Black Rock Coffee Bar (NASDAQ:BRCB) reported second-quarter 2026 revenue growth of 25% as the company expanded its store base, increased store-level margins and raised its full-year new-unit and adjusted EBITDA outlook.
Total revenue reached $63 million in the quarter, while same-store sales rose 4.2% against a 10.9% comparison in the prior-year period. On a two-year basis, same-store sales increased 15.1%. The company said it opened 10 locations during the quarter, bringing its systemwide total to 200 stores.
Transactions Turn Positive in July
Same-store sales growth in the second quarter was supported by a 2.4% contribution from price and 3.8% growth in average check. Transactions declined 2%, which management attributed largely to comparisons related to the launch and transition of its loyalty platform in the second half of 2024, as well as changes surrounding reward expiration during the first half of 2025.
Chief Financial Officer Rodd Booth said those comparisons have since eased. The company disclosed that July same-store transactions increased 1.7%, although it did not provide a total same-store sales figure for the month.
Management maintained its outlook for mid-single-digit same-store sales growth for the full year. Booth said the third quarter still faces a difficult prior-year comparison, while the fourth-quarter comparison becomes easier.
Davis said the company’s initiatives to drive traffic include seasonal beverage offerings, food innovation, targeted loyalty offers, extended store hours and digital engagement. Loyalty participation reached 68% of transactions during the quarter, while digital sales represented 17.2% of revenue.
The company said its Fuel beverage platform has gained traction, particularly in the afternoon. Black Rock also tested a grilled cheese offering in Arizona and the Pacific Northwest in June before expanding it systemwide in July. Following what management described as strong guest response, the item will become permanent. Food represented about 13% of product mix.
Margins Expand Despite Higher Operating Costs
Store-level profit increased 28.1% to $19 million, and the store-level margin expanded 70 basis points to 30.2%. Beverage, food and packaging costs declined 220 basis points to 26.9% of revenue, which Booth attributed to procurement discipline, strategic initiatives and inventory management.
Labor costs rose 40 basis points to 21% of revenue, occupancy costs increased 30 basis points to 8%, and other store operating expenses rose 70 basis points to 13.7%.
Adjusted EBITDA was $9.4 million, up 17% from the prior-year quarter. Adjusted selling, general and administrative expenses totaled $8.4 million, or 13.4% of revenue, compared with $6 million a year earlier.
Booth said the difference between revenue growth and EBITDA growth reflected the cost of operating as a public company, which was not included in the year-ago period. He said those expenses are largely fixed and the company expects EBITDA growth to converge toward, and eventually exceed, revenue growth as comparisons begin to include those costs.
The company also reported $1.3 million in preopening costs, compared with a period when it opened four stores a year earlier. Black Rock ended the quarter with $16 million in cash and cash equivalents, full access to a $25 million revolving credit facility and a $19.6 million term loan balance.
Store Expansion Outlook Raised
Black Rock raised its full-year development target to at least 38 new stores from 36 previously. It had opened 19 stores in the first half and 42 over the trailing four quarters, representing 27% unit growth.
The company said its 2026 and 2027 development pipeline is largely committed. Davis highlighted California as a significant growth market, saying newer stores in the state are trending toward first-year average unit volumes of $1.6 million, above the company’s base expectations.
Management expects seven additional California openings in 2026 and roughly 12 to 15 in 2027. Every Black Rock location includes a drive-through, Davis said. The company acknowledged California carries higher construction and occupancy costs, but said it is using more conversions in the market to help manage capital expenditures and expects strong store-level profitability and returns.
Black Rock said it is also taking a more disciplined approach to spacing in Phoenix following strategic openings that created some sales-transfer pressure. Management said the second-quarter effect was modest and less than in the first quarter, and that most of the affected store openings will be lapped in the third quarter.
Guidance Calls for Higher EBITDA
The company reaffirmed full-year revenue guidance of $255 million to $257 million, representing 27% year-over-year growth. It raised adjusted EBITDA guidance to $34 million to $35 million from a prior range of $33.5 million to $34.5 million.
The updated EBITDA range implies growth of 24% to 27% for the full year, with management expecting 28% to 35% growth in the second half versus the prior-year period.
Black Rock now expects capital expenditures of $42 million to $43 million inclusive of tenant improvement allowances, or $57 million to $59 million excluding $15 million to $16 million of such allowances. Approximately $13 million to $14 million of capital spending is expected to support the 2027 pipeline.
Management said it remains focused on reaching 1,000 locations by 2035 while directing capital toward what it views as the highest-return development opportunities.
About Black Rock Coffee Bar (NASDAQ:BRCB)
Our Mission: To Fuel People Forward – One Connection, One Moment, One Cup at a Time We are a high-growth operator of guest-centric, drive-thru coffee bars offering premium caffeinated beverages and an elevated in-store experience crafted by our engaging baristas. Black Rock Coffee Bar was founded in 2008 in Beaverton, Oregon, by our co-founders Daniel Brand and Jeff Hernandez. What started as a single 160 square foot coffee bar in 2008 is now one of the fastest growing beverage companies in the United States by revenue and the largest fully company-owned coffee retailer in the country, with 158 locations spanning seven states as of June 30, 2025, from the Pacific Northwest to Texas.
