Executive Summary

Q3 FY2025 delivered strong year-over-year growth: revenue rose to $31.519M (+9.1% YoY), diluted EPS to $1.10 (+71.9% YoY), and adjusted EBITDA to $7.479M (+30.1% YoY), driven primarily by licensing strength and disciplined cost control .
Sequentially, revenue declined to $31.519M from $41.109M in Q2 (seasonality), while diluted EPS fell to $1.10 from $1.47; licensing and restaurant operations offset branded product margin pressure from higher beef costs .
The Board declared a $0.50 quarterly cash dividend payable Feb 28, 2025; payout continuity underscores confidence amid input cost inflation .
Shares rose 3.2% since the earnings report, outpacing the S&P 500; investors favored licensing momentum and margin expansion despite beef cost headwinds .
No formal financial guidance was provided; consensus estimate comparison from S&P Global was unavailable due to data access limits.

What Went Well and What Went Wrong

Licensing continued to be the growth engine: product licensing revenue reached $7.105M in Q3 and $29.517M YTD (+13% Smithfield royalties to $26.751M), supporting profitability and cash flow .
Adjusted EBITDA increased to $7.479M (+30% YoY), reflecting operating leverage from licensing and improved corporate expense mix; EBITDA rose to $7.136M .
Restaurant operations loss narrowed materially in Q3 (–$86k vs –$308k YoY), aided by higher average checks at Coney Island locations .

Branded Product Program income from operations declined YoY in Q3 (to $2.209M from $2.421M) and YTD (to $5.406M from $5.769M), as beef and beef trimming costs increased 4% YTD and squeezed margins .
Franchise fees and royalties softened YTD ($3.238M vs $3.321M), reflecting lower franchise restaurant sales and modest franchise fee income decline .
Sequential revenue and EPS fell vs Q2 due to typical seasonality and higher input costs (Q2 revenue $41.109M, EPS $1.47 vs Q3 revenue $31.519M, EPS $1.10), highlighting off-peak quarter dynamics .

Metric	Q3 FY2024 (Dec 24, 2023)	Q1 FY2025 (Jun 30, 2024)	Q2 FY2025 (Sep 29, 2024)	Q3 FY2025 (Dec 29, 2024)
Revenue ($USD)	$28,890,000	$44,767,000	$41,109,000	$31,519,000
Income from Operations ($USD)	$5,137,000	$13,745,000	$9,632,000	$6,752,000
Adjusted EBITDA ($USD)	$5,751,000	$14,281,000	$10,350,000	$7,479,000
Net Income ($USD)	$2,607,000	$9,277,000	$6,030,000	$4,484,000
Diluted EPS ($USD)	$0.64	$2.27	$1.47	$1.10
Consensus Revenue (S&P Global)	N/A*	N/A*	N/A*	N/A*
Consensus EPS (S&P Global)	N/A*	N/A*	N/A*	N/A*

Values marked with an asterisk are unavailable at time of writing. Values retrieved from S&P Global.

Segment Revenues

Segment	Q3 FY2024	Q1 FY2025	Q2 FY2025	Q3 FY2025
Branded Product Program ($USD)	$19,688,000	$26,146,000	$24,536,000	$21,099,000
Product Licensing ($USD)	$6,078,000	$12,921,000	$9,491,000	$7,105,000
Restaurant Operations ($USD)	$2,616,000	$5,272,000	$6,522,000	$2,795,000
Advertising Fund Revenue ($USD)	$508,000	$428,000	$560,000	$520,000

Segment Income from Operations

Segment	Q3 FY2024	Q1 FY2025	Q2 FY2025	Q3 FY2025
Branded Product Program ($USD)	$2,421,000	$2,500,000	$697,000	$2,209,000
Product Licensing ($USD)	$6,033,000	$12,875,000	$9,446,000	$7,059,000
Restaurant Operations ($USD)	$(308,000)	$1,046,000	$1,781,000	$(86,000)
Corporate ($USD)	$(3,009,000)	$(2,676,000)	$(2,292,000)	$(2,430,000)

KPIs (Program/Operating Drivers)

KPI	Prior Period	Current Period
Smithfield Royalties (YTD, $USD)	$20,605,000 (26 weeks FY25)	$26,751,000 (39 weeks FY25)
Branded Product Volume Change (YTD, %)	+2.0% (26 weeks FY25)	+1.5% (39 weeks FY25)
Average Selling Price Change (YTD, %)	+2.5% (26 weeks FY25)	~+3.5% (39 weeks FY25)
Beef/Beef Trimmings Cost Change (YTD, %)	+3.0% (26 weeks FY25)	+4.0% (39 weeks FY25)
Franchise Openings (YTD, count)	21 (26 weeks FY25)	24 (39 weeks FY25)

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly Cash Dividend ($/share)	Q3 FY2025	$0.50 declared Nov 7, 2024, payable Dec 6, 2024	$0.50 declared Feb 6, 2025, payable Feb 28, 2025	Maintained
Revenue/Margins/OpEx/Tax Rate	Q3 FY2025	None provided	None provided	N/A

No formal financial guidance (revenue, margins, operating expenses, tax rate) was issued .

No earnings call transcript was available; themes reflect press release disclosures.

Topic	Previous Mentions (Q1 & Q2 FY2025)	Current Period (Q3 FY2025)	Trend
Beef Cost Inflation	Costs up ~3% YTD; BPP IFO down $151k YTD despite higher ASP/volume	Costs up ~4% YTD; BPP IFO down $363k YTD; continued margin pressure	Worsening input inflation
Product Licensing Momentum	Smithfield royalties +11% (Q1) and +13% YTD by Q2; licensing IFO strong	Smithfield royalties +13% YTD to $26.751M; licensing revenue $7.105M in Q3	Sustained strength
Restaurant Operations	Strong Q1 restaurant IFO ($1.046M) helped by average check and favorable weather	Q3 restaurant loss narrowed (–$86k vs –$308k YoY); average check growth at Coney Island	Operational improvement YoY
Franchise Development	3 openings in Q1; 21 openings by Q2	24 openings YTD by Q3	Continued expansion
Seasonality	Higher summer quarter revenue/EPS (Q1/Q2)	Revenue/EPS down sequentially in Q3	Normal seasonality

The company emphasized that licensing and branded product programs continue to drive results, with Smithfield royalties up 13% YTD to $26.751M and branded product ASP rising ~3.5%, partially offset by higher beef input costs .
Restaurant sales benefited from higher average checks at Coney Island locations, contributing to improved quarterly restaurant results versus the prior year .
Nathan’s maintained its quarterly dividend at $0.50/share, signaling ongoing commitment to shareholder returns amid inflationary pressures .
No direct management quotes were provided in the press release, and no earnings call transcript was available for Q3 FY2025 .

No Q3 FY2025 earnings call transcript was available; therefore, no analyst Q&A themes or management clarifications can be reported for the period .

S&P Global Wall Street consensus (EPS and revenue) for Q3 FY2025 was unavailable due to data access limitations at the time of request; as a result, beat/miss versus consensus cannot be assessed. Values retrieved from S&P Global.
Directionally, investors responded positively post-report, with shares rising 3.2% since the earnings release, reflecting the strength in licensing and margin expansion despite input cost inflation .

Licensing remains the core profit engine: strong Smithfield royalties (+13% YTD) and robust licensing IFO underpin margin resilience .
Input cost inflation in beef persists (3% to 4% YTD), pressuring branded product margins despite ASP increases; watch commodity trends and pricing actions .
Restaurant operations are improving year-over-year, aided by higher average checks, though sequential seasonality weighs on Q3 results .
Dividend stability ($0.50/share) supports a shareholder return narrative while the company navigates inflationary inputs .
Seasonal cadence is evident: expect stronger H1 (summer-oriented Q1/Q2) and weaker Q3; positioning around seasonal strength may be tactically advantageous .
Franchise growth continues (24 openings YTD), expanding brand reach and supporting long-term licensing and foodservice volumes .
With consensus unavailable, focus on internal momentum (licensing, restaurant improvements) and commodity risk management as primary drivers of near-term stock reaction .