By Nicholas G. Miller

Shares of Texas Roadhouse jumped Friday, a day after the company reported easing beef inflation pressures.

The stock rose 15% to $182.26 in midday trading Friday. It is up 10% so far this year.

"The supply issues with beef are well known and those have not changed, but we have seen some demand shift within the retail segments," said Michael Bailen, vice president of investor relations, in a call with analysts. "While beef is still very popular, there have been some shifts as to what cuts are being purchased and that has been reflected in our updated commodity guidance."

In the first-quarter, Texas Roadhouse's restaurant margin was 16.3%, better than the 15.9% expected by Wall Street. That margin beat was driven by lower-than-expected food costs, with the company cutting its full-year commodity cost growth outlook to 6% to 7% from its previous forecast of about 7%.

Beef prices have surged in recent quarters, driven by short supply of cattle herds, but weakening demand could be easing those inflationary pressures. "As far as demand for beef at retail, I do think there has been some demand destruction--people trading to pork and chicken, but maybe even also within the beef category, there's been some shift to lower-cost cuts," Bailen said.

Bailen added that the company expects its highest commodity inflation of the year in the second quarter but that it will ease in the second half of the year.

First-quarter earnings came in at $1.87 a share, up from $1.70 the year before. Analysts polled by FactSet had expected $1.80 a share.

Write to Nicholas G. Miller at nicholas.miller@wsj.com

(END) Dow Jones Newswires

May 08, 2026 12:38 ET (16:38 GMT)

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