Shares of Cracker Barrel Old Country Store (NASDAQ: CBRL) plummeted 9.50% in after-hours trading on Wednesday following the release of its fourth-quarter fiscal 2025 earnings report and disappointing fiscal 2026 guidance. The restaurant chain's results and outlook fell short of analyst expectations, raising concerns about its near-term performance and recent rebranding efforts.
Cracker Barrel reported quarterly adjusted earnings of $0.74 per share, missing the analyst consensus estimate of $0.80 and marking a significant 24.49% decrease from $0.98 per share in the same period last year. While the company's quarterly revenue of $868.009 million beat the analyst consensus estimate of $855.295 million by 1.49%, it still represented a 2.95% decrease from the previous year.
The company's outlook for fiscal 2026 appears particularly challenging, contributing significantly to the stock's decline. Cracker Barrel anticipates comparable store traffic to decline by 4% to 7%, along with projected revenue of $3.35 billion to $3.45 billion, falling short of analyst expectations of $3.52 billion. This guidance reflects ongoing difficulties stemming from a recent rebranding effort that backfired, including a controversial logo change and suspended restaurant renovation plans.
CEO Julie Masino addressed the rebranding issues during the earnings call, acknowledging the strong customer response to recent changes. "We conducted extensive research to inform our strategic plan," Masino stated, "But what cannot be captured in data is how much our guests see themselves and their own story in the Cracker Barrel experience, which is what's led to such a strong response to these changes." The company has since reverted to its original logo and paused remodeling efforts in an attempt to win back customers, with a new marketing campaign focusing on "nostalgia around the brand."
The negative impact of the rebranding attempt was evident in recent customer traffic data, with CFO Craig Pommells revealing that traffic has fallen around 8% since the initial logo change on August 19, with the decline more pronounced in the southeastern U.S., excluding Florida. These challenges, combined with broader economic pressures and increased competition in the restaurant industry, have created a perfect storm for Cracker Barrel, leading to the significant stock decline.