Texas Roadhouse has adjusted its menu prices again, marking the fourth price increase over the past two years. However, despite these regular hikes, the popular steakhouse chain continues to grow, with customers still flocking to enjoy its famous steaks, ribs, and margaritas.
The latest adjustment, a modest 0.9% increase, is notably less than previous rises, which may come as a relief to many restaurant fans.
Here’s a closer look at the recent price change, the reasons behind it, and how it’s impacting both customers and the restaurant’s performance.
How Much Have Texas Roadhouse Prices Increased?
The recent price adjustment means customers are now paying slightly more across the Texas Roadhouse menu, with an increase of 0.9%. Although small, it follows a series of previous increases, including a 2.2% jump this past spring, a 2.7% rise in October 2023, and another 2.2% bump in April 2023.
For those wondering what these increases mean for specific menu items, let’s break it down. The 12-ounce New York fan favorite strip now costs $23.99 at the Teterboro, NJ, location—$2 more than it did a year ago.
Similarly, the 23-ounce porterhouse T-bone, the most expensive steak on the menu, is up $2 to $34.99. Even the budget-friendly 6-ounce sirloin, the chain’s top-seller, has seen a slight price increase, now priced at $14.49, 50 cents more than last year.
Why Did Texas Roadhouse Raise Prices Again?
Despite this being the fourth price hike in two years, Texas Roadhouse says it’s keeping its customers’ budgets in mind. Chris Monroe, the company’s Chief Financial Officer, explained that the 0.9% increase is relatively small and strategic.
“We believe the 0.9% menu price increase will allow us to maintain our value proposition and our traffic and mix levels,” Monroe shared during a recent earnings call.
Monroe also pointed to one key reason for the conservative increase—lower-than-expected beef costs. Although Texas Roadhouse has faced escalating costs in areas like beef and labor, the current adjustment reflects a balance between covering these expenses and maintaining affordability.
Texas Roadhouse Keeps Growing Despite Higher Prices
Many restaurants might worry that regular price increases could scare away customers, but this doesn’t seem to be the case for Texas Roadhouse. On the contrary, the chain thrives, increasing customer traffic even after the latest price changes.
Michael Bailen, the company’s head of investor relations, shared that foot traffic increased following the recent price hike, with a jump from mid-4% in September to mid-5% in October.
Data from the foot-traffic tracking firm Placer.ai supports this trend. According to their report, Texas Roadhouse saw a 5.9% increase in customer visits during the most recent quarter, outpacing its closest competitor, LongHorn Steakhouse, which saw a 4% increase.
How Rising Costs Have Shaped Texas Roadhouse’s Pricing Strategy
Over the past year, Texas Roadhouse has grappled with inflation and the rising costs of ingredients and labor. Beef prices have been a major factor in recent adjustments.
Although these expenses have forced the company to make regular price changes, Texas Roadhouse has worked to keep increases reasonable, aiming to retain its reputation as a “value-driven” dining choice.
Company executives report that customers seem to understand the reasoning behind the price adjustments and remain loyal to the brand.
Bailen noted that the restaurant has not seen any significant customer pushback regarding the new prices. “We’re seeing good results from our guests, but we’re not hearing of any pushback on the menu pricing we have taken,” Bailen said.
This aligns with the company’s overarching mission to provide quality food at prices customers are willing to pay, even amid inflation.
Texas Roadhouse’s Expanding Footprint and Future Plans
Texas Roadhouse is not just holding steady amid economic pressures; it’s expanding. The company reported more than $3.9 billion in revenue in 2024, a 13.5% increase compared to last year.
Additionally, Texas Roadhouse plans to open around 30 new locations in 2025. This growth plan includes about 20 new Texas Roadhouse restaurants and additional spots for its sister brands, Bubba’s 33 and Jagger’s.
The strong revenue growth and expansion plans reflect Texas Roadhouse’s success in managing costs while continuing to attract diners. The company’s strategy resonates with customers, as comparable same-store sales increased by 8.3% in the latest quarter.
What This Means for Texas Roadhouse Fans
For loyal customers of Texas Roadhouse, these price changes may be unwelcome but are perhaps understandable.
While the cost of dining out has increased across the board, Texas Roadhouse has remained committed to balancing value with quality, aiming to keep its signature experience accessible even amid rising costs. Restaurant fans can expect to pay slightly more for their favorite dishes.
Still, this increase seems relatively minor, especially compared to the higher price jumps seen in other casual dining and fast-food chains.
How Does Texas Roadhouse Compare to Other Restaurants?
Texas Roadhouse’s pricing approach stands out in the broader dining landscape. While some major brands are seeing customer backlash over rising costs, Texas Roadhouse continues to experience growth in traffic and sales.
For instance, McDonald’s has recently faced criticism for price increases, with some customers even calling for a boycott. Meanwhile, Texas Roadhouse has managed to avoid such backlash and maintained its reputation for value, making it a standout in the industry.
The steady increase in traffic and foot traffic highlights that customers still see Texas Roadhouse as an affordable option for a quality steakhouse experience, which the chain aims to maintain with careful pricing adjustments.
Conclusion:
As Texas Roadhouse pushes forward with its latest price increase, it’s clear that the company’s strategy is working.
The steakhouse has kept customers returning by making more minor, manageable price adjustments while addressing rising operational costs. The strong growth in customer visits and revenue also shows that Texas Roadhouse has struck a balance that keeps customers happy without sacrificing its bottom line.
Even with the recent price hike, Texas Roadhouse’s value proposition remains vital for customers. Those looking to enjoy a meal with family or friends can still find the restaurant’s hand-cut steaks, flavorful ribs, and refreshing margaritas at a reasonable price.
And with more locations set to open in the coming year, Texas Roadhouse’s future looks as hearty as ever.
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