Cracker Barrel’s (CBRL) old country restaurant look and feel is here to stay — for now.
The restaurant chain said it is suspending the remodel of its restaurants. This comes on the heels of the company’s controversial logo redesign, which sent the stock tumbling amid broad customer backlash and a rebuke from President Trump. It all ended in a return to its old logo featuring “Old Timer” Uncle Herschel and a barrel.
“Today, we’re suspending our remodels. If your restaurant hasn’t been remodeled, you don’t need to worry, it won’t be,” the company said in a statement on its website in a page titled “WE HEAR YOU.”
The company tested four out of 660 locations but “won’t continue with it,” the statement read, adding that the “vintage Americana you love will always be here,” complete with rocking chairs, peg games, fireplaces, and the typical gift shop.
Based on a video posted online, the new design featured a modern white interior and exterior, a less-crowded shop, more modern wall decor, plus an updated menu with the new logo.
The stock fell slightly on the announcement and is down nearly 12% over the past month. The S&P 500 (^GSPC) is up nearly 2% in the past month.
When asked about the remodeling initiative on an earnings call in early June, CEO Julie Felss Masino said it has been a “year of testing and learning,” with plans to follow up with the investor community in September. The company is expected to report its fiscal fourth quarter earnings later this month.
Based on Bloomberg consensus estimates, Wall Street expects revenue to fall 4% from a year ago to $855.11 million, alongside a 22% drop in adjusted earnings to $0.76 from $0.98 a year ago.
Same-store sales for the quarter are expected to rise 3.49%, compared to the 0.45% decline it saw in the same time period last year.
Citi’s Jon Tower had said in late August that the “hubbub” over the brand could actually benefit the business in the near term, sparking curiosity among consumers to come visit.
Tower also believes the company will continue to incorporate some upgrades it made to improve the speed of service, product quality, and the employee experience. But he has some concerns. For instance, how will capital expenditures and free cash flow be deployed over the coming years? And does the brand’s multiyear guidance set in May 2024 still hold?
The company’s long-term outlook had expected fiscal 2027 sales to be between $3.8 billion and $3.9 billion. For its 2025 guidance, it expects total revenue to come in between $3.45 billion and $3.5 billion.
