It was business as usual at Chili’s Grill and Bar last quarter. But for Chili’s, “usual” is relative these days.
Same-store sales jumped 8.6% year over year for the three months ending Dec. 24, continuing a spectacular run since CEO Kevin Hochman arrived in 2022 with a plan to revive the Dallas-based casual-dining chain.
The sales growth included a 4.4% price increase, 2.7% traffic growth and a 1.5% mix improvement.
And it came on top of a 31% same-store sales increase a year ago, giving Chili’s an eye-popping two-year compound growth rate of 43%. That was 50% going back three years, and 62% on a four-year basis, representing 19 consecutive quarters of same-store sales growth for the chain.
In an earnings call Wednesday, the company chalked up its ongoing momentum to the playbook Hochman put in place nearly four years ago: Improved food and operations backed by widespread, value-based marketing.
And while some have questioned how the brand could possibly keep doing this, Chili’s believes it has same-store sales growth down to a science.
“This is what I keep saying. As long as we keep focusing on the fundamentals of casual dining and we are honestly looking in the mirror saying, ‘Are we going to be better this year than last year,’ and we continue to have this world-class marketing, there's no reason why the comp won't continue to grow,” Hochman told analysts.
On cue, parent company Brinker International upgraded its outlook for its fiscal 2026, which ends in June. It’s now expecting total revenues of $5.76 billion to $5.83 billion, up from $5.6 billion to $5.7 billion previously, which would imply same-stores sales growth of mid-single digits at Chili's for the next two quarters.
The only thing stopping Chili’s right now is the winter storm blanketing much of the country. But it still expects to return to a mid-single-digit growth pace when the weather clears, CFO Mika Ware said.
A few highlights bolstered the chain’s success last quarter. A “Wicked”-themed margarita offered in November exceeded expectations, selling 1.5 million more drinks than Chili’s typical Margarita of the Month. New Southwest queso helped drive more appetizer orders, and sales of the Triple Dipper appetizer platter also rose again following its viral turn in 2025.
Besides that, the chain continues to lean on value to drive traffic, advertising 3 for Me combo meals starting at $10.99. Despite a price increase in the quarter, Chili’s average check is still more than $3 less than its closest casual-dining competitors, and more than $4 less than casual dining as a whole. That has helped it appeal to consumers who are fed up with inflation.
“We feel like we're really positioned to win, regardless of what happens with the [macroeconomy],” Hochman said.
Chili’s continues to trim back its menu, cutting another six items last quarter. It has also stayed away from limited-time offers in an effort to keep operations simple for employees. This has led to a better experience for customers. Last quarter, the brand’s key Guests With a Problem metric fell to 2.1%, down from 2.9% a year ago and 5% when the turnaround began.
Meanwhile, it has worked on improving its core menu categories: burgers, Chicken Crispers, margaritas and fajitas. Recently, it has turned its attention to other parts of the menu, such as ribs and nachos. Sales of the new nachos are outpacing the old by 170%. It upgraded to thicker bacon on its bacon cheeseburger, which is now selling 43% better than it was before.
“It's just more of the same,” Hochman said. “We continue to streamline the menu. We continue to improve operations and make the needed investments to improve the overall guest experience. And then we see that in the internal metrics.”
This has helped Chili’s win with both new and existing customers. Longtime customers are visiting the chain the same amount, “and we keep bringing new guests in and they start looking like existing guests pretty quickly,” Hochman said. “That's how you sustainably grow over time.”
Chili’s next big menu project will be chicken sandwiches. It has revamped the item to resemble Popeyes’ game-changing sandwich, with a brioche bun, pickles, mayonnaise and a large chicken breast.
The sandwich is currently being tested in 200 locations, and Chili’s will begin advertising it on TV in late April with a “hot” opening price point, Hochman said. There will be higher-priced options featuring additional toppings, as well as a variety of sauces, including a new sauce.
The sandwich is already performing well in the test restaurants, and Chili’s believes it will be a traffic driver when it launches systemwide.
The chain is also testing a remodeling program. It has remodeled four restaurants so far and plans to do between 60 and 80 in 2027 and another 100 the following year.
The remodels are aimed at marrying the vibe from Chili’s glory days with more modern elements. They will feature tiled tables, for instance, and a more prominent bar. So far, all four redesigns have been popular with employees and customers alike, Hochman said, but they have gravitated toward the least costly of the four.
“We're learning that we probably don't need all the bells and whistles,” he said, like oversized margarita shakers that ended up feeling like clutter.
In addition to remodeling many of its restaurants, Chili’s also expects to get back to opening new ones by 2028. But it won’t move too fast. Ware suggested that annual unit count growth could be somewhere in the low single digits. Chili’s ended the quarter with 1,206 domestic restaurants.
The prospect of more Chili’s has investors excited. An analyst on the call asked if the company thought it could eventually double its footprint long-term.
“I think double is quite aggressive,” Ware said. “But yes, we think we can build more Chili's.”
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