Cracker Barrel on Wednesday released its fourth quarter earnings results, but much of the attention centered on the restaurant chain's swift reversal of its controversial logo redesign that went viral online.
The company — based out of Lebanon, Tennessee — reported total revenue of $868 million, down 2.9% from the same quarter last year. The company also said that traffic has fallen 8% since the August rollout of its simplified, text-only logo. Shares tumbled nearly 10% in after-hours trading on Wednesday.
On the earnings call, President and CEO Julie Masino acknowledged that Cracker Barrel had underestimated the deep connection customers feel toward the company's nostalgic imagery.
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"We want longtime fans and new guests to experience the full story of the people, places, and food that make Cracker Barrel so special," Masino told investors. "That's why our team pivoted quickly to switch back to our old-timer logo and has already begun executing new marketing, advertising and social media initiatives leaning into Uncle Herschel and the nostalgia around the brand."
In addition to the logo reversal, Masino noted that Cracker Barrel has begun converting its four modernized test stores back to traditional interiors. Cracker Barrel revealed earlier this month that only four of its 660 restaurants have undergone remodels and confirmed that the project will not move forward. The updated design replaced the brand’s signature Americana décor with a sleek, minimalist look.
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"The feedback we received from our guests in recent weeks on our brand refresh and store remodels has shown us just how deeply people care about Cracker Barrel," Masino said, adding that new marketing will lean in to Uncle Herschel and the brand's nostalgia. "We thank our guests for sharing their voices and love for the brand and telling us when we've misstepped."
However, Masino argued that the chain, which has 70,000 employees, has not kept pace as consumer habits — when it comes to food, travel and technology — have changed dramatically in the past decade.
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"We deeply value the strong emotional connection our guests have, not just to the old-timer logo or vintage Americana decor, but to the sense of tradition and nostalgia those represent," she said. "That connection is powerful, and we recognize there are other areas where we must continue improving, especially in our food and overall guest experience. Fortunately, these were already part of our multi-year plan, and we are moving forward with a renewed focus on both."
Masino also highlighted several bright spots in the quarter, including the return of "Uncle Herschel’s Breakfast," the rollout of a new service model known as "The Herschel Way," and continued momentum in its loyalty program, which added 300,000 members in the past four weeks.
"There is a lot to be optimistic about, and our teams are focused on getting back to a positive trajectory," she said.
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In August, Cracker Barrel introduced a redesigned logo that removed the image of an old-timer leaning against a wooden barrel — a symbol of the chain’s Southern charm and hospitality for more than five decades. The move was viewed by some as a nod to modern "woke" culture. The rollout triggered a swift backlash, erasing more than $140 million in market value at the peak of the controversy.
