STK Steakhouse appears to be back on track.
After 10 straight quarters of negative U.S. same-store sales, the brand has strung together two consecutive quarters of positive growth, including a 0.3 percent rise in Q4 and a 1.4 percent increase in Q1. The latter is the best performance STK has seen since Q1 2023. The bottom line is improving as well; restaurant operating profit margins expanded 2.8 percent to 21 percent in the first quarter.
STK is one of The ONE Group Hospitality’s premier brands. So much so that one of the company’s biggest priorities is converting underperforming RA Sushi and Kona Grill locations into STKs and Benihanas. These remodels will cost between $1 million and $1.5 million, but they are expected to be EBITDA accretive. The first conversion happened in Scottsdale, Arizona, where an RA Sushi was transformed into an STK. There, the annual run rate improved to $7 million, up from $4 million. It also boasts an ROI of approximately 4x.
“That $4 million increase in revenues will drive a significant amount of incremental EBITDA,” CEO Manny Hilario said during the Q1 earnings call. “So our ROI on that conversion will be very, very high.”
STK finished Q1 with 23 U.S. restaurants and eight international outlets. Currently, The ONE Group is developing two company-owned STK locations, including one in Phoenix and another in New York City (a relocation of an existing unit).
The steakhouse’s performance contributed to an overall momentous quarter for The ONE Group.
Total revenue in Q1 was $213 million, an increase from $211 million in Q1 2025. Consolidated same-store sales were negative 0.3 percent, but a sequential improvement from the fourth quarter.
Aside from STK, Benihana—The ONE Group’s largest concept at 85 restaurants systemwide—experienced flat comps in Q1. The company’s Grill Concepts, consisting of RA Sushi and Kona—were down 4.9 percent, which is the best performance since early 2023. Also, transactions were positive for the Grill Concepts in Q1.
Margins are growing wider too, thanks to supply chain and beef sourcing changes. Restaurant operating increased 11 percent to $40 million, and operating profit margins expanded 1 percent to 19 percent. The margin increase was fueled by a 1.4 percent reduction in food and beverage costs, which was caused by menu optimization, integration synergies, and supply chain efficiencies. To note, Benihana’s margins grew 1.3 percent to 21 percent in Q1.
The ONE Group also notched a 0.4 percent improvement in restaurant operating expenses.
Adjusted EBITDA grew 12 percent to $29 million. The improvement was driven by cost management discipline, contracted beef pricing, continued Benihana integration synergies, and the benefit of shuttered underperforming restaurants.
“The key point I want to make is that these results are execution-driven. We are not dependent on macroeconomic recovery or shifts in consumer sentiment, but would certainly welcome them,” Hilario said.
The ONE Group is using four priorities to maintain its momentum—accelerate comps through execution, capital-efficient expansion, portfolio optimization, and keeping a strong balance sheet.
Momentum in the business is increasingly being driven by execution at the store level. Leadership has seen a steady build in traffic, improved engagement, and stronger performance around key occasions. Valentine’s Day marked a record-setting day across the portfolio, while Easter delivered high single-digit sales growth year-over-year. That trend has carried into Q2, where same-store sales and transactions have turned positive through the first five weeks, supported by improving trends at STK and Benihana.
Traffic is returning in more everyday occasions as well. Happy hour has emerged as a meaningful driver, and lunch is beginning to regain traction, aided by targeted value messaging and menu adjustments. Additionally, the company continues to lean into seasonal innovation and rolling out new food and beverage menus four times a year.
Loyalty is also becoming a more important piece of the equation. The Friends with Benefits program is adding more than 8,000 new organic members per week, with early data showing that those guests are returning more frequently and spending more per visit than non-members. The company is increasingly using that base for targeted outreach around high-volume occasions like Mother’s Day and graduation season. Bookings for these celebratory moments are already tracking solidly.
Off-premises remains a smaller but growing part of the mix. Menu items like burgers and sides, along with more portable formats such as fried rice burritos, are helping drive incremental demand across brands, especially in delivery.
In terms of unit growth, The ONE Group plans to open between six and 10 new venues in 2026, but with a tighter lens on capital efficiency. New company-owned development is being targeted toward projects requiring $1.5 million or less in net capital investment.
This approach is translating into lower spending. Capital expenditures, net of tenant improvement allowances, declined 23 percent year-over-year to $10 million in the first quarter, including $6.5 million allocated to new construction and the remainder supporting existing restaurants.
Development remains active but selective. Aside from STK, The ONE Group is also opening a Benihana in Seattle.
Franchise growth has also become a bigger priority. A 10-unit development agreement for Benihana and Benihana Express in California is progressing, alongside additional franchise and licensed locations in markets such as the Florida Keys. The Benihana Express format, which eliminates traditional teppanyaki tables, is gaining traction with operators due to its smaller footprint, lower labor requirements, and reduced cost of entry.
In addition to development, The ONE Group is continuing to reshape its portfolio to improve returns. The company exited six RA Sushi and Kona Grill locations in 2025, followed by another RA Sushi closure in early 2026 that did not meet its conversion criteria.
The focus now is on upgrading existing assets. Five Grill Concepts locations were closed at the start of the year and are being redeveloped into STK or Benihana restaurants. All are expected to reopen by the end of 2026.
The remaining Grill Concepts portfolio is still expected to contribute meaningfully, with projections of approximately $100 million in revenue and $10 million in restaurant-level EBITDA. But going forward, the company plans to evaluate each location as leases expire, taking a case-by-case approach to determine whether to convert, relocate, or exit.
Financial flexibility is a major focus too. The ONE Group is working to conserve cash and limit new commitments, prioritizing projects with the highest return potential and maintaining the ability to navigate a volatile operating environment. Operating cash flow reached $22 million in the first quarter, up from $9 million a year earlier, driven by higher net income and stronger collections on holiday-related receivables.
At the same time, the company continues to reduce debt, paying down $2 million on its term loan and $7 million on its revolving credit facility, which now carries no outstanding balance. With $6.6 million in cash on hand and $33.7 million in available capacity under its revolver, The ONE Group is positioning itself to fund growth more selectively and continuing to strengthen its balance sheet.
