Arcos Dorados (ARCO) investor relations material

Executive summary

• Achieved record quarterly revenue of $1.3 billion in Q2 2026, up over 14% year-over-year, with systemwide comparable sales growth of 15.3% and strong guest volume and digital sales growth.

• Adjusted EBITDA rose 15.2% to $126.8 million, with a 9.7% margin; net income doubled to $45.0 million ($0.22 per share), both setting second quarter records.

• Digital sales penetration reached 66% of total sales, with loyalty program members showing 5x higher purchase frequency and membership reaching 34.3 million.

• Exclusive FIFA World Cup sponsorship and targeted marketing campaigns boosted traffic, premium product sales, and brand favorability to all-time highs.

• Opened 16 new restaurants in Q2, totaling 35 for the first half of 2026, with continued focus on both organic and inorganic growth drivers.

Financial highlights

• Adjusted EBITDA: $126.8 million (9.7% margin), up 15.2% year-over-year, with a 70-basis point margin expansion (excluding a prior-year transaction).

• Net income: $45.0 million (3.4% margin), up 99.3% year-over-year; EPS: $0.22 vs. $0.11 last year.

• Adjusted Free Cash Flow (LTM): $143.4 million, up from $16.1 million in the prior period.

• Brazil delivered standout results: U.S. dollar sales up over 25%, EBITDA margin expanded by 180 basis points to 14.6%, and EBITDA grew 43%.

• SLAD division sales were in line with inflation (~46-47%), with stable margins and positive EBITDA growth.

Outlook and guidance

• Expect dynamic conditions in the second half of 2026 but remain confident in plans, operating agility, and financial discipline to maximize full-year results and provide a strong foundation for 2027.

• Optimistic for continued positive trends in Brazil, NOLAD, and SLAD into the third quarter, supported by strong marketing and operational execution.

• Continued focus on monetizing market share and enhancing guest engagement through digital and loyalty platforms.