GEN Restaurant Group, Inc. reported its financial results for the third quarter of 2025, revealing a revenue increase of 2.7% to $50.4 million compared to $49.1 million in the same period last year. For the nine months ended September 30, 2025, revenue rose by 5.9% to $162.8 million, up from $153.7 million in 2024. Despite the revenue growth, the company experienced a net loss of $3.6 million for the quarter, a significant decline from a net income of $169,000 in the prior year. For the nine-month period, the net loss was $7.3 million, compared to a profit of $5.9 million in 2024.
The financial performance reflects several operational challenges, including increased costs associated with food, payroll, and occupancy. Food costs surged by 13.6% to $17.5 million in the third quarter, driven by inflation and a higher number of restaurants in operation. Occupancy expenses also rose by 31.9% to $5.4 million, reflecting the addition of new locations. Total restaurant operating expenses increased by 10% to $48.1 million for the quarter, contributing to the overall loss from operations of $3.7 million.
Strategically, GEN Restaurant Group has expanded its footprint, operating 57 restaurants as of September 30, 2025, up from 41 a year earlier. The company opened 15 new locations during the first nine months of 2025, including restaurants in Florida, New Jersey, and Texas, while closing one location. The company is also diversifying its offerings by planning to sell ready-to-cook meats in over 600 grocery stores in California and Hawaii. Additionally, the company has 16 more restaurants under development, with expected completion between 2025 and 2026.
Operationally, the company reported a decrease in average unit volume (AUV) to $5.2 million for the twelve months ended September 30, 2025, down from $5.5 million in the previous year. The comparable restaurant sales change was negative, with a decline of 9.9% for the third quarter and 5.9% for the nine-month period. The company’s general and administrative expenses also increased by 23.8% to $6.5 million for the quarter, primarily due to marketing and personnel costs associated with its expansion efforts.
Looking ahead, GEN Restaurant Group anticipates continued growth in its restaurant base and revenue, although it faces challenges from rising operational costs and market conditions. The company remains focused on achieving a payback period of less than three years for new restaurant units, targeting an ROI of 33% to 40%. Despite the current losses, management believes that cash provided by operating activities and existing cash reserves will be sufficient to meet its operational and capital needs in the near term.
About GEN Restaurant Group, Inc.
GEN Restaurant Group, Inc. operates and manages Asian casual dining restaurants in the U.S., specializing in Korean and Korean-American cuisine. Its unique "cook-it-yourself" model reduces staffing needs while offering an interactive dining experience. The company emphasizes affordable, high-quality food, rapid expansion, and efficient operations, targeting diverse markets and leveraging a loyal customer base to compete in the fragmented restaurant industry.
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