The ONE Group’s first quarter results were well received by the market, reflecting strong execution on the integration of Benihana and targeted operational efficiencies across its portfolio. Management attributed revenue growth to the full-quarter contribution from recently acquired brands and new unit openings, while noting a sequential improvement in comparable sales trends. CEO Emanuel Hilario emphasized, “We increased revenues by almost 150% to $211 million, fueled by a full quarter of Benihana and RA Sushi contributions and the strength of our new units.” Despite ongoing macroeconomic challenges, the company saw positive transaction growth at its flagship STK brand and maintained industry-leading restaurant-level margins at Benihana.
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The ONE Group (STKS) Q1 CY2025 Highlights:
- Revenue: $211.1 million vs analyst estimates of $203.4 million (148% year-on-year growth, 3.8% beat)
- Adjusted EPS: $0.14 vs analyst estimates of -$0.14 (significant beat)
- Adjusted EBITDA: $25.2 million vs analyst estimates of $24.51 million (11.9% margin, 2.8% beat)
- The company reconfirmed its revenue guidance for the full year of $852.5 million at the midpoint
- EBITDA guidance for the full year is $105 million at the midpoint, above analyst estimates of $102.7 million
- Operating Margin: 6.9%, up from 1.1% in the same quarter last year
- Same-Store Sales fell 3.2% year on year (-7.9% in the same quarter last year)
- Market Capitalization: $136.9 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions The ONE Group’s Q1 Earnings Call
- Mark Smith (Lake Street Capital Markets) asked about consumer behavior shifts, specifically if higher-end customers were more resilient. CEO Emanuel Hilario attributed performance more to brand strategy and value initiatives than to pure demographics.
- Anthony Lebiedzinski (Sidoti) inquired about the cadence of same-store sales and the impact of the calendar shift on holiday performance. Hilario highlighted February as the most challenging month, with March benefiting from Easter and strong holiday execution.
- Joe Gomes (Noble Capital) questioned the progress of franchising efforts and the company’s pricing approach. Hilario detailed steps taken to build franchise infrastructure and confirmed a conservative pricing stance, emphasizing market share and traffic growth.
- Jim Sanderson (Northcoast Research) probed the mix of traffic versus average check and the balance between company-owned and franchised Benihana locations. CFO Tyler Loy noted average check was up about 4%, while Hilario projected a long-term 50/50 split for Benihana expansion.
- Roger Lipton (Lipton Financial) asked about Benihana’s margin outlook and capital requirements. Hilario estimated build costs at $400–$500 per square foot, with strong cash-on-cash returns, and expects STK margins to improve seasonally in later quarters.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will watch for (1) the pace and success of new restaurant openings and franchise agreements, (2) margin trends as integration synergies are realized and operational efficiencies scale, and (3) the uptake and impact of the Friends with Benefits loyalty program on customer frequency and spend. We will also monitor how the company navigates competitive pressures in the casual dining segment.
The ONE Group currently trades at $4.41, up from $3.11 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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