Revenues

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenues

Revenues

Our revenues are derived primarily from two sales channels, which we operate as one segment: company restaurants and franchised and licensed restaurants. The following table disaggregates our revenue by sales channel and type of good or service:

	Quarter Ended
	March 31, 2021		March 25, 2020
	(In thousands)
Company restaurant sales	$	33,569	$	42,291
Franchise and license revenue:
Royalties	20,844		23,847
Advertising revenue	14,111		17,526
Initial and other fees	1,838		1,697
Occupancy revenue	10,214		11,334
Franchise and license revenue	47,007		54,404
Total operating revenue	$	80,576	$	96,695

Franchise occupancy revenue consisted of the following:

	Quarter Ended
	March 31, 2021		March 25, 2020
	(In thousands)
Operating lease revenue	$	7,913	$	8,622
Variable lease revenue	2,301		2,712
Total occupancy revenue	$	10,214	$	11,334

Balances related to contracts with customers consist of receivables, deferred franchise revenue and deferred gift card revenue. See Note 3 for details on our receivables.

Deferred franchise revenue consists primarily of the unamortized portion of initial franchise fees that are currently being amortized into revenue and amounts related to development agreements and unopened restaurants that we will begin amortizing into revenue when the related restaurants are opened. Deferred franchise revenue represents our remaining performance obligations to our franchisees, excluding amounts of variable consideration related to sales-based royalties and advertising.

The components of the change in deferred franchise revenue are as follows:

	(In thousands)
Balance, December 30, 2020	$	20,806
Fees received from franchisees	114
Revenue recognized (1)	(563)
Balance, March 31, 2021	20,357
Less current portion included in other current liabilities	1,972
Deferred franchise revenue included in other noncurrent liabilities	$	18,385

(1) Of this amount $0.6 million was included in the deferred franchise revenue balance as of December 30, 2020.

Deferred gift card liabilities consist of the unredeemed portion of gift cards sold in company restaurants and at third party locations. The balance of deferred gift card liabilities represents our remaining performance obligations to our customers. The balance of deferred gift card liabilities as of March 31, 2021 and December 30, 2020 was $5.5 million and $6.1 million, respectively. During the quarter ended March 31, 2021, we recognized revenue of $0.1 million from gift card redemptions at company restaurants.