Texas Roadhouse Misses Q3 2026 Estimates as Traffic Fades
As seen on the 24/7 Wall St. homepage on November 5, 2026.
Comparable sales in the first five weeks of Q4 grew just 1.5%, down from 4.3% in the quarter just reported. Traffic softened late in the quarter and management is leaning on a 1.0% menu price increase to hold the line as beef costs bite.
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Texas Roadhouse reported Q3 2026 earnings per share of $1.36, missing expectations of $1.46 on revenue of $1.57 billion against a $1.58 billion consensus. The reported EPS figure includes impairment and closure charges of $3.6 million, against $140,000 in the same quarter a year ago.
The quarter started on solid footing but deteriorated as it progressed. Comparable restaurant sales rose 4.3% for the full quarter, but traffic softened noticeably toward the end, and that weakness has carried directly into the current period. Comparable sales for the first five weeks of Q4 came in at just 1.5%, a steep step down from the 4.3% posted in Q3.
To help offset pressure on margins, management implemented a roughly 1.0% menu price increase at the start of Q4. Beef costs remain a headwind, with the company guiding for commodity inflation of about 5.0% for 2026. Wage and labor inflation is expected in the 3.5% to 4.0% range for the full year, adding further pressure to the bottom line.
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The miss is part of a pattern that began in Q1 2025, when the company posted $1.70 against a $1.76 consensus. Q4 2024 and Q1 2026 were the only quarters in the past two years where Texas Roadhouse beat expectations, making back-to-back misses in Q2 and Q3 2026 a concern for investors monitoring trend direction.
On the development side, the company has over 30 restaurants currently under construction across its Texas Roadhouse, Bubba's 33, and Jaggers brands, and it reiterated store week growth guidance of 5.0% to 5.5% for 2026. Initial 2027 guidance calls for positive comparable sales growth alongside commodity inflation of about 4.0% and wage and labor inflation of about 3.0%, a modestly friendlier cost picture than 2026 but still a meaningful headwind.
Mentioned: TXRH