Cracker Barrel Outlook Falls Short After Rebrand Controversy

(Bloomberg) — Cracker Barrel Old Country Store Inc. offered sales guidance for the current fiscal year that missed expectations, suggesting the brand is still dealing with the fallout from its controversial and short-lived logo change.

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Revenue in fiscal 2026, which ends next summer, is projected to be in a range of $3.35 billion to $3.45 billion, the company said in a statement Wednesday. Analysts are expecting sales of $3.52 billion in the period, according to the average of estimates compiled by Bloomberg.

The mid-point of Cracker Barrel’s range suggests sales will remain similar to the past two years, when growth has stagnated. The outlook assumes foot traffic at existing stores declines 4% to 7% in the coming year, the company said.

The shares fell 9.6% at 5:41 p.m. in late trading in New York. The stock has declined 6.2% this year through Wednesday’s close.

The company is dealing with the fallout from an online firestorm after it unveiled a new, streamlined logo that removed an overalls-clad character known as Uncle Herschel. Critics accused the company of erasing elements of traditional American culture and even President Donald Trump weighed in, saying Cracker Barrel should restore its old logo.

Shortly afterwards, Cracker Barrel reversed the logo change. It later halted planned remodels of restaurants.

Chief Executive Officer Julie Masino acknowledged the impact of customer feedback on the decision to halt the rebranding plan, saying the company will now focus on improvements to its kitchen and “other areas.”

Since the Aug. 19 logo change, foot traffic to restaurants declined about 8%, Chief Financial Officer Craig Pommells said during a call with analysts. Assuming current trends continue, traffic is expected to fall 7% to 8% in the fiscal first quarter, he added.

The restaurant chain said its board authorized share repurchases of up to $100 million. The company hasn’t bought back stock since 2023, according to data compiled by Bloomberg. It kept its quarterly dividend stable at 25 cents.

Cracker Barrel projects capital expenditures of as much as $150 million, below Wall Street’s expectation for $183 million. The majority of those funds will go to maintenance, with no investment toward new remodels.

The company spent around $20 million on the remodels last year, CEO Masino said during the call. It plans to revert those stores back to its traditional style.