Did RAVE Restaurant Group beat earnings in Q2 FY2026?

RAVE posted net income of $637K (+4.9% YoY) and revenue of $3.0M (+6.0% YoY), marking 23 consecutive quarters of profitability. EPS remained flat at $0.04.

What did RAVE say about Pizza Inn same-store sales?

Pizza Inn domestic comparable store retail sales increased 2.5% in Q2 FY2026, following strong 8.1% growth in Q1, driven by value promotions and menu execution.

How is RAVE's balance sheet?

RAVE has $10.9M in cash and short-term investments with no debt, positioning the company well for continued unit growth and franchise development.

RAVE RESTAURANT GROUP (RAVE)·Q2 2026 Earnings Summary

RAVE Restaurant Group Posts 23rd Straight Profitable Quarter as Pizza Inn Comps Rise 2.5%

February 5, 2026 · by Fintool AI Agent

Banner

RAVE Restaurant Group (NASDAQ: RAVE) delivered another solid quarter, reporting its 23rd consecutive quarter of profitability with revenue up 6% to $3.0 million and net income rising 4.9% to $637,000. The Pizza Inn franchisor opened three new buffet locations during the quarter—the most in over 20 years within a three-week period—signaling improved development execution.

Did RAVE Beat Earnings?

RAVE delivered across all key financial metrics, extending its profitability streak in a challenging restaurant environment:

Metric	Q2 FY2026	Q2 FY2025	YoY Change
Revenue	$3.04M	$2.87M	+6.0%
Net Income	$637K	$607K	+4.9%
Income Before Taxes	$842K	$751K	+12.1%
Adjusted EBITDA	$852K	$807K	+5.3%
Diluted EPS	$0.04	$0.04	Flat

The company's pre-tax income grew at more than double the rate of net income (+12.1% vs +4.9%), reflecting higher operating leverage before tax impacts.

Ask Fintool AI Agent

How Did Pizza Inn and Pie Five Perform?

The two brands continued their divergent paths:

Pizza Inn (Core Brand)

Domestic comparable store retail sales: +2.5%
Following +8.1% comps in Q1 FY2026
Unit count: 97 domestic (82 buffet locations) + 19 international
Three new buffet openings during the quarter

Pie Five (Fast-Casual)

Domestic comparable store retail sales: -1.5%
Improved from prior trend but still negative
Unit count: 16 domestic locations

CEO Brandon Solano noted that Pizza Inn continues to grow both unit count and same-store sales while the broader restaurant industry faces "sluggish growth and pressure on sales and traffic."

What's Driving Pizza Inn's Momentum?

Management highlighted several factors behind Pizza Inn's outperformance:

Value Promotions: The "All You Can $8" promotion (formerly "I $8 at Pizza Inn") ran at over half of buffet locations in January, with some restaurants extending through Q3.
Development Execution: Three buffet openings in a three-week span—something Pizza Inn hadn't accomplished in over 20 years—demonstrates improved operational capabilities.
Mission 2030 Strategy: The company continues executing on its long-term profitable growth plan.

CFO Jay Rooney noted the quality of earnings driven by Pizza Inn sales growth, while acknowledging Pie Five's declining impact on overall results. Management is addressing Pie Five through "new advertising, product innovation, operational efficiency, and pricing initiatives."

How Strong is RAVE's Balance Sheet?

RAVE maintains a fortress balance sheet unusual for micro-cap restaurants:

Balance Sheet Metric	Dec 28, 2025	Jun 29, 2025
Cash & Equivalents	$624K	$2.86M
Short-Term Investments	$10.28M	$7.02M
Total Liquidity	$10.9M	$9.88M
Total Debt	$0	$0
Total Equity	$15.5M	$14.2M

The shift from cash to short-term investments reflects active treasury management to generate interest income. Interest income contributed $91K in Q2 FY2026.

How Did the Stock React?

RAVE shares closed at $3.27 on February 5, 2026, with after-hours trading showing the stock at $3.21. The stock trades near its 52-week high of $3.75, significantly above its 52-week low of $2.01.

Stock Metric	Value
Current Price	$3.27
After-Hours	$3.21 (-1.8%)
52-Week High	$3.75
52-Week Low	$2.01
Market Cap	~$46M
50-Day Avg	$3.10
200-Day Avg	$2.91

The stock has appreciated approximately 55% from its 52-week low, reflecting improved fundamentals and the profitability streak.

Ask Fintool AI Agent

What Changed From Last Quarter?

Metric	Q1 FY2026	Q2 FY2026	Change
Revenue	$3.21M	$3.04M	-5.3% (seasonal)
Net Income	$645K	$637K	-1.2%
Pizza Inn Comps	+8.1%	+2.5%	Normalizing
New Buffet Opens	0	3	Development ramp

The sequential revenue decline reflects normal seasonality. The Pizza Inn comps moderation from +8.1% to +2.5% was expected after an exceptionally strong Q1. The key development is the three new unit openings, signaling franchise pipeline conversion.

What Are the Forward Catalysts?

Unit Growth Acceleration: Management expressed confidence in opening restaurants "at scale" going forward after the Q2 development success.
Q3 Value Promotions: The "All You Can $8" promotion continues into Q3 at select locations.
Pie Five Turnaround: New advertising, product innovation, and pricing initiatives are in progress.
Mission 2030: Long-term strategic plan focused on profitable growth.

Key Risks

Pie Five Drag: The fast-casual concept continues to underperform with negative comps
Micro-Cap Liquidity: Low trading volume (~10K shares/day) limits institutional participation
Franchisee Concentration: Development depends on franchisee capital and execution
Consumer Environment: Restaurant industry facing broad traffic and spending pressure

The Bottom Line

RAVE Restaurant Group delivered exactly what shareholders want: another profitable quarter, positive Pizza Inn comps, unit growth, and a strengthening balance sheet. The 23 consecutive quarters of profitability is a testament to disciplined management of the franchise model. While Pie Five remains a headwind, its diminishing contribution limits downside. The three Q2 buffet openings suggest development is finally accelerating, which could drive meaningful growth if sustained through Mission 2030.

Ask Fintool AI Agent

Data sourced from RAVE Restaurant Group 8-K filed February 5, 2026. Market data as of February 5, 2026.