Operations

Portillo's fueling growth with loyalty program, improving operations, driving kiosk usage

The chain is also testing breakfast at five locations in Chicago.

Photo: Portillo's

May 6, 2025

Portillo's Inc. reported that total revenue increased 6.4% or $10.6 million to $176.4 million during Q1, ending March 30. Same-restaurant sales increased 1.8% resulting in earnings of 5 cents per share, beating the Zacks Consensus Estimate of 4 cents but coming in lower than last year's 8 cents.

"We're proud of how our team performed through challenging macro conditions in Q1, driven by the launch of Portillo's Perks and our marketing efforts," Michael Osanloo, president and CEO of Portillo's, said in a company press release. "As we head into Q2, we're carrying momentum and remain confident in our ability to drive traffic and build sales through brand awareness, digital engagement, and operational excellence."

Recent developments

Commodity inflation was 3.4%, compared to last year's 4.8% for the quarter, and labor, as a percentage of revenue, net increased .5%, primarily due to lower transactions, an increase in benefit expenses and incremental wage rate increases, partially offset by an increase in our average check and labor efficiencies.

The chain increased some menu prices by about 1.5% during January of 2025 and by approximately 1% in April 2025.

"We will continue to prioritize strategies to drive higher traffic and mix at our restaurants while optimizing returns and retaining our top talent," according to the release.

The company's focus on driving traffic, improving margins and maximizing return strategies includes:

• The launch of Portillo's Perks loyalty program.
• Advertising beyond Chicagoland.
• Making operational improvements in speed of service, accuracy and hospitality.
• Driving kiosk usage.
• Testing breakfast at five locations in Chicago.

Growth plans

The chain will open 12 locations by year's end and will continue to focus on growing in the Sunbelt, primarily in Texas, with plans to enter Atlanta and San Antonio, in the second half of 2025. Additionally, it will launch its first walk-up restaurant format later this year but also continue to fill existing markets.

Other Q1 2025 highlights:

• Operating income increased $.3 million to $10.4 million.
• Net income decreased $1.4 million to $4.0 million.
• Restaurant-Level Adjusted EBITDA increased $0.3 million to $36.7 million and Adjusted EBITDA decreased $.6 million to $21.2 million.