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Discontinued Operations
 9 Months Ended
Sep. 28, 2025
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations Discontinued Operations
On December 30, 2024 (the “Closing Date”), an indirect wholly owned subsidiary of the Company (the “Seller”) completed the sale of 67% of the ownership interest in its business in Brazil (the “Disposal Group”) to a fund managed by an affiliate of Vinci Partners Investments Ltd. (the “Buyer”) (the “Brazil Sale Transaction”). Following the closing, the Brazil restaurants began operating as unconsolidated franchisees.

The aggregate consideration paid to the Seller consisted of 67% of the enterprise valuation of the Disposal Group in the amount of R$2.06 billion Brazilian Reais, which equaled R$1.4 billion Brazilian Reais (approximately $225.3 million in U.S. Dollars based on the exchange rate on the Closing Date), subject to customary adjustments, and withholding for Brazilian taxes (the “Purchase Price”). On December 30, 2024, the Company received cash proceeds, net of withheld income taxes, of $103.9 million, in U.S. dollars based on the exchange rate on the Closing Date, representing 52% of the Purchase Price. The proceeds were applied to the Company’s revolving credit facility during the thirteen weeks ended March 30, 2025. The second installment, representing 48% of the Purchase Price, is due on or before the first anniversary of the Closing Date (based on the exchange rate on the date of payment) and will generate interest income based on the interbank deposit rate in Brazil until paid.

The sale represents a strategic shift to a primarily franchised model for the Company’s international operations. The assets and liabilities of the Disposal Group were classified as held for sale on the Company’s Consolidated Balance Sheet as of December 29, 2024. For the thirteen and thirty-nine weeks ended September 28, 2025 and September 29, 2024, all sales, direct costs and expenses and income taxes attributable to restaurants classified as discontinued operations have been aggregated to a single caption titled Net income from discontinued operations, net of tax, in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income for all periods presented.

As of the Closing Date, the fair value of the Company’s retained interest was $59.9 million based on the proportional enterprise valuation of the Disposal Group, adjusted for debt used by the Buyer to fund a portion of the Purchase Price and to be pushed down to the operating entity subsequent to the second installment. See Note 3 - Equity Method Investment for additional details regarding the Company’s retained interest in its Brazil operations.
, in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income includes the following for the periods indicated:
THIRTEEN WEEKS ENDEDTHIRTY-NINE WEEKS ENDED
(dollars in thousands)SEPTEMBER 28, 2025SEPTEMBER 29, 2024SEPTEMBER 28, 2025SEPTEMBER 29, 2024
Revenues$— $135,372 $— $393,981 
Operating costs and expenses (1)— 126,274 — 376,074 
Gain on sale of Brazil business (2)560 — 5,135 — 
Income from operations560 9,098 5,135 17,907 
Provision for income taxes371 1,521 4,421 3,767 
Net income from discontinued operations, net of tax$189 $7,577 $714 $14,140 
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(1)Includes royalty expense of $6.6 million and $19.5 million for the thirteen and thirty-nine weeks ended September 29, 2024, respectively, eliminated in consolidation prior to the Brazil Sale Transaction, with the corresponding royalty revenues recorded within Franchise and other revenues from continuing operations in the Company’s Consolidated Statements of Operations and Comprehensive (Loss) Income.
(2)The thirteen and thirty-nine weeks ended September 28, 2025 include $0.7 million and $3.6 million, respectively, of net foreign currency translation gains on contingent consideration assets and indemnification liabilities, as discussed below.
Contingent Consideration Assets and Indemnification Liabilities - On the Closing Date, the Company recognized contingent consideration assets of $29.3 million, primarily judicial deposits, and indemnification liabilities of $6.9 million, primarily labor and tax exposures, within Other assets, net and Other long-term liabilities, net, respectively, on the Company’s Consolidated Balance Sheet in connection with the Brazil Sale Transaction. As of September 28, 2025, the Company’s balance of contingent consideration assets and indemnification liabilities, which are denominated in Brazilian Reais, increased to $34.0 million and $8.0 million, respectively, as a result of fluctuations in foreign exchange rates. All post-closing adjustments related to contingent consideration assets and indemnification liabilities will be reflected in discontinued operations.