Revenues
The following tables include a detail of liabilities from contracts with customers:
| | | | | | | | | | | |
| (in thousands) | DECEMBER 28, 2025 | | DECEMBER 29, 2024 |
| Deferred revenues: | | | |
| Deferred gift card revenue | $ | 6,548 | | | $ | 5,385 | |
| Deferred franchise fee revenue - current | 230 | | | 238 | |
| Total current deferred revenues | $ | 6,778 | | | $ | 5,623 | |
| Other long-term liabilities: | | | |
| Deferred franchise fee revenue - non-current | $ | 1,226 | | | $ | 1,691 | |
Changes in deferred gift card contract liabilities were as follows:
| | | | | | | | | | | | | | | | | |
| | FISCAL YEAR |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Deferred gift card revenue: | | | | | |
| Balance, beginning of period | $ | 5,385 | | | $ | 5,224 | | | $ | 4,897 | |
| Gift card sales | 13,193 | | | 11,492 | | | 12,329 | |
| Gift card redemptions | (10,885) | | | (10,230) | | | (11,198) | |
| Gift card breakage | (1,280) | | | (1,266) | | | (1,081) | |
| Gift card liabilities assumed through acquisitions | 135 | | | 165 | | | 277 | |
| Balance, end of period | $ | 6,548 | | | $ | 5,385 | | | $ | 5,224 | |
Gift cards are combined in one pool and are not separately identifiable. As such, the revenue recognized consists of gift cards that were part of the deferred revenue balance at the beginning of the period as well as gift cards that were issued during the period.
Changes in deferred franchise fee contract liabilities were as follows:
| | | | | | | | | | | | | | | | | |
| | FISCAL YEAR |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Deferred franchise fee revenue: | | | | | |
| Balance, beginning of period | $ | 1,929 | | | $ | 2,061 | | | $ | 2,768 | |
| Cash received | 150 | | | 559 | | | 288 | |
| Franchise revenues recognized | (225) | | | (278) | | | (388) | |
| Business combinations - franchise revenues recognized | (398) | | | (413) | | | (607) | |
| Balance, end of period | $ | 1,456 | | | $ | 1,929 | | | $ | 2,061 | |
Revenues recognized disaggregated by type were as follows:
| | | | | | | | | | | | | | | | | |
| | FISCAL YEAR |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Restaurant sales: | | | | | |
| In-restaurant dining sales | $ | 982,349 | | | $ | 829,048 | | | $ | 716,960 | |
| Third-party delivery sales | 142,255 | | | 97,444 | | | 91,433 | |
| Take-out sales | 87,569 | | | 77,863 | | | 68,699 | |
| Total restaurant sales | $ | 1,212,173 | | | $ | 1,004,355 | | | $ | 877,092 | |
| | | | | |
| Franchise revenues: | | | | | |
| Royalty and system fund contributions | $ | 9,705 | | | $ | 10,864 | | | $ | 13,464 | |
| Initial fees | 225 | | | 278 | | | 388 | |
| Business combinations - revenues recognized | 398 | | | 413 | | | 607 | |
| Total franchise revenues | $ | 10,328 | | | $ | 11,555 | | | $ | 14,459 | |
| Total revenues | $ | 1,222,501 | | | $ | 1,015,910 | | | $ | 891,551 | |
Deferred revenues as of December 28, 2025 are expected to be recognized as follows:
| | | | | |
| FISCAL YEAR | (in thousands) |
| 2026 | $ | 6,778 | |
| 2027 | $ | 227 | |
| 2028 | $ | 201 | |
| 2029 | $ | 167 | |
| 2030 | $ | 144 | |
| Thereafter | $ | 487 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.