Progress at Outback Steakhouse Advancing, Boosted by Value Meal Offerings
In a bid to boost traffic and improve customer experience, Outback Steakhouse, a popular restaurant chain under Bloomin' Brands, has embarked on a comprehensive turnaround strategy. The strategy is anchored on enhancing steak quality, service consistency, and offering value-driven offerings.
Michael Healy, the CFO of Bloomin' Brands, has shifted to the newly created role of EVP of strategy and transformation, as the company announced a series of leadership changes. This move is part of a wholesale turnaround effort under Mike Spanos, the CEO of Outback's parent company.
One of the key initiatives is menu simplification. By cutting low-volume items, the kitchen operations have been streamlined, and order execution efficiency has been improved. Outback is also testing opening price points across its categories and some new menu items to improve value. The menu has been reduced by 15%, which has eased operations and improved food consistency.
Outback is also focusing on value promotions. The "Aussie Three Course" promotion, which bundles appetizer, entrée, and dessert at a discounted rate, has led to better traffic and value scores. The company is also testing a new table-to-server ratio, assigning each server to four tables instead of six, to enhance service consistency during peak hours.
To further enhance steak quality, Outback has partnered with suppliers to improve steak specifications and updated cooking processes. The aim is to increase craveability and differentiate Outback as a "casual, craveable steakhouse."
However, Outback Steakhouse still faces challenges in its turnaround. The brand posted a 1.3% decline in U.S. comparable sales in Q1 2025, indicating ongoing struggles to regain market share. There is also pressure on average check sizes due to value-driven promotions, reflecting a tension between increasing traffic versus maintaining profitability.
Outback needs to further differentiate from competitors such as Texas Roadhouse, Bonefish Grill, and Chili's, which have outperformed it by leveraging aggressive value campaigns and stronger traffic growth. The brand must continue improving operational efficiency and guest experience, including kitchen workflows and digital ordering preferences, to better align with evolving customer expectations, particularly from younger demographics.
Despite these challenges, Mike Spanos, CEO of Bloomin' Brands, feels good about the Aussie 3-Course value meal. Bloomin' Brands is not planning to raise menu prices to offset the tariff costs, and the company is expecting an expected $6 million impact from tariffs on restaurant-level margins in the third and fourth quarters.
Bloomin's stock plunged after its results were published and was down nearly 29% as of Wednesday afternoon. Bloomin' Brands also expects to spend an additional $6 million to $8 million over the rest of the year to cover rising costs for insurance claims.
Joe Guszkowski, a senior editor with Restaurant Business covering technology and casual-dining chains, notes that Outback Steakhouse's turnaround centres on improving steak quality, enhancing service via staffing and technology adjustments, simplifying menus, and offering compelling value promotions, with a careful expansion of these initiatives to more locations. However, the brand must still focus on regaining sales momentum, maintaining profitability, and strengthening differentiation in a competitive casual dining market to achieve a full revival.
[1] Restaurant Business Online. (2025, May 10). Outback Steakhouse's turnaround strategy: Simplifying menus, improving service, and offering value. Retrieved from https://www.restaurantbusinessonline.com/brands/outback-steakhouses-turnaround-strategy-simplifying-menus-improving-service-and-offering-value
[2] Nation's Restaurant News. (2025, May 12). Outback Steakhouse's Q1 comp sales decline, but brand sees early signs of a turnaround. Retrieved from https://www.nationalsrestaurantnews.com/breaking-news/outback-steakhouses-q1-comp-sales-decline-but-brand-sees-early-signs-of-a-turnaround-1174968
[3] QSR Magazine. (2025, May 13). Outback Steakhouse's new steak lineup, menu simplification, and Aussie 3-Course value meal driving growth. Retrieved from https://www.qsrmagazine.com/food/outback-steakhouses-new-steak-lineup-menu-simplification-and-aussie-3-course-value-meal-driving-growth
[4] The Wall Street Journal. (2025, May 14). Bloomin' Brands stock plunges after earnings report. Retrieved from https://www.wsj.com/articles/bloomins-brands-stock-plunges-after-earnings-report-11684177884
[5] Restaurant Hospitality. (2025, May 15). Bloomin' Brands to invest $3 million in 2025 to support quality, service, and value upgrades at Outback Steakhouse. Retrieved from https://www.restaurant-hospitality.com/news/bloomins-brands-to-invest-3-million-in-2025-to-support-quality-service-and-value-upgrades-at-outback-steakhouse
- The comprehensive turnaround strategy at Outback Steakhouse includes not only menu simplification and improving steak quality but also enhancing lifestyle satisfaction by embracing technology to streamline operations and service during peak hours, aspiring to position Outback as a "casual, craveable steakhouse" that aligns with evolving customer expectations, particularly from younger demographics.
- In the realm of general-news and sports, the success of Outback Steakhouse's turnaround, as well as the company's financial performance, could have potential ramifications for the wider casual dining sector, particularly in relation to sports events and leisure activities that cater to families and groups, given the possible impact on traffic and sales performance of popular restaurant chains like Outback Steakhouse.
