Arcos Dorados (ARCO) Q3 2026 earnings summary

Executive summary

• Q3 revenue was $1,328.0M, up 11.3% reported and 17.6% in constant currency; systemwide comparable sales rose 15.5% on higher average check and positive guest traffic.

• Adjusted EBITDA was $125.9M; excluding the prior-year $85.6M Brazil tax credit, it grew 9.0%. Net income was $31.2M, or $0.15 per share.

• Market share expanded, digital sales exceeded 66% of systemwide sales, and 35 restaurants opened in Q3.

Financial highlights

• Company-operated sales were $1,267.2M and franchised revenue was $60.8M in Q3.

• Adjusted EBITDA fell 37.4% reported; excluding the $85.6M prior-year Brazil tax credit, it rose 9.0%.

• Adjusted EBITDA margin was 9.5%, down 20 bps excluding the prior-year tax credit; food and paper and G&A costs as a share of revenue improved.

• Net income attributable to shareholders was $31.2M versus $150.4M; net income margin was 2.3%, up 20 bps excluding the tax credit.

• LTM adjusted free cash flow was $156.3M versus $52.6M in the prior-year period.

Outlook and guidance

• Long-term objectives are mid- to high-single-digit annual revenue growth and high-single- to low-double-digit annual adjusted EBITDA growth.

• Plans call for 550–600 restaurant openings and $1.3B–$1.5B in capital expenditures from 2027–2030.

• October comparable-sales growth continued to normalize in nearly all markets; management aimed to close 2026 with another solid quarter and begin 2027 on a positive footing.

• FY 2026 payroll as a share of revenue was expected to remain broadly in line with 2025, with sequential improvement anticipated in Q4.