Jake Bartlett's questions to Texas Roadhouse Inc (TXRH) leadership • Q3 2024
Question
Jake Bartlett of Truist Securities questioned the surprisingly moderate beef inflation outlook for 2025, given that favorable supply this year might imply tighter supply next year. He asked for specific beef inflation expectations for 2024 and 2025 and the confidence level in the outlook for non-beef commodities.
Answer
CFO David Monroe acknowledged that lower-than-expected beef inflation was a surprise, attributing it to a combination of supply and demand dynamics, including rancher costs and interest rates. Executive Michael Bailen confirmed beef is the main inflation driver for both 2024 and 2025, with other commodities expected to be flat to slightly inflationary. He noted that while they have visibility, no other single item is large enough to significantly alter the outlook.