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REVENUE
 6 Months Ended
Apr. 14, 2024
Revenue from Contract with Customer [Abstract]  
REVENUE REVENUE
Nature of products and services — The Company derives revenue from retail sales at Jack in the Box and Del Taco company-operated restaurants and rental revenue, royalties, advertising, and franchise and other fees from franchise-operated restaurants.
Our franchise arrangements generally provide for an initial franchise fee per restaurant for a 20-year term, and generally require that franchisees pay royalty and marketing fees based upon a percentage of gross sales. The agreements also require franchisees to pay technology fees for both brands, as well as sourcing fees for Jack in the Box franchise agreements.
Disaggregation of revenue — The following table disaggregates revenue by segment and primary source for the periods ended April 14, 2024 (in thousands):
QuarterYear-to-date
Jack in the BoxDel TacoTotalJack in the BoxDel TacoTotal
Company restaurant sales$98,927 $68,171 $167,098 $230,984 $160,154 $391,138 
Franchise rental revenues79,618 6,208 85,826 185,196 13,826 199,022 
Franchise royalties45,414 7,314 52,728 106,737 16,768 123,505 
Marketing fees45,423 6,028 51,451 106,643 13,759 120,402 
Technology and sourcing fees4,757 1,131 5,888 10,899 2,970 13,869 
Franchise fees and other services2,123 233 2,356 4,143 766 4,909 
Total revenue$276,262 $89,085 $365,347 $644,602 $208,243 $852,845 
The following table disaggregates revenue by segment and primary source for the periods ended April 16, 2023 (in thousands):
QuarterYear-to-date
Jack in the BoxDel TacoTotalJack in the BoxDel TacoTotal
Company restaurant sales$95,489 $107,115 $202,604 $221,631 $251,164 $472,795 
Franchise rental revenues80,910 2,610 83,520 187,006 5,344 192,350 
Franchise royalties (1)46,401 5,657 52,058 113,970 12,591 126,561 
Marketing fees46,486 4,609 51,095 106,830 10,263 117,093 
Technology and sourcing fees3,875 668 4,543 8,844 1,386 10,230 
Franchise fees and other services1,671 253 1,924 3,468 343 3,811 
Total revenue$274,832 $120,912 $395,744 $641,749 $281,091 $922,840 
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(1)    In October 2022, a Jack in the Box franchise operator paid the Company $7.3 million to sell his restaurants to a new franchisee at the current standard royalty rate, which is lower than the royalty rate in the existing franchise agreements. The payment represented the difference between the royalty rates based on projected future sales for the remaining term of the existing agreements. The payment was non-refundable and not subject to any adjustments based on actual future sales. The Company determined the transaction represented the termination of the existing agreement rather than the transfer of an agreement between franchisees. As such, the $7.3 million was recognized in franchise royalty revenue during the first quarter of 2023.
Contract liabilities — Contract liabilities consist of deferred revenue resulting from initial franchise and development fees received from franchisees for new restaurant openings or new franchise terms, which are recognized over the franchise term. The Company classifies these contract liabilities as “Accrued liabilities” and “Other long-term liabilities” in our condensed consolidated balance sheets.
A summary of significant changes in contract liabilities is presented below (in thousands):
Year-to-date
April 14,
2024		April 16,
2023
Deferred franchise and development fees at beginning of period$50,474 $46,449 
Revenue recognized (3,240)(2,934)
Additions 3,162 3,332 
Deferred franchise and development fees at end of period$50,396 $46,847 
As of April 14, 2024, approximately $8.6 million of development fees related to unopened restaurants are included in deferred revenue. Timing of revenue recognition for development fees related to unopened restaurants is dependent upon the timing of restaurant openings and are recognized over the franchise term at the date of opening.
The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied as of April 14, 2024 (in thousands):
Remainder of 2024
$2,431 
20255,100 
20264,770 
20274,432 
20283,811 
Thereafter21,283 
$41,827 
The Company has applied the optional exemption, as provided for under ASC Topic 606, Revenue from Contracts with Customers, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.