Segment Information

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

Segment Information

(11)Segment Information

The Company has three reportable segments: (i) U.S. stores; (ii) supply chain; and (iii) international franchise.

The Company’s operations are organized by management on the combined basis of line of business and geography. The U.S. stores segment includes operations with respect to all franchised and Company-owned stores throughout the U.S. The supply chain segment primarily includes the distribution of food, equipment and supplies to stores from the Company’s supply chain center operations in the U.S. and Canada. Over 90% of the Company's supply chain revenues are attributable to the U.S. The international franchise segment primarily includes operations related to the Company’s franchising business in foreign markets. The accounting policies of the reportable segments are the same as those described in Note 1. The Company evaluates the performance of its segments and allocates resources to them based on revenues and earnings before interest, taxes, depreciation, amortization and other, which is the measure by which the Company allocates resources to its segments and which the Company refers to as Segment Income.

The tables below summarize the financial information concerning the Company’s reportable segments for fiscal 2023, 2022 and 2021. Intersegment revenues are comprised of sales of food, equipment and supplies from the supply chain segment to the Company-owned stores in the U.S. stores segment. Intersegment sales prices are market based. The “Other” column as it relates to Segment Income below primarily includes corporate administrative costs that are not allocable to a reportable segment, including labor, computer expenses, professional fees, travel and entertainment, rent, insurance and other corporate administrative costs.

	U.S. Stores		Supply Chain		International Franchise		Intersegment Revenues			Other			Total
Revenues
2023	$	1,454,272	$	2,829,224	$	310,077	$	(114,215	)	$	—		$	4,479,358
2022		1,487,409		2,898,069		295,007		(143,327	)		—			4,537,158
2021		1,498,360		2,699,863		298,036		(138,886	)		—			4,357,373
Segment Income
2023	$	520,977	$	245,430	$	259,608	N/A			$	(86,894	)	$	939,121
2022		438,604		208,799		236,144	N/A				(26,022	)		857,525
2021		454,875		229,877		241,873	N/A				(42,926	)		883,699
Capital Expenditures
2023	$	11,942	$	34,044	$	93	N/A			$	59,196		$	105,275
2022		9,830		34,625		—	N/A				44,384			88,839
2021		13,680		37,063		—	N/A				44,894			95,637

In the first quarter of 2023, the Company changed its allocation methodology for certain costs which support certain internally developed software used across the Company's franchise system. This allocation methodology change was implemented in order to reflect the way the chief operating decision maker allocates resources to the Company’s reportable segments and evaluates segment profitability, including the costs of internally developed software. The change in allocation methodology of certain software development costs resulted in an estimated increase in U.S. stores Segment Income of $65.7 million, an estimated increase in international franchise Segment Income of $8.9 million and an estimated decrease in other Segment Income of $74.6 million in 2023. The change in allocation methodology of certain software development costs had no impact on revenues, supply chain Segment Income or total Segment Income. The change in allocation methodology for certain software development costs is a prospective change and the comparative information has not been restated.

The following table reconciles total Segment Income to income before provision for income taxes:

	2023			2022			2021
Total Segment Income	$	939,121		$	857,525		$	883,699
Depreciation and amortization		(80,640	)		(80,251	)		(72,923	)
Refranchising (loss) gain		(149	)		21,173			—
Loss on sale/disposal of assets		(1,299	)		(1,813	)		(1,189	)
Non-cash equity-based compensation expense		(37,514	)		(28,709	)		(28,670	)
Recapitalization-related expenses		—			—			(509	)
Income from operations		819,519			767,925			780,408
Other income		17,713			—			36,758
Interest income		11,683			3,162			345
Interest expense		(196,475	)		(198,254	)		(191,806	)
Income before provision for income taxes	$	652,440		$	572,833		$	625,705

The following table summarizes the Company’s identifiable asset information by reportable segment as of December 31, 2023 and January 1, 2023:

	December 31, 2023		January 1, 2023
U.S. stores	$	232,336	$	288,149
Supply chain		631,908		614,168
International franchise		37,981		36,874
Unallocated		772,674		663,030
Total assets	$	1,674,899	$	1,602,221

Unallocated assets primarily include cash and cash equivalents, restricted cash and cash equivalents, certain accounts receivable and prepaid expenses, investments in equity securities without readily determinable fair values and marketable securities, certain long-lived assets including certain property, plant and equipment, capitalized software and the operating lease right-of-use asset for the Company’s corporate headquarters and deferred income taxes. Over 95% of the Company's long-lived assets including property, plant and equipment, capitalized software and operating lease right-of-use assets are located in the U.S.

The following table summarizes the Company’s goodwill balance by reportable segment as of December 31, 2023 and January 1, 2023:

	December 31, 2023		January 1, 2023
U.S. stores	$	10,621	$	10,696
Supply chain		1,067		1,067
Consolidated goodwill	$	11,688	$	11,763