The trend: The government shutdown and other macro headwinds are expected to slow calendar Q4 sales growth for several major casual dining chains.

• Brinker International, parent of Chili’s and Maggiano’s, said higher-than-expected costs and softer Maggiano’s results offset Chili’s gains, leading it to maintain guidance despite stronger-than-expected quarterly earnings—surprising analysts who expected an upgrade.
• While Cheesecake Factory didn’t provide detailed comparable-sales or earnings guidance, the company reported a slowdown in October and now expects sales growth to ease about 1 percentage point from the 4.8% pace in Q3. CFO Matthew Clark noted some choppiness last month, followed by a sharper slowdown amid the government shutdown, adding that the 2018–2019 shutdown reduced sales roughly 1% to 2% over its 35-day duration.
• Chipotle cited “consistent macroeconomic pressures” as the reason it cut its same-store sales forecast for the third straight quarter. It now expects full-year comparable sales to decline by a low-single-digit percentage in FY2025, a sharp reversal from February, when it projected low- to mid-single-digit growth.

The context: Consumers are feeling the squeeze.

• Real income growth has slowed to its weakest sustained pace since the early 2010s, per a JPMorgan Chase Institute report. Median income for 25- to 54-year-olds rose just 2% in real terms.
• Meanwhile, rising restaurant costs are prompting many operators to raise menu prices.
• Consumers have noticed: 82% say restaurant prices have “increased noticeably” in their area over the past year, per YouGov. As a result, 37% are dining out less, with cost being the primary driver of that pullback.

Our take: Restaurants should double down on value to keep consumers spending.

• Chili’s promotions like its “3 for Me” meal—a beverage, appetizer, and entrée for $10.99—have helped it gain market share among lower-income households, even as others, including fast-food giants like McDonald’s, report softness in that group.
• That strategy extends beyond lower-income diners. Higher-income consumers, including those who frequent Chipotle, are also seeking more bang for their buck. To stay competitive, restaurants should lean into value-focused promotions like bundled meals and use loyalty programs to target their best customers with personalized offers that drive repeat visits.