Bloomin’ Brands CEO Mike Spanos isn’t mincing words about where Outback Steakhouse stands today amid its long-term turnaround play. “We are not where we want to be,” he told investors on the company’s first quarter earnings call, adding, “We are dissatisfied with our financial and market share results and know we need to do better. Although this will take time to reverse these trends given the state of the business, we will see steady improvement.”
The steakhouse chain saw a 4.1 percent drop in traffic this quarter, while same-store sales declined 1.3 percent. This continues a trend of underperforming compared to casual-dining peers, according to Black Box—but Spanos reiterated his confidence in the brand’s potential. “Outback is an amazing brand, and the steak category is doing well. However, we are not doing well,” he said.
The good news, Spanos said, is “we know what is important to our guests: food quality, value, and a consistent guest experience. We are starting to get good feedback from our test restaurants. We will continue to iterate and refine our efforts as part of our holistic strategic plan.”
Despite Outback’s struggles this quarter, things are looking up at some of Bloomin’ Brands’ other chains: Carrabba’s Italian Grill experienced a 1.4 percent boost in same-store sales, and Fleming’s Prime Steakhouse & Wine Bar saw a 5.1 percent increase. Bonefish Grill took the biggest hit out of all brands, down 4 percent in comparable restaurant sales and 9.4 percent in traffic.
Systemwide, however, Bloomin’ posted $1.05 billion in total revenues, which is down 1.8 percent from this time last year, attributed to the impact of restaurant closures and openings, as well as a systemwide same-store sales decrease of 0.5 percent. Combined U.S. traffic was down 3.9 percent. One notable silver lining: average check saw a boost across the board, up 3.4 percent.
Spanos, former EVP and COO at Delta Air Lines, joined Bloomin’ in September 2024, taking over for former Bloomin’ CEO David Deno, who announced his retirement last May. Spanos reportedly receives a base salary of $1 million, up to $1.75 million as an annual bonus, a $6 million annual equity award, plus $2.5 million in one-time stock awards, a $500,000 signing bonus, and $500,000 for relocation expenses.
Trimming the Menu, Refining the Experience
Part of the turnaround plan Bloomin’ detailed last quarter involved reducing menu items in all its brands by 10 to 20 percent by removing low-mix items based on guest feedback and prep labor complexity.
The brand is already making good on its promise, as Outback’s April menu had 10 percent fewer menu items, while Bonefish Grill’s April menu had 20 percent fewer items and Carrabba’s May menu had 10 percent fewer. Fleming’s summer menu will reduce items by approximately 10 percent, as well, and is integrating seasonal items into the core menu.
Meanwhile, seasonal LTOs have been eliminated at Outback due to increased complexities and additional training required every eight to 10 weeks. Instead, Outback integrated value into the everyday menu—anchored by its limited-time Aussie 3-Course Meal offering. Starting at $14.99, it includes a soup or salad, choice of a select entrée, and a slice of New York-style cheesecake—all of which leverages core menu items.
“The mix continues to be in line with our expectations and is proving to be a popular abundant everyday value platform,” Spanos said. “We expect to see stronger traffic lift attributed to the Aussie 3-Course in the back half of the year.”
The focus: eliminating complexity, boosting consistency, and enhancing quality across dine-in and off-premises channels. “We are streamlining menus, both on and off-premises, removing items with low sales mix, low satisfaction scores, or items that do not travel well,” Spanos said. Bloomin’ is also retraining its standards to recipes, reevaluating cooking procedures, and working with supplier partners to enhance product specifications.
That menu refinement is backed by real-time feedback through Ziosk tablets, now live at all Outback restaurants. According to Spanos, over 85 percent of guests are already using the pay-at-table tech, which has helped shave five minutes off average table turns and delivers “immediate feedback as we test and learn.”
However, Spanos also admitted the brand’s pricing gap versus competitors. “We know right now, we’re priced higher than our competition. That is one area in terms of the value proposition we need to fix strategically,” he said. “We also need to be surgical where we put that value, so it’s profitable traffic, profitable comp sales, and also it’s easy to execute for our Outbackers. And that’s how we’re looking at it.”
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Remodels and Looking Ahead
Outback is also undergoing a repair and maintenance survey across its system, which is on track to be done by the end of Q2. “This will help inform our go-forward strategy on refreshes and remodels,” Spanos said. The company plans to dedicate $40 million toward remodels next year and beyond, focused on lower spend, higher return upgrades.
At the end of February, Spanos announced plans to slow Outback’s new unit pipeline starting in 2026 in order to focus on improving existing locations, and “earn the right to open new restaurants again,” the CEO said. While Bloomin’ still expects to open 18 to 20 company-owned restaurants this year which were already committed, the rate will decrease significantly next year.
“We are working diligently and urgently on our strategic plan. We know we need to make changes for the long-term health of the business. I cannot speak to these specific changes or investments at this time as we are in the middle of the work,” Spanos said.
Bloomin’ recently underwent a major organizational shift, laying off 100 employees in February—which represented about 17 percent of the Restaurant Support Center in Tampa, Florida—and decentralizing brand functions like culinary and marketing. The move was designed to be more cost efficient and speed up decision making, Spanos said. The company recently partnered with a third-party firm to assist with long-term strategy development, including “specific cost-saving initiatives” that will help “self-fund future investments,” Spanos noted.
Simplifying the agenda dates back to last year with the re-franchising of the Brazil operations for $243 million. Bloomin’ maintained 33 percent ownership and can sell the remaining part in 2028. Spanos said this move not only allows the management team to focus on the U.S., but it also de-risks the business model; going forward, over 30 percent of restaurants are franchisee-owned, with a steady royalty stream and less earnings volatility. Bloomin’ received $104 million from the first installment of the Brazil re-franchising transaction in Q1.
The company is also testing new service models informed by both data and Outback guest input, including evaluating staffing levels, server-to-table ratios, and management engagement during peak hours.
Spanos, who has a passion for spending time with front-line workers in stores during “listening tours,” noted employees are “consistently telling me they want a simpler, easier way to execute to the guests. They want less complexity, and they want to win. That’s fundamentally what they’re all saying. And they’re pointing to areas in food quality. They’re pointing to areas of value we should be focused on. And they’re really giving me great advice on consistency of execution, both back-of-the-house and front-of-the-house, what that looks like. And that’s embedded in the strategic work we’re doing.”
He also acknowledged the turnaround won’t happen overnight. In the meantime, he promised to transparently communicate their plan and financial impact later in the year. “This will take time to fix, but we are committed to getting it right,” he added. “Our people are resilient, competitive, and want to win.”
