v3.25.2
Segment Information
 6 Months Ended
Jun. 25, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
We manage our business by brand and as a result have identified two operating segments, Denny’s and Keke’s. In addition, we have identified Denny’s as a reportable segment. The Denny’s reportable segment includes the results of all company and franchised and licensed Denny’s restaurants. Our Keke’s operating segment, which includes the results of all company and franchised Keke's restaurants, is included in Other.

The primary sources of revenues for all operating segments are the sale of food and beverages at our company restaurants and the collection of royalties, advertising revenue, initial and other fees, including occupancy revenue, from restaurants operated by our franchisees. We do not rely on any major customer as a source of sales and the customers and assets of all operating segments are located predominantly in the United States. There are no material transactions between segments.

Management’s measure of segment income is restaurant-level operating margin. The Company defines restaurant-level operating margin as operating income excluding the following four items: general and administrative expenses, depreciation and amortization, goodwill impairment charges and operating (gains), losses and other charges, net. The Company excludes general and administrative expenses, which include primarily non restaurant-level costs associated with the support of company and franchised restaurants and other activities at their corporate office. The Company excludes depreciation and amortization expense, substantially all of which is related to company restaurant-level assets, because such expenses represent historical sunk costs which do not reflect current cash outlays for the restaurants. The Company excludes goodwill impairment charges and operating (gains), losses and other charges, net, to provide a clearer perspective of its ongoing operating performance and more relevant comparison to prior period results. The Company's chief operating decision maker (“CODM”) is our Chief Executive Officer. Restaurant-level operating margin is used by our CODM to evaluate restaurant-level operating efficiency and performance and make key operating decisions.
The following tables present revenues by segment and a reconciliation of restaurant-level operating margin to net income:
Quarter Ended June 25, 2025Two Quarters Ended June 25, 2025
Denny'sOtherTotalDenny'sOtherTotal
Revenues(In thousands)(In thousands)
Company restaurant sales$48,474 $9,921 $58,395 $94,180 $18,115 $112,295 
Franchise and license revenue:
Royalties27,912 1,179 29,091 54,504 2,424 56,928 
Advertising revenue19,047 443 19,490 37,667 896 38,563 
Initial and other fees2,742 62 2,804 5,471 207 5,678 
Occupancy revenue7,844 33 7,877 15,764 66 15,830 
Total franchise and license revenue57,545 1,717 59,262 113,406 3,593 116,999 
Total operating revenue106,019 11,638 117,657 207,586 21,708 229,294 
Cost and expenses
Costs of company restaurant sales, excluding depreciation and amortization:
Product costs12,301 2,785 15,086 24,020 5,277 29,297 
Payroll and benefits17,971 3,898 21,869 35,664 7,301 42,965 
Occupancy costs3,909 1,272 5,181 7,906 2,334 10,240 
Other operating expenses:
Utilities1,516 313 1,829 2,975 548 3,523 
Repairs and maintenance742 105 847 1,506 177 1,683 
Marketing2,085 301 2,386 3,898 516 4,414 
Legal settlements382 9 391 807 (11)796 
Pre-opening costs— 645 645 — 1,354 1,354 
Other direct costs3,258 853 4,111 6,568 1,530 8,098 
Total costs of company restaurant sales, excluding depreciation and amortization42,164 10,181 52,345 83,344 19,026 102,370 
Costs of franchise and license revenue, excluding depreciation and amortization:
Advertising costs19,047 443 19,490 37,667 896 38,563 
Occupancy costs4,839 33 4,872 9,739 66 9,805 
Other direct costs4,580 275 4,855 8,520 683 9,203 
Total costs of franchise and license revenue, excluding depreciation and amortization28,466 751 29,217 55,926 1,645 57,571 
Total restaurant-level operating margin35,389 706 36,095 68,316 1,037 69,353 
Reconciliation of restaurant-level operating margin to net income
General and administrative expenses21,445 41,475 
Depreciation and amortization4,378 8,485 
Operating (gains), losses and other charges, net1,700 5,611 
Total other operating expenses27,523 55,571 
Operating income8,572 13,782 
Interest expense, net5,374 9,802 
Other nonoperating income, net(563)(401)
Income before income taxes3,761 4,381 
Provision for income taxes1,291 1,585 
Net income$2,470 $2,796 
Quarter Ended June 26, 2024Two Quarters Ended June 26, 2024
Denny'sOtherTotalDenny'sOtherTotal
Revenues(In thousands)(In thousands)
Company restaurant sales$49,557 $4,791 $54,348 $97,724 $8,966 $106,690 
Franchise and license revenue:
Royalties28,781 1,233 30,014 56,830 2,490 59,320 
Advertising revenue20,339 449 20,788 38,019 907 38,926 
Initial and other fees2,369 79 2,448 4,112 152 4,264 
Occupancy revenue8,306 23 8,329 16,678 23 16,701 
Total franchise and license revenue59,795 1,784 61,579 115,639 3,572 119,211 
Total operating revenue109,352 6,575 115,927 213,363 12,538 225,901 
Cost and expenses
Costs of company restaurant sales, excluding depreciation and amortization:
Product costs12,340 1,292 13,632 24,544 2,399 26,943 
Payroll and benefits18,374 2,119 20,493 37,031 3,936 40,967 
Occupancy costs4,031 640 4,671 8,044 1,200 9,244 
Other operating expenses:
Utilities1,550 145 1,695 3,097 253 3,350 
Repairs and maintenance947 61 1,008 1,924 89 2,013 
Marketing1,758 118 1,876 3,239 241 3,480 
Legal settlements197 11 208 1,646 11 1,657 
Pre-opening costs— 191 191 — 557 557 
Other direct costs3,418 386 3,804 6,648 837 7,485 
Total costs of company restaurant sales, excluding depreciation and amortization42,615 4,963 47,578 86,173 9,523 95,696 
Costs of franchise and license revenue, excluding depreciation and amortization:
Advertising costs20,339 449 20,788 38,019 907 38,926 
Occupancy costs5,072 22 5,094 10,204 22 10,226 
Other direct costs7,251 295 7,546 11,232 418 11,650 
Total costs of franchise and license revenue, excluding depreciation and amortization32,662 766 33,428 59,455 1,347 60,802 
Total restaurant-level operating margin34,075 846 34,921 67,735 1,668 69,403 
Reconciliation of restaurant-level operating margin to net income
General and administrative expenses20,486 41,708 
Depreciation and amortization3,735 7,316 
Goodwill impairment charges20 20 
Operating (gains), losses and other charges, net1,565 1,238 
Total other operating expenses25,806 50,282 
Operating income9,115 19,121 
Interest expense, net4,573 8,993 
Other nonoperating income, net(224)(861)
Income before income taxes4,766 10,989 
Provision for income taxes1,198 2,730 
Net income$3,568 $8,259 
June 25, 2025December 25, 2024
Segment assets:(In thousands)
Denny’s$325,492 $344,986 
Other165,658 151,288 
Total assets$491,150 $496,274