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Shares of the steakhouse chain are trading lower following its Q4 report last night, as the company posted a sizable EPS miss with revenue coming in in-line with expectations. Commodity inflation — particularly beef inflation — remains the primary headwind.

• Q4 EPS missed expectations by a wide margin, while revenue was in-line with estimates. Commodity inflation, especially beef, continues to pressure margins and is expected to remain a key issue into 2026.
• The company announced a 1.9% menu price increase set to begin in Q2.
• Q4 comparable sales increased +4.2% at company restaurants, down from +6.1% in Q3. Q4 comps were driven by +1.9% traffic growth and a +2.3% increase in average check. Monthly comp trends decelerated through the quarter: +6.1% in October, +4.8% in November, and +2.2% in December, which may concern investors. December results were impacted by holiday shifts and weather.
• Probably the best news is that Q1 is off to a strong start with comps up +8.2% through the first seven weeks.
• TXRH reaffirmed FY26 commodity inflation guidance of approximately 7%, with inflation expected to run above that level in 1H26 and below it in 2H26.
• Beef inflation accounts for nearly all of the expected commodity inflation for the year. Looking ahead to 2027, the company noted it is too early to predict industry conditions but suggested herd expansion is unlikely before late 2027.

Briefing.com Analyst Insight:

Texas Roadhouse's headline EPS miss is understandably weighing on the stock, as margin pressure from beef inflation continues to overshadow otherwise solid traffic trends. The deceleration in monthly comps during Q4 is not ideal optics, even if December was distorted by calendar shifts and weather. Encouragingly, Q1's +8.2% comp growth suggests demand remains healthy, which supports the brand's strong consumer positioning. Still, with commodity inflation projected at 7% in FY26 — heavily concentrated in beef — margin recovery may be gradual. The reaffirmed inflation guidance is a modest positive, but until there is clearer evidence of easing cattle supply constraints, investors may remain cautious on multiple expansion.