Texas Roadhouse has reported a notable shift in consumer behavior: Texans are ordering less alcohol. Despite this trend, the chain has experienced strong sales growth, driven by an increase in overall traffic and check sizes.
During a recent earnings call, Texas Roadhouse executives noted that while alcohol sales have flattened, other menu categories such as entrees, appetizers, and add-ons have remained stable or even increased. This shift has not deterred the chain’s overall performance, which saw a 12.5% year-over-year revenue increase, reaching $1.32 billion in the first quarter of 2024.
CEO Jerry Morgan emphasized the company’s focus on providing value, which has resonated well with customers. Even with recent price hikes, the commitment to quality food and service continues to attract diners. Morgan mentioned that their strategy of integrating value into the menu helps maintain customer satisfaction, even as consumers become more cautious with their spending.
Additionally, Texas Roadhouse’s investment in technology and operational efficiencies has contributed to its resilience. Approximately 30% of their locations have completed digital kitchen conversions, enhancing back-of-house operations and overall service quality. The introduction of the “Roadie First” system aims to streamline employee management and improve staff experiences, further supporting the company’s growth.