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Dine Brands Global, Inc. (DIN)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 revenue was $214.8M, up 4.1% YoY and up sequentially vs Q4; adjusted EPS was $1.03, a clear miss vs Wall Street consensus of $1.24, and revenue modestly missed consensus by ~$0.3M. Management reiterated full‑year guidance and emphasized improving sales/traffic momentum through March and into April . EPS consensus and revenue consensus values marked with an asterisk were retrieved from S&P Global.
  • Adjusted EBITDA was $54.7M (down 10% YoY), while GAAP EPS was $0.53 (down vs $1.13 YoY); negative comps persisted at Applebee’s (-2.2%) and IHOP (-2.7%), but off‑premise mix rose and average weekly off‑premise sales improved sequentially .
  • Guidance maintained: FY25 adjusted EBITDA $235–$245M, Applebee’s comps -2% to +1%, IHOP comps -1% to +2%, G&A $200–$205M, CapEx $20–$30M; dividend of $0.51 per share declared for Q2 2025 .
  • Catalysts/narrative: execution on value platforms (Applebee’s Big Easy, 2 for $25; IHOP House Faves), loyalty acceleration (Club Applebee’s +175k signups), dual‑brand momentum (domestic pipeline), and supply chain mitigation (egg inflation, tariffs exposure limited to ~10–13% of baskets) .

What Went Well and What Went Wrong

What Went Well

  • Value and menu innovation drove late‑quarter and April momentum; management: “we’re seeing steady improvement across sales, traffic, and our development pipeline” as initiatives took hold . Applebee’s off‑premise comps +3.7% YoY; Big Easy promo and NCAA Boneless Wings campaign supported traffic/check in March/April .
  • Loyalty and marketing engagement stepped up: Date Night exclusivity lifted Club Applebee’s memberships by 175,000 to 8.5M; IHOP set a Guinness World Record event generating 3B+ impressions and the largest National Pancake Day lift since COVID .
  • Dual‑brand strategy traction: first domestic dual brand performing ~3x vs stand‑alone IHOP at launch; franchisees signing up for more openings; 14 domestic openings targeted in 2025; international dual brands expected to more than double to 41 .

What Went Wrong

  • Same‑store sales declined at both flagship brands: Applebee’s -2.2%, IHOP -2.7% in Q1; Fuzzy’s remained pressured with domestic SSS -12.2% and sales -16.9% .
  • Profitability compression: adjusted EBITDA down to $54.7M (from $60.8M YoY) and adjusted free cash flow halved to $14.6M (from $29.7M), reflecting lower segment profit and working capital timing (rent/tax settlement) .
  • Cost headwinds: IHOP commodity costs +8.4% YoY in Q1, with eggs the primary driver; full‑year IHOP commodity outlook raised to mid‑single digits; tariff uncertainty noted (limited international exposure: ~13% at IHOP, ~10% at Applebee’s) .

Financial Results

Summary metrics vs prior periods

MetricQ1 2024Q4 2024Q1 2025
Revenue ($USD Millions)$206.2 $204.8 $214.8
GAAP Diluted EPS ($)$1.13 $0.34 $0.53
Adjusted Diluted EPS ($)$1.33 $0.87 $1.03
Adjusted EBITDA ($USD Millions)$60.8 $50.1 $54.7

Estimates vs actuals (Q1 2025)

MetricConsensus Q1 2025Actual Q1 2025
Revenue ($USD Millions)$215.1*$214.8
Adjusted Diluted EPS ($)$1.24*$1.03

Values marked with * were retrieved from S&P Global.

Revenue mix detail

MetricQ1 2024Q4 2024Q1 2025
Franchise revenues ($USD Millions)$175.9 $167.2 $166.2
Company restaurant sales ($USD Millions)$0.3 $8.4 $21.6
Rental revenues ($USD Millions)$29.5 $28.7 $26.7
Financing revenues ($USD Millions)$0.5 $0.4 $0.3
Total revenues ($USD Millions)$206.2 $204.8 $214.8

Cash flow

MetricQ1 2024Q1 2025
Cash from Operations ($USD Millions)$30.6 $16.1
Adjusted Free Cash Flow ($USD Millions)$29.7 $14.6

KPIs and comps

KPIQ4 2024Q1 2025
Applebee’s domestic SSS change (%)-4.7% -2.2%
Applebee’s off‑premise mix (%)21.6% 23.5%
Applebee’s avg weekly off‑premise sales ($)~$11,000 ~$12,800
IHOP domestic SSS change (%)-2.8% -2.7%
IHOP off‑premise mix (%)20.4% 21.2%
IHOP avg weekly off‑premise sales ($)~$7,800 ~$7,700
Fuzzy’s domestic SSS change (%)-10.3% (Q4 FY data) -12.2%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Applebee’s domestic compsFY 2025-2% to +1% -2% to +1% Maintained
IHOP domestic compsFY 2025-1% to +2% -1% to +2% Maintained
Adjusted EBITDA ($M)FY 2025$235–$245 $235–$245 Maintained
G&A ($M)FY 2025$200–$205 (incl. ~$35M SBC & D&A) $200–$205 (incl. ~$35M SBC & D&A) Maintained
Capital Expenditures ($M)FY 2025$20–$30 $20–$30 Maintained
Applebee’s domestic net unitsFY 202520–35 net fewer 20–35 net fewer Maintained
IHOP domestic net unitsFY 2025-10 to +10 -10 to +10 Maintained
Dividend per shareQ2 2025—$0.51 declared (payable Jul 9; record Jun 20) Announced

Earnings Call Themes & Trends

TopicQ3 2024 (11/6)Q4 2024 (3/5)Q1 2025 (5/7)Trend
Value platform & pricingPromotional intensity; comps pressure; plan to enhance value proposition Launch of Applebee’s Really Big Meal Deal; IHOP House Faves; everyday value platform planned for H2’25 Applebee’s Big Easy drove traffic/check; Applebee’s value mix rose to 34%; IHOP House Faves traction Improving execution; emphasis on core value
Off‑premise growthMix steady YoY; Applebee’s off‑premise ~21.7% Applebee’s off‑premise supported lunch/daypart; digital overperformance Off‑premise comps +3.7%; mix 23.5% Applebee’s; 21.2% IHOP Strengthening off‑premise
Dual‑brand conceptInternational duals expanding; future domestic launch First U.S. dual brand opened; ~3x initial sales vs IHOP; strong franchisee demand 14 domestic duals targeted; more openings in 2026; franchise acquisitions to convert/reimage Building pipeline and momentum
Supply chain & commoditiesStabilizing costs 2025 pricing flat to slightly down at Applebee’s; IHOP low‑to‑mid single digit (eggs) IHOP commodity +8.4% in Q1; full‑year IHOP mid‑single digit; tariff exposure ~10–13% Egg inflation persists; tariffs monitored
Loyalty & marketingNFL partnership; building loyalty Club Applebee’s and IHOP loyalty expansion; 10M IHOP members Club Applebee’s +175k signups; more insider access; culture‑centric marketing at IHOP Elevated engagement
Remodel programPlanning for prototype, reimage Applebee’s “Looking Good” remodel; 30 company units; incentives oversubscribed ~100 franchise/corporate remodels expected; $200–$300k per unit typical Accelerating refresh

Management Commentary

  • “We’re seeing steady improvement across sales, traffic, and our development pipeline… advancing our long‑term strategy by executing near‑term priorities—enhancing the guest experience, strengthening menu and value platforms, and driving clearer value messaging through marketing.” — CEO John Peyton .
  • “Our asset‑light business model remains steady with solid cash flow, enabling us to invest in our brands and system to drive performance and continue returning capital to our shareholders.” — CFO Vance Chang .
  • “Across Applebee’s and IHOP, the value mix increased versus Q4… Applebee’s from 28% to 34%… IHOP from 16% to 19%… sales and traffic improved in March and continued into April.” — CEO John Peyton .
  • “IHOP comp traffic beat Black Box… up 4.3% for the quarter and improved each month; absolute traffic up in March and continued into April.” — CEO John Peyton .
  • “Only a small portion of our market basket is sourced internationally… ~13% at IHOP and ~10% at Applebee’s… we’re actively working with our supply chain co‑op to mitigate tariff impact.” — CEO John Peyton .
  • “We are maintaining our full‑year financial guidance at this time.” — CFO Vance Chang .

Q&A Highlights

  • Value positioning and cadence: Applebee’s comfortable operating with a 34% value mix centered on profitable 2 for $25; plans to evolve everyday value platform to address singles, pairs, and groups; IHOP testing House Faves as an everyday program across channels (digital, loyalty) .
  • Traffic trajectory: Sequential improvement from March into April despite tough prior‑year comps; off‑premise momentum and targeted promotions driving stability .
  • Remodel incentives and P&L treatment: Early adopter incentives provided; if no franchise term extension, G&A hit; if extension, amortized over new term; typical remodel investment ~$200–$300k with ROI uplift observed .
  • Average check/pricing: Pricing normalization to low single digits; Applebee’s check slightly up on menu launch/Big Easy; IHOP check down modestly on value mix shift, offset by traffic gains .
  • Operations simplification at IHOP: FOH tablet/POS/KDS improvements reducing table turns by ~2 minutes; training modernization via short‑form videos; franchisee task force engagement .

Estimates Context

  • Q1 2025: Adjusted EPS $1.03 vs consensus $1.24 (miss); revenue $214.8M vs consensus $215.1M (slight miss). Street had 8 EPS and 7 revenue estimates for the quarter . Consensus values marked with * were retrieved from S&P Global.
  • FY 2025: Street EBITDA consensus ~$214.5M* sits below company guidance of $235–$245M, implying potential upward estimate revisions if momentum sustains; FY25 EPS consensus ~$4.02* and target price consensus ~$27* (5 estimates) frame investor expectations .

Values marked with * were retrieved from S&P Global.

Key Takeaways for Investors

  • Execution is improving: sequential traffic and sales momentum into April, driven by value/menu innovation and off‑premise campaigns; watch for continued trend confirmation in Q2 .
  • Near‑term margin headwinds persist (egg inflation at IHOP, comps negative), but supply chain initiatives and stable labor backdrop mitigate; monitor commodity commentary for inflection .
  • Guidance credibility reinforced: management maintained FY25 ranges despite Q1 miss; Street EBITDA sits below guidance, creating potential for estimate convergence if momentum holds .
  • Loyalty and marketing are key levers: Club Applebee’s insider access strategy and IHOP culture‑centric marketing are aimed at frequency and mix improvement; track membership growth and campaign efficacy .
  • Dual‑brand deployment is a structural growth vector: domestic pipeline and early performance are compelling; successful conversions could reshape unit economics and comps trajectory .
  • Asset‑light flexibility enables targeted takebacks/refranchising and remodel acceleration; recent franchise acquisitions and incentives should support system health and brand refresh .
  • Trading implication: near‑term setup hinges on Q2 comp/traffic sustaining March/April momentum and visibility on commodity normalization; any signs of everyday value platform uplift or dual‑brand openings hitting plan could be positive catalysts .