Brinker International reported $25.1 million in gift card sales for the 13 weeks ended September 23, up about 22% from the prior year. The parent of Chili’s and Maggiano’s also recorded a $1.1 million charge for disposing of obsolete physical gift cards associated with a brand it had divested. The company filed its quarterly report on October 28. [S1] [S2] [S3]
Gift card sales rose and the outstanding liability fell
Quarterly card sales increased from $20.5 million, while redemptions recognized in company sales rose to $28.2 million from $24.5 million. Breakage recognized in sales was $2.8 million in each quarter. Breakage is the portion of outstanding value recognized as revenue because the company does not expect it to be redeemed. [S1] [S2]
Brinker’s gift card sales, redemptions and breakage
Figures from the gift card liability roll-forward for two comparable 13-week periods.
USD millions
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Sources
Redemptions and breakage are shown as positive magnitudes. Both reduce the reported liability.
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| Category | September quarter 2025 | September quarter 2026 |
|---|---|---|
| Gift card sales | 20.5 USD millions | 25.1 USD millions |
| Redemptions recognized in sales | 24.5 USD millions | 28.2 USD millions |
| Breakage recognized in sales | 2.8 USD millions | 2.8 USD millions |
The card liability ended the quarter at $47.3 million, down from $52.8 million in June and $50.8 million a year earlier. The balance reflects unredeemed gift cards after recognized breakage and the unamortized portion of third-party fees. [S1] [S2] The reported sales row is not a separate disclosure of gross face value issued.
The company booked a separate inventory charge
The $1.1 million charge appears in other gains and charges. Brinker said it decided to dispose of obsolete stock of multi-brand physical cards linked to a divested brand. It did not identify the brand or state how many cards it disposed of. The equivalent period a year earlier showed no inventory write-off. [S1]
Brinker’s gift card inventory write-offs
The quarterly charge for obsolete physical gift card inventory.
USD millions
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Source
The filing shows a dash for the 2025 comparison. These are inventory charges, separate from gift card breakage and customer balances.
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| Category | Reported inventory write-offs |
|---|---|
| September quarter 2025 | 0.0 USD millions |
| September quarter 2026 | 1.1 USD millions |
The charge concerns cards held as inventory. The filing does not identify any cancellation of balances that customers had loaded. Brinker’s current card terms, updated in July, say legacy cards may name brands that no longer participate or operate, but the remaining balance can still be redeemed at currently participating brands identified for the card. The terms also say the cards do not expire. Those redemption terms are separate from the inventory accounting charge. [S1] [S4] [S5]
In this article
Oliver Reed
Oliver Reed covers industry acquisitions, investment and market research for Gift Card News.