(Bloomberg) — Texas Roadhouse Inc. shares fell in postmarket trading Thursday after the company lifted its forecast for commodity inflation for this year and predicted an acceleration next year.
The Louisville, Kentucky-based chain now expects its commodity prices, driven by high beef prices, to rise about 6% in 2025, up from roughly 5% projected last quarter, it said in a statement Thursday. For 2026, it sees those costs increasing around 7%.
Commodity inflation will likely be above the full-year guidance in the first half of 2026 and below in the second half, interim Chief Financial Officer Keith Humpich said on an earnings call.
In the third quarter, commodity inflation reached 7.9%, pressuring profitability and driving restaurant margin — the share of sales left after food, labor, and operating costs — down year-on-year for a third straight quarter.
To help offset higher costs, the company raised menu prices 1.7% last month, while strong customer traffic helped cushion the impact in the third quarter, Chief Executive Officer Jerry Morgan said in a statement. The company expects same-store sales to grow in 2026, supported in part by this year’s menu price increases.
Company-owned same-store sales rose 6.1% in the quarter, topping the 5.3% gain expected by analysts surveyed by Bloomberg. Earnings per share were $1.25, three cents below the consensus estimate.
Shares dropped as much as 2.6% in postmarket trading. The stock has fallen 11% this year through Thursday’s close, while the S&P Composite 1500 Restaurants Index fell 8.9% over the same period.
