10q10k10q10k.net

What changed in Dine Brands Global, Inc.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of Dine Brands Global, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+283 added−440 removedSource: 10-K (2026-02-25) vs 10-K (2025-03-05)

Top changes in Dine Brands Global, Inc.'s 2025 10-K

283 paragraphs added · 440 removed · 220 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

73 edited+14 added−78 removed12 unchanged
Biggest changeAs of December 31, 2024, Applebee's restaurants are 97.1% franchisee owned and operated with 57 franchise groups (30 domestic and 27 international) operating 1,567 Applebee’s franchise restaurants (1,454 domestic and 113 international). We operated 47 Applebee's restaurants acquired from franchisees in November 2024.
Biggest changeAs of December 28, 2025, 62 franchise groups (32 domestic and 30 international) operated 1,520 Applebee’s franchised restaurants and we owned 59 Applebee's restaurants acquired from franchisees, of which 47 were acquired in November 2024 and 12 were acquired in May 2025. As of December 28, 2025, 32 Applebee’s franchisees owned a total of 1,413 domestic Applebee's restaurants.
Government Regulation We are subject to regulation by the Federal Trade Commission (“FTC”) and a number of foreign and state laws that regulate the offer and sale of franchises. We also are subject to a number of foreign and state laws that regulate substantive aspects of the franchisor-franchisee relationship.
Government Regulation We are subject to regulation by the Federal Trade Commission (“FTC”) and a number of foreign and state laws that regulate the offer and sale of franchises. We are also subject to a number of foreign and state laws that regulate substantive aspects of the franchisor-franchisee relationship.
Trademarks and Service Marks We and our affiliates have registered or submitted registrations for certain trademarks and service marks with the United States Patent and Trademark Office and various international jurisdictions, including “Dine Brands Global ® .” We own trademarks and service marks used in the Applebee's system, including various logos and the trademarks “Applebee's ® ,” 10 “Applebee's Neighborhood Grill + Bar®” and variations of each.
Trademarks and Service Marks We and our affiliates have registered or submitted registrations for certain trademarks and service marks with the United States Patent and Trademark Office and various international jurisdictions, including “Dine Brands Global ® .” We own trademarks and service marks used in the Applebee's system, including various logos and the trademarks “Applebee's ® ,” “Applebee's Neighborhood Grill + Bar ® ” and variations of each.
As a result, an acquired restaurant may incur operating losses for some period of time. 9 Supply Chain In February 2009, Centralized Supply Chain Services, LLC (“CSCS” or the “Co-op”), an independent cooperative entity, was formed by us and franchisees of Applebee's and IHOP domestic restaurants.
As a result, an acquired restaurant may incur operating losses for some period of time. Supply Chain In February 2009, Centralized Supply Chain Services, LLC (“CSCS” or the “Co-op”), an independent cooperative entity, was formed by us and franchisees of IHOP and Applebee's domestic restaurants.
Seasonality We do not consider our operations to be seasonal to a material degree. We may experience a slight increase in system-wide sales in the first quarter of our fiscal year due to redemptions of gift cards sold during the preceding December holiday season.
Seasonality We may experience a slight increase in system-wide sales in the first quarter of our fiscal year due to redemptions of gift cards sold during the preceding December holiday season but we do not consider our operations to be seasonal to a material degree.
Our common stock is listed on the New York Stock Exchange (“NYSE”) and trades under the ticker symbol “DIN.” Available Information Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and amendments to those reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge through our website as soon as reasonably practicable after electronically filing such material with the SEC.
Our common stock is listed on the New York Stock Exchange (“NYSE”) and trades under the ticker symbol “DIN.” Available Information Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and amendments to those reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge through our website as soon as reasonably practicable after electronically filing such materials with the SEC.
The SEC maintains an Internet site that contains periodic reports, proxy and information statements and other information regarding our filings at www.sec.gov . The above references to our website and the SEC’s website do not constitute incorporation by reference of the information contained on those websites and should not be considered part of this document. 13
The SEC maintains an Internet site that contains periodic reports, proxy and information statements and other information regarding our filings at www.sec.gov . The above references to our website and the SEC’s website do not constitute incorporation by reference of the information contained on those websites and should not be considered part of this document. 9
We are actively supporting our brands with focused teams that are accountable at the brand level to drive strong performance. Together with our franchisees, significant investments have been made and will continue to be made in marketing across traditional and digital channels to drive traffic to our restaurants.
We actively support our brands with focused teams that are accountable at the brand level to drive strong performance. Together with our franchisees, significant investments have been made and will continue to be made in marketing across traditional and digital channels to drive traffic to our restaurants.
Maarten and Trinidad & Tobago. The area license agreements provide the licensees with the right to develop and franchise new IHOP restaurants in their respective territories and provide for royalties ranging from 1.0% to 5.5% of gross sales, and advertising fees ranging from 0.25% to approximately 2.0% of gross sales.
Maarten and Trinidad & Tobago. The area license agreements provide the licensees with the right to develop and franchise new IHOP restaurants in their respective territories and provide for royalties ranging from 1.0% to 5.5% of gross sales, and national advertising fees ranging from 0.25% to 2.0% of gross sales.
In limited instances, we have agreed to accept reduced royalties and/or lease payments from franchisees or have provided other accommodations to franchisees for specified periods of time to assist them in either establishing or reinvigorating their businesses.
In limited instances, we have agreed to accept reduced royalties and/or lease payments from franchisees or have provided other accommodations to franchisees for specified periods of time to assist them in either establishing or reinvigorating their business.
We make the design specifications for a typical restaurant available to franchisees, and we retain the right to prohibit or modify the use of any set of plans.
We make the design specifications for a typical restaurant available to franchisees, and we retain the right to prohibit or modify the use of any set of plans. Franchise Operations We monitor franchise restaurant operations.
IHOP Area License Agreements We have entered into four long-term area license agreements for IHOP restaurants covering the state of Florida and certain counties in the state of Georgia, the province of British Columbia, Canada, the country of Pakistan, and certain countries or islands in the Caribbean, including Aruba, Bonaire and Curacao, Bahamas, Barbados, Guyana, Jamaica, St. Lucia, St.
In addition, we entered into a long-term area license agreement for IHOP restaurants covering the state of Florida and certain counties in the state of Georgia, and three long-term area license agreements for the province of British Columbia, Canada, Pakistan, and certain countries or islands in the Caribbean, including Aruba, Bonaire and Curacao, Bahamas, Barbados, Guyana, Jamaica, St. Lucia, St.
Business Dine Brands Global, Inc. ® , together with its subsidiaries (referred to as the “Company,” “Dine Brands Global,” “we,” “our” and “us”), owns and franchises the Applebee’s Neighborhood Grill + Bar ® (“Applebee’s”) concept in the American full-service restaurant segment within the casual dining category of the restaurant industry, the International House of Pancakes ® (“IHOP”) concept in the midscale full-service restaurant segment within the family dining category of the restaurant industry, and the Fuzzy’s Taco Shop ® (“Fuzzy’s”) concept in the Mexican limited-service restaurant segment within the fast-casual dining category of the restaurant industry, acquired in December 2022.
Business Dine Brands Global, Inc. ® , together with its subsidiaries (referred to as the “Company,” “Dine Brands Global,” “we,” “our” and “us”), owns and franchises the International House of Pancakes ® (“IHOP”) restaurant concept in the full-service restaurant family dining category, the Applebee’s Neighborhood Grill + Bar ® (“Applebee’s”) restaurant concept in the full-service casual dining category, and the Fuzzy’s Taco Shop ® (“Fuzzy’s”) restaurant concept in the limited-service fast-casual dining category.
The principal commercial terms of the franchise arrangements under the Previous IHOP Business Model and the Current IHOP Business Model, including the franchise royalties and the franchise advertising fees, are substantially the same except with respect to the terms relating to the franchise fee, lease or sublease rents for the restaurant property and building, and interest income from any franchise fee notes and equipment leases.
The principal commercial terms of the franchise arrangements under the Previous IHOP Business Model and the Current IHOP Business Model, including the franchise royalties and national advertising fees, are substantially the same except with respect to the terms relating to the franchise fee, lease or sublease rents for the restaurant property and building.
We refer to this as our “Previous IHOP Business Model,” which accounts for most of the activity in our rental and financing operations. 4 For most IHOP restaurants opened after 2003, the franchisee is primarily responsible for the development and financing of the restaurant.
We refer to this as our "Previous IHOP Business Model," which accounted for most of the activity in our Rental business segment. 4 For most IHOP restaurants opened after 2003, the franchisee is primarily responsible for the development and financing of the restaurant.
Initiatives in the area of nutrition disclosure or advertising, such as requirements to provide information about the nutritional content of our food, may result in increased costs of compliance with the requirements and may also change customer buying habits in a way that adversely impacts our sales. For further information regarding governmental regulation, see Item 1A - Risk Factors .
Initiatives in the area of nutrition disclosure or advertising, such as requirements to provide information about the nutritional content of our food, may result in increased costs of compliance with the requirements for us and our franchisees and may also change customer buying habits in a way that adversely impacts our sales.
Our franchisees must comply with the regulatory requirements of the local jurisdictions. 8 Domestic and International Franchise Restaurant Development Each franchisee is responsible for selecting the site for each new restaurant. We may consult with franchisees when they are selecting appropriate sites, and selections made by franchisees are subject to our approval.
Domestic and International Franchise Sites Each franchisee is responsible for selecting the site for each new restaurant. We may consult with franchisees when they are selecting appropriate sites, and selections made by franchisees are subject to our approval.
We submit our systems to regular audit and review, as required by the Payment Card Industry Data Security Standard (“PCI DSS”), including periodic scanning of our networks to check for vulnerability.
We accept credit cards, third party gift cards, and branded gift cards as payment in our restaurants. We submit our systems to regular audit and review, as required by the Payment Card Industry Data Security Standard (“PCI DSS”), including periodic scanning of our networks to check for vulnerability.
We assess our culture and listen to our workforce through periodic team member engagement surveys. Numerous policy changes have been made or been influenced by the feedback we receive from our team members. A recent example of such a change is our hybrid work schedule, which offers increased flexibility for our restaurant support center team members.
Numerous policy changes have been made or been influenced by the feedback we receive from our team members. A recent example of such a change is our hybrid work schedule, which offers increased flexibility for our restaurant support center team members.
IHOP competes in the family dining category against national and multi-state restaurant chains such as Denny's, Cracker Barrel Old Country Store, Golden Corral, Waffle House and Bob Evans Restaurants. IHOP also faces competition from fast-casual and quick service restaurant chains that serve breakfast. In addition, there are many independent restaurants and diners across the country in the family dining segment.
IHOP competes in the family dining category against national restaurant chains such as Denny's, Cracker Barrel Old Country Store, Waffle House and Bob Evans Restaurants. IHOP also faces competition from fast-casual and quick service restaurant chains that serve breakfast.
Applebee's competes in the casual dining category against national and multi-state restaurant chains such as Buffalo Wild Wings, Olive Garden, Chili's Grill & Bar, Texas Roadhouse and Outback Steakhouse, among others, as well as fast-casual and quick service restaurant chains. In addition, there are many independent restaurants across the country in the casual dining segment.
Applebee's competes in the casual dining category against national restaurant chains such as Buffalo Wild Wings, Olive Garden, Chili's Grill & Bar, Texas Roadhouse and Outback Steakhouse, among others, as well as fast-casual and quick service restaurant chains.
In general, we no longer provide any financing with respect to the franchise fee, restaurant site or equipment. The franchisee uses its own capital and financial resources along with third-party financial sources obtained by the franchisee to purchase or lease a restaurant site, build and equip the business and fund its working capital needs.
The franchisee uses its own capital and financial resources along with third-party financial sources obtained by the franchisee to purchase or lease a restaurant site, build and equip the business and fund its working capital needs.
Fuzzy's competes in the fast-casual dining category against national and multi-state restaurant chains such as Velvet Taco, Torchy's Tacos, and Rusty Taco, among others, as well as casual and quick service restaurant chains. In addition, there are many independent restaurants across the country in the fast-casual dining segment. Fuzzy's is in the Mexican limited-service restaurant segment in the restaurant industry.
Fuzzy's competes in the fast-casual dining category against multi-state restaurant chains such as Velvet Taco, Torchy's Tacos, and Rusty Taco, among others, as well as casual and quick service restaurant chains. In addition, there are many independent restaurants across the country in the above discussed categories that are considered competition to our brands.
In addition, we have registered various domain names on the Internet that incorporate some of our trademarks and service marks and believe these domain name registrations are an integral part of our identity. From time to time, we may take appropriate legal action to defend and protect the use of our intellectual property.
In addition, we have registered various domain names on the Internet that incorporate some of our trademarks and service marks and believe these domain name registrations are an integral part of our identity.
We typically identified and leased or purchased the restaurant sites for new company-developed IHOP restaurants, built and equipped the restaurants and then franchised them to franchisees. In addition, we typically financed as much as 80% of the franchise fee for periods ranging from five to eight years and leased the restaurant and equipment to the franchisee over a 25-year period.
In addition, we typically financed as much as 80% of the franchise fee for periods ranging from five to eight years and leased the restaurant and equipment to the franchisee over a 25-year period.
The IHOP NAF is also used to defray certain expenses associated with our marketing and advertising functions. 7 Advertising may be disseminated in various media, including television, radio, print, point of sale, www.ihop.com, mobile app, outdoor banners, billboards, online, digital, social media and other emerging media on a national, regional or local level, though most advertising is national.
Contributions to the IHOP NAF or Applebee’s NAF are used to purchase various media, including television, radio, print, point of sale, mobile app, outdoor banners, billboards, online, digital, social media and other emerging media on a national, regional or local level, though most advertising is national.
CSCS has been appointed as the sole authorized purchasing organization and purchasing agent for goods, equipment and distribution services for Applebee's and IHOP restaurants in the United States. As of December 31, 2024, 100% of Applebee's domestic franchise restaurants and 100% of IHOP domestic franchise restaurants were members of CSCS.
CSCS has been appointed as the sole authorized purchasing organization and purchasing agent for goods, equipment and distribution services for IHOP and Applebee's restaurants in the United States. CSCS combines the purchasing volume for goods, equipment and distribution services across the IHOP and Applebee's concepts.
Our Total Rewards Program plays a big part in our commitment to creating an environment of well-being. We have a consistent and fair compensation program that reflects our pay-for-performance philosophy and rewards our team members for their contributions to our success. We offer comprehensive health and protection benefits that support our team members and their families’ overall well-being.
We have a consistent and fair compensation program that reflects our pay-for-performance philosophy and rewards our team members for their contributions to our success. We offer comprehensive health and protection benefits that support our team members and their families’ overall well-being. We also contribute to programs that provide our team members with financial security, now and in the future.
Environmental Matters We are subject to federal and state environmental regulations, but historically these have not had a material effect on our operations. We are not aware of any federal, state or local environmental laws or regulations that are likely to materially impact our revenues, cash flow or competitive position, or result in any material capital expenditure.
We are not aware of any federal, state or local environmental laws or regulations that are likely to materially impact our revenues, cash flow or competitive position, or result in any material capital expenditure. However, we cannot predict the effect of possible future environmental legislation or regulations.
We also contribute to programs that provide our team members with financial security, now and in the future. We offer other rewards that focus on recognition, career building, health and wellness, time-off benefits, and other perks that are designed to make our peoples’ experience as Dine Brands team members productive and fun.
We offer other rewards that focus on recognition, career building, health and wellness, time-off benefits, and other perks that are designed to make our peoples’ experience as Dine Brands team members productive and fun. We assess our culture and listen to our workforce through periodic team member engagement surveys.
We currently operate 47 Applebee's restaurants as company restaurants. The first Fuzzy’s Taco Shop opened in 2003 in Fort Worth, Texas and the first franchised location opened in 2009. Since that time, Fuzzy’s has engaged in the development, franchising, and operation of Fuzzy’s Taco Shops.
As of December 28, 2025, there are 28 domestic dual-branded restaurant openings. The first Fuzzy’s Taco Shop opened in 2003 in Fort Worth, Texas and the first franchised location opened in 2009. Since that time, Fuzzy’s has engaged in the development, franchising, and operation of Fuzzy’s Taco Shops.
Restaurant location, quality and speed of service, advertising, name identification and attractiveness of facilities are important. Additionally, changes in the price of groceries may influence the attractiveness of dining at home versus dining out. The market for high quality commercial real estate is also very competitive.
The principal bases of competition in the industry are the type, quality and price of the food products served. Restaurant location, quality and speed of service, advertising, name identification and attractiveness of facilities are important. Additionally, changes in the price of groceries may influence the attractiveness of dining at home versus dining out.
We consider our trademarks and service marks important to the identification of our company and our restaurants and believe they are of material importance to the conduct of our business. Depending upon the jurisdiction, trademarks and service marks generally are valid as long as they are used and/or registered.
We consider our trademarks and service marks important to the identification of our company and our restaurants and believe they are of material importance to the conduct of our business. We own or have rights to all trademarks we believe are material to our restaurant operations.
We and our franchisees compete with other restaurant chains and retail businesses for suitable sites for the development of new restaurants. We also compete against other franchisors both within and outside the restaurant industry for new franchisees. For further information regarding competition, see Item 1A - Risk Factors .
The market for high quality commercial real estate is also very competitive. We and our franchisees compete with other restaurant chains and retail businesses for suitable sites for the development of new restaurants. We also compete against other franchisors both within and outside the restaurant industry for new franchisees.
We are focused on a comprehensive approach to valuing diversity across leadership, team members, franchisees and the community. We believe the power to meaningfully impact the people and communities we serve is realized when each team member is personally and professionally fulfilled. One of our primary focuses is to ensure the health and well-being of our team members.
We believe the power to meaningfully impact the people and communities we serve is realized when each team member is personally and professionally fulfilled. One of our primary focuses is to ensure the health and well-being of our team members. Our Total Rewards Program plays a big part in our commitment to creating an environment of well-being.
This has the potential to directly impact our business, especially due to new laws and regulations in the United States and internationally that require notifying individuals and government authorities about security breaches involving certain types of personal information. We are also subject to laws and regulations, which may vary from jurisdiction to jurisdiction, relating to nutritional content and menu labeling.
This has the 8 potential to directly impact our business, especially due to new laws and regulations in the United States and internationally that require notifying individuals and government authorities about security breaches involving certain types of personal information, or expanding data privacy rights for individuals that may increase our legal risks and compliance requirements.
As one of the world’s largest casual dining brands, Applebee’s Neighborhood Grill + Bar offers guests a dining experience that combines simple American fare with classic drinks and local draft beers.
In November 2007, we completed the acquisition of AII, which comprised 1,455 franchised restaurants and 510 company-owned restaurants. We subsequently refranchised all Applebee's company-owned restaurants and were 100% franchised. As one of the world’s largest casual dining brands, Applebee’s Neighborhood Grill + Bar offers guests a dining experience that combines simple American fare with classic drinks and local draft beers.
The restaurant industry is generally classified into categories and segments based on various factors including price point ranges, the types of food and beverages offered, and the types of service available to customers. These categories include, among others, fast food or quick service restaurants, fast-casual dining, family dining, casual dining and fine dining.
IHOP, Applebee's and Fuzzy's are among the numerous restaurant chains and independent restaurants competing in the restaurant industry in the United States. The restaurant industry is generally classified into categories and segments based on various factors including price point ranges, the types of food and beverages offered, and the types of service available to customers.
Development of Applebee’s and IHOP restaurants outside of the United States has historically been conducted through a separate development agreement and franchise agreement. More recently, certain franchisees have entered into a multi-unit franchise agreement that governs the rights and obligations to develop a territory, in addition to terms of operating each restaurant opened in the territory.
More recently, certain franchisees have entered into a multi-unit franchise agreement that governs the rights and obligations to develop a territory, in addition to terms of operating each restaurant opened in the territory. The term of a franchisee’s exclusive right to develop a territory expires when the agreement’s development schedule is completed.
The restaurant and related food-service industries are highly competitive and are affected by, among other things, economic conditions, price levels, on-going changes in eating habits and food preferences, population trends and traffic patterns. The principal bases of competition in the industry are the type, quality and price of the food products served.
The operations of CSCS are funded by a separately stated administrative fee added to one or more products purchased by restaurant operators. Industry Overview and Competition The restaurant and related food-service industries are highly competitive and are affected by, among other things, economic conditions, price levels, ongoing changes in eating habits and food preferences, population trends and traffic patterns.
From time to time, we may also offer reduced or eliminated initial franchise fees, key money grants, equipment leasing options, and periods of reduced royalties as development incentives to encourage the development of new restaurants.
From time to time, we may also offer reduced or eliminated initial franchise fees, franchisee incentives, equipment leasing options, and periods of reduced royalties as incentive to develop new restaurants. Advertising Fees Advertising fees collected from our franchisees are contributed to the IHOP National Advertising Fund (IHOP NAF) or the Applebee’s National Advertising Fund (Applebee’s NAF).
Information Technology We use in-house developed and third-party point of sale systems for order processing, and back-of-the house systems for accounting, labor and inventory management in our franchisees' restaurants. We utilize a variety of proprietary and commercially available systems to support our corporate operations.
From time to time, we may take appropriate legal action to defend and protect the use of our intellectual property. 7 Information Technology We use in-house developed and third-party point of sale systems for order processing, and back-of-the house systems for accounting, labor and inventory management in our franchisees' restaurants.
Franchising Franchisee Relationships We value good relationships with our franchisees and strive to maintain positive working relationships with them. Applebee’s, IHOP and Fuzzy’s franchisees participate in Company-sponsored advisory groups. These groups provide a forum for franchisees to share demonstrated best practices, offer counsel and review successful strategies, while working side-by-side with management of the Applebee's, IHOP and Fuzzy’s brands.
These groups provide a forum for franchisees to share demonstrated best practices, offer counsel and review successful strategies, while working side-by-side with management of the IHOP, Applebee's and Fuzzy’s brands. The IHOP sponsored Franchise Leadership Council is an elected and appointed body of up to 14 IHOP franchisees.
Our five largest Applebee’s franchisees owned 56% of the total 1,567 Applebee's franchise restaurants. As of December 31, 2024, 235 franchisees owned a total of 1,694 domestic IHOP restaurants, including 87 franchisees that each owned one restaurant. The largest single IHOP franchisee owned 263 domestic restaurants.
As of December 28, 2025, 228 franchisees owned a total of 1,672 domestic IHOP restaurants, including 85 franchisees that each owned one restaurant. The largest single IHOP franchisee owned 263 domestic restaurants. As of December 28, 2025, 33 franchisees owned a total of 140 international IHOP franchise restaurants.
Although such laws may restrict a franchisor in the termination and/or non-renewal of a franchise agreement by, for example, requiring “good 11 cause” to exist as a basis for the termination and/or non-renewal, advance notice to the franchisee of the termination or non-renewal, an opportunity to cure a default and/or a repurchase of inventory or other compensation upon termination, these provisions have not historically had a significant effect on our business.
Although such laws may restrict a franchisor in the termination and/or non-renewal of a franchise agreement. These provisions have not historically had a significant effect on our business.
However, we cannot predict the effect of possible future environmental legislation or regulations. Human Capital We view our team members as one of the three core strategic pillars of our business - People, Brand, and Growth. We believe that hiring, developing and retaining team members is critical to our operations and that our corporate responsibility begins with our team members.
Human Capital We view our team members as one of the three core strategic pillars of our business, which are "People, Brand, and Growth." We believe that hiring, developing and retaining qualified team members is critical to our operations. We take a comprehensive approach to leadership, team members, franchisees and the community.
We are subject to a number of privacy and data protection laws and regulations globally, including, without limitation, the California Consumer Privacy Act, California Privacy Rights Act, and Virginia Consumer Data Protection Act. The legislative and regulatory landscape for privacy and data protection continues to evolve, and there has been increased attention in privacy and data protection issues.
The legislative and regulatory landscape for privacy and data protection continues to evolve, and there has been increased attention in privacy and data protection issues.
In November 2007, we completed the acquisition of Applebee’s. Effective June 2, 2008, we changed our name to DineEquity, Inc. and on February 20, 2018, we changed our name to Dine Brands Global, Inc. In December 2022, we completed the acquisition of Fuzzy's.
Corporate Information We were incorporated under the laws of the State of Delaware in 1976 with the name IHOP Corp. Effective June 2, 2008, we changed our name to DineEquity, Inc. and on February 20, 2018, we changed our name to Dine Brands Global, Inc.
At our company restaurants, we employ both full-time and part-time restaurant employees in order to provide the flexibility necessary during peak periods of restaurant operations and meet the individual needs of our employees. Our employees are not presently represented by any collective bargaining agreements and we have not experienced any significant work stoppages.
Approximately 92% of our company-owned restaurant employees are paid on an hourly basis, while certain restaurant and operations management and corporate positions are salaried. At our company-owned restaurants, we employ both full-time and part-time restaurant employees in order to provide the flexibility necessary during peak periods of restaurant operations and meet the individual needs of our employees.
As of December 31, 2024, we had signed commitments from Applebee's franchisees to build approximately nine domestic restaurants and approximately 59 international restaurants over the next six years.
As of December 28, 2025, we had signed commitments from IHOP franchisees to build 245 IHOP restaurants over the next seven years.
Applebee’s sponsors its Franchise Business Council (“FBC”), which consists of eight elected franchisee representatives and three Applebee's representatives. IHOP sponsors its Franchise Leadership Council (“FLC”), an elected and appointed body of up to 14 IHOP franchisees. Fuzzy’s sponsors its Franchise Advisory Council (“FAC”), an elected body of eight Fuzzy’s franchisees plus a Fuzzy’s representative.
The Applebee’s Franchise Business Council is a sponsored group, which consists of eight elected franchisee representatives and three Applebee's representatives. Fuzzy’s sponsors an elected body of eight Fuzzy’s franchisees plus a Fuzzy’s representative for its Franchise Advisory Council. Company-Owned Restaurants From time to time, we may acquire a number of restaurants from franchisees for a variety of reasons.
In addition, we participate in annual audits of our financial and human resources systems to verify that measures are in place to protect our employees' personal information. We accept credit cards, third party gift cards, and branded gift cards as payment in our restaurants.
We continue to focus on enhancing our cybersecurity capabilities, educating our team members on cybersecurity importance, and managing our cyber risks. In addition, we participate in annual audits of our financial and human resources systems to verify that measures are in place to protect our employees' personal information.
Due to cultural and regulatory differences, we may have different requirements for restaurants opened outside of the United States. We also monitor the financial health of our franchisees through business and financial reviews. Composition of Franchise Systems As of December 31, 2024, 30 Applebee’s franchisees owned a total of 1,454 domestic Applebee's restaurants.
Due to cultural and regulatory differences, we may have different requirements for restaurants opened outside of the United States. We also monitor the financial health of our franchisees through business and financial reviews. Franchisee Relationships We value our franchisees and strive to maintain a positive working relationship with them. IHOP, Applebee's and Fuzzy’s franchisees participate in Company-sponsored advisory groups.
We believe that technology is and will continue to be a key component of our long-term plans and are committed to providing system stability and targeted innovation. Our use of technology, particularly in terms of managing electronic payments and confidential information, also represents security and operational risks that we must manage and may result in additional costs incurred.
Our use of technology, particularly in terms of managing electronic payments and confidential information, also represents security and operational risks that we must manage and may result in additional costs incurred. Protection of financial and personal information is a high priority for us, led by our Cybersecurity Department and a committee representing key functional areas.
Most of our revenue is derived from domestic sources within these four reporting segments, with approximately 83% of our total revenues for the year ended December 31, 2024 being generated from our two largest franchise operating segments, Applebee's and IHOP. Internationally, our restaurants are in 19 countries and two United States territories at December 31, 2024.
Most of our revenue is derived from domestic sources within our business segments, with approximately 74% of our total revenues for the year ended December 28, 2025 being generated from our two largest operating segments, IHOP and Applebee's. Revenues from Company-owned and Rental segments primarily make up the remaining 26%.
In recent years, there has been an increased legislative, regulatory and consumer focus at the federal, state and municipal levels on the food industry including nutrition and advertising practices. Restaurants operating in the quick-service and fast-casual segments have been a particular focus.
We are also subject to laws and regulations, which may vary from jurisdiction to jurisdiction, relating to nutritional content and menu labeling. In recent years, there has been an increased legislative, regulatory and consumer focus at the federal, state and municipal levels on the food industry including nutrition and advertising practices.
Sales and product mix information is transmitted to our restaurant support centers daily and this information supports our operations and marketing initiatives. We mitigate the potential impact from operational interruption of our information technology systems through a disaster recovery plan that is updated on a regular basis.
We utilize a variety of proprietary and commercially available systems to support our corporate operations. Sales and product mix information is transmitted to our restaurant support centers daily and this information supports our operations and marketing initiatives.
We refer to this as our “Current IHOP Business Model.” The first restaurant in what became the Applebee’s chain opened in 1980 in Decatur, Georgia. Applebee's International, Inc, (“AII”) became a public company in 1989, then comprised of 100 restaurants.
The number of international restaurants held by a single franchisee ranged from one to 20 restaurants. Our five largest IHOP franchisees owned 32% of the total 1,812 IHOP franchised restaurants. The first restaurant in what became the Applebee’s chain opened in 1980 in Decatur, Georgia. Applebee's International, Inc., (“AII”) became a public company in 1989, which then had 100 restaurants.
Since that time, the Company and its predecessors have engaged in the development, franchising and, from time to time, operation of IHOP restaurants. Prior to 2003, new IHOP restaurants were generally developed by us, and we were involved in all aspects of the construction and financing of the restaurants.
Prior to 2003, new IHOP restaurants were generally developed by us, and we were involved in all aspects of the construction and financing of the restaurants. We typically identified and leased or purchased the restaurant sites for new company-developed IHOP restaurants, built and equipped the restaurants and then franchised them to franchisees.
We are investing in technology to create more ways for customers to access our brands and in growth platforms such as online ordering, off-premise business and delivery. We work alongside our franchisees to develop new restaurants across the globe.
We are investing in technology to create more ways for customers to access our brands and in growth platforms such as online ordering, off-premise business and delivery. We efficiently deploy capital towards investments with the highest return to maximize long-term shareholder value. Our capital deployment may include distributions of dividends and repurchases of our common stock.
We believe our relations with employees are good. Our franchisees are not our employees as independent business owners and their employees also are not our employees. Therefore, franchisees and their employees are not included in our employee count. Corporate Information We were incorporated under the laws of the State of Delaware in 1976 with the name IHOP Corp.
Our employees are not presently represented by any collective bargaining agreements and we have not experienced any significant work stoppages. We believe our relations with employees are good. Our franchisees, as independent business owners, are not our employees and their employees also are not our employees. Therefore, franchisees and their employees are not included in our employee count.
When acquired restaurants are not refranchised quickly, we typically operate the acquired restaurants until they can be refranchised. These restaurants may require investments in remodeling and rehabilitation before they can be refranchised.
We assess and monitor opportunities to refranchise company-owned restaurants under favorable circumstances and, historically, have been able to refranchise these restaurants to new franchisees. When these restaurants require investments in remodeling and 6 rehabilitation before they can be refranchised, we typically operate the acquired restaurants to bring them back to Company standards before they are refranchised.
Our Strategic Priorities Our fundamental approach to restaurant brand building centers on innovation and evolution of our existing brands as well as exploring investments in or acquisitions of new concepts. We intend to leverage our significant scale and our franchise business model to drive robust margins and cash flows.
Our Goal Our goal is to accelerate profitable growth and create significant value for stockholders and franchisees. Our Strategic Priorities Our approach to restaurant brand building centers on innovation and evolution of our existing brands, such as our expansion into dual-branded IHOP and Applebee's restaurants, as well as exploring investments or acquisitions of new concepts.
CSCS combines the purchasing volume for goods, equipment and distribution services within and across the Applebee's and IHOP concepts. Its mission is to achieve for its members the benefit of available goods, higher quality equipment and distribution services in adequate quantities at the lowest possible sustainable prices.
Its mission is to provide for its members the benefit of available goods, higher quality goods and equipment, and distribution services at the lowest possible sustainable prices. We do not control CSCS, but do have contractual rights associated with supplier certification, quality assurance and protection of our intellectual property.
In December 2022, we completed the acquisition of Fuzzy’s, which consisted of 135 franchised restaurants and three company-operated restaurants at the time of acquisition. Restaurant Concepts Applebee's We franchise Applebee’s restaurants in the American full-service restaurant segment within the casual dining category of the restaurant industry.
In December 2022, we completed the acquisition of Fuzzy’s, which consisted of 135 franchised restaurants and three company-owned restaurants. Fuzzy's operates restaurants in the fast-casual plus dining category of the restaurant industry under the name, Fuzzy’s Taco Shop. Fuzzy's restaurants' menu items feature regionally-inspired Mexican food and innovative tacos.
As of December 31, 2024, 28 franchisees owned a total of 130 international IHOP franchise restaurants. The number of international restaurants held by a single franchisee ranged from one restaurant to 20 restaurants. Our five largest IHOP franchisees owned 31% of the total 1,824 IHOP franchise restaurants.
The number of domestic restaurants held by a single franchisee ranged from one to 459 restaurants. Internationally, 30 franchisees owned a total of 107 international Applebee's restaurants. Our five largest Applebee’s franchisees owned 57% of the total 1,520 Applebee's franchised restaurants. In February 2025, one of the first domestic dual-branded IHOP and Applebee's restaurants opened in Seguin, Texas.
References herein to Applebee’s ® , IHOP ® and Fuzzy’s ® restaurants are to these three restaurant concepts, whether operated by franchisees, area licensees and their sub-licensees or by us. As of December 31, 2024, the substantial majority of our 3,555 restaurants across all brands were franchised.
References herein to IHOP ® , Applebee’s ® and Fuzzy’s restaurants are to these three restaurant concepts, whether operated by franchisees, area licensees and their sub-licensees or by the Company. The terms franchise or franchisee used throughout this document are intended to describe third parties that operate under franchise agreements.
These include such matters as minimum wage requirements, overtime, tip credits and other working requirements and conditions.
These include such matters as minimum wage requirements, overtime, tip credits and other working requirements and conditions. Significant additional government-imposed increases in compensation and benefits could be detrimental to the economic viability of company-owned restaurants and our franchisees' restaurants.
IHOP We franchise restaurants in the midscale full-service restaurant segment within the family dining category of the restaurant industry under the names IHOP and International House of Pancakes. IHOP restaurants feature full table service and high quality, moderately priced food and beverage offerings in an attractive and comfortable family atmosphere.
Our History The first IHOP restaurant opened in 1958 in Toluca Lake, California. Since that time, the Company and its predecessors have engaged in the development, franchising, and from time to time, ownership and operation of IHOP restaurants. The restaurants feature full table service and high quality, moderately priced food and beverage offerings in an attractive and comfortable family atmosphere.
Our current standard franchise fees are an initial franchise fee of $40,000 per restaurant, a royalty fee of 5% of weekly gross sales, and a renewal fee of $5,000 per renewal term. We also earn revenue from franchisees from sale of our proprietary products.
Our standard domestic Fuzzy’s franchise agreement typically provides for an initial franchise fee of $40,000 per restaurant and an initial term of 10 years. Under these arrangements, we generally receive franchise royalty fees of 5% of gross sales and 2% of gross sales are contributed to the Fuzzy’s Development Fund.
Our current standard domestic IHOP franchise agreement typically provides for an initial term of 20 years and permits one renewal for a term of 10 years, upon payment of a renewal fee of $10,000.
The largest single Fuzzy's franchisee owned 12 domestic restaurants. Our five largest Fuzzy's franchisees owned 41% of the total 105 Fuzzy's franchise restaurants. Franchising Franchise Agreements and Fees Our standard domestic IHOP franchise agreement typically provides for an initial franchise fee of $40,000 - $50,000 per restaurant and an initial term of 20 years.
We also have signed option agreements to build an additional 11 restaurants over the next four years, primarily under domestic multi-restaurant development agreements. As of December 31, 2024, we had signed commitments from Fuzzy's franchisees to build 122 Fuzzy's Taco Shop restaurants over the next eight years.
As of December 28, 2025, we had signed commitments from Fuzzy's franchisees to build 79 Fuzzy's Taco Shop restaurants over the next seven years. Development of IHOP and Applebee's restaurants outside of the United States has historically been conducted through a separate development and franchise agreements.
As of December 31, 2024, we had signed commitments from IHOP franchisees to build 285 IHOP restaurants over the next six years, comprised of eight restaurants under single restaurant or non-traditional development agreements, 98 restaurants under domestic multi-restaurant development agreements and 179 restaurants under international development agreements.
Under these arrangements, we generally receive franchise royalty fees of 4% of gross sales and national advertising fees of 4.25% of gross sales. As of December 28, 2025, we had signed commitments from Applebee's franchisees to build approximately seven domestic restaurants and approximately 59 international restaurants over the next five years.
Removed
We believe this highly franchised business model requires less capital investment and general and administrative overhead, generates higher gross profit margins and reduces the volatility of adjusted free cash flow performance, as compared to a business model based on owning a significant number of company-operated restaurants.
Added
As of December 28, 2025, the substantial majority of our 3,509 restaurants across all brands were owned and operated by independent franchisees.
Removed
We generated revenue during the year ended December 31, 2024 from four reporting segments, comprised as follows: • Franchise operations - consist of Applebee’s, IHOP and Fuzzy's, generating royalties, advertising fees and other income from 1,567 Applebee’s franchised restaurants, 1,824 IHOP franchised and area licensed restaurants, and 116 Fuzzy's franchised restaurants; • Rental operations - primarily rental income derived from lease or sublease agreements covering 554 IHOP franchised restaurants and two Applebee’s franchised restaurants; • Financing operations - primarily interest income from approximately $13 million of receivables for equipment leases and franchise fee notes generally associated with IHOP franchised restaurants developed before 2003 and approximately $14 million of notes receivable from franchisees; and • Company restaurant operations - primarily retail sales from 47 company-operated Applebee's restaurants we acquired from franchisees in November 2024 and one company-operated Fuzzy's restaurant.
Added
During the year ended December 28, 2025, we conducted our business through the following three reportable business segments: • Franchise - consists of IHOP, Applebee’s, and Fuzzy's franchise operations which generate revenues primarily from royalties and advertising fees from 1,812 IHOP franchised restaurants, 1,520 Applebee’s franchised restaurants, and 105 Fuzzy's franchised restaurants in addition to revenues from the sale of proprietary IHOP and Fuzzy's products to our franchisees; • Company-owned restaurants - primarily generates revenues from 12 IHOP restaurants, 59 Applebee's restaurants and one Fuzzy's restaurant; • Rental - rental revenues are primarily from lease or sublease agreements covering 521 IHOP franchised restaurants and one Applebee’s franchised restaurant.
Removed
Revenue derived from all international operations comprised less than 3% of total consolidated revenue for the year ended December 31, 2024. At December 31, 2024, there were no long-lived assets located outside of the United States. Our Goal Our goal is to accelerate profitable growth and create significant value for stockholders and franchisees.
Added
Internationally, our restaurants are in 20 countries and two territories of the United States of America (the "United States") as of December 28, 2025. Revenues derived from all international operations were less than 2% of total consolidated revenues for the year ended December 28, 2025.
Removed
We will focus on capital allocation strategies to maximize long-term stockholder return, including cash dividends and repurchases of our common stock, taking into consideration market conditions. Furthermore, we will continue to evaluate the addition of new brands to our restaurant portfolio through acquisitions and other strategic investments. Our History The first IHOP restaurant opened in 1958 in Toluca Lake, California.

… 85 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

50 edited+5 added−4 removed178 unchanged
Biggest changeThese include antitrust and tax requirements, import/export/customs regulations, anti-boycott regulations, other international trade regulations, the USA Patriot Act and the Foreign Corrupt Practices Act. Failure to comply with any such legal requirements could subject us to monetary liabilities and other sanctions, which could harm our business, results of operations and financial condition.
Biggest changeWe also are subject to governmental regulations throughout the world that impact the way we do business with our international franchisees and vendors. These include antitrust and tax requirements, import/export/customs regulations, anti-boycott regulations, other international trade regulations, the USA Patriot Act and the Foreign Corrupt Practices Act.
Our franchisees' failure to address cost pressures, including rising costs for commodities, labor, health care and utilities could adversely affect our franchisees and our revenues and results of operations.
Our and our franchisees' failure to address cost pressures, including rising costs for commodities, labor, health care and utilities could adversely affect our franchisees and our revenues and results of operations.
We rely on franchisees to develop Applebee's, IHOP and Fuzzy's restaurants. From time to time, our franchisees have failed to fulfill their commitments to build new restaurants in the numbers and within the timeframes required by their development agreements, and we expect that this will continue to varying degrees in the future.
We rely on franchisees to develop IHOP, Applebee's and Fuzzy's restaurants. From time to time, our franchisees have failed to fulfill their commitments to build new restaurants in the numbers and within the timeframes required by their development agreements, and we expect that this will continue to varying degrees in the future.
Restaurant development and the success of restaurants opened by our franchisees involve substantial risks, including the following: • the demand for Applebee’s, IHOP and Fuzzy's restaurants and the selection of appropriate franchisee candidates; • costs of construction, permit issuance and regulatory compliance; • the availability of suitable locations and terms for potential development sites, including lease or purchase terms for new locations; • the availability of financing, at acceptable rates and terms, to both franchisees and third-party landlords, for restaurant development and/or implementation of our business strategy through new remodel programs and other operational changes; • delays in obtaining construction permits and in completion of construction; • competition for suitable development sites; • challenges in the general labor market and our franchisees' ability to maintain adequate staffing of restaurants; • changes in governmental rules, regulations, and interpretations (including interpretations of the requirements of the Americans with Disabilities Act); and • general economic and business conditions.
Restaurant development and the success of restaurants opened by our franchisees involve substantial risks, including the following: • the demand for IHOP, Applebee’s and Fuzzy's restaurants and the selection of appropriate franchisee candidates; • costs of construction, permit issuance and regulatory compliance; • the availability of suitable locations and terms for potential development sites, including lease or purchase terms for new locations; • the availability of financing, at acceptable rates and terms, to both franchisees and third-party landlords, for restaurant development and/or implementation of our business strategy through new remodel programs and other operational changes; • delays in obtaining construction permits and in completion of construction; • competition for suitable development sites; • challenges in the general labor market and our franchisees' ability to maintain adequate staffing of restaurants; • changes in governmental rules, regulations, and interpretations (including interpretations of the requirements of the Americans with Disabilities Act); and • general economic and business conditions.
Negative publicity (e.g., crime, scandal, litigation, on-site accidents and injuries or other harm to customers, social issues and food-borne illness) at a single Applebee's, IHOP or Fuzzy's location can have a substantial negative impact on all restaurants within their respective system.
Negative publicity (e.g., crime, scandal, litigation, on-site accidents and injuries or other harm to customers, social issues and food-borne illness) at a single IHOP, Applebee's or Fuzzy's location can have a substantial negative impact on all restaurants within their respective system.
The risk of food-borne illness or food tampering cannot be completely eliminated. Any outbreak of food-borne illness or other food-related incidents attributed to Applebee's, IHOP or Fuzzy's restaurants or within the food service industry or any widespread negative publicity regarding the Applebee's, IHOP or Fuzzy's brands or the restaurant industry in general could harm our reputation.
The risk of food-borne illness or food tampering cannot be completely eliminated. Any outbreak of food-borne illness or other food-related incidents attributed to IHOP, Applebee's or Fuzzy's restaurants or within the food service industry or any widespread negative publicity regarding the IHOP, Applebee's or Fuzzy's brands or the restaurant industry in general could harm our reputation.
Although we maintain liability insurance, and each franchisee is required to maintain liability insurance pursuant to its franchise agreements, a liability claim could injure the reputation of all Applebee's, IHOP or Fuzzy's restaurants, whether or not it is ultimately successful.
Although we maintain liability insurance, and each franchisee is required to maintain liability insurance pursuant to its franchise agreements, a liability claim could injure the reputation of all IHOP, Applebee's or Fuzzy's restaurants, whether or not it is ultimately successful.
Changing health or dietary preferences may cause consumers to avoid Applebee's, IHOP and Fuzzy's restaurants in favor of alternative options. The food service industry as a whole rests on consumer preferences and demographic trends at the local, regional, national and international levels.
Changing health or dietary preferences may cause consumers to avoid IHOP, Applebee's and Fuzzy's restaurants in favor of alternative options. The food service industry as a whole rests on consumer preferences and demographic trends at the local, regional, national and international levels.
Various additional factors such as: (i) the Food and Drug Administration’s menu labeling rules; (ii) nutritional guidelines issued by the United States Department of Agriculture and issuance of similar guidelines or statistical information by state or local municipalities; (iii) academic studies; or (iv) efforts by environmental, animal health and welfare and sustainability advocacy groups, may impact consumer choice and cause consumers to select foods other than those that are offered by Applebee's, IHOP or Fuzzy's restaurants.
Various additional factors such as: (i) the Food and Drug Administration’s menu labeling rules; (ii) nutritional guidelines issued by the United States Department of Agriculture and issuance of similar guidelines or statistical information by state or local municipalities; (iii) academic studies; or (iv) efforts by environmental, animal health and welfare and sustainability advocacy groups, may impact consumer choice and cause consumers to select foods other than those that are offered by IHOP, Applebee's or Fuzzy's restaurants.
We may not be able to adequately adapt Applebee's, IHOP or Fuzzy's restaurants' menu offerings to keep pace with developments in consumer preferences, which may result in reduced royalty revenues from a decline in demand for our food and fewer guests visiting our restaurants.
We may not be able to adequately adapt IHOP, Applebee's or Fuzzy's restaurants' menu offerings to keep pace with developments in consumer preferences, which may result in reduced royalty revenues from a decline in demand for our food and fewer guests visiting our restaurants.
For example, it could: • make it more difficult for us to satisfy our obligations with respect to our debt or refinance any of our debt on attractive terms, commercially reasonable terms, or at all; • increase our vulnerability to general adverse economic and industry conditions or a downturn in our business; 14 • require us to dedicate a substantial portion of our cash flow from operations to debt service, thereby reducing the availability of our cash flow to pay dividends to our stockholders, repurchase shares of our common stock, fund working capital, capital expenditures and other general corporate purposes; • limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; • place us at a competitive disadvantage compared to our competitors that are not as highly leveraged; • limit our ability to borrow additional funds; • prevent us from taking actions that we believe would be in the best interest of our business and make it difficult for us to successfully execute our business strategy; and • result in an event of default if we fail to satisfy our obligations under our debt or fail to comply with the financial and other restrictive covenants contained in our debt documents, which event of default could result in all of our debt becoming immediately due and payable and could permit certain of our lenders to foreclose on our assets securing such debt.
For example, it could: • make it more difficult for us to satisfy our obligations with respect to our debt or refinance any of our debt on attractive terms, commercially reasonable terms, or at all; • increase our vulnerability to general adverse economic and industry conditions or a downturn in our business; 10 • require us to dedicate a substantial portion of our cash flow from operations to debt service, thereby reducing the availability of our cash flow to pay dividends to our stockholders, repurchase shares of our common stock, fund working capital, capital expenditures and other general corporate purposes; • limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; • place us at a competitive disadvantage compared to our competitors that are not as highly leveraged; • limit our ability to borrow additional funds; • prevent us from taking actions that we believe would be in the best interest of our business and make it difficult for us to successfully execute our business strategy; and • result in an event of default if we fail to satisfy our obligations under our debt or fail to comply with the financial and other restrictive covenants contained in our debt documents, such event of default could result in all of our debt becoming immediately due and payable and could permit certain of our lenders to foreclose on our assets securing such debt.
The risks and uncertainties related to the use of Artificial Intelligence include, but are not limited to, concerns around privacy, security, intellectual property, and ethics, and if the Artificial Intelligence technologies that we use (or create) turn out to be controversial or otherwise flawed, we could face competitive, brand, or reputational harm, legal liability, regulatory action, or other adverse impacts on our business.
The risks and uncertainties related to the use of Artificial Intelligence include, but are not limited to, concerns 13 around privacy, security, intellectual property, and ethics, and if the Artificial Intelligence technologies that we use (or create) turn out to be controversial or otherwise flawed, we could face competitive, brand, or reputational harm, legal liability, regulatory action, or other adverse impacts on our business.
Even where such food-related incidents occur solely at restaurants of our competitors or within the industry, our business could be adversely affected by negative publicity about the restaurant industry generally. Our company restaurants and our franchisees may produce or receive through the supply chain sub-standard or non-compliant food or beverage products.
Even where such food-related incidents occur solely at restaurants of our competitors or within the industry, our business could be adversely affected by negative publicity about the restaurant industry generally. Our company-owned restaurants and our franchisees may produce or receive through the supply chain sub-standard or non-compliant food or beverage products.
The success of our franchisees (and our success with company restaurants) depend significantly on the ability to anticipate and react to changes in the price and availability of food (such as the cost and supply of eggs, which may be impacted by avian flu), ingredients, labor, health care, utilities, fuel and other related costs.
The success of our franchisees (and our success with company-owned restaurants) depend significantly on the ability to anticipate and react to changes in the price and availability of food (such as the cost and supply of eggs, which may be impacted by avian flu), ingredients, labor, health care, utilities, fuel and other related costs.
We, through the operation of our company restaurants, and our franchisees, through the operation of franchised restaurants, are also subject to "dram shop" laws in some states pursuant to which we and our franchisees may be subject to liability in connection with personal injuries or property damages incurred in connection with wrongfully serving alcoholic beverages to an intoxicated person.
We, through the operation of our company-owned restaurants, and our franchisees, through the operation of franchised restaurants, are also subject to "dram shop" laws in some states pursuant to which we and our franchisees may be subject to liability in connection with personal injuries or property damages incurred in connection with wrongfully serving alcoholic beverages to an intoxicated person.
We rely heavily on information technology systems across our operations, including point-of-sale processing in our and our franchisees’ restaurants, online ordering and delivery, management of our supply chain, collection of cash and other receivables, payment of obligations and various other processes and procedures.
We rely heavily on information technology systems across our operations, including point-of-sale processing in our and our franchisees’ restaurants, online ordering and delivery, 11 management of our supply chain, collection of cash and other receivables, payment of obligations and various other processes and procedures.
However, the implementation and use of Artificial Intelligence technologies could present various risks and uncertainties to our business and there is no assurance that using such technologies will produce the 17 desired results.
However, the implementation and use of Artificial Intelligence technologies could present various risks and uncertainties to our business and there is no assurance that using such technologies will produce the desired results.
In connection with the continued operation or remodeling of certain restaurants, we and our franchisees may be required to expend funds to meet federal, state, local and 18 international regulations. The inability to obtain or maintain such licenses or publicity resulting from actual or alleged violations of such laws could have an adverse effect on our results of operations.
In connection with the continued operation or remodeling of certain restaurants, we and our franchisees may be required to expend funds to meet federal, state, local and 14 international regulations. The inability to obtain or maintain such licenses or publicity resulting from actual or alleged violations of such laws could have an adverse effect on our results of operations.
Many of these factors are outside of our control, and any failure to meet market expectations whether for sales growth, earnings per share or other metrics could cause our share price to decline. Our actual operating and financial results in any given period may differ from guidance we provide to the public, 20 including our most recent public guidance.
Many of these factors are outside of our control, and any failure to meet market expectations whether for sales growth, earnings per share or other metrics could cause our share price to decline. Our actual operating and financial results in any given period may differ from guidance we provide to the public, 16 including our most recent public guidance.
If we are unable to refinance or repay amounts under the securitized debt prior to the expiration of the applicable six- or seven-year term, our cash flow would be directed to the repayment of the securitized debt and, other than a weekly management fee sufficient to cover minimal selling, general and administrative expenses, would not be available for operating our business.
If we are unable to refinance or repay amounts under the securitized debt prior to the expiration of the applicable five- or six-year term, our cash flow would be directed to the repayment of the securitized debt and, other than a weekly management fee sufficient to cover minimal selling, general and administrative expenses, would not be available for operating our business.
A future potential epidemic, disease outbreak or public health emergency may also heighten many of the other risks described in this Item 1A - Risk Factors . Risks Related to Our Franchised Business Model Restaurant development plans under development agreements may not be implemented effectively and developed restaurants may not achieve desired results.
A future potential epidemic, disease outbreak or public health emergency may also heighten many of the other risks described in this Item 1A - Risk Factors . Risks Related to Our Franchise Business Model Restaurant development plans under development agreements may not be implemented effectively and developed restaurants may not achieve desired results.
In the event that a rapid amortization event occurs under the indenture (including, without limitation, upon an event of default under the indenture or the failure to repay the securitized debt at the end of the applicable five- or seven-year term), the funds available to us would be reduced or eliminated, which would in turn reduce our ability to operate or grow our business.
In the event that a rapid amortization event occurs under the indenture (including, without limitation, upon an event of default under the indenture or the failure to repay the securitized debt at the end of the applicable five- or six-year term), the funds available to us would be reduced or eliminated, which would in turn reduce our ability to operate or grow our business.
Disruptions in our relationships with suppliers and distributors may reduce the payments we receive from our franchisees or our pancake and waffle dry mix distributors or the profits generated by our company-operated restaurants. In addition, interruptions to the availability of gas, electric, water or other utilities may adversely affect the operations of our and our franchised restaurants.
Disruptions in our relationships with suppliers and distributors may reduce the payments we receive from our franchisees or our pancake and waffle dry mix distributors or the profits generated by our company-owned restaurants. In addition, interruptions to the availability of gas, electric, water or other utilities may adversely affect the operations of our and our franchised restaurants.
This could negatively impact the financial performance of our company-operated restaurants and reduce the profitability of franchised restaurants, potentially impacting the ability of franchisees to make royalty payments owed to us when due and negatively impacting franchisees’ ability to develop new restaurants as may be required in their respective development agreements.
This could negatively impact the financial performance of our company-owned restaurants and reduce the profitability of franchised restaurants, potentially impacting the ability of franchisees to make royalty payments owed to us when due and negatively impacting franchisees’ ability to develop new restaurants as may be required in their respective development agreements.
From time to time, we have experienced, and we may continue to experience, poor franchise relations caused by the efforts of one or more of our larger franchisees or an organized franchise association. 22 Concentration of Applebee's franchised restaurants in a limited number of franchisees subjects us to greater risk.
From time to time, we have experienced, and we may continue to experience, poor franchise relations caused by the efforts of one or more of our larger franchisees or an organized franchise association. 18 Concentration of Applebee's franchised restaurants in a limited number of franchisees subjects us to greater risk.
Accordingly, in cases in which a franchisee experiences increased insurance premiums or must pay out-of-pocket claims, the franchisee may not have the funds necessary to make 23 franchise and other payments to us, and franchisees may be unable to perform other obligations under their franchise agreements.
Accordingly, in cases in which a franchisee experiences increased insurance premiums or must pay out-of-pocket claims, the franchisee may not have the funds necessary to make 19 franchise and other payments to us, and franchisees may be unable to perform other obligations under their franchise agreements.
As part of our marketing efforts, we rely on search engine marketing and social media platforms to attract and retain guests. 25 These efforts may not be successful, resulting in expenses incurred without the benefit of higher revenues or increased employee engagement.
As part of our marketing efforts, we rely on search engine marketing and social media platforms to attract and retain guests. 21 These efforts may not be successful, resulting in expenses incurred without the benefit of higher revenues or increased employee engagement.
Our franchisees have experienced and continue to experience inflationary conditions with respect to most or all of these costs during fiscal 2024. Increases in minimum wage, health care and other benefit costs may have a material adverse effect on our and our franchisees' labor costs.
Our franchisees have experienced and continue to experience inflationary conditions with respect to most or all of these costs during fiscal 2025. Increases in minimum wage, health care and other benefit costs may have a material adverse effect on our and our franchisees' labor costs.
Factors outside our control may harm our brands' reputations. The success of our business is largely dependent upon brand recognition and the strength of our franchise systems. Our and our franchisees’ continued success is directly dependent 24 upon maintaining a favorable public view of the Applebee's, IHOP and Fuzzy's brands.
Factors outside our control may harm our brands' reputations. The success of our business is largely dependent upon brand recognition and the strength of our franchise systems. Our and our franchisees’ continued success is directly dependent 20 upon maintaining a favorable public view of the IHOP, Applebee's and Fuzzy's brands.
Our financial results are 21 significantly contingent upon the performance of our franchised restaurants because we derive a substantial portion of our revenues from royalties that are based on a percentage of gross sales at franchised restaurants.
Our financial results are 17 significantly contingent upon the performance of our franchised restaurants because we derive a substantial portion of our revenues from royalties that are based on a percentage of gross sales at franchised restaurants.
Our use of personal information is regulated by international, federal and state laws, as well as by certain third-party agreements.
Our use of personal information, as well as our use of innovative technologies, is regulated by international, federal and state laws, as well as by certain third-party agreements.
As of December 31, 2024, certain of our indirect, wholly-owned subsidiaries had approximately $1.2 billion of long-term debt. In addition, we had approximately $0.4 billion in operating lease, finance lease and other financing obligations as of December 31, 2024. We may incur substantial additional indebtedness in the future.
As of December 28, 2025, certain of our indirect, wholly-owned subsidiaries had approximately $1.2 billion of long-term debt. In addition, we had approximately $0.4 billion in operating lease, finance lease and other financing obligations as of December 28, 2025. We may incur substantial additional indebtedness in the future.
This could subject us to increased exposure to stockholder lawsuits. We and our franchisees are subject to complaints or litigation from guests alleging illness, injury or other food quality, food safety, health or operational concerns as well as claims related to social issues (e.g., allegations of discrimination), the Americans with Disabilities Act and other premises liability.
We and our franchisees are subject to complaints or litigation from guests alleging illness, injury or other food quality, food safety, health or operational concerns as well as claims related to social issues (e.g., allegations of discrimination), the Americans with Disabilities Act and other premises liability.
Of the 1,694 IHOP domestic franchise and area license restaurants as of December 31, 2024, approximately 554 restaurants have property lease/sublease agreements and/or notes and equipment contract obligations outstanding. We and our franchisees are subject to potential losses that may not be covered by insurance.
Of the 1,672 IHOP domestic franchise and area license restaurants as of December 28, 2025, approximately 521 restaurants have property lease/sublease agreements and/or notes and equipment contract obligations outstanding. We and our franchisees are subject to potential losses that may not be covered by insurance.
In 2020 and 2024, we recognized several significant impairment charges and could incur similar charges in the future. As of December 31, 2024, our total stockholders' deficit was $216.0 million. Any significant impairment write-down of goodwill, intangible assets or long-lived assets in the future could increase the stockholders' deficit. Repurchases of our common stock will also increase the stockholders' deficit.
In 2025 and 2024, we recognized several significant impairment charges and could incur similar charges in the future. As of December 28, 2025, our total stockholders' deficit was $273.9 million. Any significant impairment write-down of goodwill, intangible assets or long-lived assets in the future could increase the stockholders' deficit. Repurchases of our common stock will also increase the stockholders' deficit.
Our business expansion into virtual brands, dual-branded restaurants, and non-traditional restaurant formats, including restaurants with a smaller footprint, restaurants located in non-traditional locations and restaurants that operate on a delivery-only and/or ghost kitchen basis, could create new risks to our brands and reputation. 19 Failure of our internal controls over financial reporting and future changes in accounting standards may cause adverse unexpected operating results, affect our reported results of operations or otherwise harm our business and financial results.
Our business expansion into dual-branded restaurants, non-traditional restaurant formats, including restaurants with a smaller footprint, and restaurants located in non-traditional locations could create new risks to our brands and reputation. 15 Failure of our internal controls over financial reporting and future changes in accounting standards may cause adverse unexpected operating results, affect our reported results of operations or otherwise harm our business and financial results.
If our security and information systems are compromised or if our employees or franchisees fail to comply with these laws and regulations, and this information is obtained by unauthorized persons or used inappropriately, it could adversely affect our reputation and could disrupt our operations and result in costly litigation, judgments, or penalties resulting from violation of federal and state laws and payment card industry regulations.
If our security and information systems are compromised or if our employees or franchisees fail to comply with these laws and regulations, and this information is obtained by unauthorized persons or used or disclosed inappropriately, or we leverage technologies in ways that are challenged by new or evolving legal standards, it could adversely affect our reputation and could disrupt our operations and result in costly litigation, judgments, or penalties resulting from violation of international, federal and state laws and payment card industry regulations.
The inflationary period experienced over recent years, which has been over 20% cumulatively since 2020, and potential future inflationary periods, could negatively impact consumers’ discretionary income and reduce the amount of income previously used for dining outside the home.
The inflationary period experienced over recent years, and potential future inflationary periods, could negatively impact consumers’ discretionary income and reduce the amount of income previously used for dining outside the home.
We may be subject to litigation and other legal proceedings that could be time consuming, require significant amounts of management time and result in the diversion of significant operational resources. We are involved in lawsuits, claims and proceedings incident to the ordinary course of our business. Litigation is inherently unpredictable.
We are involved in lawsuits, claims and proceedings incident to the ordinary course of our business. Litigation is inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in the diversion of significant operational resources.
For further information regarding cybersecurity, see Item 1C - Cybersecurity . In connection with the implementation of our corporate strategies, we may face risks associated with the acquisition of businesses, the integration of acquired businesses, and the growth and development of these businesses.
In connection with the implementation of our corporate strategies, we may face risks associated with the acquisition of businesses and franchised restaurants, the integration of acquired businesses, and the growth and development of these businesses.
Additionally, the fixed-rate 2023 Class A-2 and 2019 Class A-2-II senior notes have scheduled quarterly principal amortization payments of $1.25 million and $1.5 million, respectively. If we maintain a leverage ratio of less than or equal to 5.25x total debt to adjusted EBITDA, we may elect to not make the scheduled principal payments.
Under the terms of the Series 2023-1 Class A-2 Notes and the Series 2025-1 Class A-2 Notes, if we maintain a leverage ratio of less than or equal to 5.25x total debt to adjusted EBITDA, we may elect to not make the scheduled principal payments.
Our expansion into and continued operations in international markets could create risks to our brands and reputation. There is no assurance that our international 16 operations will be profitable or that international growth will continue. Our international operations are subject to the same risks associated with our domestic operations, as well as a number of additional risks.
We face a variety of risks associated with doing business in international markets . Our expansion into and continued operations in international markets could create risks to our brands and reputation. There is no assurance that our international operations will be profitable or that international growth will continue.
Further, changes by any rating agency to our credit rating may negatively impact the value and liquidity of both our debt and equity securities, as well as the potential costs associated 15 with refinancing our debt.
Further, changes by any rating agency to our credit rating may negatively impact the value and liquidity of both our debt and equity securities, as well as the potential costs associated with refinancing our debt. Downgrades in our credit ratings could also affect the terms of any such financing and restrict our ability to obtain additional financing in the future.
As of December 31, 2024, Applebee's franchisees operated 1,454 Applebee's restaurants in the United States. Of those restaurants, the ten largest Applebee's franchisees owned 1,173 restaurants, representing 81% of all franchised Applebee's restaurants in the United States. The largest Applebee's franchisee owned 460 restaurants, representing 32% of all franchised Applebee's restaurants in the United States.
As of December 28, 2025, Applebee's franchisees operated 1,413 Applebee's restaurants in the United States. Of those restaurants, the ten largest Applebee's franchisees owned 1,153 restaurants, representing 82% of all franchised Applebee's restaurants in the United States. The largest Applebee's franchisee owned 459 restaurants, representing 32% of all franchised Applebee's restaurants in the United States.
From time to time, we have been subject to these types of lawsuits. The cost of defending claims against us or the ultimate resolution of such claims may harm our business and operating results. In addition, the increasingly regulated business environment may result in a greater number of enforcement actions and private litigation.
There have been a growing number of lawsuits in recent years. There also has been a rise in employment-related lawsuits. From time to time, we have been subject to these types of lawsuits. The cost of defending claims against us or the ultimate resolution of such claims may harm our business and operating results.
Downgrades in our credit ratings could also affect the terms of any such financing and restrict our ability to obtain additional financing in the future. We are heavily dependent on information technology and any material failure of that technology could impair our ability to effectively and efficiently operate our business.
We are heavily dependent on information technology and any material failure of that technology could impair our ability to effectively and efficiently operate our business.
These include, among other things, international economic and political conditions, issues with collections, international currency fluctuations, difficulty in enforcing intellectual property rights, terrorism, civil unrest, global travel risks and differing cultures and consumer preferences. We also are subject to governmental regulations throughout the world that impact the way we do business with our international franchisees and vendors.
Our international operations are subject to the same risks 12 associated with our domestic operations, as well as a number of additional risks. These include, among other things, international economic and political conditions, issues with collections, international currency fluctuations, difficulty in enforcing intellectual property rights, terrorism, civil unrest, global travel risks and differing cultures and consumer preferences.
As privacy and information security laws and regulations change, we may incur additional costs to ensure that we remain in compliance with those laws and regulations. For example, we are subject to the California Consumer Privacy Act and California Privacy Rights Act, which require various processes and protections to be implemented.
As privacy and information security laws and regulations change, we may incur additional costs to ensure that we remain in compliance with those laws and regulations.
In addition, continued integration efforts may result in material challenges. We may not be able to successfully integrate and streamline overlapping functions from past or future acquisitions, and integration may be more costly to accomplish than we expect.
We may not be able to successfully integrate and streamline overlapping functions from past or future acquisitions, and integration may be more costly to accomplish than we expect. Furthermore, growth and development plans with respect to acquired businesses may not be achievable or may not be achieved in our estimated time frame.
In pursuing our corporate strategy, from time to time we may acquire other businesses or brands, as we did in December 2022 when we acquired Fuzzy’s. There can be no assurance that we will realize the anticipated synergies or cost savings related to acquisitions or that they will be achieved in our estimated timeframe.
There can be no assurance that we will realize the anticipated synergies or cost savings related to acquisitions or that they will be achieved in our estimated timeframe. In addition, continued integration efforts may result in material challenges.
Removed
During the six-year term following issuance, the outstanding fixed-rate 2023 Class A-2 senior notes will accrue interest at a rate of 7.824% per year. During the seven-year term following issuance, the outstanding fixed-rate 2019 Class A-2-II senior notes will accrue interest at a rate of 4.723% per year.
Added
For example, we are subject to the CCPA and other state privacy laws which require various disclosures, processes and protections to be implemented, and provide for a variety of consumer data privacy rights that require compliance investment and may limit our ability to use certain data or technologies. For further information regarding cybersecurity, see Item 1C - Cybersecurity .
Removed
It is anticipated that the 2023 Class A-2 Notes will be repaid or refinanced prior to June 2029 and the Class A-2-II Notes will be repaid or refinanced prior to June 2026. If these notes are not repaid or refinanced prior to these anticipated dates, under certain circumstances additional interest will accrue on these notes.
Added
In pursuing our corporate strategy, from time to time we may acquire other businesses or brands, as we did in December 2022 when we acquired Fuzzy’s. We may also acquire restaurants from our franchisees.
Removed
Furthermore, growth and development plans with respect to acquired businesses may not be achievable or may not be achieved in our estimated time frame. We could also encounter difficulties in managing our combined company due to its increased size and scope. We face a variety of risks associated with doing business in international markets .
Added
We could also encounter difficulties in managing our combined company due to its increased size and scope. Additionally, our efforts to reduce cost depend, in part, upon our ability to successfully refranchise acquired restaurants, which in turn, depend on our ability to select qualified and capable franchisees.
Removed
Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in the diversion of significant operational resources. There have been a growing number of lawsuits in recent years. There also has been a rise in employment-related lawsuits.
Added
Failure to comply with any such legal requirements could subject us to monetary liabilities and other sanctions, which could harm our business, results of operations and financial condition. We may be subject to litigation and other legal proceedings that could be time consuming, require significant amounts of management time and result in the diversion of significant operational resources.
Added
In addition, the increasingly regulated business environment may result in a greater number of enforcement actions and private litigation. This could subject us to increased exposure to stockholder lawsuits.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

2 edited+0 added−0 removed17 unchanged
Biggest changeWe engage with a range of third-party cybersecurity service providers, assessors and auditors to evaluate and enhance the effectiveness of our cybersecurity program. Services provided by these third parties include 24/7 security logging, network and 26 endpoint monitoring, vulnerability scanning, penetration testing, security incident response tabletop exercises and security and compliance posture assessments.
Biggest changeWe engage with a range of third-party cybersecurity service providers, assessors and auditors to evaluate and enhance the effectiveness of our cybersecurity program. Services provided by these third parties include 24/7 security logging, network and 22 endpoint monitoring, vulnerability scanning, penetration testing, security incident response tabletop exercises and security and compliance posture assessments.
Members of the Board of Directors also engage in ad hoc conversations with management on cybersecurity-related news events and discuss any updates to our cybersecurity risk management and strategy programs. 27
Members of the Board of Directors also engage in ad hoc conversations with management on cybersecurity-related news events and discuss any updates to our cybersecurity risk management and strategy programs. 23

Item 2. Properties

Properties — owned and leased real estate

9 edited+0 added−1 removed2 unchanged
Biggest changeThe table below shows the location and ownership type of Applebee's, IHOP, and Fuzzy's restaurants as of December 31, 2024: Applebee's (a) IHOP (a)(b) Fuzzy's (a) Total Restaurants Franchise Company Franchise Area License Franchise Company United States Alabama 30 — 15 — 1 — 46 Alaska 1 — 4 — — — 5 Arizona 20 — 42 — 1 — 63 Arkansas 5 1 17 — 1 — 24 California 103 — 225 — — — 328 Colorado 22 — 36 — 16 — 74 Connecticut 5 — 11 — — — 16 Delaware 12 — 8 — — — 20 District of Columbia — — 2 — — — 2 Florida 87 — — 143 6 — 236 Georgia 24 32 83 3 — — 142 Hawaii — — 7 — — — 7 Idaho 12 — 7 — — — 19 Illinois 30 2 43 — — — 75 Indiana 56 — 27 — — — 83 Iowa 25 — 12 — 1 — 38 Kansas 26 — 30 — 6 — 62 Kentucky 24 2 12 — — — 38 Louisiana 12 — 29 — 1 — 42 Maine 12 — 5 — — — 17 Maryland 17 — 54 — — — 71 Massachusetts 24 — 21 — — — 45 Michigan 81 — 28 — — — 109 Minnesota 45 — 8 — 1 — 54 Mississippi 17 2 13 — 1 — 33 Missouri 41 3 32 — 4 — 80 Montana 7 — 4 — — — 11 Nebraska 14 — 7 — — — 21 Nevada 11 — 23 — — — 34 New Hampshire 13 — 4 — — — 17 New Jersey 55 — 49 — — — 104 New Mexico 18 — 15 — — — 33 New York 94 — 61 — — — 155 North Carolina 37 — 52 — — — 89 North Dakota 11 — 3 — — — 14 Ohio 75 — 39 — 1 — 115 Oklahoma 11 — 35 — 9 — 55 Oregon 17 — 14 — — — 31 Pennsylvania 75 — 28 — — — 103 Rhode Island 6 — 5 — — — 11 South Carolina 26 — 30 — — — 56 South Dakota 6 — 2 — — — 8 Tennessee 22 5 35 — — — 62 Texas 86 — 218 — 66 1 371 Utah 9 — 20 — — — 29 Vermont 3 — — — — — 3 Virginia 46 — 67 — — — 113 Washington 40 — 37 — — — 77 West Virginia 14 — 10 — — — 24 Wisconsin 24 — 18 — — — 42 Wyoming 3 — 1 — 1 — 5 Total Domestic 1,454 47 1,548 146 116 1 3,312 28 Applebee's (a) IHOP (a)(b) Fuzzy's (a) Total Restaurants Franchise Company Franchise Area License Franchise Company International Bahamas 1 — 1 — — — 2 Bahrain 1 — — — — — 1 Brazil 10 — — — — — 10 Canada 11 — 22 8 — — 41 Dominican Republic 3 — — — — — 3 Ecuador — — 7 — — — 7 Egypt — — 1 — — — 1 Guam 1 — 1 — — — 2 Guatemala 4 — — — — — 4 Honduras 1 — 1 — — — 2 India — — 2 — — — 2 Kuwait 7 — 7 — — — 14 Mexico 37 — 55 — — — 92 Oman 1 — — — — 1 Pakistan — — 2 — — — 2 Panama 4 — 4 — — — 8 Peru 1 — 2 — — — 3 Puerto Rico 8 — 8 — — — 16 Qatar 8 — 3 — — — 11 Saudi Arabia 12 — 3 — — — 15 United Arab Emirates 3 — 3 — — — 6 Total International 113 — 122 8 — — 243 Total 1,567 47 1,670 154 116 1 3,555 _________________________________ (a) The properties identified in this table generate revenue in our franchise, rental, financing and company restaurant operating segments.
Biggest changeThe table below shows the location and ownership type of IHOP, Applebee's, and Fuzzy's restaurants as of December 28, 2025: Franchise Company Total Restaurants IHOP (a) Applebee's Fuzzy's IHOP Applebee's Fuzzy's United States Alabama 17 29 — — — — 46 Alaska 4 1 — — — — 5 Arizona 42 20 1 — — — 63 Arkansas 17 4 1 — 2 — 24 California 224 102 1 — — — 327 Colorado 37 22 16 — — — 75 Connecticut 11 5 — — — — 16 Delaware 8 12 — — — — 20 District of Columbia 2 — — — — — 2 Florida 142 78 4 — — — 224 Georgia 85 24 — — 32 — 141 Hawaii 6 — — — — — 6 Idaho 7 12 — — — — 19 Illinois 41 30 — — 2 — 73 Indiana 26 54 — — 2 — 82 Iowa 11 25 1 — — — 37 Kansas 30 21 5 — — — 56 Kentucky 10 19 — 2 7 — 38 Louisiana 24 12 1 — — — 37 Maine 6 12 — — — — 18 Maryland 54 17 — — — — 71 Massachusetts 21 24 — — — — 45 Michigan 27 81 — — — — 108 Minnesota 8 45 1 — — — 54 Mississippi 11 17 1 — 2 — 31 Missouri 31 39 — 1 3 — 74 Montana 4 7 — — — — 11 Nebraska 7 14 — — — — 21 Nevada 23 11 — — — — 34 New Hampshire 4 13 — — — — 17 New Jersey 49 55 — — — — 104 New Mexico 15 18 — — — — 33 New York 62 91 — — — — 153 North Carolina 52 37 — — — — 89 North Dakota 3 11 — — — — 14 Ohio 26 75 1 9 — — 111 Oklahoma 35 6 10 — 4 — 55 Oregon 17 16 — — — — 33 Pennsylvania 28 74 — — — — 102 Rhode Island 5 6 — — — — 11 South Carolina 26 26 — — — — 52 South Dakota 2 5 — — — — 7 Tennessee 33 22 — — 5 — 60 Texas 221 89 61 — — 1 372 Utah 20 9 — — — — 29 Vermont — 3 — — — — 3 Virginia 67 45 — — — — 112 Washington 37 40 — — — — 77 West Virginia 10 14 — — — — 24 Wisconsin 24 19 — — — — 43 Wyoming — 2 1 — — — 3 Total Domestic 1,672 1,413 105 12 59 1 3,262 24 Franchise Company Total Restaurants IHOP (a) Applebee's Fuzzy's IHOP Applebee's Fuzzy's Total Restaurants International Bahamas 1 1 — — — — 2 Bahrain 1 1 — — — — 2 Brazil — 10 — — — — 10 Canada 31 9 — — — — 40 Costa Rica 1 1 — — — — 2 Dominican Republic — 3 — — — — 3 Ecuador 8 — — — — — 8 Egypt 2 1 — — — — 3 Guam 1 1 — — — — 2 Guatemala — 4 — — — — 4 Honduras 1 1 — — — — 2 India 1 — — — — — 1 Kuwait 7 7 — — — — 14 Mexico 55 30 — — — — 85 Oman 1 1 — — — — 2 Pakistan 3 — — — — — 3 Panama 3 4 — — — — 7 Peru 2 2 — — — — 4 Puerto Rico 8 7 — — — — 15 Qatar 4 7 — — — — 11 Saudi Arabia 7 14 — — — — 21 United Arab Emirates 3 3 — — — — 6 Total International 140 107 — — — — 247 Total 1,812 1,520 105 12 59 1 3,509 _________________________________ (a) There are 142 IHOP restaurants operated by area licenses in the U.S. state of Florida, three in the U.S. state of Georgia and nine in Canada.
All of the IHOP restaurants operated by area licensees, 1,565 of the franchisee-operated Applebee's restaurants and all the franchisee-operated Fuzzy's restaurants were located on sites owned or leased by the area licensees or the franchisees.
All of the IHOP restaurants operated by area licensees, 1,519 of the franchisee-operated Applebee's restaurants and all the franchisee-operated Fuzzy's restaurants were located on sites owned or leased by the area licensees or the franchisees.
We currently occupy approximately 93,000 square feet for our principal corporate offices and restaurant support center located in Pasadena, California, under a lease expiring in August 2035. We also lease approximately 8,000 square feet of office space in Irving, Texas under a lease expiring in February 2026. 29
We currently occupy approximately 93,000 square feet for our principal corporate offices and restaurant support center located in Pasadena, California, under a lease expiring in August 2035.
Under our Applebee's and Fuzzy's franchise agreements, we have certain rights to gain control of a restaurant site in the event of default under the franchise agreement.
When this occurs, the restaurant is closed and possession of the premises is returned to the landlord. Under our Applebee's and Fuzzy's franchise agreements, we have certain rights to gain control of a restaurant site in the event of default under the franchise agreement.
Of the 1,670 IHOP restaurants operated by franchisees, 52 were located on sites owned by us, 502 were located on sites leased by us from third parties and 1,116 were located on sites owned or leased by franchisees.
Of the 1,658 IHOP restaurants operated by franchisees, 48 were located on sites owned by us, 473 were located on sites leased by us from third parties and 1,137 were located on sites owned or leased by franchisees.
We owned one site on which a franchisee-operated Applebee's restaurant was located and one franchisee-operated Applebee's restaurant was located on site leased by us from third parties. The 47 Applebee's restaurants we operated as of December 31, 2024 were located on sites leased by us from third parties.
We owned one site on which a franchisee-operated Applebee's restaurant was located and no franchisee-operated Applebee's restaurant was located on a site leased by us from third parties. The 12 IHOP, 59 Applebee's and one Fuzzy's company-owned restaurants as of December 28, 2025 were located on sites leased by us from third parties.
(b) There are six IHOP restaurants in the U.S. state of Florida and five IHOP restaurants in Canada that have been sub-licensed by the area licensee in Florida and Canada, respectively.
Of those, there are two IHOP restaurants in Florida and five IHOP restaurants in Canada that have been sub-licensed by the area licensee.
In addition, a substantial number of the leases for both IHOP and Applebee's restaurants include provisions calling for the periodic escalation of rents during the initial term and/or during renewal terms.
In addition, a substantial number of the leases for both IHOP and Applebee's restaurants include provisions calling for the periodic escalation of rents during the initial term and/or during renewal terms. The leases typically provide for payment of rents in an amount equal to the greater of a fixed amount or a specified percentage of gross sales.
The leases typically provide for payment of rents in an amount equal to the greater of a fixed amount or a specified percentage of gross sales and for payment of taxes, insurance premiums, maintenance expenses and certain other costs. Historically, it has been our practice to seek to extend, through negotiation, those leases that expire without renewal options.
They also generally require payment of taxes, insurance premiums, maintenance expenses and certain other costs. Historically, it has been our practice to seek to extend, through negotiation leases that expire and do not contain renewal options. However, from time to time, we may choose not to renew a lease or are unsuccessful in negotiating satisfactory renewal terms.
Removed
However, from time to time, we choose not to renew a lease or are unsuccessful in negotiating satisfactory renewal terms. When this occurs, the restaurant is closed and possession of the premises is returned to the landlord.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeLegal fees and expenses associated with the defense of all of our litigation are expensed as such fees and expenses are incurred. Management regularly assesses our insurance deductibles, analyzes litigation information with our attorneys and evaluates our loss experience in connection with pending legal proceedings.
Biggest changeLegal fees and expenses associated 25 with the defense of all of our litigation are expensed as such fees and expenses are incurred. Management regularly assesses our insurance deductibles, analyzes litigation information with our attorneys and evaluates our loss experience in connection with pending legal proceedings.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−0 removed2 unchanged
Biggest changeIssuer Purchases of Equity Securities Purchases of Equity Securities by the Company Month Period Total number of shares (a) Average price paid per share Total number of shares purchased as part of publicly announced plan or programs Approximate dollar value of shares that may yet be purchased under the plans or programs September 30, 2024 – October 27, 2024 421 $ 31.87 — $ 133,266,000 October 28, 2024 – November 24, 2024 401 $ 35.30 — $ 133,266,000 November 25, 2024 – December 29, 2024 2,085 $ 32.24 — $ 133,266,000 Total 2,907 $ 32.61 — $ 133,266,000 _________________________________ (a) These amounts represent shares owned and tendered by employees to satisfy tax withholding obligations arising upon the vesting of restricted stock awards.
Biggest changeIssuer Purchases of Equity Securities Purchases of Equity Securities by the Company Month Period Total number of shares (a) Average price paid per share Total number of shares purchased as part of publicly announced plan or programs Approximate dollar value of shares that may yet be purchased under the plans or programs September 29, 2025 – October 26, 2025 37 $ 23.90 — $ 103,164,000 October 27, 2025 – November 23, 2025 3,956 $ 26.08 601,278 $ 87,485,000 November 24, 2025 – December 28, 2025 435 $ 31.70 451,918 $ 73,163,000 Total 4,428 $ 28.48 1,053,196 _________________________________ (a) These amounts represent shares owned and tendered by employees to satisfy tax withholding obligations arising upon the vesting of restricted stock awards.
The graph and table assume $100 was invested at the close of trading on the last day of trading in 2019 in our common stock and in each of the market indices, with reinvestment of all dividends. Stockholder returns over the indicated periods should not be considered indicative of future stock prices or stockholder returns.
The graph and table assume $100 was invested at the close of trading on the last day of trading in 2020 in our common stock and in each of the market indices, with reinvestment of all dividends. Stockholder returns over the indicated periods should not be considered indicative of future stock prices or stockholder returns.
This number does not include beneficial owners whose shares are held in street name by brokers and other nominees. Dividends on Common Stock Refer to Note 12 - Stockholders' Deficit, of the Notes to the Consolidated Financial Statements for information on dividends declared and paid in the fiscal years ended December 31, 2024, 2023 and 2022.
This number does not include beneficial owners whose shares are held in street name by brokers and other nominees. Dividends on Common Stock Refer to Note 11 - Stockholders' Deficit, of the Notes to the Consolidated Financial Statements for information on dividends declared and paid in the fiscal years 2025, 2024 and 2023.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is traded on the NYSE under the symbol “DIN”. Holders As of February 24, 2025, there were 185 holders of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is traded on the NYSE under the symbol “DIN”. Holders As of February 13, 2026, there were 188 registered holders of our common stock.
Shares so surrendered by the participants are repurchased by us pursuant to the terms of the plan under which the shares were issued and the applicable individual award agreements and not pursuant to publicly announced repurchase authorizations. 30 Stock Performance Graph The graph below shows a comparison of the cumulative total stockholder return on our common stock with the cumulative total return on the Standard & Poor's 500 Composite Index ("S&P 500") and the Standard & Poor's Composite 1500 Restaurants Index (“Restaurants Index”) over the five-year period ended December 31, 2024.
These shares surrendered by holders are repurchased by us pursuant to the terms of the plan under which the shares were issued and the applicable individual award agreements and not pursuant to publicly announced repurchase authorizations. 27 Stock Performance Graph The graph below shows a comparison of the cumulative total stockholder return on our common stock with the cumulative total return on the Standard & Poor's 500 Composite Index ("S&P 500") and the Standard & Poor's Composite 1500 Restaurants Index (“Restaurants Index”) over the five fiscal years.
Comparison of Five-Year Cumulative Total Stockholder Return Dine Brands Global, Inc., S&P 500 and the Restaurants Index (Performance Results through December 31, 2024) 2019 2020 2021 2022 2023 2024 Dine Brands Global, Inc. $ 100.00 $ 72.42 $ 95.16 $ 83.45 $ 66.50 $ 42.71 Standard & Poor's 500 100.00 118.40 152.39 124.79 157.59 197.02 S&P Composite 1500 Restaurants (1) 100.00 119.57 145.93 133.03 153.95 164.08 _________________________________ (1) The S&P Composite 1500 Restaurants Index is a comprehensive restaurant industry index.
Comparison of Five-Year Cumulative Total Stockholder Return Dine Brands Global, Inc., S&P 500 and the Restaurants Index (Performance Results through December 28, 2025) 2020 2021 2022 2023 2024 2025 Dine Brands Global, Inc. $ 100.00 $ 131.41 $ 115.24 $ 91.83 $ 60.08 $ 71.45 Standard & Poor's 500 100.00 128.71 105.40 133.10 166.40 196.16 S&P Composite 1500 Restaurants (1) 100.00 122.05 111.26 128.76 137.23 134.80 _________________________________ (1) The S&P Composite 1500 Restaurants Index is a comprehensive restaurant industry index.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

68 edited+43 added−136 removed5 unchanged
Biggest changeOur 2024 total franchise expenses decreased $4.5 million compared to 2023 due to changes in the following components: • Advertising expenses decreased $5.7 million, primarily due to a corresponding decrease in advertising revenue partially offset the recognition of an advertising fund deficit in 2024. • IHOP franchise expenses decreased $1.3 million compared to 2023, primarily due to a decrease in franchise IT support costs, a decrease in cost of proprietary sales, a decrease in virtual brand expense and a decrease in bad debt expense, partially offset by an increase in franchisor advertising contribution. • Applebee's franchise expenses decreased $0.3 million compared to 2023 primarily due to a decrease in bad debt expense, partially offset by an increase in franchisor advertising contribution. • Fuzzy's franchise expenses increased $2.8 million compared to 2023 primarily due to an increase in franchisor advertising contribution and an increase in bad debt expense.
Biggest changeFranchise expenses decreased as a result of the following: • IHOP franchise expenses decreased $2.8 million primarily due to a decrease in the cost of proprietary sales and a decrease in franchisor advertising contributions as compared to the prior year. • Applebee’s franchise expenses increased $5.3 million primarily due to an increase in bad debt expense. • Fuzzy’s franchise expense decreased $2.8 million primarily due to a franchisor advertising contribution in the prior year. • Advertising expenses decreased $16.4 million primarily due to a corresponding decrease in the number of franchise restaurants and a 1.5% decrease in IHOP domestic same-restaurant sales, partially offset by a 1.4% increase in Applebee's franchise domestic same-restaurant sales. 34 Company-Owned Restaurant Segment 2025 2024 Change (In millions) Company-owned restaurant revenues $ 104.6 $ 9.3 $ 95.3 Company-owned restaurant expenses 112.6 9.9 (102.7) Company-owned restaurant segment loss $ (8.0) $ (0.6) $ (7.4) During fiscal year 2025, the Company owned 72 restaurants compared to 48 restaurants in fiscal year 2024.
The final maturity of the 2023 Class A-2 Notes is in March 2053, but it is anticipated that, unless repaid earlier, to the extent permitted under the Indenture, the 2023 Class A-2 Notes will be repaid in June 2029.
Maturity The final maturity of the 2023 Class A-2 Notes is in March 2053, but it is anticipated that, unless repaid earlier, to the extent permitted under the Indenture, the 2023 Class A-2 Notes will be repaid in June 2029.
GAAP measures should be considered in addition to, and not as a substitute for, the U.S. GAAP information contained within our financial statements.
Non-GAAP measures should be considered in addition to, and not as a substitute for, the U.S. GAAP information contained within our financial statements.
Share Repurchases On February 17, 2022, our Board of Directors authorized a new share repurchase program, effective April 1, 2022, of up to $250 million (the "2022 Repurchase Program").
Share Repurchases On February 17, 2022, our Board of Directors authorized a share repurchase program, effective April 1, 2022, of up to $250 million (the "2022 Repurchase Program").
Adjusted free cash flow does not represent residual cash flow available for discretionary purposes. Adjusted free cash flow is a non-U.S. GAAP measure. This non-U.S. GAAP measure is not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies. Non-U.S.
Adjusted free cash flow does not represent residual cash flow available for discretionary purposes. 39 Adjusted free cash flow is a non-GAAP measure. This non-GAAP measure is not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies.
See Note 11 - Commitments and Contingencies, of the Notes to the Consolidated Financial Statements, for a description of the Company's lease guarantees. We believe that our unrestricted cash and cash equivalents on hand, cash flow from operations and the borrowing capacity available under our Credit Facility will provide us with adequate liquidity for at least the next twelve months.
See Note 10 - Commitments and Contingencies, of the Notes to the Consolidated Financial Statements, for a description of the Company's lease guarantees. We believe that our unrestricted cash and cash equivalents on hand, cash flow from operations and the borrowing capacity available under our Credit Facility will provide us with sufficient liquidity for at least the next twelve months.
Our significant accounting policies are comprehensively described in Note 2 - Basis of Presentation and Significant Accounting Policies, of the Notes to the Consolidated Financial Statements contained in Part II, Item 8 of this 10-K.
Critical Accounting Estimates Our significant accounting policies are comprehensively described in Note 2 - Basis of Presentation and Summary of Significant Accounting Policies , of the Notes to the Consolidated Financial Statements contained in Part II, Item 8 of this Form 10-K.
We believe the accounting policies discussed below are particularly important to the understanding of our consolidated financial statements and require higher degree of judgment and/or complexity in the preparation of those consolidated financial statements. In exercising those judgments, we make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures.
We believe the accounting policies discussed below, which are important in the preparation of our consolidated financial statements, require a higher degree of judgment or complexity in the preparation of our consolidated financial statements. In exercising these judgments, we make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures.
Future trends in system-wide sales are dependent to a significant extent on national, regional and local economic conditions, and, to a lesser extent, on global economic conditions, particularly those conditions affecting the demographics of the guests that frequently patronize our 51 restaurants.
Future trends in system sales are dependent to a large degree on national, regional and local economic conditions, and, to a lesser degree, on global economic conditions, particularly those conditions affecting the demographics of the guests that frequently patronize our restaurants.
Our 2024 effective tax rate of 27.5% applied to pretax book income was different than the statutory Federal income tax rate of 21% primarily due to state and local taxes and a lower tax deduction related to stock-based compensation.
The fiscal year 2024 effective tax rate of 27.5% was different than the statutory Federal income tax rate of 21% primarily due to state and local taxes and a lower tax deduction related to stock-based compensation.
Long-Term Debt Key provisions of our long-term debt potentially impacting liquidity are summarized below. See Note 8 - Long-Term Debt, of the Notes to the Consolidated Financial Statements, for additional detail on long-term debt, including the balances outstanding at December 31, 2024 and 2023.
Long-Term Debt Key provisions of our long-term debt potentially impacting liquidity are summarized below. See Note 8 - Long-Term Debt, of the Notes to the Consolidated Financial Statements, for additional detail on long-term debt, including the balances outstanding as of December 28, 2025 and December 29, 2024.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. General The following discussion provides analyses of our results of operations and reasons for material changes for 2024 as compared to 2023 and should be read together with the financial statements included in this Annual Report on Form 10-K.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. General The following provides a discussion of our results of operations for fiscal 2025 as compared to fiscal 2024 and should be read together with the financial statements included in this Annual Report on Form 10-K.
Newly Issued Accounting Standards Not Yet Adopted See Note 2 - Basis of Presentation and Summary of Significant Accounting Policies, of the Notes to the Consolidated Financial Statements included in this report, for a description of newly issued accounting standards that may impact us in the future.
Recent Accounting Pronouncements See Note 2 - Basis of Presentation and Summary of Significant Accounting Policies, of the Notes to the Consolidated Financial Statements included in this report, for a description of accounting standards we adopted in the current fiscal year and newly issued accounting standards that may impact us in the future.
As of December 31, 2024, the make-whole premium associated with voluntary prepayment of the 2023 Class A-2 Notes was approximately $28.0 million. We also would be subject to a make-whole premium in the event of a mandatory prepayment required following certain rapid amortization events or certain asset dispositions.
As of December 28, 2025, the make-whole premium associated with voluntary prepayment of the 2023 Class A-2 Notes was approximately $17.4 million and for the 2025 Class A-2 Notes was approximately $37.1 million. We also would be subject to a make-whole premium in the event of a mandatory prepayment required following certain rapid amortization events or certain asset dispositions.
On February 20, 2025, our Board of Directors declared a first quarter 2025 cash dividend of $0.51 per share of common stock, payable on April 4, 2025 to the stockholders of record as of the close of business on March 17, 2025.
On February 20, 2026, our Board of Directors declared a first quarter 2026 cash dividend of $0.19 per share of common stock, payable on April 10, 2026 to the stockholders of record as of the close of business on March 18, 2026.
Capital Allocation Dividends During the fiscal years ended December 31, 2024, 2023 and 2022, we declared and paid dividends on common stock as shown in Note 12 - Stockholders' Deficit , of the Notes to the Consolidated Financial Statements included in this report.
Capital Allocation Dividends During the fiscal years ended December 28, 2025, December 29, 2024 and December 31, 2023, we declared and paid dividends on common stock as shown in Note 11 - Stockholders' Deficit , of the Notes to the Consolidated Financial Statements.
Significant assumptions used to determine fair value under the relief of royalty method include future trends in sales, a royalty rate, and a discount rate to be applied to the forecast revenue stream. There is an inherent degree of uncertainty in preparing any forecast of future results.
Significant assumptions used to determine fair value under the relief from royalty method include future trends in system sales, the royalty rate applied to system sales, and the discount rate used to calculate the present value of the forecasted cash flow stream. There is an inherent degree of uncertainty in preparing any forecast of future results.
Instruments Our long-term debt includes two series of fixed rate senior secured notes, the Series 2019-1 4.723% Fixed Rate Senior Secured Notes in an initial aggregate principal amount of $600 million (the “2019 Class A-2-II Notes”) and the Series 2023-1 7.824% Fixed Rate Senior Secured Notes, Class A-2 in an initial aggregate principal amount of $500 million (the “2023 Class A-2 Notes” and, together with the 2019 Class A-2-II Notes, the “Class A-2 Notes”).
Instruments Our long-term debt includes two series of fixed rate senior secured notes, the Series 2023-1 7.824% Fixed Rate Senior Secured Notes, Class A-2 in an initial aggregate principal amount of $500 million (the "2023 Class A-2 Notes") and the Series 2025-1 6.720% Fixed Rate Senior Secured Notes, Class A-2 in an initial aggregate principal amount of $600 million (the "2025 Class A-2 Notes" and, together with the 2023 Class A-2 Notes, the "Class A-2 Notes").
The weighted average interest rate on Credit Facility borrowings for the period outstanding during the year ended December 31, 2024 was 7.78%.
The weighted average interest rate on Credit Facility borrowings for the period outstanding during the year ended December 28, 2025 was 6.78%.
The decrease for the three months ended December 31, 2024 was primarily due to a decrease in traffic, offset by an increase in average check. The decrease for the year ended December 31, 2024 was primarily due to a decrease in traffic, offset by an increase in average check resulting from menu price increases by franchisees.
The decrease for the three months ended December 28, 2025 was primarily due to a decrease in traffic, partially offset by an increase in average check. The increase for the year ended December 28, 2025 was primarily due to an increase in average check resulting from menu price increases, partially offset by additional value offerings.
Significant factors considered in this assessment include, but are not limited to, macro-economic conditions, market and industry conditions, cost considerations, the competitive environment, share price fluctuations, overall financial performance and results of past impairment tests. If we do not qualitatively determine that it is more-likely-than-not that an impairment does not exist, we perform a quantitative impairment test.
In doing so, we first perform a qualitative assessment of whether it is more likely than not that an impairment exists. Factors considered in this assessment include, but are not limited to, macro-economic conditions, market and industry conditions, cost considerations, the competitive environment, share price fluctuations, overall financial performance and results of past impairment tests.
Based on data from Black Box Intelligence, a restaurant sales reporting firm (“Black Box”), Applebee's same-restaurant sales for the three and twelve months ended December 31, 2024 underperformed the casual dining segment of the restaurant industry (excluding Applebee's) as compared with the same respective periods of 2023.
Based on data from Black Box Intelligence, a restaurant sales reporting firm (“Black Box”), IHOP domestic same-restaurant sales outperformed for the three months ended December 28, 2025 and underperformed for the twelve months ended December 28, 2025 in the family dining category (excluding IHOP), as compared with the same respective periods of fiscal 2024.
Based on data from Black Box, IHOP same-restaurant sales underperformed the family dining segment of the restaurant industry (excluding IHOP) for the three and twelve months ended December 31, 2024, as compared with the same respective periods of 2023.
Based on data from Black Box, Applebee's domestic same-restaurant sales for the three and twelve months ended December 28, 2025 underperformed the casual dining category (excluding Applebee's) as compared with the same respective periods of fiscal 2024.
Reconciliation of the cash provided by operating activities to adjusted free cash flow is as follows: Favorable (Unfavorable) 2024 2023 (In millions) Cash flows provided by operating activities $ 108.2 $ (22.9) $ 131.1 Net receipts from notes and equipment receivables 12.3 3.0 9.3 Additions to property and equipment (14.1) 23.1 (37.2) Adjusted free cash flow $ 106.4 $ 3.2 $ 103.3 The increase in adjusted free cash flow in 2024 compared to 2023 was primarily due to the decrease in additions to property and equipment and the decrease in cash provided by operating activities which was discussed in preceding section of this MD&A.
Reconciliation of the cash provided by operating activities to adjusted free cash flow is as follows: 2025 2024 Change (In millions) Cash flows provided by operating activities $ 89.0 $ 108.2 $ (19.2) Net receipts from notes and equipment receivables 8.1 12.3 (4.2) Additions to property and equipment (35.6) (14.1) (21.5) Adjusted free cash flow $ 61.5 $ 106.4 $ (44.9) The decrease in adjusted free cash flow in 2025 compared to 2024 was primarily due to the increase in additions to property and equipment and the decrease in cash provided by operating activities, which was discussed in preceding section of this Management's Discussion & Analysis.
Domestic Same-Restaurant Sales - Fuzzy's Fuzzy's system-wide domestic same-restaurant sales decreased 10.3% for the three months ended December 31, 2024 and decreased 9.3% for the year ended December 31, 2024, as compared to the same respective periods of 2023.
Domestic Same-Restaurant Sales - Fuzzy's Fuzzy's system domestic same-restaurant sales decreased 0.8% for the three months ended December 28, 2025 and decreased 7.0% for the year ended December 28, 2025, as compared to the same respective periods of 2024.
Sales at restaurants that are owned by franchisees and area licensees are not attributable to the Company. An increase in franchisees' reported sales will result in a corresponding increase in our royalty revenue, while a decrease in franchisees' reported sales will result in a corresponding decrease in our royalty revenue.
Sales at restaurants that are operated by franchisees are not revenues attributable to the Company. An increase in system sales of franchised restaurants will result in a corresponding increase in our royalty revenues, while a decrease will result in a corresponding decrease in our royalty revenues.
According to Black Box, the family dining segment also experienced increases in same-restaurant sales resulting from an increase in average customer check, partially offset by a decline in customer traffic.
According to Black Box, the family dining category experienced a decrease in same-restaurant sales resulting from a decrease in customer traffic, partially offset by an increase in average customer check for the twelve months ended December 28, 2025.
The payment of principal on the Class A-2 Notes may be suspended when the leverage ratio for the Company and its subsidiaries is less than or equal to 5.25x. As of December 31, 2024, our leverage ratio was approximately 4.1x. Therefore, quarterly principal payments are not required.
While the Class A-2 Notes are outstanding, payment of principal and interest is required to be made on the Class A-2 Notes on a quarterly basis. The payment of principal on the Class A-2 Notes may be suspended when the leverage ratio for the Company and its subsidiaries is less than or equal to 5.25x.
In connection with the approval of the 2022 Repurchase Program, the 2019 Share Repurchase Program terminated effective April 1, 2022. 50 A summary of shares repurchased under the 2022 Repurchase Program, during the year ended December 31, 2024 and cumulatively, is as follows: Shares Cost of shares (In millions) 2022 Repurchase Program Repurchased during the year ended December 31, 2024 269,621 $ 12.0 Cumulative (life-of-program) repurchases 1,865,399 $ 116.8 Remaining dollar value of shares that may be repurchased n/a $ 133.2 See Note 12 - Stockholders' Deficit, of the Notes to the Consolidated Financial Statements included in this report for shares repurchased in fiscal 2024, 2023 and 2022.
A summary of shares repurchased under the 2022 Repurchase Program, during the year ended December 28, 2025 and cumulatively, is as follows: Shares Cost of shares (In millions) 2022 Repurchase Program Repurchased during the year ended December 28, 2025 2,352,636 $ 60.1 Cumulative (life-of-program) repurchases 4,218,035 $ 176.8 Remaining dollar value of shares that may be repurchased n/a $ 73.2 See Note 11 - Stockholders' Deficit, of the Notes to the Consolidated Financial Statements included in this report for shares repurchased in fiscal 2025, 2024 and 2023.
Such indicators include, but are not limited to, events or circumstances such as a significant adverse change in our business, in the overall climate of the business, unanticipated competition, a loss of key personnel, adverse legal or regulatory developments or a significant decline in the market price of our common stock.
Such indicators include, but are not limited to, events or circumstances such as a significant adverse change in our business, climate of the business, unanticipated competition, a loss of key personnel, adverse legal or regulatory developments or a significant decline in the market price of our common stock. 40 If no indicators of impairment exist, we perform our annual impairment test of goodwill and indefinite-lived intangible assets annually in the fourth fiscal quarter.
For a detailed discussion of year-to-year comparisons between fiscal 2023 and fiscal 2022 as well as between fiscal 2022 and fiscal 2021, please refer to the applicable portion of “ Management's Discussion and Analysis of Financial Condition and Results of Operations ” contained in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which is hereby incorporated by reference.
For discussion of our results of operations for fiscal 2024 and 2023 results, please refer to “ Management's Discussion and Analysis of Financial Condition and Results of Operations ” contained in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 29, 2024.
Repurchases of the Company's debt, if any, are expected to reduce future cash interest payments, as well as future amounts due at maturity or upon redemption.
On February 16, 2023, our Company's Board of Directors authorized a debt repurchase program of up to $100 million. Repurchases of the Company's debt, if any, are expected to reduce future cash interest payments, as well as future amounts due at maturity or upon redemption.
There were no repayment or issuance of long-term debt during the year ended December 31, 2024. Adjusted Free Cash Flow We define “adjusted free cash flow” for a given period as cash provided by operating activities, plus receipts from notes and equipment contract receivables, less additions to property and equipment.
Adjusted Free Cash Flow We define “adjusted free cash flow” for a given period as cash provided by operating activities, plus receipts from notes and equipment contract receivables, less additions to property and equipment.
The Company increased spending in information technology and other projects in fiscal year 2023. 49 The following table represents the timing of principal receipts from the Company's long-term receivables for equipment, real estate leases receivable, and other notes receivable from franchisees as of December 31, 2024: Principal Receipts Due By Period 2025 2026 2027 2028 2029 Thereafter Total (In millions) Equipment leases (1) $ 5.6 $ 4.2 $ 2.3 $ 0.8 $ 0.4 $ — $ 13.2 Real estate leases receivable (2) 1.4 1.5 1.6 1.7 1.7 10.4 18.3 Other notes (3) 1.8 1.6 1.5 1.5 1.4 6.2 14.0 Total $ 8.8 $ 7.3 $ 5.4 $ 4.0 $ 3.5 $ 16.6 $ 45.5 __________________________________________ (1) Equipment leases receivable extend through the year 2029.
The increase in cash used in investing activities is largely driven by the remodels and construction of the company-owned restaurants and decrease of principal receipts from notes and equipment contracts receivables offset by the decrease in restaurant reacquisition activity. 37 The following table represents the timing of principal receipts from the Company's long-term receivables for equipment, real estate leases receivable, and other notes receivable from franchisees as of December 28, 2025: Principal Receipts Due By Period 2026 2027 2028 2029 2030 Thereafter Total (In millions) Equipment leases (1) $ 3.8 $ 2.1 $ 0.5 $ — $ — $ 0.1 $ 6.6 Real estate leases receivable (2) 1.6 1.7 1.8 1.9 1.9 9.4 18.2 Other notes (3) 5.4 3.0 2.8 2.3 3.1 4.3 20.9 Total $ 10.8 $ 6.8 $ 5.1 $ 4.2 $ 5.0 $ 13.8 $ 45.7 __________________________________________ (1) Equipment leases receivable extend through the year 2037.
There are numerous potential events that could reasonably be expected to negatively affect the forecast of system-wide sales, including a decrease in customers' disposable income available for discretionary spending or a decrease in the perceived wealth of customers, as well as unexpected events such as a global pandemic.
There are numerous potential events that could reasonably be expected to negatively affect the forecast of system sales, from a decrease in customers' disposable income to an unexpected event such as a global pandemic. As a result, our restaurants could experience a decline in system sales as a result of numerous factors.
Material cash requirements to satisfy these obligations were as follows: Obligation Due in Fiscal 2025 Due Thereafter Total Reference (1) (in millions) Long-term debt (principal) $ 100.0 $ 1,094.0 $ 1,194.0 Note 8 - Long-term Debt Long-term debt (interest) 71.5 150.9 222.4 Note 8 - Long-term Debt Operating leases 87.2 387.5 474.7 Note 10 - Leases Finance leases 7.6 44.8 52.4 Note 10 - Leases Financing obligations 4.1 29.3 33.4 Note 9 - Financing Obligations Purchase commitments 94.7 34.6 129.3 Note 11 - Commitments and Contingencies Total $ 365.1 $ 1,741.1 $ 2,106.2 _________________________________ (1) See referenced note of Notes to the Consolidated Financial Statements for additional information about the obligation.
Material cash requirements to satisfy these obligations were as follows: Obligation Due in Fiscal 2026 Due Thereafter Total Reference (1) (in millions) Long-term debt (principal) $ — $ 1,200.0 $ 1,200.0 Note 8 - Long-term Debt Long-term debt (interest) 83.9 256.3 340.2 Note 8 - Long-term Debt Operating leases 91.7 386.9 478.6 Note 9 - Leases Finance leases 7.6 41.4 49.0 Note 9 - Leases Financing obligations 4.0 22.2 26.2 Note 9 - Leases Purchase commitments 99.1 5.3 104.4 Note 10 - Commitments and Contingencies Total $ 286.3 $ 1,912.1 $ 2,198.4 _________________________________ (1) See referenced note of Notes to the Consolidated Financial Statements for additional information about the obligation.
Changes in estimates and judgments could significantly affect our results of operations, financial condition and cash flow in the future. Goodwill and Intangible Assets Goodwill and intangible assets considered to have an indefinite life are evaluated throughout the year to determine if indicators of impairment exist.
Actual results could differ from our estimates and judgments, which could significantly affect our reported results of operations, financial condition and cash flows in the future. Goodwill and Indefinite-lived Intangible Assets Goodwill and intangible assets considered to have an indefinite life are required to be tested for impairment annually or more frequently if indicators of impairment exist.
Under the authorization, the Company may make repurchases of the Company's debt from time to time in the open market or in privately negotiated transactions upon such terms and at such prices as management may determine.
Under the authorization, the Company may make repurchases of the Company's debt from time to time in the open market or in privately negotiated transactions upon such terms and at such prices as management may determine. 38 Make-whole Premiums We may voluntarily repay the Class A-2 Notes at any time; however, if repaid prior to certain dates we would be required to pay make-whole premiums.
Investing Activities Investing activities used net cash of $8.5 million for the year ended December 31, 2024 compared to using net cash of $30.1 million for the year ended December 31, 2023, a favorable change of $21.6 million.
Investing Activities Investing activities used net cash of $31.6 million for the year ended December 28, 2025 compared to using net cash of $8.5 million during the comparable prior period.
IHOP Off-Premise Sales Data Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2022 2024 2023 2022 Off-premise sales (in millions) (1) $ 154.3 $ 155.9 $ 160.9 $ 600.5 $ 616.5 $ 627.4 % sales mix 20.4 % 20.4 % 21.7 % 20.2 % 20.6 % 22.0 % (1) Primarily to-go, delivery and catering sales.
IHOP Off-Premise Sales Data Fourth Fiscal Quarter Fiscal Year 2025 2024 2025 2024 Off-premise sales (in millions) (1) $ 160.7 $ 154.3 $ 606.8 $ 600.5 % sales mix 21.2 % 20.4 % 20.6 % 20.2 % (1) Primarily to-go, delivery and catering sales.
The decrease in cash used by financing activities of $173.7 million was primarily due to the repayment and issuance of long-term debt of $159.8 million including payment of debt issuance costs during the year ended December 31, 2023 and a $14.1 million decrease in repurchases of common stock.
The increase in cash used in financing activities of $52.6 million was primarily due to the increase of $48.6 million in repurchases of common stock and repayment and issuance of long-term debt of $5.6 million including payment of debt issuance costs. There were no repayment or issuance of long-term debt during the year ended December 29, 2024.
See Part II, Item 5 - Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for detail on this stock repurchase activity during the twelve months ended December 31, 2024. Critical Accounting Estimates We prepare our consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”).
See Part II, Item 5 - Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for detail on this stock repurchase activity during the twelve months ended December 28, 2025.
Applebee's Off-Premise Sales Data Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2022 2024 2023 2022 Off-premise sales (in millions) (1) $ 210.0 $ 215.4 $ 250.7 $ 882.5 $ 944.1 $ 1,088.7 % sales mix 21.6 % 20.8 % 23.8 % 21.7 % 22.0 % 25.3 % (1) Primarily to-go, delivery and catering sales.
Applebee's Off-Premise Sales Data Fourth Fiscal Quarter Fiscal Year 2025 2024 2025 2024 Off-premise sales (in millions) (1) $ 212.3 $ 210.0 $ 890.1 $ 882.5 % sales mix 23.0 % 21.6 % 22.8 % 21.7 % (1) Primarily to-go, delivery and catering sales.
(2) Real estate leases receivable extend through the year 2045. (3) Other notes receivable extend through the year 2031. Financing Activities Financing activities used net cash of $51.7 million for the year ended December 31, 2024.
(2) Real estate leases receivable extend through the year 2046. (3) Other notes receivable extend through the year 2032. Financing Activities Cash flows used in financing activities increased $52.6 million for the year ended December 28, 2025.
The preparation of the projections requires considerable judgment and is subject to change to reflect future events and changes in the tax laws. When we establish or reduce the valuation allowance against our deferred tax assets, our income tax expense will increase or decrease, respectively, in the period such determination is made.
When we establish or reduce the valuation allowance, our income tax expense will increase or decrease, respectively, in the period such determination is made. Tax laws are complex and subject to different interpretations by the taxpayers and respective governmental authorities.
Closure and Impairment Charges Favorable (Unfavorable) Favorable (Unfavorable) 2024 2023 2022 (In millions) Closure charges $ 2.2 $ (0.6) $ 1.6 $ 0.1 $ 1.7 Goodwill impairment 7.1 (7.1) — — — Long-lived asset impairment 0.0 2.0 2.0 (0.6) 1.4 Total $ 9.2 $ (5.7) $ 3.6 $ (0.5) $ 3.1 Closure Charges The closure charges of $2.2 million for the year ended December 31, 2024 comprised of $1.5 million for revisions to existing closure reserves, including accretion, for approximately 21 IHOP restaurants closed prior to 2023, and $0.6 million related to the conversion of approximately 20,000 square feet of office space in the Leawood, Kansas restaurant support center to a remote work model in February 2024.
The closure charges of $2.2 million for the year ended December 29, 2024 were $1.5 million for revisions to existing reserves, for approximately 21 IHOP restaurants closed prior to 2023, and $0.6 million related to the office space in the Leawood, Kansas restaurant support center referenced above.
The decrease in franchise 41 operations revenue was primarily attributable to the decrease in domestic same-restaurant sales and the decrease in the number of Applebee's and Fuzzy's effective restaurants, partially offset by increases in the number of effective restaurants and proprietary product sales at IHOP.
The decrease in royalty revenue and proprietary product sales was primarily due to a 7.0% decrease in franchise domestic same-restaurant sales and a decrease in the number of franchise restaurants. • Advertising revenue decreased $8.7 million due to the decrease in the number of franchise restaurants as noted above and a 1.5% decrease in IHOP domestic same-restaurant sales, partially offset by a 1.4% increase in Applebee’s domestic same-restaurant sales.
In performing a quantitative test for impairment of goodwill, we primarily use the income approach method of valuation that includes the discounted cash flow method and the market approach that includes the guideline public company method to determine the fair value of goodwill and intangible assets.
In addition, we may use a market approach that includes the guideline public company method to determine the fair value of a reporting unit or to compare to the value derived from our discounted cash flow.
The decrease for the year ended December 31, 2024 was primarily due to a decrease in traffic, offset by an increase in average check resulting from the successful promotional food and beverage offerings and menu price increases by franchisees.
The increase for the three months ended December 28, 2025 was primarily driven by an increase in traffic, partially offset by a decrease in average check. The decrease for the year was primarily due to a decrease in average check, resulting from the introduction of our new everyday value menu.
For additional details regarding the methodology and assumptions utilized refer to Note 6 - Goodwill and Note 7 - Other Intangible Assets of the Notes to the Consolidated Financial Statements for additional information.
See Note 2 - Basis of Presentation and Summary of Significant Accounting Policy, Note 6 - Goodwill and Note 7 - Other Intangible Assets of the Notes to the Consolidated Financial Statements.
We concluded it was more likely than not that the fair value of Fuzzy's goodwill did not exceed its respective carrying amount and recorded an impairment charge of $7.1 million during the year ended December 31, 2024.
In fiscal year 2024, our quantitative test of goodwill determined that the fair value of the Fuzzy’s reporting unit was less than its carrying value and we recorded a non-cash impairment charge of $7.1 million during the year.
Applebee's off-premise sales dollars for the three and twelve months ended December 31, 2024 decreased as compared with the same respective periods of 2023, primarily due to our delivery service partners performing below our native channels. 36 IHOP’s domestic same-restaurant sales decreased 2.8% for the three months ended December 31, 2024 and decreased 2.0% for the year ended December 31, 2024, as compared to the same respective periods of 2023.
IHOP's off-premise sales for the three and twelve months ended December 28, 2025 increased by $6.4 million and $6.3 million respectively, as compared to the same respective periods of fiscal 2024 primarily due to the brand's focus on delivery promotions and catering services. 32 Applebee’s system domestic same-restaurant sales decreased 0.4% for the three months ended December 28, 2025 and increased 1.3% for the year ended December 28, 2025, as compared to the same respective periods of 2024.
Because of new restaurant openings and restaurant closures, the domestic restaurants open throughout both fiscal periods being compared may be different from period to period. (e) The franchise sales percentage change for 2024 was impacted by the acquisition of 47 franchise restaurants in November 2024 now reported as company-operated.
“Domestic same-restaurant sales change” reflects the percentage change in sales of domestic restaurants in any given fiscal period that operated during the comparable prior year period and have been open for at least 18 months. Due to new restaurant openings and restaurant closures, the restaurants open throughout both fiscal periods being compared may be different from period to period.
Our long-term debt also includes a revolving financing facility, the Credit Facility that allows for drawings up to $325 million of variable funding notes on a revolving basis and the issuance of letters of credit. 47 Maturity The final maturity of the 2019 Class A-2-II Notes is in June 2049, but it is anticipated that, unless repaid earlier, the 2019 Class A-2-II Notes will be repaid in June 2026.
Our long-term debt also includes the Credit Facility that allows for drawings up to $325 million of variable funding notes on a revolving basis and the issuance of letters of credit. As of December 28, 2025, we had drawn $100.6 million, which includes $0.6 million of letters of credit.
Our total franchise revenue decreased $20.4 million in 2024 compared to 2023, due to the following changes: • Advertising revenue decreased $10.4 million compared to 2023, due to the decreases in domestic same-restaurant sales and development activity as noted above. • Applebee's franchise revenue decreased $7.3 million compared to 2023 primarily due to the unfavorable impact on royalties of a 4.2% decrease in domestic same-restaurant sales and a decrease in the number of effective franchise restaurants, partially offset by an increase in accelerated franchise fee revenue recognition due to restaurant closures. • Fuzzy's franchise revenue decreased $1.5 million compared to 2023 due to 9.3% decrease in same-restaurant sales and a decrease in the number of effective franchise restaurants, partially offset by an increase in termination fees. • IHOP franchise revenue decreased $1.3 million, or 0.6%, compared to 2023, primarily due to a 2.0% decrease in domestic franchise same-restaurant sales and a decrease in licensing and virtual brand revenue, partially offset by an increase in proprietary product sales and an increase in the number of effective franchise restaurants.
The decrease in royalty revenue and proprietary product sales was primarily due to a 1.5% decrease in franchise domestic same-restaurant sales and a decrease in the number of franchise restaurants due to the acquisition of 10 IHOP company-owned restaurants in March 2025. • Applebee’s franchise revenue decreased $2.6 million primarily due to a decrease in royalty revenue partially offset by an increase in termination fees.
Significant assumptions used to determine fair value under the guideline public company method include the selection of guideline companies and the valuation multiples applied. In the process of a quantitative test, if necessary, of the Applebee's and Fuzzy's tradename intangible asset, we primarily use the relief of royalty method under the income approach method of valuation.
Significant assumptions used to determine fair value under the guideline public company method include the selection of guideline companies and the valuation multiples applied. We believe our assumptions and valuation methodologies are consistent with those that would be used by a market participant. Our indefinite-lived intangible assets have primarily consisted of the Applebee's and Fuzzy's tradenames.
We make certain estimates and judgments in the calculation of tax expense and the resulting tax liabilities and in the recoverability of deferred tax assets that arise from temporary differences between the tax and financial statement recognition of revenue and expense. Tax laws are complex and subject to different interpretations by the taxpayers and respective governmental authorities.
We make certain estimates and judgments in the calculation of tax expense, the resulting tax liabilities and in the recoverability of deferred tax assets that arise from temporary differences between the financial statement recognition of revenue and expense and recognition of those for tax reporting. 41 Deferred tax accounting requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that a portion or all of a deferred tax asset will not be realized.
The renewal date of the Credit Facility is June 2027, subject to two additional one-year extensions at the option of the Company upon the satisfaction of certain conditions. Payment of Principal and Interest While the Class A-2 Notes are outstanding, payment of principal and interest is required to be made on the Class A-2 Notes on a quarterly basis.
As of December 28, 2025, our leverage ratio was approximately 4.8x. Exceeding the leverage ratio of 5.25x does not violate any covenant related to the Class A-2 Notes. The renewal date of the Credit Facility is June 2030, subject to two additional one-year extensions at the option of the Company upon the satisfaction of certain conditions.
Liquidity and Capital Resources of the Company Our total cash balances, net of revolving credit facility borrowings, at December 31, 2024, 2023 and 2022 were as follows: December 31, 2024 December 31, 2023 December 31, 2022 (In millions) Cash and cash equivalents $ 186.7 $ 146.0 $ 269.7 Restricted cash, current 42.4 35.1 38.9 Restricted cash, non-current 19.5 19.5 16.4 Total cash, restricted cash and cash equivalents 248.6 200.6 325.0 Less: Revolving credit facility borrowing (100.0) (100.0) (100.0) Total cash, restricted cash and cash equivalents, net $ 148.6 $ 100.6 $ 225.0 At December 31, 2024, we had contractual obligations to repay debt, make payments under operating leases, finance leases and financing obligations, and to purchase certain goods and services.
Liquidity and Capital Resources of the Company Our total cash balances including restricted cash, net of revolving credit facility borrowings, at December 28, 2025 and December 29, 2024 were as follows: December 28, 2025 December 29, 2024 (In millions) Cash and cash equivalents $ 128.2 $ 186.7 Restricted cash, current 51.5 42.4 Restricted cash, non-current 22.0 19.5 Total cash, restricted cash and cash equivalents 201.7 248.6 Less: Revolving credit facility borrowing (100.0) (100.0) Total cash, restricted cash and cash equivalents, net $ 101.7 $ 148.6 Cash Flows In summary, our cash flows for the years ended December 28, 2025 and December 29, 2024 were as follows: 2025 2024 Change (In millions) Net cash provided by operating activities $ 89.0 $ 108.2 $ (19.2) Net cash used in investing activities (31.6) (8.5) (23.1) Net cash used in financing activities (104.3) (51.7) (52.6) Net (decrease) increase in cash, cash equivalents and restricted cash $ (46.9) $ 48.0 $ (94.9) Operating Activities Cash provided by operating activities decreased $19.2 million during the current fiscal year compared to the same period of the prior year.
IHOP's off-premise sales dollars for the three and twelve months ended December 31, 2024 decreased as compared to the same respective periods of 2023.
Applebee's off-premise sales for the three and twelve months ended December 28, 2025 increased $2.3 million and $7.6 million, respectively, as compared with the same respective periods of fiscal 2024, primarily due to limited time offers paired with digital promotions to encourage more off-premise occasions.
Impairment of Fuzzy's Goodwill and Tradename We performed a quantitative test for impairment of Fuzzy's goodwill and indefinite-lived intangible assets in the fourth quarter of 2024. As a result of performing the quantitative test, we recognized an impairment of Fuzzy's goodwill of $7.1 million.
Intangible assets impairment charges In the fourth quarter of 2025, the Company determined the Fuzzy's tradename intangible asset was impaired and recorded a $29.0 million noncash impairment charge. In the fourth quarter of 2024, we wrote off goodwill of $7.1 million related to our acquisition of Fuzzy's.
Failure to maintain a prescribed DSCR can trigger the following events: • DSCR less than 1.75x - Cash Flow Sweeping Event • DSCR less than 1.20x - Rapid Amortization Event • Interest-only DSCR less than 1.20x - Manager Termination Event • Interest-only DSCR less than 1.10x - Default Event Our DSCR for the reporting period ended December 31, 2024 was approximately 3.4x.
Failure to maintain a DSCR greater than 1.75x can trigger events causing required immediate payments of our Class A-2 Notes and Credit Facility. Our DSCR for the reporting period ended December 28, 2025 was approximately 3.0x.
Rental operations segment profit for the year ended December 31, 2024 decreased compared to the same period of the prior year primarily due to lease buyouts during the prior year and operating lease terminations.
Rental segment profit for the year ended December 28, 2025 decreased compared to the prior fiscal year primarily due to lease terminations resulting from restaurant closures and the impact of company-acquired IHOP restaurants in March 2025 for which we previously collected rental revenues as the lessor from the franchisee.
Changes in our pretax book income between 2024 and 2023 are addressed in the preceding sections of “ Consolidated Results of Operations - Fiscal 2024, 2023 and 2022. ” The fiscal year 2024 effective tax rate of 27.5% applied to pretax book income was different than the statutory Federal income tax rate of 21% primarily due to state and local taxes and a lower tax deduction related to stock-based compensation.
Gain on Disposition of Assets The gain on disposition of assets for the year ended December 28, 2025 primarily relates to the early termination of a finance lease and the release of certain financing obligations in 2025 compared to a gain on the refranchising of nine Applebee's restaurants simultaneously acquired with 47 Applebee's restaurants in 2024. 36 Income Tax Provision 2025 2024 Change (In millions) Income tax provision $ 8.1 $ 24.7 $ (16.6) Effective tax rate 32.0 % 27.5 % 4.5 % The fiscal year 2025 effective tax rate of 32.0% was different than the statutory Federal income tax rate of 21% primarily due to state and local taxes and a lower tax deduction related to stock-based compensation.
The Company repaid the entire outstanding balance of approximately $585.1 million of its 2019 Class A-2-I Notes during the year ended December 31, 2023 and recognized a $1.7 million loss on extinguishment of debt from the write-off of the related remaining issuance costs.
As part of the refinancing, the Company repaid the entire outstanding balance of approximately $594.0 million of its 2019 Class A-2-II Notes and recognized a $0.9 million loss on extinguishment of debt from the refinancing in June 2025. 35 Closure and Impairment Charges 2025 2024 Change (In millions) Closure charges $ 5.0 $ 2.2 $ (2.8) Goodwill impairment — 7.1 7.1 Tradename impairment 29.0 — (29.0) Other asset impairment charges 6.0 — (6.0) Total $ 40.0 $ 9.2 $ (30.7) Closure charges For the year ended December 28, 2025, we recorded $5.0 million of closure charges primarily comprised of $3.6 million for restaurant closure costs related to IHOP restaurants closed in 2025 or earlier.
The decrease in Applebee's advertising expenses was lower than the decrease in advertising revenue primarily because of the recognition of an advertising fund deficit in 2024. IHOP's advertising revenue for 2024 decreased by 1.2%, compared to 2023, primarily due to the decrease of 2.0% in domestic franchise same-restaurant sales offset by an increase in the number of effective franchise restaurants.
This decrease was partially offset by a 1.4% increase in franchise domestic same-restaurant sales. • Fuzzy’s franchise revenue decreased $2.3 million primarily due to a decrease in royalty revenue and a decrease in proprietary product sales.
Rental operations relate primarily to IHOP franchise restaurants that were developed under the Previous IHOP Business Model described under Item 1. - Business . Rental income includes revenue from operating leases and interest income from real estate leases. Rental expenses are costs of prime operating leases and interest expense on prime finance leases on certain franchise restaurants.
Rental Segment 2025 2024 Change (In millions) Rental revenues $ 109.3 $ 117.1 $ (7.8) Rental expenses 84.2 87.2 3.0 Rental Segment Profit $ 25.1 $ 29.9 $ (4.8) Rental operations primarily relate to IHOP franchise restaurants that were developed prior to 2003. Rental revenues are primarily derived from operating leases and interest income from real estate leases.
On a regular basis, we assess whether events or changes in circumstances have occurred that potentially indicate the carrying value of intangible assets with finite lives, primarily assets related to Applebee's franchise rights, may not be recoverable.
Property and Equipment and Finite-Lived Intangible Assets The Company assesses whether property and equipment and finite-lived intangible assets that are held and used are impaired whenever events or changes in circumstances indicate the carrying amount may not be recoverable.
Removed
For a detailed discussion of year-to-year comparisons between fiscal 2023 and fiscal 2022, please refer to the applicable portion of “ Management's Discussion and Analysis of Financial Condition and Results of Operations ” contained in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 28, 2024, which is hereby incorporated by reference.
Added
This Item 7 is organized as follows: • Consolidated Results • Key Performance Indicators • Segment Results • Non-Segment Items • Liquidity and Capital Resources of the Company • Critical Accounting Estimates • Recent Accounting Pronouncements Consolidated Results 2025 2024 Change (In millions) Revenues: Franchise revenues $ 665.5 $ 686.0 $ (20.5) Company-owned restaurant revenues 104.6 9.3 95.3 Rental revenues 109.3 117.1 (7.8) Total revenues 879.3 812.3 67.0 Cost of revenues: Franchise expenses 323.2 339.9 (16.7) Company-owned restaurant expenses 112.6 9.9 102.7 Rental expenses 84.2 87.2 (3.0) Total cost of revenues 520.0 437.0 83.0 Gross profit 359.3 375.3 (16.0) General and administrative expenses 203.8 196.7 7.1 Interest expense, net 78.0 72.1 5.8 Closure and impairment charges 40.0 9.2 30.7 Amortization of intangible assets 11.9 10.8 1.1 Loss on extinguishment of debt 0.9 — 0.9 Gain on disposition of assets (0.5) (3.1) 2.7 Income before income taxes $ 25.2 $ 89.5 $ (64.4) Total revenues increased $67.0 million in fiscal year 2025 compared to fiscal year 2024, largely driven by $95.3 million increase from the Company-owned restaurant segment from restaurants acquired over the last 14 months.
Removed
The financial tables appearing in Management's Discussion and Analysis present amounts in millions of dollars that are rounded from our consolidated financial statements presented in thousands of dollars. As a result, the tables may not foot or cross foot due to rounding. The first International House of Pancakes restaurant opened in 1958 in Toluca Lake, California.
Added
This increase was partially offset by a $20.5 million decrease in franchise revenues due to lower system sales and a $7.8 million decrease in rental revenues. Total cost of revenues increased $83.0 million primarily due to an increase in Company-owned restaurant expenses.
Removed
Shortly thereafter, the Company's predecessor began developing and franchising additional restaurants. The Company was incorporated under the laws of the State of Delaware in 1976 with the name IHOP Corp. In November 2007, the Company completed the acquisition of Applebee's International, Inc., which became a wholly-owned subsidiary of the Company.
Added
Income before income taxes in fiscal year 2025 decreased compared to fiscal year 2024 largely due to increases in closure and impairment charges, decrease in gross profit, increases in general and administrative expenses, and increase in interest expense.
Removed
Effective June 2, 2008, the name of the Company was changed to DineEquity, Inc. and on February 20, 2018, the name of the Company was changed to Dine Brands Global, Inc. ® (“Dine Brands Global,” “we” or “our”).
Added
The increase in closure and impairment charges is primarily due to a $29 million non-cash impairment charge recorded in the fourth quarter of 2025 related to the Fuzzy's tradename intangible assets. The increase in general and administrative expenses is primarily due to an increase in compensation-related expenses and an increase in professional service fees.
Removed
Through various subsidiaries (see Exhibit 21, Subsidiaries of Dine Brands Global, Inc.), we own and franchise the Applebee's Neighborhood Grill + Bar ® (“Applebee's”) concept in the American full-service restaurant segment within the casual dining category of the restaurant industry and we own and franchise the International House of Pancakes ® (“IHOP”) concept in the midscale full-service restaurant segment within the family dining category of the restaurant industry.
Added
The increase in interest expense is primarily the result of the refinancing of our Fixed Rate Senior Secured Notes Series 2025-1 completed in June 2025.
Removed
In December 2022, we acquired the Fuzzy's Taco Shop ® (“Fuzzy's”) concept in the Mexican limited-service restaurant segment within the fast-casual dining category of the restaurant industry.
Added
This increase is driven by an increase in the interest rate and an increase to the principal, partially offset by a decrease in the Credit Facility interest. 29 Key Performance Indicators In addition to revenue, cost of revenues, and gross profit in evaluating the performance of each of our brands, management also considers the following key performance indicators in evaluating our business: "System sales” are retail sales at IHOP, Applebee’s and Fuzzy's restaurants operated by franchisees reported to the Company and revenues generated at Company-owned restaurants.

… 167 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

11 edited+1 added−1 removed2 unchanged
Biggest changeCommodity Prices Many of the food products purchased by our franchisees and area licensees are affected by commodity pricing and are therefore subject to unpredictable price volatility. Extreme increases in commodity prices and/or long-term changes could affect our franchisees, area licensees and company-operated restaurants adversely.
Biggest changeBased on our interest-earning cash, cash equivalents and restricted cash balances as of December 28, 2025, a 1% change in interest rates would change our annual interest income by approximately $2.0 million. Commodity Prices Many of the food products purchased by our franchisees and area licensees are affected by commodity pricing and are therefore subject to unpredictable price volatility.
The Company and owners of Applebee's and IHOP franchise restaurants are members of CSCS, a Co-op that manages procurement activities for the Applebee's and IHOP restaurants that belong to the Co-op. We believe the larger scale created by combining the supply chain requirements of both brands under one organization can provide cost savings and efficiency in the purchasing function.
The Company and owners of IHOP and Applebee's franchise restaurants are members of CSCS, a Co-op that manages procurement activities for the IHOP and Applebee's restaurants that belong to the Co-op. We believe the larger scale created by combining the supply chain requirements of both brands under one organization can provide cost savings and efficiency in the purchasing function.
In some instances, IHOP and Applebee's may be required to guarantee their purchase of any remaining inventory of certain food and other items purchased by CSCS for the purpose of supplying limited time promotions on behalf of the Applebee's and IHOP systems as a whole. None of these food product guarantees is a derivative instrument.
In some instances, IHOP and Applebee's may be required to guarantee their purchase of any remaining inventory of certain food and other items purchased by CSCS for the purpose of supplying limited time promotions on behalf of the IHOP and Applebee's systems as a whole. None of these food product guarantees is a derivative instrument.
We do not hold a material amount of cash and cash equivalents in currencies other than the U.S. Dollar. 54
We do not hold a material amount of cash and cash equivalents in currencies other than the U.S. Dollar. 42
Interest Rate Risk The significant majority of our long-term debt outstanding at December 31, 2024 was issued at fixed interest rates (see Note 8 - Long-Term Debt, of the Notes to Consolidated Financial Statements). We are only exposed to interest rate risk on borrowings we make under our Credit Facility, borrowings from which are subject to variable interest rates.
Interest Rate Risk The significant majority of our long-term debt outstanding as of December 28, 2025 was issued at fixed interest rates (see Note 8 - Long-Term Debt, of the Notes to Consolidated Financial Statements). We are only exposed to interest rate risk on borrowings we make under our Credit Facility, borrowings from which are subject to variable interest rates.
Revenue derived from all international country operations comprised less than 3% of total consolidated revenue for the year ended December 31, 2024, such that a hypothetical concurrent 10% adverse change in the currency of every international country in which our franchisees operate restaurants would have a negative impact of less than 0.3% of our consolidated revenue.
Revenue derived from all international country operations comprised less than 2% of total consolidated revenue for the year ended December 28, 2025, such that a hypothetical concurrent 10% adverse change in the currency of every international country in which our franchisees operate restaurants would have a negative impact of less than 0.2% of our consolidated revenue.
At December 31, 2024, our outstanding guarantees for food product purchases were $2.8 million. International Currency Exchange Rate Risk We have minimal exposure to international currency exchange rate fluctuations.
As of December 28, 2025, our outstanding guarantees for food product purchases were $2.7 million. International Currency Exchange Rate Risk We have minimal exposure to international currency exchange rate fluctuations.
In August 2022, we borrowed $100 million against the Credit Facility, all of which was outstanding at December 31, 2024. A 1% increase or decrease in interest rates would not have a material impact on any fees associated with the Credit Facility. We do not engage in speculative transactions nor do we hold or issue financial instruments for trading purposes.
In August 2022, we borrowed $100 million against the Credit Facility, all of which was outstanding as of December 28, 2025. A 1% increase or decrease in interest rates would not have a material impact on any fees associated with the Credit Facility.
We expect that, in most cases, the brand systems would be able to pass increased commodity prices through to their customers via increases in menu prices. From time to time, competitive circumstances could limit short-term menu price flexibility, and in those cases, franchisees' margins would be negatively impacted by increased commodity prices.
From time to time, competitive circumstances could limit short-term menu price flexibility, and in those cases, franchisees' margins would be negatively impacted by increased commodity prices.
Fixed rate securities may have their fair market value adversely impacted due to a rise in interest rates. We currently do not hold any fixed rate investments. Based on our interest-earning cash, cash equivalents and restricted cash balances as of December 31, 2024, a 1% change in interest rates would change our annual interest income by approximately $2.5 million.
Investments in instruments earning a fixed rate of interest carry a degree of interest rate risk. Fixed rate securities may have their fair market value adversely impacted due to a rise in interest rates. We currently do not hold any fixed rate investments.
We had no material amounts of derivative instruments at December 31, 2024 and did not hold any material amount of derivative instruments during the year ended December 31, 2024. 53 Investments in instruments earning a fixed rate of interest carry a degree of interest rate risk.
We do not engage in speculative transactions nor do we hold or issue financial instruments for trading purposes. We had no material amounts of derivative instruments as of December 28, 2025 and did not hold any material amount of derivative instruments during the year ended December 28, 2025.
Removed
As of December 31, 2024, 100% of Applebee's domestic franchise restaurants and 100% of IHOP domestic franchise restaurants are members of CSCS.
Added
Extreme increases in commodity prices and/or long-term changes could affect our franchisees, area licensees and company-owned restaurants adversely. We expect that, in most cases, the brand systems would be able to pass increased commodity prices through to their customers via increases in menu prices.

Other DIN 10-K year-over-year comparisons