. The decrease was partially offset by higher legal fees, new store preopening costs, and other general and administrative expense. Excluding the impact of the $6.3 million favorable legal settlement, as a percentage of sales G&A decreased to 10.3% or 50 basis points. During the second quarter, we recorded a provision for income taxes of $5.2 million for an effective tax rate of 28.8%. This compares to a provision for income taxes of $3 million and an effective tax rate of 29.6% in the prior year period. We reported GAAP net income of $12.8 million or $0.43 per diluted share in the second quarter compared to GAAP net income of $7.1 million or $0.24 per diluted share in the prior year period. Adjusted EBITDA for the second quarter of 2026 was $19.1 million compared to $18.5 million in the second quarter of 2025. Adjusted net income for the second quarter was 8.9 million or $0.30 per diluted share compared to adjusted net income of $8.2 million or $0.28 per diluted share in the second quarter of last year. Please refer to our earnings release for a reconciliation of non GAAP measures. As Liz mentioned earlier, we are pleased with our increasing pace of new store development as we opened 5 new franchise locations and 1 new company location in the second quarter. Since the end of the second quarter, we have opened an additional 2 locations bringing our 2026 year to date new store opening to 10 and we remain on track to deliver a total of 18 to 20 new openings in 2026. In regard to our remodeling efforts, during the second quarter, we completed 6 franchise restaurant remodels and 5 company remodels. Bringing the remodels completed, through the first half of the year to 2024, consisting of 12 franchise remodels and 12 company remodels. In terms of liquidity, as of July 1, 2026, after a net paydown of $21 million on our revolver during the preceding 26 weeks, we had $30 million of debt outstanding and $13.3 million in cash and cash equivalents. Subsequent to the end of the quarter, on 08/04/2026, we amended our $150 million revolving credit facility extending the term to August 4, 2031. With that, we would like to provide you with the following updated guidance for 2026. We are increasing our system wide comparable store sales growth guidance to now be between 3.5% and 4.5% for the full year. We are increasing our adjusted EBITDA guidance to be between $68 million and $70 million We are reducing our expected capital spending to be between $33 and $37 million In addition, we now expect depreciation and amortization expenses to be between $18 million and $18.5 million for the year. We are maintaining the following guidance. The opening of at least 3 to 4 company operated restaurants and 15 to 16 franchise operated restaurants. G&A expenses between $52 and $54 million, excluding 1-time charges or benefits. And finally, an estimated effective income tax rate of approximately 29% to 29.5% before discrete items. This concludes our prepared remarks. We would like to thank you again for joining us on the call today. And we are now happy to answer any questions that you may have. Operator, please open the line for questions. Operator: Thank you. And our first question is from the line of Todd Brooks with Benchmark. Please proceed with your question. Todd Brooks: Congrats on another solid quarter, and continued momentum into the third quarter. Great to say. Elizabeth Goodwin Williams: Thanks, Todd. Todd Brooks: If we can Liz, if we can talk about franchisees. You gave us some good color last quarter about some of the magnitude of the openings in Washington and New Mexico. Now you have added Idaho on top of it. What are you seeing for kind of continued strength and performance in newer markets? Elizabeth Goodwin Williams: Yes. Appreciate the question. Our newer markets are opening really well. We are very pleased with the strength of the sales Most are opening above system average. Particularly when it is the first restaurant and the first state and/or first market, they are opening to just blockbuster lines and quite frankly, exceeding our expectations. Which is giving us a belief that the fired grilled chicken is resonating and our brand is resonating. It also gives us the confidence to open more units and those franchisees to open more units in those markets. So like I mentioned, Idaho, the second Idaho location is coming on board in the next couple months. They are already looking for additional sites Similarly, up in Washington, we got just 1 unit. We have been working on finding additional sites up there. Following on with the rest of the quarter, we will have restaurants opening in New in Colorado, another 1 in Washington, as I mentioned, and then a few more in California. And 1 in New Mexico. So just really pleased with how these are opening and our franchise partners, it is giving a lot of confidence to them. And then additional new partners who are looking at coming into the brand. Todd Brooks: And I wanted to follow-up on that because I think you used the word national 3 or 4 times. During the prepared remarks. These discovery days and the outbound work that you are doing to build a pipeline of interest with potential franchisees can you give us a sense of how far afield the interest in the brand, is reaching? Is it does it feel contiguous? Are you are you seeing interest nationwide, which kind of helps prove out that concept of fire-grilled chicken working anywhere in your mind. I am just curious how this is developing as it goes. Elizabeth Goodwin Williams: There is nationwide interest, and while we have been rather contiguous over the years, particularly West Coast and down into the South, as we went over to Texas and just a couple in Louisiana. You know, jumping across the country is certainly something that we are considering doing talking with folks, and, you know, there is a lot of population on the East Coast, and just throughout different parts of the country. So we do not think it has to be contiguous. We certainly could see a world where we could jump many states and go across the country. It really just depends on, how these conversations progress over the next couple months. To and, hopefully, we will share more in upcoming calls to that. That effect. Todd Brooks: that is great. And then just final question. I will jump back in queue. What if you are going to make a jump, in the non contiguous and a new territory, new market, What are you looking for in that franchisee partner? And in your outreach, are those type of partners being drawn to the brand? Do you have to go find them? Just kind of if you can give us the criteria and interest from that type of partner. Thanks. Elizabeth Goodwin Williams: Certainly. Partners that we are talking with are partners that have experience in the restaurant space, multi units, We want partners that are a great fit with the brand that love the brand, have the enthusiasm for the brand, they believe in the economic story of the brand, but, also, they have a proven track record in the restaurant space, and they are great operators. that is really important to us. They have done this before. They know how to do new store development. They know how to do grand openings. They know how to do just great customer service. We also have the benefit of a fabulous franchise system today, and I cannot say enough great things about our existing franchise partners. And, you know, we are talking with many of them about their desires to be in additional states As I mentioned in the remarks, our partner up in Idaho is a partner that is been in the system for many years. And so that is just been a great opening for many reasons, but 1 of which is he knows the El Pollo Loco system, and he has just a great team that was able to get trained and ready to go with great efficiency. Okay. Thanks, Liz. Yeah. Thank you. Operator: The next question is from the line of Matthew Curtis with D. A. Davidson. Please proceed with your question. Matthew Curtis: I want to talk about comp trends. July accelerated, I see, in terms of traffic. Relative to the second quarter. I just want was wondering if you could unpack what drove the sequential acceleration I mean, was it LTO momentum, loyalty activity, easier comparisons, or something else? And then, you know, given the guidance for the full third quarter on comps, it implies a deceleration. Is that just a function of more difficult comparisons in August and September? Or is there something else going on we should be aware of? Elizabeth Goodwin Williams: Thanks for the question. I will start and then hand it over to Ira for the back half of that. So I would say all of the above when you gave the list, we were proud of how our loaded quesadilla got off to a great start. it is a it is a nice eat, at a great value combined with just the media that we have had behind it and also we wish we could have a world cup advertising in the month of July every year. You know, usually, are not watching live sports in July and, you know, we think that certainly got eyeballs on El Pollo Loco. Also, in terms of just the momentum that the brand you know, was experiencing. And then you know, in terms of as we think about the lap from last year as well, you think about with everything going on last year, people were not coming out of their homes as much, and so some of that certainly has come back as well. In fact, we are seeing even some trends where people are eating in the dining room more whereas last year, if they were coming out, maybe they were going through the drive through, So would say all of those factors you know, have played a role. Ira Fils: And then as we look into the back half of the year, Yeah. As we think about, you know, our full year guidance for the year and the quarter, we ran a 3.9% in Q2 And if you think about the midpoint of the guidance for both Q3 and Q4, that is right at 4%. So really consistent with what we, you know, what we ran in Q2. I will tell you, there is a little bit of about a 200 basis point change as you go into Q4 versus Q3 in regards to the compares get tougher. As you move into Q4. But, as you can see by our guidance, you know, we feel great about what is going on from a same store sales trend. And we are and we really foresee Q3 being pretty much, on the same pace as Q2. Matthew Curtis: Okay. Got it. Then separately on local tenders, can you maybe just expand on the way you learned from the local tenders in terms of guest acquisition, repeat rates, check impact, and all of that. And I mean, given that the product brought new guests into the brand, it sounds like, Yeah. I guess what I am what needs to be true for tenders to return in a more permanent or recurring way? Elizabeth Goodwin Williams: Yeah. So in terms of what needs to be true, so tenders did great. For us, and we will come around to the answers to some of those first questions. On the back half, the tenders we had always planned as a limited time offer for the main reason of having some of the equipment the restaurants to be able to hold them at a so that we could operate at a higher velocity and just operationally, we could execute them for just a better execution. And so we are working with the system now. We are testing holding equipment so that they could be a permanent menu item. What gives us the confidence in earning that spot for a permanent menu item was that tenders drove a lot of incrementality particularly around a new consumer with that younger consumer, but also that consumer that is wanting something more portable, that consumer that wants them late night. We saw, you know, higher incidents and attach rate through delivery, delivery coupled by late night. And when I say late night for us, late night is, like, you know, 8 to 10:00 in the evening. We are not even talking. You know, true deep into late nights. So just it was really evident that this fit a need state also in snacking, which was an afternoon as well. We also just were really pleased with how it helps with check across the board. All times of the day. So we learned a lot there. The other thing, that we are going back into tests and we will learn some more is different ways to enjoy tenders. So we have a great menu item that has the tender in a wrap. that is, again, a portable, more robust eat. I personally love the tender chopped up on a salad. So there is a lot of things, that we can do with tenders, and I think you will see a lot more over the upcoming quarters. Okay. Got it. Matthew Curtis: Thanks very much for the time. Operator: Thank you. Our next question is from the line of Todd Brooks with BenchmarkStonex. Please proceed with your question. Todd Brooks: I think you have heard me yet. I have 1 for Ira that I forgot to ask here. Ira, you talked about reduced cost pressure. In the quarter, and I have heard from a couple of other operators that it was very spiky but relatively short lived. it is you look at the COGS pressure, that you talked about, I guess, what proportion of that was related to produce? And if are you finding that it is more short lived and kind of retrenching here as we get into Q3? Ira Fils: And if that is the case, just wondering about the 19.1% restaurant level margin in Q2 the 18.25 or, sorry, the 18 to 18 and a half. Gotcha. Yeah. So team so answer the first part. About, you know, 3 quarters of the COGS pressure that we did see in Q2 was related to produce in particular, we have had it we have seen it mitigate some. Still a little pressure there, but it has mitigated some. And we are seeing you know, some pressure on some other lines. We have seen some pressure packaging, and we have seen some pressure on oil costs. Not as significant as what we have seen in produce. So we, and there is been some fuel pressure as well for delivery charges as far as getting things to the restaurant. And we have got all that baked in till we think about our guidance when we think about the balance of the year. And margins as we look forward? Todd Brooks: Okay. Ira Fils: So it is kind of anticipatory based on what you are seeing now not baking in any relief from these levels currently? We definitely got we definitely have reliefs from produce, but there is still some other items where we are feeling on. Todd Brooks: Okay. Perfect. Thank you. Operator: Thank you. The next question is from the line of Jeremy Hamblin with Craig Hallum. Jeremy Hamblin: Thanks. I will add my congratulations on the strong results. Just want to come back to the question around the Q3 guide. So if we look back I do not think that the compares actually get tougher in August or September. I think they are pretty similar to what July looked like. Just wanted to see if you could confirm that. And so, just maybe some assumption that there is a moderation from the current 5.8% level? Ira Fils: that is exactly right, Jeremy. The balance of the quarter is pretty similar. To what July was And I think, the way to think about it is more about the balance of the quarter being more similar to what Q2 was. And that really in July, we had some outsized benefit from some things that Liz mentioned are you know, we had some great advertising mentions and spots and related the World Cup. It really worked hard for us this year. Live sports is great for us. From a from a media standpoint, and we had and again, played really well for us. So I think July was a little more outsized. And as we think about the quarter, in a whole, you know, kind of the midpoint of our guide, that is where you think about where our trend is. Jeremy Hamblin: Got it. And I have to ask since it is a kind of topical here, you know, some other, you know, kind of Mexican food concepts have been thrown. Some curveballs here. You know, with their sourcing. Have you know, I have you scoured your food sourcing to ensure no potential issues with jalapenos, anything like that. Have you seen any impact at all with those headlines that are reaching consumers? Elizabeth Goodwin Williams: Yeah. Yeah. So we take food safety, you know, utmost seriousness, and you know, of course, we have scoured every bit of our supply chain and work really closely with our suppliers. El Pollo Loco is not involved in any of the lettuce recalls. There was no lettuce product pulled, and no illnesses, have been linked to us. And all of our lettuce is currently sourced from The USA. So all of that. And then on the peppers, we do not use jalapeno peppers. We use serrano peppers. And we also do not use the supplier that I know people are talking about right now. So, you know, we continue to be vigilant with the supply chain and you know, it definitely part of the industry and caring deeply about that. In terms of benefit, it is hard to tease out. You know, I think possibly, you know, we probably got a little bit of help from it. I know our salad business and our it is a core part of our menu, and it remains strong. Do not have any worries in terms of consumer demand there. Particularly in the summertime, it is it is a they are really popular items, and they continue to remain strong. Jeremy Hamblin: Got it. And then want to come to the CapEx for a second. I think you lowered it by about $3 or $4 million, but you are maintaining you know, your unit growth. And you might have mentioned it, but can you just talk about kind of the lowering of that? Is there presumably, the new units are coming in at or below budget. But just color you might be able to share on that Yeah. Ira Fils: Great question, Jeremy. So, where we really took the CapEx ticking down is more just the timing of our new remodel program. We are very happy. We are very pleased with the results. Of the remodel program. We are continuing to move forward. But just as we evaluate a, you know, the timing of permits, number 1, and 2, making sure that we are deploying the right resources internally from an operations and from a development standpoint, We have just pulled the timing back a little bit of it, and that is really the first driver of, of the lower CapEx. And the second 1 is you know, a little bit what Liz has mentioned, we are still testing and we are working on holding equipment. Which, feel like if the tests go, that is something we are going to move forward with. it is just more of a timing issue. Than, than a cancellation of a project. Jeremy Hamblin: Got it. 1 other housekeeping item. With the extension of your credit agreement, what is the what is the interest rate that we should expect? Ira Fils: And The spread from what we were paying before will be going up by about 50 basis points. Operator: Thank you. Ladies and gentlemen, we have reached the end of today's question and answer session. I would like to turn the call back over to Liz Williams for closing remarks. Elizabeth Goodwin Williams: Thanks again, everyone, for your interest in El Pollo Loco. We look forward to you again next quarter. Have a great evening. Operator: This will conclude today's conference. May disconnect your lines at this time, and thank you for your participation. Before you buy stock in El Pollo Loco, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and El Pollo Loco wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,209!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,393!* Now, it’s worth noting Stock Advisor’s total average return is 964% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 13, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. El Pollo Loco (LOCO) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by a combination of strategic menu innovation, targeted digital value, and operational excellence, resulting in 3.9% system-wide same-store sales growth. The launch of 'Loco Tenders' successfully attracted a younger, new-to-brand consumer cohort and expanded the brand's appeal beyond its core fire-grilled chicken loyalists. Digital sales reached approximately 28% of system sales, with loyalty members visiting three times more frequently than non-members and showing double the check growth. Operational improvements led to year-over-year gains in guest satisfaction scores across order accuracy, speed of service, and friendliness. Strategic entry into Idaho marks the third new state in 24 months, supporting the long-term goal of transitioning from a regional to a national brand. Restaurant level margins of 19.5% were achieved despite significant cost pressure in produce, driven by labor productivity and waste reduction initiatives. The 'Restaurant Refresh' initiative continues to deliver mid-single-digit sales lifts, reinforcing the value of modernizing the physical store footprint. Management increased full-year system-wide comparable store sales guidance to 3.5%–4.5%, assuming continued momentum from innovation and digital channels. The development pipeline is accelerating with a goal of 18–20 new restaurant openings in 2026, nearly double the pace of the previous year. Commodity inflation is projected to be between 2.5% and 3.5% for the full year, with management monitoring potential volatility in produce and oil costs. Future menu strategy includes testing holding equipment to potentially transition 'Loco Tenders' from a limited-time offer to a permanent menu fixture. Capital expenditure guidance was reduced to $33–$37 million, primarily reflecting the timing of the remodel program and equipment testing rather than project cancellations. G&A expenses were significantly impacted by a $6.3 million favorable legal settlement received during the second quarter. The company amended its revolving credit facility, extending the term to August 2031, though the interest rate spread increased by approximately 50 basis points. Management explicitly confirmed no exposure to recent industry-wide lettuce recalls or specific pepper supplier issues, citing domestic sourcing and different product varieties. A 1.1% decrease in company-operated transactions was offset by a 4.2% increase in average check size, highlighting the impact of pricing and premium menu mix. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. New markets like Idaho and Washington are opening above system averages, often with 'blockbuster lines' that exceed management expectations. Management is open to 'jumping' states to enter high-population areas like the East Coast rather than strictly following a contiguous expansion model. Ideal franchise partners are defined as multi-unit operators with proven restaurant experience and the ability to execute grand openings efficiently. July system-wide comparable sales rose 5.8%, aided by high-visibility media placements during the World Cup and strong reception of loaded quesadillas. Management noted a shift in consumer behavior with more guests returning to dining rooms compared to the previous year. The Q3 guidance of 3.5%–4.5% assumes some moderation from the July peak as results moderate from an outsized July performance, despite comparisons remaining similar for the balance of the quarter. Tenders proved highly incremental, particularly for snacking and late-evening dayparts (8:00 PM to 10:00 PM). The product was initially an LTO due to equipment constraints; the company is now testing specialized holding equipment to support a permanent rollout. Future iterations may include tenders integrated into other platforms, such as wraps or salads, to leverage their portability.

This article first appeared on GuruFocus. Total Revenue: $129.6 million in Q2 2026, up from $125.8 million in Q2 2025. Company-Operated Restaurant Revenue: Increased 3.7% to $108.1 million, driven by 3% growth in comparable restaurant sales. Franchise Revenue: Decreased 3.8% to $12.9 million, impacted by a $1.1 million decrease in IT pass-through revenue, partially offset by a 4.5% increase in comparable franchise sales. System-Wide Same-Store Sales: Increased 3.9%, with system-wide transactions down 0.9%. Company-Operated Comparable Sales: Up 3%, including a 4.2% increase in average check size, partially offset by a 1.1% decrease in transactions. Franchise Comparable Sales: Up 4.5%, with a 5.3% increase in average check size, partially offset by a 0.8% decrease in transactions. Restaurant Contribution Margin: Improved to 19.5% in Q2 2026, compared to 19.1% in the year-ago period. Food and Paper Costs: As a percentage of company restaurant sales, increased approximately 90 basis points year-over-year to 25.4%, due to commodity inflation of 4.1%. Labor and Related Expenses: As a percentage of company restaurant sales, decreased about 90 basis points year-over-year to 29.9%. Occupancy and Other Operating Expenses: As a percentage of company restaurant sales, decreased 30 basis points year-over-year to 25.3%. General and Administrative Expenses: Decreased to $7.1 million from $13.5 million in the prior year, primarily due to a $6.3 million legal settlement received. GAAP Net Income: $12.8 million, or $0.43 per diluted share, compared to $7.1 million, or $0.24 per diluted share, in the prior year period. Adjusted EBITDA: $19.1 million in Q2 2026, compared to $18.5 million in Q2 2025. Adjusted Net Income: $8.9 million, or $0.30 per diluted share, compared to $8.2 million, or $0.28 per diluted share, in the prior year. Digital Sales: Represented approximately 28% of system sales, up 13% year-over-year. Off-Premise Digital Business: Represented almost 17% of sales, increasing 12% year-over-year. New Store Openings: Opened 5 new franchise locations and 1 new company location in Q2; year-to-date openings total 10. Remodels: Completed 6 franchise and 5 company remodels in Q2, bringing first-half total to 24. Liquidity: $30 million of debt outstanding and $13.3 million in cash and cash equivalents as of July 1, 2026. Warning! GuruFocus has detected 7 Warning Sign with LOCO. Is LOCO fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. System-wide same-store sales grew 3.9% in Q2, with momentum continuing into Q3 with a 5.8% increase through July 29, 2026. Restaurant-level margin improved to 19.5%, within the long-term target range of 18-20%, despite commodity cost pressures. Menu innovation, including Loco Tenders and Loaded Quesadillas, successfully attracted new and younger customers, driving trial and check growth. Digital sales grew 13% year-over-year, representing 28% of system sales, with loyalty members visiting 3 times more frequently than non-members. New unit growth is on track with 18-20 openings planned for 2026, including successful entry into new states like Idaho, and a strong pipeline of franchise interest. G&A expenses decreased significantly due to a $6.3 million legal settlement and lower activism-related costs, contributing to higher net income. The company raised its full-year 2026 guidance for system-wide comparable store sales growth to 3.5-4.5% and adjusted EBITDA to $68-70 million. System-wide transactions decreased 0.9% in Q2, indicating that sales growth was driven by higher check size rather than increased customer traffic. Food and paper costs increased 90 basis points year-over-year due to 4.1% commodity inflation, primarily from produce, which pressured margins. The company faces ongoing cost pressures from packaging, oil, and fuel, which are expected to continue into the second half of the year. Franchise revenue decreased 3.8% due to a $1.1 million decrease in IT pass-through revenue from the POS system rollout. The company's Q3 margin guidance of 18-18.5% is lower than Q2's 19.5%, reflecting anticipated cost headwinds and a moderation in sales growth. The extension of the credit facility will increase interest costs by 50 basis points, impacting future financial performance. Capital spending guidance was reduced due to timing delays in the remodel program and testing of new equipment, which may slow some growth initiatives. Q: Can you unpack what drove the sequential acceleration in July comps, and given the full Q3 guidance, does the implied deceleration reflect tougher comparisons or other factors?A: Liz Williams (CEO) attributed the acceleration to a combination of factors: the strong launch of loaded quesadillas, effective World Cup advertising, and easier comparisons from the prior year. Ira Fils (CFO) added that July had outsized benefits from World Cup media placements, and the guidance for Q3 reflects a moderation to a pace more consistent with Q2's 3.9% growth, with comparisons getting tougher in Q4. Q: What are you seeing in terms of new restaurant sales, particularly for first entries into new states like Idaho, and how is this impacting your national expansion strategy?A: Liz Williams (CEO) stated that new restaurants are opening above system average, especially first entries into new states, which is exceeding expectations and giving confidence to franchisees to open more units. The company is seeing nationwide interest from potential franchise partners and does not believe expansion must be contiguous, potentially jumping to other parts of the country. Q: What did you learn from the Loco Tenders LTO, and what needs to be true for them to return as a permanent menu item?A: Liz Williams (CEO) explained that tenders drove significant incrementality, attracting a younger consumer and driving sales in snacking and late-night dayparts. They were always planned as an LTO due to equipment constraints, but the company is now testing holding equipment to potentially make them permanent. They are also exploring different ways to serve tenders, such as in wraps or on salads. Q: Can you provide more detail on the COGS pressure in Q2, and is the produce inflation proving to be short-lived?A: Ira Fils (CFO) noted that approximately three-quarters of the COGS pressure was related to produce, which has since mitigated somewhat. However, there is still pressure on other lines, including packaging, oil costs, and fuel for delivery. These factors are baked into the company's guidance for the balance of the year. Q: Have you scoured your food sourcing for potential issues with jalapenos or other ingredients, and have recent industry headlines impacted consumer demand?A: Liz Williams (CEO) confirmed that El Pollo Loco was not involved in any lettuce recalls, all lettuce is sourced from the USA, and the company does not use jalapeno peppers or the supplier in question. While it's hard to tease out benefits, the company may have gotten a slight boost from the headlines, and its salad business remains strong. Q: Why did you lower your CapEx guidance while maintaining unit growth, and can you provide color on the drivers?A: Ira Fils (CFO) explained that the reduction is primarily due to timing of the remodel program, related to permits and internal resource deployment. Additionally, the company is testing holding equipment for tenders, which is a timing issue rather than a cancellation of the project. Q: What are the criteria for new franchise partners, especially for potential non-contiguous expansion, and are these partners being drawn to the brand?A: Liz Williams (CEO) stated that the company is looking for partners with multi-unit restaurant experience, a proven track record, a love for the brand, and strong operational capabilities. Existing franchise partners are also expressing interest in expanding to additional states, which has been a key driver of growth. Q: Can you provide more detail on the Q3 comp guidance, specifically whether the balance of the quarter is expected to moderate from the current 5.8% trend?A: Ira Fils (CFO) confirmed that the balance of the quarter is expected to be more similar to Q2's performance, with July benefiting from outsized World Cup advertising. The midpoint of the Q3 guidance reflects this moderation, and comparisons get tougher in Q4. Q: What is the impact of the amended credit facility on interest rates?A: Ira Fils (CFO) noted that the spread on the amended credit facility will increase by approximately 50 basis points compared to the previous agreement. Q: How are new restaurant openings performing in terms of unit economics, and what is the company's approach to development costs?A: Liz Williams (CEO) highlighted that the company is benefiting from second-generation sites with lower development costs, along with value engineering initiatives. New restaurants are opening with strength, reinforcing confidence in the brand's appeal as it expands nationally. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in El Pollo Loco Holdings, Inc.? Here are five stocks we like better. El Pollo Loco raised its 2026 outlook after second-quarter revenue increased to $129.6 million and systemwide same-store sales grew 3.9%. Full-year comparable-sales guidance was raised to 3.5%–4.5%, while adjusted EBITDA guidance increased to $68 million–$70 million. Restaurant contribution margin improved to 19.5% despite produce-related inflation, supported by labor efficiencies and sales leverage. Adjusted EBITDA rose to $19.1 million, while GAAP net income benefited from a $6.3 million favorable legal settlement. The company is emphasizing menu innovation, digital sales and expansion: digital orders represented about 28% of system sales, and El Pollo Loco entered Idaho as its 10th state. Management continues to target 18–20 new locations in 2026 while testing products such as tenders, quesadillas and Chatacoffee. MarketBeat Week in Review – 03/16 - 03/20 El Pollo Loco (NASDAQ:LOCO) reported second-quarter results marked by higher same-store sales, improved restaurant-level margins and continued expansion outside California, while raising its full-year sales and adjusted EBITDA outlook. For the quarter ended July 1, 2026, total revenue rose to $129.6 million from $125.8 million a year earlier. Company-operated restaurant revenue increased 3.7% to $108.1 million, driven by 3% comparable restaurant sales growth and contributions from three company-operated restaurants opened since the prior-year quarter. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Winner Winner, Chicken Dinner: El Pollo Loco’s Turnaround Recipe Systemwide same-store sales increased 3.9%, with company-operated comparable sales up 3% and franchise comparable sales up 4.5%. The sales gains were driven by higher average checks, which rose 4.2% at company-operated locations and 5.3% at franchise locations, while transactions declined 1.1% and 0.8%, respectively. The company said its effective price increase versus 2025 was approximately 3.4%. Chief Financial Officer Ira Fils said systemwide comparable sales increased 5.8% through July 29, including a 4.4% increase at company-operated restaurants and a 6.6% gain at franchise locations. The company expects third-quarter same-store sales growth of 3.5% to 4.5%. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High 2026 Food Inflation Outlook: This ETF Could Outperform Chief Executive Officer Liz Williams attributed July’s performance to several factors, including the launch of Loaded Quesadillas, advertising tied to the World Cup and broader brand momentum. Fils said July received an “outsized benefit” from the live-sports media activity, while the company expects the full-quarter trend to be more consistent with its second-quarter performance. The company raised its full-year 2026 systemwide comparable-store-sales outlook to 3.5% to 4.5%, and increased its adjusted EBITDA guidance to $68 million to $70 million. → Ulta's Growth Is Real, But So Are the Risks Williams said recent menu launches helped attract new customers and support higher checks. Loco Tenders, introduced at the end of the first quarter as a limited-time offer, brought in younger consumers and customers who had not previously considered the brand, according to Williams. The product was particularly popular in snacking, delivery and evening occasions. Management is testing holding equipment that could support a more permanent role for tenders on the menu. Williams said the company is also exploring other potential uses for the product, including wraps and salads. In late June, El Pollo Loco introduced Loaded Quesadillas in queso and street-corn varieties. The company priced the items at less than $10 a la carte or $10.99 as a combo meal. It also launched its Chatacoffee beverage platform, featuring horchata iced coffee and cold foam, aimed at capturing afternoon and snacking occasions. Looking ahead, the company plans to introduce double-chicken burrito bowls, a pumpkin spice churro and caramel apple Chatacoffee during the fall. It is also testing salads, wraps and sandwiches for potential 2027 introductions. Digital sales, including app, web and kiosk orders, represented about 28% of system sales and increased 13% from the prior year. Off-premise digital sales, including delivery, accounted for nearly 17% of sales and grew 12% year over year. Williams said Loco Rewards members visit about three times more frequently annually than non-members. Targeted loyalty offers and more frequent communications helped loyalty-member frequency and check growth exceed that of non-loyalty customers by more than double, she said. Restaurant contribution margin improved to 19.5% from 19.1% in the prior-year quarter. Food and paper costs increased 90 basis points to 25.4% of company restaurant sales, primarily due to 4.1% commodity inflation, particularly in produce, as well as increased discounts and menu mix shifts. Fils said roughly three-quarters of the food-cost pressure in the quarter was related to produce. While produce costs have moderated, the company continues to face pressure in packaging, oil and fuel-related delivery costs. Labor and related expenses declined 90 basis points to 29.9% of company restaurant sales, helped by operating efficiencies, lower health insurance and workers’ compensation costs, and sales leverage. Wage inflation was below 1% during the quarter for company-operated restaurants. The company expects full-year commodity inflation of 2.5% to 3.5% and wage inflation of 1.5% to 2.5%. It maintained its full-year restaurant-level margin outlook of 18.25% to 18.75%, compared with 17.8% for full-year 2025. GAAP net income increased to $12.8 million, or $0.43 per diluted share, from $7.1 million, or $0.24 per diluted share, a year earlier. The result included a $6.3 million favorable legal settlement that contributed to lower general and administrative expenses. Adjusted EBITDA increased to $19.1 million from $18.5 million, while adjusted net income rose to $8.9 million, or $0.30 per diluted share, from $8.2 million, or $0.28 per diluted share. El Pollo Loco opened five franchise locations and one company-operated location during the second quarter. It opened two additional locations after quarter-end, bringing year-to-date openings to 10. The company continues to expect 18 to 20 systemwide openings in 2026, including three to four company-operated restaurants and 15 to 16 franchise-operated restaurants. The company entered Idaho in late June, its 10th state, and expects a second location in the state to open in the fall. Williams said newer markets, including Washington, New Mexico and Idaho, have generally opened above the system average, with first locations in new markets producing particularly strong initial demand. Management said it is considering non-contiguous expansion opportunities as it engages prospective franchisees nationwide. Williams said the company is looking for partners with multiunit restaurant experience, development capability, operational expertise and enthusiasm for the brand. El Pollo Loco completed 11 restaurant remodels in the second quarter, bringing first-half remodels to 24. The company said refreshed restaurants have continued to generate an average mid-single-digit sales lift. It reduced expected 2026 capital spending to $33 million to $37 million, primarily due to the timing of remodel work and continued testing of equipment related to menu initiatives. As of July 1, the company had $30 million of debt outstanding and $13.3 million in cash and cash equivalents after paying down $21 million on its revolving credit facility during the preceding 26 weeks. On Aug. 4, El Pollo Loco extended its $150 million revolving credit facility through Aug. 4, 2031. Fils said the borrowing spread under the amended agreement will increase by about 50 basis points. El Pollo Loco (NASDAQ: LOCO) is a fast-casual restaurant chain specializing in Mexican-style fire-grilled chicken and complementary menu offerings. The company's signature product is its marinated, flame-grilled chicken, which is prepared in an open-flame rotisserie and served in a variety of formats including tacos, burritos, bowls and salads. In addition to its core chicken offerings, El Pollo Loco menu items feature fresh-made salsas, guacamole, sides such as charro beans and fresh tortillas, as well as a selection of beverages and desserts. Founded in 1975 in Guasave, Sinaloa, Mexico, by Juan Francisco Ochoa, the concept expanded into the United States in 1980 with its first U.S. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "El Pollo Loco Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Fast food chain El Pollo Loco (NASDAQ:LOCO) missed Wall Street’s revenue expectations in Q2 CY2026 as sales rose 3% year on year to $129.6 million. Its non-GAAP profit of $0.30 per share was 7.8% above analysts’ consensus estimates. Is now the time to buy El Pollo Loco? Find out in our full research report. Revenue: $129.6 million vs analyst estimates of $130.3 million (3% year-on-year growth, 0.5% miss) Adjusted EPS: $0.30 vs analyst estimates of $0.28 (7.8% beat) Adjusted EBITDA: $19.11 million vs analyst estimates of $18.52 million (14.7% margin, 3.2% beat) Operating Margin: 14.4%, up from 9% in the same quarter last year Locations: 511 at quarter end, up from 499 in the same quarter last year Same-Store Sales rose 3.9% year on year (-0.3% in the same quarter last year) Market Capitalization: $517.4 million With a name that translates into ‘The Crazy Chicken’, El Pollo Loco (NASDAQ:LOCO) is a fast food chain known for its citrus-marinated, fire-grilled chicken recipe that hails from the coastal town of Sinaloa, Mexico. Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. With $500.8 million in revenue over the past 12 months, El Pollo Loco is a small restaurant chain, which sometimes brings disadvantages compared to larger competitors benefiting from better brand awareness and economies of scale. As you can see below, El Pollo Loco’s 1.8% annualized revenue growth over the last seven years was weak as it barely increased sales at existing, established dining locations. This quarter, El Pollo Loco’s revenue grew by 3% year on year to $129.6 million, falling short of Wall Street’s estimates. Looking ahead, sell-side analysts expect revenue to grow 1.8% over the next 12 months, similar to its seven-year rate. This projection is underwhelming and implies its newer menu offerings will not accelerate its top-line performance yet. ONE MORE THING: The $21 AI Application Stock Wall Street Forgot. While Wall Street obsesses over who’s building AI, one company is already using it to print money. And nobody’s paying attention. AI chip stocks trade at ridiculous valuations. This company processes a trillion consumer signals monthly using AI and trades at a third of the price. The gap won’t last. The institutions will figure it out. You need to see this first. Read the FREE Report Before They Notice. El Pollo Loco sported 511 locations in the latest quarter. Over the last two years, it has generally opened new restaurants, averaging 1% annual growth. This was faster than the broader restaurant sector. When a chain opens new restaurants, it usually means it’s investing for growth because there’s healthy demand for its meals and there are markets where its concepts have few or no locations. A company’s restaurant base only paints one part of the picture. When demand is high, it makes sense to open more. But when demand is low, it’s prudent to close some locations and use the money in other ways. Same-store sales gives us insight into this topic because it measures organic growth at restaurants open for at least a year. El Pollo Loco’s demand within its existing dining locations has been relatively stable over the last two years but was below most restaurant chains. On average, the company’s same-store sales have grown by 1.7% per year. This performance suggests it should consider improving its foot traffic and efficiency before expanding its restaurant base. In the latest quarter, El Pollo Loco’s same-store sales rose 3.9% year on year. This growth was an acceleration from its historical levels, which is always an encouraging sign. It was encouraging to see El Pollo Loco beat analysts’ EBITDA expectations this quarter. We were also happy its same-store sales was in line with Wall Street’s estimates. On the other hand, its revenue slightly missed. Overall, this print had some key positives. The stock traded up 2% to $16.71 immediately after reporting. So should you invest in El Pollo Loco right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free.

El Pollo Loco Holdings (LOCO) came out with quarterly earnings of $0.3 per share, beating the Zacks Consensus Estimate of $0.29 per share. This compares to earnings of $0.28 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +3.45%. A quarter ago, it was expected that this Tex-Mex fast food chain would post earnings of $0.22 per share when it actually produced earnings of $0.28, delivering a surprise of +27.27%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. El Pollo Loco, which belongs to the Zacks Retail - Restaurants industry, posted revenues of $129.57 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 1.09%. This compares to year-ago revenues of $125.83 million. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. El Pollo Loco shares have added about 62.4% since the beginning of the year versus the S&P 500's gain of 12.8%. While El Pollo Loco has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for El Pollo Loco was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.26 on $127.2 million in revenues for the coming quarter and $0.95 on $502.1 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Restaurants is currently in the bottom 22% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Jack In The Box (JACK), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 12. This burger chain is expected to post quarterly earnings of $0.90 per share in its upcoming report, which represents a year-over-year change of -11.8%. The consensus EPS estimate for the quarter has been revised 0.3% lower over the last 30 days to the current level. Jack In The Box's revenues are expected to be $260.04 million, down 21.9% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report El Pollo Loco Holdings, Inc. (LOCO) : Free Stock Analysis Report Janus Henderson Sustainable & Impact Core Bond ETF (JACK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Delivers 3.9% System-wide Comparable Restaurant SalesRaises 2026 Full-Year Outlook COSTA MESA, Calif., Aug. 06, 2026 (GLOBE NEWSWIRE) -- El Pollo Loco Holdings, Inc. (Nasdaq: LOCO) (the “Company”) today announced financial results for the 13-week period ended July 1, 2026. Highlights for the second quarter ended July 1, 2026 compared to the second quarter ended June 25, 2025 were as follows: Total revenue was $129.6 million compared to $125.8 million. System-wide comparable restaurant sales(1) increased by 3.9%. Income from operations was $18.7 million compared to $11.3 million. Restaurant contribution(1) was $21.1 million, or 19.5% of company-operated restaurant revenue, compared to $19.9 million, or 19.1% of company-operated restaurant revenue. Net income was $12.8 million, or $0.43 per diluted share, compared to net income of $7.1 million, or $0.24 per diluted share. Adjusted net income(1) was $8.9 million, or $0.30 per diluted share, compared to $8.2 million, or $0.28 per diluted share. Adjusted EBITDA(1) was $19.1 million, compared to $18.5 million. -------------------- “We are pleased with the continued momentum reflected in our second quarter results, with systemwide same-store sales growth of 3.9% and restaurant-level margins of 19.5%,” said Liz Williams, Chief Executive Officer of El Pollo Loco. “Our extensive menu innovation pipeline, continued improvement on operational excellence, and enhanced digital engagement are working together to drive increased sales and new unit development. As we look ahead, we remain focused on driving sustainable traffic growth across our system, maintaining the margin discipline we've demonstrated, and thoughtfully growing El Pollo Loco across the country.” Second Quarter 2026 Financial Results Company-operated restaurant revenue in the second quarter of 2026 increased to $108.1 million, compared to $104.3 million in the second quarter of 2025, primarily due to an increase in company-operated comparable restaurant revenue of $3.1 million, or 3.0%, as well as $1.0 million of additional sales from the opening of three restaurants after the second quarter of 2025. The company-operated comparable restaurant sales increase consisted of a 4.2% increase in average check size, partially offset by a 1.1% decrease in transactions. Franchise revenue in the second quarter of 2026 decreased by 3.8% to $12.9 million from $13.4 million. The decrease was primarily due to a $1.1 million decrease in franchisee information technology (“IT”) pass-through revenue related to the franchise rollout of the new Point of Sale (“POS”) system completed in 2025, with the decrease partially offset by a corresponding decrease in related franchise expenses. Franchise revenue also benefits from an increase in franchise revenue related to the 11 franchise-operated restaurant openings during or subsequent to the second quarter of 2025 and a franchise comparable restaurant sales increase of 4.5%. The franchise comparable restaurant sales increase consisted of a 5.3% increase in average check size, partially offset by a 0.8% decrease in transactions. Income from operations in the second quarter of 2026 was $18.7 million, compared to $11.3 million in the second quarter of 2025. Restaurant contribution was $21.1 million, or 19.5% of company-operated restaurant revenue, compared to $19.9 million, or 19.1% of company-operated restaurant revenue in the second quarter of 2025. The increase in restaurant contribution margin was largely due to leverage on the 3.0% comparable store sales increase, improved operating efficiencies, and higher menu prices. For the quarter ended July 1, 2026, general and administrative expenses decreased $6.5 million, or 47.9%, from the comparable period in the prior year. The decrease for the quarter was primarily due to $6.3 million received from a legal settlement, net of legal expenses, in the current year, a $0.8 million decrease in legal and professional fee costs related to shareholder activism and related matters in the prior year, and a $0.7 million decrease related to restructuring and executive transition costs in the prior year. The general and administrative expenses decrease was partially offset by a $0.3 million increase in legal fees, a $0.2 million increase in store pre-opening costs and a $0.8 million increase in other general and administrative expenses. Net income for the second quarter of 2026 was $12.8 million, or $0.43 per diluted share, compared to net income of $7.1 million, or $0.24 per diluted share, in the second quarter of 2025. Adjusted net income was $8.9 million, or $0.30 per diluted share, during the second quarter of 2026, compared to $8.2 million, or $0.28 per diluted share, during the second quarter of 2025. As of July 1, 2026, after net pay down of $21.0 million on our five-year senior-secured revolving credit facility (the “credit facility”) during the preceding twenty-six weeks, the Company’s outstanding debt balance was $30.0 million with $13.3 million in cash and cash equivalents. Subsequent Events Subsequent to quarter end, the Company paid down an additional $4.0 million on its $150.0 million credit facility, resulting in outstanding borrowings of $26.0 million as of July 29, 2026. Subsequent to quarter end, on August 4, 2026, the Company amended its $150.0 million credit facility, extending the term to August 4, 2031. 2026 Outlook The Company is providing the following updated expectations for fiscal year 2026: System-wide comparable restaurant sales growth of 3.5% to 4.5%. Adjusted EBITDA1 between $68 million and $70 million. Capital spending between $33 million and $37 million. The Company is reiterating the following expectations for fiscal year 2026: The opening of three to four company-operated restaurants and 15 to 16 franchise-operated restaurants. G&A expense between $52 million and $54 million, excluding one-time costs. Estimated effective income tax rate of 29.0% to 29.5% before discrete items. ___________________________ 1 A reconciliation of the forward-looking fiscal 2026 Adjusted EBITDA to net income cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. Definitions of Non-GAAP and other Key Financial Measures System-Wide Sales are neither required by, nor presented in accordance with, GAAP. System-wide sales are the sum of company-operated restaurant revenue and sales from franchise-operated restaurants. The Company’s total revenue in the consolidated statements of income is limited to company-operated restaurant revenue and franchise revenue from the Company’s franchisees. Accordingly, system-wide sales should not be considered in isolation or as a substitute for our results as reported under GAAP. Management believes that the presentation of system-wide sales provides useful information to investors, because it is a measure that is widely used in the restaurant industry, including by our management, to evaluate brand scale and market penetration. System-wide sales do not include the eight currently licensed stores in the Philippines. The total number of currently licensed stores reflects the closure of two licensed restaurants during the fiscal year ended December 31, 2025. Company-Operated Restaurant Revenue consists of sales of food and beverages in company-operated restaurants net of promotional allowances, employee meals, and other discounts. Company-operated restaurant revenue in any period is directly influenced by the number of operating weeks in such period, the number of open restaurants, and comparable restaurant sales. Seasonal factors and the timing of holidays cause our revenue to fluctuate from quarter to quarter. Our revenue per restaurant is typically lower in the first and fourth quarters due to reduced January and December transactions and higher in the second and third quarters. As a result of seasonality, our quarterly and annual results of operations and key performance indicators such as company-operated restaurant revenue and comparable restaurant sales may fluctuate. Comparable Restaurant Sales reflect year-over-year sales changes for comparable company-operated, franchise-operated and system-wide restaurants. A restaurant enters our comparable restaurant base the first full week after it has operated for 15 months. Comparable restaurant sales exclude restaurants closed during the applicable period. At July 1, 2026, there were 489 system-wide comparable restaurants, 172 company-operated restaurants and 317 franchise-operated restaurants. Comparable restaurant sales indicate the performance of existing restaurants, since new restaurants are excluded. Comparable restaurant sales growth can be generated by an increase in the number of meals sold and/or by increases in the average check amount, resulting from a shift in menu mix and/or higher prices resulting from new products or price increases. Because other companies may calculate this measure differently than we do, comparable restaurant sales as presented herein may not be comparable to similarly titled measures reported by other companies. Management believes that comparable restaurant sales is a valuable metric for investors to evaluate the performance of our store base, excluding the impact of new stores and closed stores. Restaurant Contribution and Restaurant Contribution Margin are neither required by, nor presented in accordance with, GAAP. Restaurant contribution is defined as company-operated restaurant revenue less company restaurant expenses, which includes food and paper cost, labor and related expenses, and occupancy and other operating expenses, where applicable. Restaurant contribution therefore excludes franchise revenue, franchise advertising fee revenue and franchise expenses as well as certain other costs, such as general and administrative expenses, depreciation and amortization, impairment and closed-store reserve, loss on disposal of assets and other costs that are considered corporate-level expenses and are not considered normal operating costs of our restaurants. Accordingly, restaurant contribution is not indicative of overall Company results and does not accrue directly to the benefit of stockholders because of the exclusion of certain corporate-level expenses. Restaurant contribution margin is defined as restaurant contribution as a percentage of company-operated restaurant revenue. Restaurant contribution and restaurant contribution margin are supplemental measures of operating performance of our restaurants, and our calculations thereof may not be comparable to those reported by other companies. Restaurant contribution and restaurant contribution margin have limitations as analytical tools, and you should not consider them in isolation, or superior to, or as substitutes for the analysis of our results as reported under GAAP. Management uses restaurant contribution and restaurant contribution margin as key metrics to evaluate the profitability of incremental sales at our restaurants, to evaluate our restaurant performance across periods, and to evaluate our restaurant financial performance compared with our competitors. Management believes that restaurant contribution and restaurant contribution margin are important tools for investors, because they are widely-used metrics within the restaurant industry to evaluate restaurant-level productivity, efficiency, and performance. Management further believes restaurant level operating margin is useful to investors to highlight trends in our core business that may not otherwise be apparent to investors when relying solely on GAAP financial measures. EBITDA and Adjusted EBITDA are neither required by, nor presented in accordance with, GAAP. EBITDA represents net income (loss) before interest expense, provision (benefit) for income taxes, depreciation, and amortization, and Adjusted EBITDA represents net income (loss) before interest expense (net of interest income), provision (benefit) for income taxes, depreciation, amortization, and items that we do not consider representative of our ongoing operating performance, as identified in the reconciliation table included under “Unaudited Reconciliation of Net Income to EBITDA and Adjusted EBITDA” in the accompanying financial tables at the end of this release. EBITDA and Adjusted EBITDA as presented in this release are supplemental measures of our performance that are neither required by, nor presented in accordance with, GAAP. EBITDA and Adjusted EBITDA are not measurements of our financial performance under GAAP and should not be considered as alternatives to net income, operating income, or any other performance measures derived in accordance with GAAP, or as alternatives to cash flow from operating activities as a measure of our liquidity. In addition, in evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we will incur expenses or charges such as those added back to calculate EBITDA and Adjusted EBITDA. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. EBITDA and Adjusted EBITDA have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Some of these limitations are (i) they do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments, (ii) they do not reflect changes in, or cash requirements for, our working capital needs, (iii) they do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt, (iv) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements, (v) they do not adjust for all non-cash income or expense items that are reflected in our statements of cash flows, (vi) they do not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our on-going operations, and (vii) other companies in our industry may calculate these measures differently than we do, limiting their usefulness as comparative measures. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from such non-GAAP financial measures. We further compensate for the limitations in our use of non-GAAP financial measures by presenting comparable GAAP measures more prominently. Management believes that EBITDA and Adjusted EBITDA facilitate operating performance comparisons from period to period by isolating the effects of some items that vary from period to period without any correlation to core operating performance or that vary widely among similar companies. These potential differences may be caused by variations in capital structures (affecting interest expense), tax positions (such as the impact on periods or companies of changes in effective tax rates or NOLs) and the age and book depreciation of facilities and equipment (affecting relative depreciation expense). We also present EBITDA and Adjusted EBITDA because (i) management believes that these measures are frequently used by securities analysts, investors and other interested parties to evaluate companies in our industry, (ii) management believes that investors will find these measures useful in assessing our ability to service or incur indebtedness, and (iii) we use EBITDA and Adjusted EBITDA internally for a number of benchmarks, including to compare our performance to that of our competitors. Adjusted Net Income is neither required by, nor presented in accordance with, GAAP. Adjusted net income represents net income adjusted for (i) costs (or gains) related to loss (or gains) on disposal of assets and asset impairment and closed store costs reserves, (ii) expenses related to special legal and professional fees, (iii) extraordinary legal settlement costs, (iv) restructuring charges and executive transition costs, (v) insurance proceeds related to reimbursement of lost profits, net of the related costs and (vi) provision for income taxes at a normalized tax rate of 28.5% and 28.8% for the thirteen and twenty-six weeks ended July 1, 2026, respectively, and 29.3% for both the thirteen and twenty-six weeks ended June 25, 2025 which reflects our estimated long-term effective tax rate, including both federal and state income taxes (excluding the impact of discrete items) and applied after giving effect to the foregoing adjustments. Because other companies may calculate these measures differently than we do, adjusted net income as presented herein may not be comparable to similarly titled measures reported by other companies. Management believes adjusted net income is an important supplement to GAAP measures that enhances the overall understanding of our operating performance and long-term profitability, and enables investors to more effectively compare the Company’s performance to prior and future periods. Conference Call The Company will host a conference call to discuss financial results for the second quarter of 2026 today at 4:30 PM Eastern Time. Liz Williams, Chief Executive Officer, and Ira Fils, Chief Financial Officer, will host the call. The conference call can be accessed live over the phone by dialing 201-493-6780. A replay will be available after the call and can be accessed by dialing 412-317-6671; the passcode is 13757077. The replay will be available until Thursday, August 20, 2026. The conference call will also be webcast live from the Company’s corporate website at investor.elpolloloco.com under the “Events & Presentations” page. An archive of the webcast will be available at the same location on the corporate website shortly after the call has concluded. About El Pollo Loco El Pollo Loco (Nasdaq: LOCO) is the nation's leading fire-grilled chicken restaurant known for its craveable, flavorful, and better-for-you offerings. Our menu features innovative meals with Mexican flavors all made in our restaurants daily using quality ingredients. At El Pollo Loco, inclusivity is at the heart of our culture. Our community of over 4,000 employees reflects our commitment to creating a workplace where everyone has a seat at our table. Since 1980, El Pollo Loco has successfully expanded its presence, operating more than 500 company-owned and franchise-operated restaurants across ten U.S. states: Arizona, California, Colorado, Idaho, Louisiana, Nevada, New Mexico, Texas, Utah and Washington. The Company has also extended its footprint internationally, with eight licensed restaurant locations in the Philippines. For more information or to place an order, visit the Loco Rewards APP or ElPolloLoco.com. Follow us on Instagram, TikTok, Facebook, or X. Forward-Looking Statements This press release contains forward-looking statements within the meaning of federal securities laws that are subject to risks and uncertainties. All statements other than statements of historical fact included in this press release are forward-looking statements. Examples of forward-looking statements in this press release include, but are not limited to, discussions of our current expectations, projections, intentions, or beliefs relating to our financial condition, results of operations, liquidity, prospects, growth, trends, strategies, and the industry in which we operate. You can identify forward-looking statements because they do not relate strictly to historical or current facts. These statements may include words such as “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “outlook,” “potential,” “project,” “projection,” “plan,” “intend,” “seek,” “may,” “could,” “would,” “will,” “should,” “can,” “can have,” “likely,” the negatives thereof and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those that we expected. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. You should evaluate all forward-looking statements made in this press release in the context of the risks and uncertainties that could cause outcomes to differ materially from our expectations. These factors include, but are not limited to: our ability to open new restaurants in new and existing markets; our ability to compete successfully; global economic or other business conditions, including trade policies, tariff and import regulations by the United States, as well as consumer preferences; our ability to attract, develop, assimilate, and retain employees; our vulnerability to regional geographic conditions; our ability to maintain business continuity in the event of a disaster or disruption; impairment of our assets; changes in food and supply costs, especially for chicken, labor, construction and utilities; the impacts of public health crises; potential negative publicity; our ability to continue to expand our digital business, delivery orders and catering; concerns about food safety and quality and about food-borne illness; dependence on frequent and timely deliveries of food and supplies; our ability to service our level of indebtedness; the success of our marketing programs, new menu items, advertising campaigns and restaurant designs and remodels; risks related to our dependence on our franchisees, including their vulnerability to economic changes; exposure from our self-insurance programs; obligations under long-term and non-cancelable leases, and our ability to renew leases at the end of their terms; our ability to achieve our corporate responsibility goals; information technology system failures, cybersecurity breaches, or failure to protect our customers’ data or personal information; our ability to enforce and maintain our intellectual property; the impact of federal, state and local laws, including those governing our relationships with our employees fluctuations in our quarterly operating results due to seasonality and other factors; any future offerings of debt or equity securities that may impact the market price of our common stock or dilute existing shareholders’ ownership; the possibility that Delaware law, our organizational documents, our shareholder rights agreement, and our existing and future debt agreements may impede or discourage a takeover; the impact of shareholder activism on our expenses, business and stock price; and other risks set forth in our filings with the Securities and Exchange Commission (“SEC”) from time to time, including under Item 1A, Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2025, as such risk factors may be amended, supplemented or superseded from time to time by other reports we file with the SEC, all of which are or will be available online at www.sec.gov. We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences we anticipate or affect us or our operations in the ways that we expect. The forward-looking statements included in this press release are made only as of the date hereof, and we caution you to not place undue reliance on any forward-looking statement made in this press release. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements. Non-GAAP Financial Measures To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures that are supplemental measures of the operating performance of our business and restaurants: System-wide sales, Restaurant contribution and Restaurant contribution margin, EBITDA and Adjusted EBITDA, and Adjusted net income. Our calculations of these non-GAAP financial measures may not be comparable to those reported by other companies. These measures have limitations as analytical tools, and are not intended to be considered in isolation or as substitutes for, or superior to, financial measures prepared and presented in accordance with GAAP. We use non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons and to evaluate our restaurants’ financial performance against our competitors’ performance. We believe these measures provide useful information about our operating results, enhance understanding of past performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. These non-GAAP financial measures may also assist investors in evaluating our business and performance relative to industry peers and provide greater transparency with respect to the Company’s financial condition and results of operation. Additional information about these non-GAAP financial measures (System-wide sales, Restaurant contribution and Restaurant contribution margin, EBITDA and Adjusted EBITDA, and Adjusted net income) is provided under “Definitions of Non-GAAP and other Key Financial Measures” above. For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP financial measure, see “Unaudited Reconciliation of System-Wide Sales to Company-Operated Restaurant Revenue and Total Revenue,” “Unaudited Reconciliation of Net Income to EBITDA and Adjusted EBITDA,” “Unaudited Reconciliation of Net Income to Adjusted Net Income” and “Unaudited Reconciliation of Income from Operations to Restaurant Contribution” in the accompanying financial tables at the end of this press release. Investor Contact:[email protected] Media Contact:Brittney Shaffer [email protected] __________________________ (1)  Percentages for line items relating to cost of operations and company restaurant expenses are calculated with company-operated restaurant revenue as the denominator. All other percentages use total revenue. _________________________________ (1)   Our restaurant count includes 511 domestic restaurants and excludes the eight licensed restaurants in the Philippines, as well as the two previously licensed restaurants in the Philippines that were closed during the twenty-six weeks ended June 25, 2025. ________________________________________ (1)   System-wide sales do not include the eight licensed restaurants in the Philippines. __________________________________

Bloomin' Brands (BLMN) came out with quarterly earnings of $0.39 per share, beating the Zacks Consensus Estimate of $0.28 per share. This compares to earnings of $0.33 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +39.29%. A quarter ago, it was expected that this owner of Outback Steakhouse and other casual dining spots would post earnings of $0.57 per share when it actually produced earnings of $0.67, delivering a surprise of +17.54%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Bloomin' Brands, which belongs to the Zacks Retail - Restaurants industry, posted revenues of $1.02 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 1.67%. This compares to year-ago revenues of $1 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Bloomin' Brands shares have added about 44.6% since the beginning of the year versus the S&P 500's gain of 13%. While Bloomin' Brands has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Bloomin' Brands was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.19 on $921.96 million in revenues for the coming quarter and $0.86 on $3.96 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Restaurants is currently in the bottom 23% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, El Pollo Loco Holdings (LOCO), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This Tex-Mex fast food chain is expected to post quarterly earnings of $0.29 per share in its upcoming report, which represents a year-over-year change of +3.6%. The consensus EPS estimate for the quarter has been revised 8.3% higher over the last 30 days to the current level. El Pollo Loco Holdings' revenues are expected to be $131 million, up 4.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bloomin' Brands, Inc. (BLMN) : Free Stock Analysis Report El Pollo Loco Holdings, Inc. (LOCO) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

El Pollo Loco Holdings (LOCO) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price. The earnings report, which is expected to be released on August 6, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This Tex-Mex fast food chain is expected to post quarterly earnings of $0.29 per share in its upcoming report, which represents a year-over-year change of +3.6%. Revenues are expected to be $131 million, up 4.1% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 8.33% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For El Pollo Loco, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +6.90%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination indicates that El Pollo Loco will most likely beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that El Pollo Loco would post earnings of $0.22 per share when it actually produced earnings of $0.28, delivering a surprise of +27.27%. Over the last four quarters, the company has beaten consensus EPS estimates four times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. El Pollo Loco appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Shake Shack (SHAK), another stock in the Zacks Retail - Restaurants industry, is expected to report earnings per share of $0.33 for the quarter ended June 2026. This estimate points to a year-over-year change of -25%. Revenues for the quarter are expected to be $417.79 million, up 17.2% from the year-ago quarter. Over the last 30 days, the consensus EPS estimate for Shake Shack has remained unchanged. Nevertheless, the company now has an Earnings ESP of -8.34%, reflecting a lower Most Accurate Estimate. When combined with a Zacks Rank of #5 (Strong Sell), this Earnings ESP makes it difficult to conclusively predict that Shake Shack will beat the consensus EPS estimate. Over the last four quarters, the company surpassed consensus EPS estimates three times. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report El Pollo Loco Holdings, Inc. (LOCO) : Free Stock Analysis Report Shake Shack, Inc. (SHAK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research