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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended September 28, 2025.

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT of 1934

For the transition period from to .

Commission File No. 001-35962

NATHAN'S FAMOUS, INC.

(Exact name of registrant as specified in its charter)

Delaware		11-3166443
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

	One Jericho Plaza, Jericho, New York		11753
	(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code:

516-338-8500

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $.01 per share		NATH		The NASDAQ Global Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At November 3, 2025 an aggregate of 4,089,510 shares of the registrant's common stock, par value of $.01, were outstanding.

-1-

NATHAN'S FAMOUS, INC. AND SUBSIDIARIES

INDEX

		Page Number

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements.	3

	Condensed Consolidated Balance Sheets – September 28, 2025 (Unaudited) and March 30, 2025	3

	Condensed Consolidated Statements of Earnings (Unaudited) – Thirteen and Twenty-six Weeks Ended September 28, 2025 and September 29, 2024	4

	Condensed Consolidated Statements of Changes in Stockholders’ Deficit (Unaudited) – Thirteen Weeks Ended September 28, 2025 and September 29, 2024	5

	Condensed Consolidated Statements of Changes in Stockholders’ Deficit (Unaudited) – Twenty-six Weeks Ended September 28, 2025 and September 29, 2024	6

	Condensed Consolidated Statements of Cash Flows (Unaudited) – Twenty-six Weeks Ended September 28, 2025 and September 29, 2024	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	33

Item 4.	Controls and Procedures.	34

PART II.	OTHER INFORMATION	35

Item 1.	Legal Proceedings.	35

Item 1A.	Risk Factors.	35

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	35

Item 3.	Defaults Upon Senior Securities.	35

Item 4.	Mine Safety Disclosures.	35

Item 5.	Other Information.	35

Item 6.	Exhibits.	36

SIGNATURES		37

-2-

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

Nathan’s Famous, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS

September 28, 2025 and March 30, 2025

(in thousands, except share and per share amounts)

	September 28, 2025			March 30, 2025
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents (Note E)	$	32,175		$	27,802
Accounts and other receivables, net (Note G)		21,613			14,064
Inventories		945			1,221
Prepaid expenses and other current assets (Note H)		683			2,048
Total current assets		55,416			45,135

Property and equipment, net of accumulated depreciation of $12,672 and $12,295, respectively		2,013			2,114
Operating lease right-of-use assets, net (Note Q)		4,242			4,987
Goodwill		95			95
Intangible asset, net (Note I)		435			522
Deferred income taxes		570			510
Other assets		96			113

Total assets	$	62,867		$	53,476

LIABILITIES AND STOCKHOLDERS’ DEFICIT

CURRENT LIABILITIES
Current portion of long-term debt (Note P)	$	2,400		$	2,400
Accounts payable		8,142			6,163
Accrued expenses and other current liabilities (Note K)		5,010			5,969
Current portion of operating lease liabilities (Note Q)		1,933			1,923
Deferred franchise fees		250			309
Total current liabilities		17,735			16,764

Long-term debt, net of unamortized debt issuance costs of $291 and $327, respectively (Note P)		46,909			48,073
Long-term portion of operating lease liabilities (Note Q)		2,631			3,528
Other liabilities		864			927
Deferred franchise fees		631			697

Total liabilities		68,770			69,989

COMMITMENTS AND CONTINGENCIES (Note R)

STOCKHOLDERS’ DEFICIT
Common stock, $.01 par value; 30,000,000 shares authorized; 9,379,025 shares issued; and 4,089,510 shares outstanding at September 28, 2025 and March 30, 2025		94			94
Additional paid-in capital		64,064			63,492
Retained earnings		16,601			6,563
Stockholders’ equity before treasury stock		80,759			70,149

Treasury stock, at cost, 5,289,515 shares at September 28, 2025 and March 30, 2025		(86,662	)		(86,662	)
Total stockholders’ deficit		(5,903	)		(16,513	)

Total liabilities and stockholders’ deficit	$	62,867		$	53,476

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

-3-

Nathan’s Famous, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

Thirteen and Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands, except per share amounts)

(Unaudited)

	Thirteen weeks ended						Twenty-six weeks ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024

REVENUES
Branded Products	$	29,047		$	24,536		$	58,122		$	50,682
Company-owned restaurants		5,624			5,348			9,610			9,547
License royalties		9,227			9,491			21,608			22,412
Franchise fees and royalties		1,223			1,174			2,352			2,247
Advertising fund revenue		566			560			993			988
Total revenues		45,687			41,109			92,685			85,876

COSTS AND EXPENSES
Cost of sales		32,378			26,029			60,801			51,270
Restaurant operating expenses		1,432			1,389			2,611			2,518
Depreciation and amortization		236			247			464			496
General and administrative expenses		3,452			3,252			7,402			7,227
Advertising fund expense		687			560			1,114			988
Total costs and expenses		38,185			31,477			72,392			62,499

Income from operations		7,502			9,632			20,293			23,377

Interest expense		(739	)		(1,441	)		(1,497	)		(2,501	)
Loss on debt extinguishment (Note P)		-			(334	)		-			(334	)
Interest and dividend income		236			219			439			297
Other income, net		22			23			43			44

Income before provision for income taxes		7,021			8,099			19,278			20,883
Provision for income taxes		1,822			2,069			5,151			5,576
Net income	$	5,199		$	6,030		$	14,127		$	15,307

PER SHARE INFORMATION
Weighted average shares used in computing net income per share:
Basic		4,089			4,085			4,089			4,085
Diluted		4,130			4,095			4,127			4,092

Net income per share:
Basic	$	1.27		$	1.48		$	3.45		$	3.75
Diluted	$	1.26		$	1.47		$	3.42		$	3.74

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

-4-

Nathan’s Famous, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

Thirteen weeks ended September 28, 2025 and September 29, 2024

(in thousands, except share and per share amounts)

(Unaudited)

					Additional										Total
	Common		Common		Paid-in		Retained			Treasury Stock, at Cost					Stockholders’
	Shares		Stock		Capital		earnings			Shares		Amount			Deficit

Balance, June 29, 2025		9,379,025	$	94	$	63,780	$	13,446			5,289,515	$	(86,662	)	$	(9,342	)

Dividends on common stock ($0.50 per share)		-		-		-		(2,044	)		-		-			(2,044	)
Share-based compensation		-		-		284		-			-		-			284
Net income		-		-		-		5,199			-		-			5,199
Balance, September 28, 2025		9,379,025	$	94	$	64,064	$	16,601			5,289,515	$	(86,662	)	$	(5,903	)

							Retained
					Additional		earnings								Total
	Common		Common		Paid-in		(Accumulated			Treasury Stock, at Cost					Stockholders’
	Shares		Stock		Capital		Deficit)			Shares		Amount			Deficit

Balance, June 30, 2024		9,374,130	$	94	$	63,124	$	(2,057	)		5,289,515	$	(86,662	)	$	(25,501	)

Dividends on common stock ($0.50 per share)		-		-		-		(2,042	)		-		-			(2,042	)
Share-based compensation		-		-		229		-			-		-			229
Net income		-		-		-		6,030			-		-			6,030
Balance, September 29, 2024		9,374,130	$	94	$	63,353	$	1,931			5,289,515	$	(86,662	)	$	(21,284	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

-5-

Nathan’s Famous, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands, except share and per share amounts)

(Unaudited)

					Additional										Total
	Common		Common		Paid-in		Retained			Treasury Stock, at Cost					Stockholders’
	Shares		Stock		Capital		earnings			Shares		Amount			Deficit

Balance, March 30, 2025		9,379,025	$	94	$	63,492	$	6,563			5,289,515	$	(86,662	)	$	(16,513	)

Dividends on common stock ($1.00 per share)		-		-		-		(4,089	)		-		-			(4,089	)
Share-based compensation		-		-		572		-			-		-			572
Net income		-		-		-		14,127			-		-			14,127
Balance, September 28, 2025		9,379,025	$	94	$	64,064	$	16,601			5,289,515	$	(86,662	)	$	(5,903	)

							Retained
					Additional		earnings								Total
	Common		Common		Paid-in		(Accumulated			Treasury Stock, at Cost					Stockholders’
	Shares		Stock		Capital		Deficit)			Shares		Amount			Deficit

Balance, March 31, 2024		9,374,130	$	94	$	62,936	$	(9,291	)		5,289,515	$	(86,662	)	$	(32,923	)

Dividends on common stock ($1.00 per share)		-		-		-		(4,085	)		-		-			(4,085	)
Share-based compensation		-		-		417		-			-		-			417
Net income		-		-		-		15,307			-		-			15,307
Balance, September 29, 2024		9,374,130	$	94	$	63,353	$	1,931			5,289,515	$	(86,662	)	$	(21,284	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

-6-

Nathan’s Famous, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Twenty-six weeks ended September 28, 2025 and September 29, 2024

(in thousands)

(Unaudited)

	September 28, 2025			September 29, 2024
Cash flows from operating activities:
Net income	$	14,127		$	15,307
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on debt extinguishment		-			334
Depreciation and amortization		464			496
Amortization of debt issuance costs		36			122
Share-based compensation expense		572			417
Provision for expected credit losses		63			53
Deferred income taxes		(60	)		(20	)
Changes in operating assets and liabilities:
Accounts and other receivables, net		(7,612	)		(994	)
Inventories		276			(163	)
Prepaid expenses and other current assets		1,365			1,370
Other assets		17			14
Operating lease assets and liabilities		(142	)		(124	)
Accounts payable, accrued expenses and other current liabilities		1,020			(1,912	)
Deferred franchise fees		(125	)		(125	)
Other liabilities		(63	)		51

Net cash provided by operating activities		9,938			14,826

Cash flows from investing activities:
Purchase of property and equipment		(276	)		(130	)

Net cash used in investing activities		(276	)		(130	)

Cash flows from financing activities:
Proceeds from Credit Facility		-			60,000
Repayment of Credit Facility		(1,200	)		-
Repayment of Senior Secured Notes		-			(60,000	)
Debt issuance costs		-			(431	)
Dividends paid to stockholders		(4,089	)		(4,085	)

Net cash used in financing activities		(5,289	)		(4,516	)

Net increase in cash and cash equivalents		4,373			10,180

Cash and cash equivalents, beginning of period		27,802			21,027

Cash and cash equivalents, end of period	$	32,175		$	31,207

Cash paid during the period for:
Interest	$	1,531		$	3,125
Income taxes	$	4,141		$	4,444

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

-7-

NATHAN'S FAMOUS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 28, 2025

(in thousands, except share and per share amounts)

(Unaudited)

NOTE A - BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements of Nathan's Famous, Inc. and subsidiaries (collectively “Nathan’s,” the “Company,” “we,” “us” or “our”) as of and for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The unaudited condensed consolidated financial statements include all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary for a fair presentation of financial condition, results of operations and cash flows for the periods presented. However, our results of operations are seasonal in nature, and the results of any interim period are not necessarily indicative of results for any other interim period or the full fiscal year.

The Company uses a 52-53 week fiscal year ending on the Sunday closest to March 31. The 2026 fiscal year will end on March 29, 2026 and will contain 52 weeks.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the requirements of the U.S. Securities and Exchange Commission (“SEC”).

Certain prior year amounts have been reclassified in operating activities within the Condensed Consolidated Statements of Cash Flows to conform with the current year presentation. The reclassification does not affect previously reported cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows.

Management believes that the disclosures included in the accompanying condensed consolidated interim financial statements and footnotes are adequate to make the information not misleading but should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Nathan’s Annual Report on Form 10-K for the fiscal year ended March 30, 2025 as filed with the SEC on June 10, 2025.

Our significant interim accounting policies include the recognition of advertising fund expense in proportion to advertising fund revenue, and the recognition of income taxes using an estimated annual effective tax rate.

A summary of the Company’s significant accounting policies is identified in Note B of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 30, 2025.

NOTE B – NEW ACCOUNTING STANDARDS NOT YET ADOPTED

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which updates income tax disclosure requirements primarily by requiring specific categories and greater disaggregation within the rate reconciliation table and disaggregation of income taxes paid, net of refunds, by jurisdiction. All entities are required to apply the guidance prospectively, with the option to apply it retrospectively. The guidance is effective for fiscal years beginning after December 15, 2024, which for us is our fiscal year 2026 beginning on March 31, 2025. The adoption of ASU 2023-09 is expected to impact disclosures only and not have an impact on our consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, which requires the disaggregation of certain expenses in the notes to the financial statements, to provide enhanced transparency into the expense captions presented on the face of the statement of earnings. Additionally, in January 2025, the FASB issued ASU 2025-01, “Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date”, which clarified the effective date for non-calendar year-end entities such as us. The guidance is effective for the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments in this Update should be applied either (1) prospectively to financial statements for reporting periods after the effective date of this Update or (2) retrospectively to any or all prior periods presented in the financial statements. For the Company, annual reporting requirements will be effective for our fiscal year 2028 beginning on March 29, 2027 and interim reporting requirements will be effective beginning with our first quarter of fiscal year 2029. The Company is currently evaluating the impact that the new guidance will have on our consolidated financial statements.

-8-

In July 2025, the FASB issued ASU 2025-05, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” which provides all entities with a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the assets when estimating credit losses for current accounts receivable and current contract assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, which for us is our fiscal year 2027 beginning on March 30, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted. Based on our preliminary evaluation, we do not anticipate a material effect on our consolidated financial statements.

The Company does not believe that any recently issued, but not yet effective accounting standards, when adopted, will have a material effect on the accompanying condensed consolidated financial statements.

NOTE C – REVENUES

The Company’s disaggregated revenues for the thirteen and twenty-six weeks ended September 28, 2025 and September 29, 2024 are as follows (in thousands):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024

Branded Products	$	29,047	$	24,536	$	58,122	$	50,682
Company-owned restaurants		5,624		5,348		9,610		9,547
License royalties		9,227		9,491		21,608		22,412
Franchise royalties		1,138		1,066		2,139		2,047
Franchise fees		85		108		213		200
Advertising fund revenue		566		560		993		988
Total revenues	$	45,687	$	41,109	$	92,685	$	85,876

The following table disaggregates revenues by primary geographical market (in thousands):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024

United States	$	44,756	$	40,464	$	90,795	$	83,760
International		931		645		1,890		2,116
Total revenues	$	45,687	$	41,109	$	92,685	$	85,876

Contract balances

The following table provides information about contract liabilities from contracts with customers (in thousands):

	September 28, 2025		March 30, 2025
Deferred franchise fees (a)		$881		$1,006
Deferred revenues, which are included in
“Accrued expenses and other current liabilities” (b)		$715		$1,392

(a)

Deferred franchise fees of $250 and $631 as of September 28, 2025 and $309 and $697 as of March 30, 2025 are included in Deferred franchise fees – current and long term, respectively.

(b)

Includes $215 of deferred license royalties and $500 of deferred advertising fund revenue as of September 28, 2025 and $892 of deferred license royalties and $500 of deferred advertising fund revenue as of March 30, 2025.

-9-

Significant changes in deferred franchise fees are as follows (in thousands):

	Twenty-six weeks ended
	September 28, 2025			September 29, 2024
Deferred franchise fees at beginning of period	$	1,006		$	1,226
New deferrals due to cash received and other		88			75
Revenue recognized during the period		(213	)		(200	)
Deferred franchise fees at end of period	$	881		$	1,101

Significant changes in deferred revenues are as follows (in thousands):

	Twenty-six weeks ended
	September 28, 2025			September 29, 2024
Deferred revenues at beginning of period	$	1,392		$	1,375
New deferrals due to cash received and other		500			500
Revenue recognized during the period		(1,177	)		(1,275	)
Deferred revenues at end of period	$	715		$	600

Anticipated future recognition of deferred franchise fees

The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied at the end of the period (in thousands):

	Estimate for fiscal year
2026 (a)	$	152
2027		196
2028		104
2029		77
2030		56
Thereafter		296
Total	$	881

(a)

Represents franchise fees expected to be recognized for the remainder of the 2026 fiscal year, which includes international development fees expected to be recognized over the duration of one year or less. Amount does not include $213 of franchise fee revenue recognized for the twenty-six weeks ended September 28, 2025.

We have applied the optional exemption, as provided for under ASC Topic 606 “Revenues from Contracts with Customers,” which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.

NOTE D – INCOME PER SHARE

Basic net income per common share is calculated by dividing net income by the weighted average number of common shares outstanding and excludes any dilutive effect of share-based awards. Diluted net income per common share gives effect to all potentially dilutive common shares that were outstanding during the period. Dilutive common shares used in the computation of diluted net income per common share result from the assumed exercise of stock options as determined using the treasury stock method and restricted stock unit awards.

-10-

The following chart provides a reconciliation of information used in calculating the per-share amounts for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024, respectively (in thousands, except share and per share amounts):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024

Net income	$	5,199	$	6,030	$	14,127	$	15,307

Common Stock:
Weighted average basic shares outstanding		4,089,000		4,085,000		4,089,000		4,085,000
Effect of dilutive share-based awards		41,000		10,000		38,000		7,000
Weighted average diluted shares outstanding		4,130,000		4,095,000		4,127,000		4,092,000

Net income per share:
Basic	$	1.27	$	1.48	$	3.45	$	3.75
Diluted	$	1.26	$	1.47	$	3.42	$	3.74

Anti-dilutive share-based awards		-		120		-		120

NOTE E – CASH AND CASH EQUIVALENTS

Cash and cash equivalents principally consist of cash in bank accounts, money market accounts and money market funds. The Company considers money market accounts and money market funds to be cash equivalents. Cash equivalents were $24,551 and $19,400 at September 28, 2025 and March 30, 2025, respectively.

At September 28, 2025 and March 30, 2025, substantially all of the Company’s cash balances are in excess of insurance limits of the Federal Deposit Insurance Corporation or the FDIC. The Company has not experienced any losses in such accounts.

NOTE F – FAIR VALUE MEASUREMENTS

Nathan’s follows a three-level fair value hierarchy that prioritizes the inputs to measure fair value. This hierarchy requires entities to maximize the use of “observable inputs” and minimize the use of “unobservable inputs.” The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows:

● Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for an identical asset or liability in an active market

● Level 2 - inputs to the valuation methodology include quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability

● Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement of the asset or liability and reflect the Company’s own assumptions

The carrying amounts reported in the Company’s Condensed Consolidated Balance Sheets for cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term nature of those items.

The carrying amount of our long-term debt (see Note P – LONG TERM DEBT) also approximates fair value since such borrowings bear interest at variable market rates and is categorized as Level 2.

Certain non-financial assets and liabilities are measured at fair value on a non-recurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances, such as when evidence of impairment exists. At September 28, 2025, no fair value adjustment or material fair value measurements were required for non-financial assets or liabilities.

-11-

NOTE G – ACCOUNTS AND OTHER RECEIVABLES, NET

Accounts and other receivables, net, consist of the following (in thousands):

	September 28,			March 30,
	2025			2025

Branded product sales	$	17,239		$	10,534
Franchise and license royalties		3,815			3,902
Other		1,266			270
		22,320			14,706
Less: allowance for credit losses		(707	)		(642	)
Accounts and other receivables, net	$	21,613		$	14,064

Our provision for credit losses is based on the current expected credit losses model. The Company is exposed to credit losses through its trade accounts receivable. Trade accounts receivable are generally due within 30 days and are stated at amounts due from franchisees, including virtual kitchens, retail licensees and Branded Product Program customers, net of an allowance for credit losses. Accounts that are outstanding longer than the contractual payment terms are generally considered past due.

An allowance for credit losses is determined by pooling financial assets based on similar risk characteristics and delinquency status under an aging method at the measurement date. The Company considers both qualitative and quantitative information when developing the estimate including assessments of collectability based on historical trends, the financial condition of the Company’s franchisees, licensees and Branded Product Program customers, including any known or anticipated bankruptcies, and an evaluation of current economic conditions as well as the Company’s expectations of conditions in the future.

The Company provides for expected credit losses through a charge to earnings. After the Company has used reasonable collection efforts, it writes off accounts receivable through a charge to the allowance for credit losses.

Changes in the Company’s allowance for credit losses for the twenty-six week period ended September 28, 2025 and the fiscal year ended March 30, 2025 are as follows (in thousands):

	September 28, 2025		March 30, 2025

Beginning balance	$	642	$	403
Provision for expected credit losses		63		275
Write offs and other		2		(36	)
Ending balance	$	707	$	642

NOTE H – PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consist of the following (in thousands):

	September 28,		March 30,
	2025		2025

Income taxes	$	-	$	493
Real estate taxes		84		80
Insurance		91		379
Marketing		145		798
Other		363		298
Total prepaid expenses and other current assets	$	683	$	2,048

-12-

NOTE I - INTANGIBLE ASSET

The Company’s definite-lived intangible asset consists of trademarks, and the trade name and other intellectual property in connection with its Arthur Treacher’s co-branding agreements. Based upon review of the current Arthur Treacher’s co-branding agreements, the Company determined that the remaining useful lives of these agreements is three years concluding in fiscal year 2028, and the intangible asset is subject to annual amortization. The Company performs an annual impairment test, or more frequently if events or changes in circumstances indicate that the intangible asset may be impaired. The Company tests for recoverability of its definite-lived intangible asset based on the projected undiscounted cash flows to be derived from such co-branding agreements. Cash flow projections require significant estimates and assumptions by management. Should the estimates and assumptions prove to be incorrect, the Company may be required to record an impairment charge in future periods and such impairment could be material.

There have been no significant events or changes in circumstances during the thirteen and twenty-six week periods ended September 28, 2025 that would indicate that the carrying amount of the Company’s intangible asset may be impaired as of September 28, 2025.

NOTE J - LONG LIVED ASSETS

Long-lived assets on a restaurant-by-restaurant basis are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

Long-lived assets include property, equipment and right-of-use assets for operating leases with finite useful lives. Assets are grouped at the individual restaurant level, which represents the lowest level for which cash flows can be identified largely independent of the cash flows of other assets and liabilities. The Company generally considers a history of restaurant operating losses to be its primary indicator of potential impairment for individual restaurant locations.

The Company tests for recoverability based on the projected undiscounted cash flows to be derived from such assets. If the projected undiscounted future cash flows are less than the carrying value of the asset, the Company will record on a restaurant-by-restaurant basis, an impairment loss, if any, based on the difference between the estimated fair value and the carrying value of the asset. The Company generally measures fair value by considering discounted estimated future cash flows from such assets. Cash flow projections and fair value estimates require significant estimates and assumptions by management. Should the estimates and assumptions prove to be incorrect, the Company may be required to record impairment charges in future periods and such impairments could be material.

There have been no significant events or changes in circumstances during the thirteen and twenty-six week periods ended September 28, 2025 that would indicate that the carrying amount of the Company’s long-lived assets may be impaired as of September 28, 2025.

NOTE K – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following (in thousands):

	September 28, 2025		March 30, 2025

Payroll and other benefits	$	1,943	$	3,269
Accrued rebates		1,061		742
Rent and occupancy costs		50		60
Deferred revenue		715		1,392
Interest		78		148
Professional fees		142		60
Sales, use and other taxes		115		33
Corporate income taxes		639		-
Other		267		265
Total accrued expenses and other current liabilities	$	5,010	$	5,969

-13-

NOTE L – INCOME TAXES

The effective income tax rates for the thirteen week periods ended September 28, 2025 and September 29, 2024 were 26.0% and 25.5%, respectively. The effective income tax rate for the thirteen weeks ended September 28, 2025 reflected $1,822 of income tax expense recorded on $7,021 of pre-tax income. The effective income tax rate for the thirteen weeks ended September 29, 2024 reflected $2,069 of income tax expense recorded on $8,099 of pre-tax income.

The effective income tax rate for each of the twenty-six week periods ended September 28, 2025 and September 29, 2024 was 26.7%. The effective income tax rate for the twenty-six weeks ended September 28, 2025 reflected $5,151 of income tax expense recorded on $19,278 of pre-tax income. The effective income tax rate for the twenty-six weeks ended September 29, 2024 reflected $5,576 of income tax expense recorded on $20,883 of pre-tax income.

The effective tax rates are higher than the United States Federal statutory rates primarily due to state and local taxes, as well as non-deductible compensation under the Internal Revenue Code Section 162(m).

The amount of unrecognized tax benefits included in Other liabilities at September 28, 2025 and March 30, 2025 was $462 and $532, respectively, all of which would impact the Company’s effective rate, if recognized. As of September 28, 2025 and March 30, 2025, the Company had approximately $418 and $395, respectively, of accrued interest and penalties in connection with unrecognized tax benefits.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”). The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, and the business interest expense limitation. The OBBBA did not have a material impact to our provision for income taxes for the thirteen and twenty-six weeks ended September 28, 2025. The Company is continuing to evaluate the full year impact of the OBBBA and, based on our preliminary analysis, we do not anticipate a material effect on our consolidated financial statements for the fiscal year ending March 29, 2026.

NOTE M – SEGMENT INFORMATION

Nathan’s considers itself to be a brand marketer of the Nathan’s Famous signature products to the foodservice industry pursuant to its various business structures. Nathan’s sells its products directly to consumers through its Restaurant Operations segment consisting of Company-owned and franchised restaurants, including virtual kitchens; to distributors that resell our products to the foodservice industry through the Branded Product Program; and by third party manufacturers pursuant to license agreements that sell our products to supermarkets, club stores and grocery stores nationwide.

The Company’s Chief Executive Officer has been identified as the Chief Operating Decision Maker (“CODM”) who regularly reviews operating results, evaluates performance and allocates resources for the Branded Product Program, Product Licensing and Restaurant Operations segments based upon a number of factors, the primary profit measure being income from operations as reported on the Condensed Consolidated Statement of Earnings. The CODM regularly reviews revenues, gross profit and income from operations by segment when evaluating the financial performance of each segment. Significant segment expenses are monitored by the CODM and included in the tables below. Segment asset information is not used by the CODM to assess performance and allocate resources and therefore is not presented. Certain administrative expenses are not allocated to the segments and are reported within the Corporate segment.

Branded Product Program – This segment derives revenue principally from the sale of hot dog products either directly to foodservice operators or to various foodservice distributors who resell the products to foodservice operators.

Product licensing – This segment derives revenue, primarily in the form of royalties, from licensing a broad variety of Nathan’s Famous branded products, including our hot dogs, frozen crinkle-cut French fries and additional products through retail supermarkets, grocery channels and club stores throughout the United States.

Restaurant operations – This segment derives revenue from the sale of our products at Company-owned restaurants and earns fees and royalties from its franchised restaurants, including its virtual kitchens.

Revenues from operating segments are from transactions with unaffiliated third parties and do not include any intersegment revenues.

-14-

Interest expense, loss on debt extinguishment and interest and dividend income are managed centrally at the corporate level, and, accordingly, such items are not presented by segment since they are excluded from the measure of profitability reviewed by the CODM.

The following tables summarize segment information and reconcile our segment results to our consolidated results as reported on our Condensed Consolidated Statement of Earnings (in thousands):

Thirteen weeks ended

September 28, 2025

Branded

Product

Program

Product

Licensing

Restaurant

Operations

Corporate

Total

Revenues

29,047

9,227

6,847

566

45,687

Less:

Cost of sales

29,590

2,788

32,378

Segment gross profit (loss)

(543

)

9,227

4,059

566

13,309

Less (1):

Restaurant operating expenses (2)

1,432

Department expenses (3)

236

109

103

494

Other general and administration expenses (4)

1,478

Payroll expense

270

360

850

1,480

Depreciation and amortization

165

236

Advertising fund expense

687

Income (loss) from operations

(1,082

)

9,181

1,993

(2,590

)

7,502

Interest expense

(739

)

(739

)

Interest and dividend income

236

Other income, net

Income (loss) before provision for income taxes

(1,082

)

9,181

2,015

(3,093

)

7,021

	Thirteen weeks ended
	September 29, 2024
	Branded Product Program		Product Licensing		Restaurant Operations		Corporate			Total

Revenues		24,536		9,491		6,522		560			41,109
Less:
Cost of sales		23,318		-		2,711		-			26,029
Segment gross profit		1,218		9,491		3,811		560			15,080
Less (1):
Restaurant operating expenses (2)		-		-		1,389		-			1,389
Department expenses (3)		216		45		133		102			496
Other general and administration expenses (4)		-		-		-		1,311			1,311
Payroll expense		267		-		345		833			1,445
Depreciation and amortization		38		-		163		46			247
Advertising fund expense		-		-		-		560			560
Income (loss) from operations		697		9,446		1,781		(2,292	)		9,632
Interest expense		-		-		-		(1,441	)		(1,441	)
Loss on debt extinguishment		-		-		-		(334	)		(334	)
Interest and dividend income		-		-		-		219			219
Other income, net		-		-		23		-			23
Income (loss) before provision for income taxes		697		9,446		1,804		(3,848	)		8,099

-15-

Twenty-six weeks ended

September 28, 2025

Branded

Product

Program

Product

Licensing

Restaurant

Operations

Corporate

Total

Revenues

58,122

21,608

11,962

993

92,685

Less:

Cost of sales

55,823

4,978

60,801

Segment gross profit

2,299

21,608

6,984

993

31,884

Less (1):

Restaurant operating expenses (2)

2,611

Department expenses (3)

464

263

198

1,017

Other general and administration expenses (4)

3,319

Payroll expense

574

727

1,765

3,066

Depreciation and amortization

322

464

Advertising fund expense

1,114

Income (loss) from operations

1,194

21,516

3,061

(5,478

)

20,293

Interest expense

(1,497

)

(1,497

)

Interest and dividend income

439

Other income, net

Income (loss) before provision for income taxes

1,194

21,516

3,104

(6,536

)

19,278

	Twenty-six weeks ended
	September 29, 2024
	Branded Product Program		Product Licensing		Restaurant Operations		Corporate			Total

Revenues		50,682		22,412		11,794		988			85,876
Less:
Cost of sales		46,290		-		4,980		-			51,270
Segment gross profit		4,392		22,412		6,814		988			34,606
Less (1):
Restaurant operating expenses (2)		-		-		2,518		-			2,518
Department expenses (3)		548		91		401		202			1,242
Other general and administration expenses (4)		-		-		-		2,928			2,928
Payroll expense		571		-		739		1,747			3,057
Depreciation and amortization		76		-		329		91			496
Advertising fund expense		-		-		-		988			988
Income (loss) from operations		3,197		22,321		2,827		(4,968	)		23,377
Interest expense		-		-		-		(2,501	)		(2,501	)
Loss on debt extinguishment		-		-		-		(334	)		(334	)
Interest and dividend income		-		-		-		297			297
Other income, net		-		-		44		-			44
Income (loss) before provision for income taxes		3,197		22,321		2,871		(7,506	)		20,883

(1)	The significant expense categories and amounts align with segment-level information that is regularly provided to the CODM.

(2)	Includes occupancy expenses, insurance expenses, utility costs, repair and maintenance expense and other Company-owned restaurant expenses.

(3)	Includes travel expense, marketing and trade show expense and certain other overhead expenses.

(4)	Includes incentive compensation expense, share-based compensation expense, professional fees, occupancy expenses, provision for credit losses and certain other overhead expenses.

-16-

NOTE N – SHARE-BASED COMPENSATION

Total share-based compensation expense during the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 was $284 and $229, and $572 and $417, respectively. Total share-based compensation expense is included in general and administrative expenses in our accompanying Condensed Consolidated Statements of Earnings. As of September 28, 2025, there was $2,709 of unamortized compensation expense related to share-based awards. We expect to recognize this expense over approximately thirty-two months, which represents the weighted average remaining requisite service periods for such awards.

The Company recognizes compensation expense for unvested share-based awards on a straight-line basis over the requisite service period. Compensation expense recognized under all share-based awards is as follows (in thousands):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024

Stock options	$	115	$	60	$	234	$	79
Restricted stock units		169		169		338		338
Total share-based compensation expense	$	284	$	229	$	572	$	417

Stock options

There were no new share-based awards granted during the twenty-six week period ended September 28, 2025.

Transactions with respect to stock options for the twenty-six weeks ended September 28, 2025 are as follows:

			Weighted		Weighted		Aggregate
			Average		Average		Intrinsic
			Exercise		Remaining		Value
	Shares		Price		Contractual Life		(in thousands)

Options outstanding at March 30, 2025		130,000	$	74.28		4.08	$	2,667
Granted		-		-		-		-
Exercised		-		-		-		-
Options outstanding at September 28, 2025		130,000	$	74.28		3.58	$	4,515

Options exercisable at September 28, 2025		42,500	$	73.48		3.06	$	1,510

Restricted stock units

Transactions with respect to restricted stock units for the twenty-six weeks ended September 28, 2025 are as follows:

			Weighted
			Average
			Grant-date Fair value
	Shares		Per share

Unvested restricted stock units at March 30, 2025		30,000	$	67.59
Granted		-		-
Vested		-		-
Unvested restricted stock units at September 28, 2025		30,000	$	67.59

-17-

NOTE O – STOCKHOLDERS’ EQUITY

1. Dividends

Effective June 10, 2025, the Company’s Board of Directors (the “Board”) declared its first quarterly cash dividend of $0.50 per share for fiscal 2026, which was paid on July 1, 2025 to stockholders of record as of the close of business on June 23, 2025.

Effective August 8, 2025, the Board declared its second quarterly cash dividend of $0.50 per share for fiscal 2026, which was paid on September 5, 2025 to stockholders of record as of the close of business on August 25, 2025.

Effective November 6, 2025, the Board declared its third quarterly cash dividend of $0.50 per share for fiscal 2026 payable on December 5, 2025 to stockholders of record as of the close of business on November 24, 2025.

Additionally, effective November 6, 2025, the Board also declared a special cash dividend of $2.50 per share to stockholders of record as of close of business on November 24, 2025 of approximately $10,224 payable on December 5, 2025.

Our ability to pay future dividends is limited by the terms of our Credit Agreement (as defined in Note P – LONG TERM DEBT). In addition to the terms of our Credit Agreement, the declaration and payment of any cash dividends in the future are subject to final determination of the Board and will be dependent upon our earnings and financial requirements.

2. Stock Repurchase Programs

In 2016, the Board authorized increases to the sixth stock repurchase plan for the purchase of up to 1,200,000 shares of its common stock on behalf of the Company. As of September 28, 2025, Nathan’s had repurchased 1,101,884 shares at a cost of $39,000 under the sixth stock repurchase plan. At September 28, 2025 there were 98,116 shares remaining to be repurchased pursuant to the sixth stock repurchase plan. The plan does not have a set expiration date. Purchases under the Company’s stock repurchase program may be made from time to time, depending on market conditions, in open market or privately negotiated transactions, at prices deemed appropriate by management. There is no set time limit on the repurchases.

NOTE P – LONG-TERM DEBT

Long-term debt consists of the following (in thousands):

	September 28, 2025			March 30, 2025

SOFR Term Loan Borrowings with an effective interest rate of 5.636% and 5.825% at September 28, 2025 and March 30, 2025, respectively.	$	49,600		$	50,800

Less: unamortized debt issuance costs		(291	)		(327	)
Total debt, net of debt issuance costs		49,309			50,473
Less: current portion of long-term debt		(2,400	)		(2,400	)
Long-term debt, net	$	46,909		$	48,073

The Company’s mandatory debt principal repayments as of September 28, 2025 were as follows (in thousands):

Fiscal Year	Amount
Remainder of 2026	$	1,200
2027		2,400
2028		2,400
2029		2,400
2030		41,200
Total	$	49,600

Total debt repayments through 2030 exceed the total carrying amount of the Company’s debt as of September 28, 2025 because the carrying amount reflects the unamortized portion of debt issuance costs.

-18-

On July 10, 2024 (the “Effective Date”), the Company entered into a five-year unsecured Credit Agreement (the “Credit Agreement”) among the Company, as borrower, direct and indirect subsidiaries of the Company, as guarantors, the lenders from time to time party thereto (the “Lenders”) and Citibank, N.A., as administrative agent, swing line lender, L/C issuer and a Lender (capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Credit Agreement).

The Credit Agreement provides for a term loan facility (“Term Loan”) of $60,000 and a revolving credit facility (“Revolving Loan”) of up to $10,000. The Credit Agreement also provides that the Company has the right from time to time during the term of the Credit Agreement to request the Lenders for incremental revolving loan borrowing increases of up to an additional $10,000 in the aggregate, subject to, among other items, the Lenders agreeing to lend any such additional amounts and compliance with terms specified in the Credit Agreement. The Credit Agreement matures on July 10, 2029.

The Company borrowed $60,000 in Term Loan borrowings on the Effective Date to refinance and redeem its outstanding 6.625% Senior Secured Notes due 2025. The Company will use any Revolving Loan borrowings under the Credit Agreement for working capital and general corporate purposes. As of September 28, 2025, there were no outstanding borrowings under the Revolving Loan.

In connection with the refinancing, the Company recorded a loss on extinguishment of debt of $334 during the quarter ending September 29, 2024 that reflected the write-off of the remainder of the debt issuance costs on the Company’s 6.625% Secured Notes due 2025. Additionally, in connection with the refinancing, the Company incurred $431 of debt issuance costs on the Term Loan borrowings that were capitalized and will be amortized over the term of the Credit Agreement.

Term Loan and Revolving Loan borrowings under the Credit Agreement will bear interest at a rate per annum, at the Company’s option, of (a) for Base Rate Loans, the Base Rate plus the Applicable Rate of 0.00% or (b) for Term SOFR Loans, Term SOFR plus the Applicable Rate of 1.40% for one (1), three (3) or six (6) month periods, as selected by the Company in its Loan Notice. The Company is subject to a commitment fee of 0.20% per annum on the daily amount of the undrawn portion of the Revolving Committed Amount. The interest rate on the Term Loan borrowings at September 28, 2025 was 5.636%.

The Credit Agreement contains customary affirmative covenants and negative covenants and requires the Company to maintain a Consolidated Fixed Charge Ratio not to exceed 1.20 to 1.00 and a Consolidated Net Leverage Ratio not to exceed 3.00 to 1.00, in each case, as of the end of each fiscal quarter. The Company was in compliance with the covenants of the Credit Agreement at September 28, 2025.

The outstanding Term Loan borrowings under the Credit Agreement are payable in equal quarterly installments of 1.0% of the original principal amount of the Term Loan, or $600, which began on September 30, 2024, with the balance payable on the final maturity date. The Company made mandatory principal repayments on the Term Loan of $1,200 during fiscal 2026. Subsequent to the quarter ending September 28, 2025, on September 30, 2025, the Company paid its next quarterly mandatory debt principal repayment of $600.

The outstanding Term Loan borrowings and the Revolving Loan borrowings under the Credit Agreement are voluntarily prepayable by the Company without penalty or premium, provided, that each of the following shall require a mandatory prepayment of outstanding Term Loan borrowings and Revolving Loan borrowings by the Company as follows: (i) 100% of any Net Cash Proceeds in excess of $2,000 individually or in the aggregate over the term of the Credit Agreement in respect of any Extraordinary Receipt provided that the Company shall be permitted to reinvest such Net Cash Proceeds in accordance with the Credit Agreement, (ii) 100% of any Net Cash Proceeds of an Equity Issuance, (iii) 100% of any Net Cash Proceeds from a Debt Issuance and (iv) 100% of any Net Cash Proceeds from the Disposition of certain assets individually, or in the aggregate, in excess of $2,000 in any fiscal year provided that the Company shall be permitted to reinvest such Net Cash Proceeds in accordance with the Credit Agreement.

The Company’s obligations under the Credit Agreement are fully and unconditionally guaranteed by all of the Company’s wholly-owned subsidiaries.

The Credit Agreement provides that certain Change of Control events constitutes an Event of Default. Such an Event of Default entitles the Lenders to, among other things, cause all outstanding debt obligations under the Credit Agreement to become immediately due and payable.

-19-

NOTE Q – LEASES

The Company is party as lessee to various leases for land, buildings and certain office equipment for its Company-owned restaurants and corporate office, as well as a lessee/sublessor to one other property.

Company as lessee

The components of the net lease cost for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

	Thirteen weeks ended						Twenty-six weeks ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024

Operating lease cost	$	417		$	420		$	855		$	861
Variable lease cost		645			638			1,109			1,098
Less: Sublease income, net		(21	)		(21	)		(42	)		(42	)

Total net lease cost	$	1,041		$	1,037		$	1,922		$	1,917

The components of the net lease cost are included in the Condensed Consolidated Statements of Earnings for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 as follows (in thousands):

	Thirteen weeks ended						Twenty-six weeks ended
	September 28, 2025			September 29, 2024			September 28, 2025			September 29, 2024

Restaurant operating expenses	$	858		$	861		$	1,540		$	1,548
General and administrative expenses		204			197			424			411
Less: Other income, net		(21	)		(21	)		(42	)		(42	)

Total net lease cost	$	1,041		$	1,037		$	1,922		$	1,917

Cash paid for amounts included in the measurement of lease liabilities for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

Thirteen weeks ended

Twenty-six weeks ended

September 28,

2025

September 29,

2024

September 28,

2025

September 29,

2024

Operating cash flows from operating leases

$561

$551

$1,122

$1,104

The weighted average remaining lease term and weighted average discount rate for operating leases as of September 28, 2025 were as follows:

Weighted average remaining lease term (years):	3.1

Weighted average discount rate:	8.472	%

-20-

Future lease commitments to be paid and received by the Company as of September 28, 2025 were as follows (in thousands):

	Payments			Receipts
	Operating Leases			Subleases		Net Leases

Fiscal year:
2026 (a)	$	803		$	84	$	719
2027		1,940			281		1,659
2028		1,790			129		1,661
2029		440			-		440
2030		171			-		171
Thereafter		-			-		-
Total lease commitments	$	5,144		$	494	$	4,650
Less: Amount representing interest		(580	)
Present value of lease liabilities (b)	$	4,564

	(a)	Represents future lease commitments to be paid and received by the Company for the remainder of the 2026 fiscal year. Amount does not include $920 of lease commitments paid and received by the Company for the twenty-six week period ended September 28, 2025.
	(b)	The present value of minimum operating lease payments of $1,933 and $2,631 are included in “Current portion of operating lease liabilities” and “Long-term portion of operating lease liabilities,” respectively on the Condensed Consolidated Balance Sheet.

Company as lessor

The components of net lease income for the thirteen and twenty-six week periods ended September 28, 2025 and September 29, 2024 were as follows (in thousands):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024

Operating lease income, net	$	21	$	21	$	42	$	42

NOTE R – COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company and its subsidiaries are from time to time involved in ordinary and routine litigation. Management presently believes that the ultimate outcome of these proceedings, individually or in the aggregate, will not have a material adverse effect on the Company’s financial position, cash flows or results of operations. Nevertheless, litigation is subject to inherent uncertainties and unfavorable rulings could occur. An unfavorable ruling could include money damages and, in such event, could result in a material adverse impact on the Company’s results of operations for the period in which the ruling occurs.

NOTE S – SUBSEQUENT EVENTS

The Company evaluated subsequent events through the date the condensed consolidated financial statements were issued and filed with the SEC. There were no subsequent events that required recognition or disclosure.

-21-

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

This Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve risks and uncertainties. You can identify forward-looking statements because they contain words such as “believes,” “expects,” “projects,” “may,” “would,” “should,” “seeks,” “intends,” “plans,” “estimates,” “anticipates” or similar expressions that relate to our strategy, plans or intentions. All statements we make relating to our estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and financial results or to our expectations regarding future industry trends are forward-looking statements. In addition, we, through our senior management, from time to time make forward-looking public statements concerning our expected future operations and performance and other developments. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may change at any time, and, therefore, our actual results may differ materially from those that we expected. We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect our actual results. All forward-looking statements contained in this Form 10-Q are based upon information available to us on the date of this Form 10-Q.

Statements in this Form 10-Q quarterly report may be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties, many of which are not within our control, include but are not limited to: the impact of disease epidemics such as the COVID-19 pandemic; increases in the cost of food and paper products; the impact of price increases on customer visits; the status of our licensing and supply agreements, including our licensing revenue and overall profitability being substantially dependent on our agreement with Smithfield Foods, Inc.; the impact of our debt service and repayment obligations under our Credit Agreement, including the effect on our ability to fund working capital, operations and make investments; economic (including inflationary pressures like those currently being experienced); weather (including the impact on sales at our restaurants particularly during the summer months); changes in the price of beef and beef trimmings; our ability to pass on the cost of any price increases in beef and beef trimmings; legislative and business conditions; potential changes in U.S. income tax or tariff policies; the collectability of receivables; changes in consumer tastes; the continued viability of Coney Island as a destination location for visitors; the ability to attract franchisees; the impact of the minimum wage legislation on labor costs in New York State or other changes in labor laws, including regulations which could render a franchisor as a “joint employer” or the impact of our union contracts; our ability to attract competent restaurant and managerial personnel; the enforceability of international franchising agreements; the future effects of any food borne illness such as bovine spongiform encephalopathy, BSE or e-coli; as well as those risks discussed from time to time in this Form 10-Q and our Form 10-K annual report for the year ended March 30, 2025, and in other documents we file with the U.S. Securities and Exchange Commission. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements. We generally identify forward-looking statements with the words “believe,” “intend,” “plan,” “expect,” “anticipate,” “estimate,” “will,” “should” and similar expressions. Any forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 10-Q.

Introduction

As used in this Report, the terms “we,” “us,” “our,” “Nathan’s” or the “Company” mean Nathan’s Famous, Inc. and its subsidiaries (unless the context indicates a different meaning).

We are engaged primarily in the marketing of the “Nathan’s Famous” brand and the sale of products bearing the “Nathan’s Famous” trademarks through several different channels of distribution. Historically, our business has been the operation and franchising of quick-service restaurants featuring Nathan’s World Famous Beef Hot Dogs, crinkle-cut French fries, and a variety of other menu offerings. Our Company-owned and franchised restaurants operate under the name “Nathan’s Famous,” the name first used at our original Coney Island restaurant opened in 1916. Nathan’s Product Licensing Program sells packaged hot dogs; frozen crinkle-cut French fries and additional products to retail customers through supermarkets, grocery channels and club stores for off-site consumption. Our Branded Product Program enables foodservice retailers and others to sell some of Nathan’s proprietary products outside of the realm of a traditional franchise relationship. In conjunction with this program, purchasers of Nathan’s products are granted a limited use of the Nathan’s Famous trademark with respect to the sale of the purchased products, including Nathan’s World Famous Beef Hot Dogs, certain other proprietary food items and paper goods. Our Branded Menu Program is a limited franchise program, under which foodservice operators may sell a greater variety of Nathan’s Famous menu items than under the Branded Product Program.

-22-

Our revenues are generated primarily from selling products under Nathan’s Branded Product Program, operating Company-owned restaurants, licensing agreements for the sale of Nathan’s products within supermarkets, grocery stores and club stores, the sale of Nathan’s products directly to other foodservice operators, the manufacture of certain proprietary spices by third parties and the royalties, fees and other sums we can earn from franchising the Nathan’s restaurant concept (including the Branded Menu Program and virtual kitchens).

At September 28, 2025, our restaurant system, excluding virtual kitchens, was comprised of 227 locations, including 112 franchise locations, and 115 Branded Menu Program locations, as well as four Company-owned restaurants (including one seasonal unit), located in 19 states, and 12 foreign countries.

At September 29, 2024, our restaurant system, excluding virtual kitchens, was comprised of 243 locations, including 115 franchise locations, and 128 Branded Menu Program locations, as well as four Company-owned restaurants (including one seasonal unit), located in 17 states, and 13 foreign countries.

Our primary focus is to expand the market penetration of the Nathan’s Famous brand by increasing the number of distribution points for our products across all of our business platforms, including our Licensing Program for distribution of Nathan’s Famous branded consumer packaged goods, our Branded Products Program for distribution of Nathan’s Famous branded bulk products to the foodservice industry, and our namesake restaurant system comprised of both Company-owned restaurants and franchised locations, including virtual kitchens. The primary drivers of our growth have been our Licensing and Branded Product Programs which have been the largest contributors to the Company’s revenues and profits.

While we do not expect to significantly increase the number of Company-owned restaurants, we may opportunistically and strategically invest in a small number of new units as showcase locations for prospective franchisees and master developers as we seek to grow our franchise system. We continue to seek opportunities to drive sales in a variety of ways as we adapt to the ever-changing consumer and business climate.

As described in our Annual Report on Form 10-K for the year ended March 30, 2025, our future results could be materially impacted by many developments including our dependence on Smithfield Foods, Inc. as our principal supplier and the dependence of our licensing revenue and overall profitability on our agreement with Smithfield Foods, Inc. In addition, our future operating results could be impacted by supply constraints on beef or by increased costs of beef, beef trimmings and other commodities due to inflationary pressures compared to earlier periods.

As described below, we are also including information relating to EBITDA and Adjusted EBITDA, which are non-GAAP financial measures, in this Form 10-Q quarterly report. See “Reconciliation of GAAP and Non-GAAP Measures.”

Recent events

Inflationary Factors

Inflationary pressures impacted our results of operations during the first half of fiscal 2026, and we anticipate continued inflationary pressures on commodity prices, including beef and beef trimmings, as well as labor inflation during the remainder of fiscal 2026. In general, we have been able to offset some of these cost increases resulting from inflation through various actions, such as increasing prices at our Company-owned restaurants and entering into sales agreements with our Branded Product Program customers that are correlated to our cost of beef and beef trimmings. We continue to monitor these inflationary pressures and may need to adjust our prices further to mitigate the impact of these inflationary pressures. Inherent volatility in commodity markets, including beef and beef trimmings, could have a significant impact on our results of operations. Delays in implementing price increases, competitive pressures, a decline in consumer spending levels and other factors may limit our ability to implement further price increases in the future.

Uncertainty in the current macroeconomic environment, including the potential impact of tariffs or other changes in U.S. tax policy, may have an adverse impact on our sales or increase our cost of goods sold.

-23-

Critical Accounting Policies and Estimates

As discussed in our Form 10-K for the fiscal year ended March 30, 2025, the discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the amounts of assets, liabilities, revenues and expenses reported in those condensed consolidated financial statements. These judgments can be subjective and complex, and consequently, actual results could differ from those estimates. Our most critical accounting estimates relate to impairment of intangible assets; impairment of long-lived assets; current expected credit losses; customer rebates and income taxes (including uncertain tax positions). There have been no changes to our critical accounting estimates from those disclosed in our Annual Report on Form 10-K for the fiscal year ended March 30, 2025.

New Accounting Standards Not Yet Adopted

Please refer to Note B of the preceding condensed consolidated financial statements for our discussion of the New Accounting Standards Not Yet Adopted.

EBITDA and Adjusted EBITDA

The Company believes that EBITDA and Adjusted EBITDA, which are non-GAAP financial measures, are useful to investors to assist in assessing and understanding the Company's operating performance and underlying trends in the Company's business because EBITDA and Adjusted EBITDA are (i) among the measures used by management in evaluating performance and (ii) are frequently used by securities analysts, investors and other interested parties as a common performance measure.

Reconciliation of GAAP and Non-GAAP Measures

The following is provided to supplement certain Non-GAAP financial measures.

In addition to disclosing results that are determined in accordance with US GAAP, the Company has provided EBITDA, a non-GAAP financial measure, which is defined as net income excluding (i) interest expense; (ii) provision for income taxes and (iii) depreciation and amortization expense. The Company has also provided Adjusted EBITDA, a non-GAAP financial measure, which is defined as EBITDA, excluding (i) the loss on debt extinguishment and (ii) share-based compensation that the Company believes will impact the comparability of its results of operations.

EBITDA and Adjusted EBITDA are not recognized terms under US GAAP and should not be viewed as alternatives to net income or other measures of financial performance or liquidity in conformity with US GAAP. Additionally, our definitions of EBITDA and Adjusted EBITDA may differ from other companies. Analysis of results and outlook on a non-US GAAP basis should be used as a complement to, and in conjunction with, data presented in accordance with US GAAP.

The following is a reconciliation of net income to EBITDA and Adjusted EBITDA (in thousands):

	Thirteen weeks ended				Twenty-six weeks ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
	(unaudited)				(unaudited)

Net income	$	5,199	$	6,030	$	14,127	$	15,307
Interest expense		739		1,441		1,497		2,501
Provision for income taxes		1,822		2,069		5,151		5,576
Depreciation and amortization		236		247		464		496
EBITDA		7,996		9,787		21,239		23,880

Loss on debt extinguishment		-		334		-		334
Share-based compensation		284		229		572		417
Adjusted EBITDA	$	8,280	$	10,350	$	21,811	$	24,631

-24-

Seasonality

Our routine business pattern is affected by seasonal fluctuations, including the effects of weather and economic conditions. Historically, sales from our Company-owned restaurants, principally at Coney Island, and franchised restaurants from which franchised royalties are earned and the Company’s earnings have been highest during our first two fiscal quarters, with the fourth quarter representing the slowest period. Additionally, revenues from our Branded Product Program, Branded Menu Program and Product Licensing Program generally follow similar seasonal fluctuations, although not to the same degree. We expect that this seasonality will continue. Working capital requirements may vary throughout the year to support these seasonal patterns.

Due to the above seasonal factors, as well as inflationary pressures, our results of operations for the thirteen and twenty-six weeks ended September 28, 2025 are not necessarily indicative of those for a full fiscal year.

Results of Operations

Thirteen weeks ended September 28, 2025 compared to thirteen weeks ended September 29, 2024

Revenues

Total revenues increased by approximately 11% to $45,687,000 for the thirteen weeks ended September 28, 2025 (“second quarter fiscal 2026”) as compared to $41,109,000 for the thirteen weeks ended September 29, 2024 (“second quarter fiscal 2025”).

Foodservice sales from the Branded Product Program increased by approximately 18% to $29,047,000 for the second quarter fiscal 2026 as compared to $24,536,000 for the second quarter fiscal 2025. During the second quarter fiscal 2026, the total volume of hot dogs sold in the Branded Product Program increased by approximately 7% as compared to the second quarter fiscal 2025. Our average selling price increased by approximately 11% as compared to the second quarter fiscal 2025.

Total Company-owned restaurant sales increased by approximately 5% to $5,624,000 during the second quarter fiscal 2026 as compared to $5,348,000 during the second quarter fiscal 2025. Restaurant sales were primarily impacted by higher sales at our Coney Island locations due to a 7% increase in customer traffic.

License royalties decreased by approximately 3% to $9,227,000 in the second quarter fiscal 2026 as compared to $9,491,000 in the second quarter fiscal 2025. Total royalties earned on sales of hot dogs from our license agreement with Smithfield Foods, Inc. at retail and foodservice, decreased 2% to $8,389,000 for the second quarter fiscal 2026 as compared to $8,595,000 in the second quarter fiscal 2025. The decrease is due to an 18% decrease in retail volume which was offset, in part, by a 19% increase in net selling price. The price increases year over year led to a reduction in promotional activities contributing to the decline in volume. The foodservice business earned higher royalties of $54,000 as compared to the second quarter fiscal 2025. Royalties earned from all other licensing agreements for the manufacture and sale of Nathan’s products decreased by $58,000 during the second quarter fiscal 2026 as compared to the second quarter fiscal 2025 primarily due to lower royalties earned on sales of proprietary spices offset, in part, by higher royalties earned on beef sticks.

Franchise fees and royalties increased by approximately 4% to $1,223,000 in the second quarter fiscal 2026 period as compared to $1,174,000 in the second quarter fiscal 2025. Total royalties were $1,138,000 in the second quarter fiscal 2026 as compared to $1,066,000 in the second quarter fiscal 2025. Royalties earned under the Branded Menu Program were $249,000 in the second quarter fiscal 2026 as compared to $248,000 in the second quarter fiscal 2025. Royalties earned under the Branded Menu Program are not based upon a percentage of restaurant sales but are based upon product purchases. Virtual kitchen royalties were $21,000 in the second quarter fiscal 2026 as compared to $11,000 in the second quarter fiscal 2025. Traditional franchise royalties were $868,000 in the second quarter fiscal 2026 as compared to $807,000 in the second quarter fiscal 2025. Franchise restaurant sales increased to $19,873,000 in the second quarter fiscal 2026 as compared to $18,681,000 in the second quarter fiscal 2025 principally due to higher sales at travel plazas and international venues offset by lower sales at casino locations, primarily in Las Vegas, Nevada. Comparable domestic franchise sales (consisting of 63 Nathan’s franchised restaurants, excluding sales under the Branded Menu Program) were $15,245,000 in the second quarter fiscal 2026 as compared to $15,286,000 in the second quarter fiscal 2025.

At September 28, 2025, 227 franchised locations, including domestic, international and Branded Menu Program units were operating as compared to 243 franchised locations, including domestic, international and Branded Menu Program units at September 29, 2024. Total franchise fee income was $85,000 in the second quarter fiscal 2026 as compared to $108,000 in the second quarter fiscal 2025. Domestic franchise fee income was $27,000 in the second quarter fiscal 2026 as compared to $35,000 in the second quarter fiscal 2025. International franchise fee income was $53,000 in the second quarter fiscal 2026 as compared to $59,000 in the second quarter fiscal 2025. We recognized $5,000 and $14,000 in forfeited fees in the second quarter fiscal 2026 and the second quarter fiscal 2025, respectively. During the second quarter fiscal 2026, six franchise locations opened and four franchise locations closed. During the second quarter fiscal 2025, eighteen franchise locations opened and six franchise locations closed.

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Advertising fund revenue, after eliminating Company contributions, was $566,000 during the second quarter fiscal 2026 as compared to $560,000 during the second quarter fiscal 2025.

Costs and Expenses

Overall, our cost of sales increased by approximately 24% to $32,378,000 in the second quarter fiscal 2026 as compared to $26,029,000 in the second quarter fiscal 2025. Our gross profit (calculated as total Branded Products sales plus total Company-owned restaurant sales less cost of sales) was $2,293,000 or 7% during the second quarter fiscal 2026 as compared to $3,855,000 or 13% during the second quarter fiscal 2025.

Cost of sales in the Branded Product Program increased by approximately 27% to $29,590,000 in the second quarter fiscal 2026 as compared to $23,318,000 in the second quarter fiscal 2025, primarily due to a 7% increase in the volume of hot dogs sold, as well as a 20% increase in the average cost per pound of our hot dogs. A shrinking supply of cattle due to drought conditions and high input costs, combined with strong industry demand and inflationary pressures have resulted in higher commodity prices, including beef and beef trimmings, contributing to the increase in the average cost per pound of our hot dogs. We did not make any purchase commitments of beef during the second quarter fiscal 2026 or the second quarter fiscal 2025 periods. If the cost of beef and beef trimmings increases and we are unable to pass on these higher costs through price increases or otherwise reduce any increase in our costs through the use of purchase commitments, our margins will be adversely impacted. With respect to Company-owned restaurants, our cost of sales during the second quarter fiscal 2026 was $2,788,000 or 50% of restaurant sales as compared to $2,711,000 or 51% of restaurant sales during the second quarter fiscal 2025. Food and paper costs as a percentage of Company-owned restaurant sales were 23.8%, down from 24.2% in the comparable period of the prior year primarily as a result of certain menu price increases. Labor and related expenses as a percentage of Company-owned restaurant sales were 25.7%, down from 26.5% in the comparable period of the prior year primarily as a result of certain menu price increases and efforts to improve hourly and management labor efficiency, offset by legislative increases in the New York State minimum wage which became effective January 1, 2025.

Restaurant operating expenses were $1,432,000 in the second quarter fiscal 2026 as compared to $1,389,000 in the second quarter fiscal 2025. The increase is due primarily to higher repairs and maintenance expenses of $25,000 and higher utilities expenses of $22,000. As a percentage of Company-owned restaurant sales, restaurant operating expenses were 25% in the second quarter fiscal 2026 as compared to 26% in the second quarter fiscal 2025.

Depreciation and amortization, which primarily consists of the depreciation of fixed assets, including leasehold improvements and equipment, and the amortization of a definite-lived intangible asset, was $236,000 in the second quarter fiscal 2026 as compared to $247,000 in the second quarter fiscal 2025.

General and administrative expenses increased by $200,000 or 6% to $3,452,000 in the second quarter fiscal 2026 as compared to $3,252,000 in the second quarter fiscal 2025. The increase in general and administrative expenses was primarily attributable to higher professional fees of $23,000, higher share-based compensation expense of $55,000, higher trade show and travel expenses of $25,000 and higher salaries and fringe expenses of $39,000 attributable to annual rate increases.

Advertising fund expense, after eliminating Company contributions, was $687,000 during the second quarter fiscal 2026 as compared to $560,000 in the second quarter fiscal 2025. The Company projects that the Advertising Fund normal seasonal deficit will not be fully recovered during the remainder of the fiscal 2026 period and has reflected the projected deficit of $121,000 in the second quarter fiscal 2026 results of operations.

Other Items

Interest expense of $739,000 in the second quarter fiscal 2026 represented interest expense of $722,000 on the Secured Overnight Financing Rate (“SOFR”) Term Loan borrowings and amortization of debt issuance costs of $17,000.

Interest expense of $1,441,000 in the second quarter fiscal 2025 represented interest expense of $458,000 and $930,000 on the 6.625% Secured Notes due 2025 (“2025 Notes”) which were redeemed in August 2024 and the SOFR Term Loan borrowings, respectively, and amortization of debt issuance costs of $35,000 and $18,000 on the 2025 Notes and the SOFR Term Loan borrowings, respectively.

The reduction in interest expense of $702,000 is due primarily to lower outstanding long-term debt and a lower interest rate associated with our Credit Agreement.

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In the second quarter fiscal 2025, the Company refinanced and redeemed its outstanding 2025 Notes. In connection with this transaction, the Company recorded a loss on extinguishment of debt of $334,000 that reflected the write-off of the remainder of previously recorded debt issuance costs.

Interest and dividend income of $236,000 in the second quarter fiscal 2026 represented amounts earned by the Company on its interest bearing money market accounts and money market funds, as compared to $219,000 in the second quarter fiscal 2025 period. The increase is due to higher levels of invested cash earning interest at higher rates in the second quarter fiscal 2026 as compared to the second quarter fiscal 2025.

Other income, net was $22,000 and $23,000 in the second quarter fiscal 2026 and the second quarter fiscal 2025, respectively, which primarily relates to sublease income.

Provision for Income Taxes

The effective income tax rate for the second quarter fiscal 2026 was 26.0% compared to 25.5% in the second quarter fiscal 2025. The effective income tax rate for the second quarter fiscal 2026 reflected income tax expense of $1,822,000 recorded on $7,021,000 of pre-tax income. The effective income tax rate for the second quarter fiscal 2025 reflected income tax expense of $2,069,000 recorded on $8,099,000 of pre-tax income. The effective tax rates are higher than the U.S. Federal statutory rates primarily due to state and local taxes, as well as non-deductible compensation under the Internal Revenue Code Section 162(m). The effective tax rate for the second quarter fiscal 2026 included a favorable discrete adjustment of 0.6%.

The American Rescue Plan Act of 2021 (“ARPA”), among other things, includes provisions to expand the IRC Section 162(m) disallowance for deduction of certain compensation paid by publicly held corporations. Effective for tax years starting after December 31, 2026 (March 29, 2027 for the Company), ARPA expands the limitations to cover the next five most highly compensated employees. We continue to evaluate the potential impact ARPA may have on our operations and condensed consolidated financial statements in future periods.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The OBBBA did not have a material impact to our provision for income taxes for the second quarter fiscal 2026.

The amount of unrecognized tax benefits at September 28, 2025 was $462,000 all of which would impact the Company’s effective tax rate, if recognized. As of September 28, 2025, the Company had approximately $418,000 accrued for the payment of interest and penalties in conjunction with unrecognized tax benefits.

Nathan’s estimates that its unrecognized tax benefit excluding accrued interest and penalties could be further reduced by up to $55,000 during the fiscal year ending March 29, 2026 due primarily to the lapse of statutes of limitations which would favorably impact the Company’s effective tax rate, although no assurances can be given in this regard.

Results of Operations

Twenty-six weeks ended September 28, 2025 compared to twenty-six weeks ended September 29, 2024

Revenues

Total revenues increased by approximately 8% to $92,685,000 for the twenty-six weeks ended September 28, 2025 (“fiscal 2026 period”) as compared to $85,876,000 for the twenty-six weeks ended September 29, 2024 (“fiscal 2025 period”).

Foodservice sales from the Branded Product Program increased by approximately 15% to $58,122,000 for the fiscal 2026 period as compared to $50,682,000 for the fiscal 2025 period. During the fiscal 2026 period, the total volume of hot dogs sold in the Branded Product Program increased by approximately 3% as compared to the fiscal 2025 period. Our average selling price increased by approximately 10% as compared to the fiscal 2025 period.

Total Company-owned restaurant sales increased by approximately 1% to $9,610,000 during the fiscal 2026 period as compared to $9,547,000 during the fiscal 2025 period. Restaurant sales were primarily impacted by higher sales at our Coney Island locations which were offset by lower sales at our locations in Oceanside and Yonkers, New York.

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License royalties decreased by approximately 4% to $21,608,000 in the fiscal 2026 period as compared to $22,412,000 in the fiscal 2025 period. Total royalties earned on sales of hot dogs from our license agreement with Smithfield Foods, Inc. at retail and foodservice, decreased 4% to $19,853,000 for the fiscal 2026 period as compared to $20,605,000 in the fiscal 2025 period. The decrease is due to a 17% decrease in retail volume which was offset, in part, by a 15% increase in net selling price. The price increases year over year led to a reduction in promotional activities contributing to the decline in volume. The foodservice business earned higher royalties of $109,000 as compared to the fiscal 2025 period. Royalties earned from all other licensing agreements for the manufacture and sale of Nathan’s products decreased by $52,000 during the fiscal 2026 period as compared to the fiscal 2025 period primarily due to lower royalties earned on sales of pickles and proprietary spices offset, in part, by higher royalties earned on French fries, onion rings and beef sticks.

Franchise fees and royalties increased by approximately 5% to $2,352,000 in the fiscal 2026 period as compared to $2,247,000 in the fiscal 2025 period. Total royalties were $2,139,000 in the fiscal 2026 period as compared to $2,047,000 in the fiscal 2025 period. Royalties earned under the Branded Menu Program were $425,000 in the fiscal 2026 period as compared to $423,000 in the fiscal 2025 period. Royalties earned under the Branded Menu Program are not based upon a percentage of restaurant sales but are based upon product purchases. Virtual kitchen royalties were $36,000 in the fiscal 2026 period as compared to $25,000 in the fiscal 2025 period. Traditional franchise royalties were $1,678,000 in the fiscal 2026 period as compared to $1,599,000 in the fiscal 2025 period. Franchise restaurant sales increased to $38,316,000 in the fiscal 2026 period as compared to $36,334,000 in the fiscal 2025 period principally due to higher sales at travel plazas and international venues offset by lower sales at casino locations, primarily in Las Vegas, Nevada. Comparable domestic franchise sales (consisting of 61 Nathan’s franchised restaurants, excluding sales under the Branded Menu Program) were $28,957,000 in the fiscal 2026 period as compared to $29,379,000 in the fiscal 2025 period.

At September 28, 2025, 227 franchised locations, including domestic, international and Branded Menu Program units were operating as compared to 243 franchised locations, including domestic, international and Branded Menu Program units at September 29, 2024. Total franchise fee income was $213,000 in the fiscal 2026 period as compared to $200,000 in the fiscal 2025 period. Domestic franchise fee income was $50,000 in the fiscal 2026 period as compared to $58,000 in the fiscal 2025 period. International franchise fee income was $107,000 in the fiscal 2026 period as compared to $119,000 in the fiscal 2025 period. We recognized $56,000 and $23,000 in forfeited fees in the fiscal 2026 period and fiscal 2025 period, respectively. During the fiscal 2026 period, fourteen franchise locations opened and seventeen franchise locations closed. During the fiscal 2025 period, twenty-one franchise locations opened and eight franchise locations closed.

Advertising fund revenue, after eliminating Company contributions, was $993,000 during the fiscal 2026 period as compared to $988,000 during the fiscal 2025 period.

Costs and Expenses

Overall, our cost of sales increased by approximately 19% to $60,801,000 in the fiscal 2026 period as compared to $51,270,000 in the fiscal 2025 period. Our gross profit (calculated as total Branded Products sales plus total Company-owned restaurant sales less cost of sales) was $6,931,000 or 10% during the fiscal 2026 period as compared to $8,959,000 or 15% during the fiscal 2025 period.

Cost of sales in the Branded Product Program increased by 21% to $55,823,000 during the fiscal 2026 period as compared to $46,290,000 during the fiscal 2025 period, primarily due to a 3% increase in the volume of hot dogs sold, as well as a 16% increase in the average cost per pound of our hot dogs. A shrinking supply of cattle due to drought conditions and high input costs, combined with strong industry demand and inflationary pressures have resulted in higher commodity prices, including beef and beef trimmings, contributing to the increase in the average cost per pound of our hot dogs. We did not make any purchase commitments of beef during the fiscal 2026 and 2025 periods. If the cost of beef and beef trimmings increases and we are unable to pass on these higher costs through price increases or otherwise reduce any increase in our costs through the use of purchase commitments, our margins will be adversely impacted. With respect to Company-owned restaurants, our cost of sales during the fiscal 2026 period was $4,978,000 or 52% of restaurant sales which was comparable to $4,980,000 or 52% of restaurant sales in the fiscal 2025 period. Food and paper costs as a percentage of Company-owned restaurant sales were 23.8%, down from 24.8% in the comparable period of the prior year primarily as a result of certain menu price increases. Labor and related expenses as a percentage of Company-owned restaurant sales were 28.0%, up from 27.4% primarily as a result of legislative increases in the New York State minimum wage which became effective January 1, 2025.

Restaurant operating expenses were $2,611,000 in the fiscal 2026 period as compared to $2,518,000 in the fiscal 2025 period. The increase is due primarily to higher repairs and maintenance expenses of $27,000, higher utilities expenses of $16,000 and higher credit card processing fees of $48,000. As a percentage of Company-owned restaurant sales, restaurant operating expenses were 27.1% in the fiscal 2026 period as compared to 26.4% in the fiscal 2025 period.

Depreciation and amortization, which primarily consists of the depreciation of fixed assets, including leasehold improvements and equipment, and the amortization of a definite-lived intangible asset, was $464,000 in the fiscal 2026 period as compared to $496,000 in the fiscal 2025 period.

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General and administrative expenses increased by approximately $175,000 or 2% to $7,402,000 in the fiscal 2026 period as compared to $7,227,000 in the fiscal 2025 period. The increase in general and administrative expenses was primarily attributable to higher professional fees of $120,000 and higher share-based compensation expense of $155,000 which were offset, in part, by lower trade show and travel expenses of $150,000.

Advertising fund expense, after eliminating Company contributions, was $1,114,000 during the fiscal 2026 period as compared to $988,000 in the fiscal 2025 period. The Company projects that the Advertising Fund normal seasonal deficit will not be fully recovered during the remainder of the fiscal 2026 period and has reflected the projected deficit of $121,000 in the second quarter fiscal 2026 results of operations.

Other Items

Interest expense of $1,497,000 in the fiscal 2026 period represented interest expense of $1,461,000 on the SOFR Term Loan borrowings and amortization of debt issuance costs of $36,000.

Interest expense of $2,501,000 in the fiscal 2025 period represented interest expense of $1,449,000 and $930,000 on the 2025 Notes and the SOFR Term Loan borrowings, respectively, and amortization of debt issuance costs of $104,000 and $18,000 on the 2025 Notes and the SOFR Term Loan borrowings, respectively.

The reduction in interest expense of $1,004,000 is due primarily to lower outstanding long-term debt and a lower interest rate associated with our Credit Agreement.

During the fiscal 2025 period, the Company refinanced and redeemed its outstanding 2025 Notes. In connection with this transaction, the Company recorded a loss on extinguishment of debt of $334,000 that reflected the write-off of the remainder of previously recorded debt issuance costs.

Interest and dividend income of $439,000 in the fiscal 2026 period represented amounts earned by the Company on its interest bearing money market accounts and money market funds, as compared to $297,000 in the fiscal 2025 period. The increase is due to higher levels of invested cash earning interest at higher rates in the fiscal 2026 period as compared to the fiscal 2025 period.

Other income, net was $43,000 and $44,000 in the fiscal 2026 and fiscal 2025 periods, respectively, which primarily relates to sublease income.

Provision for Income Taxes

The effective income tax rate for the fiscal 2026 period was 26.7% which was comparable to the fiscal 2025 period. The effective income tax rate for the fiscal 2026 period reflected income tax expense of $5,151,000 recorded on $19,278,000 of pre-tax income. The effective income tax rate for the fiscal 2025 period reflected income tax expense of $5,576,000 recorded on $20,883,000 of pre-tax income. The effective tax rates are higher than the U.S. Federal statutory rates primarily due to state and local taxes as well as non-deductible compensation under the Internal Revenue Code Section 162(m).

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Off-Balance Sheet Arrangements

At September 28, 2025 and September 29, 2024, Nathan’s did not have any open purchase commitments for hot dogs. Nathan’s may enter into purchase commitments in the future as favorable market conditions become available.

Liquidity and Capital Resources

Sources and uses of cash

Cash and cash equivalents at September 28, 2025 aggregated $32,175,000, a $4,373,000 increase during the fiscal 2026 period as compared to cash of $27,802,000 at March 30, 2025. Net working capital increased to $37,681,000 at September 28, 2025 as compared to $28,371,000 at March 30, 2025.

Our primary sources of liquidity and capital resources are cash flows from operations and our cash and cash equivalents. Our primary cash requirements are to fund our quarterly dividends, to satisfy the debt service under our credit facility, capital expenditures, lease obligations, working capital and general corporate needs.

Cash flows for the fiscal year 2026 will be impacted by various factors, including, (i) mandatory debt repayments on our Term Loan borrowings under our Credit Agreement, (ii) interest payments on our Term Loan borrowings under our Credit Agreement and (iii) expected dividend payments.

Summary of Cash Flows

The following table presents summary cash flow information for the periods indicated (in thousands):

	Twenty-six weeks ended
	September 28,			September 29,
	2025			2024

Net cash provided by operating activities	$	9,938		$	14,826
Net cash used in investing activities		(276	)		(130	)
Net cash used in financing activities		(5,289	)		(4,516	)
Net increase in cash and cash equivalents	$	4,373		$	10,180

Operating activities

Cash provided by operations of $9,938,000 in the fiscal 2026 period is primarily attributable to net income of $14,127,000 in addition to other non-cash operating items of $1,075,000, offset by changes in other operating assets and liabilities of $5,264,000. Non-cash operating expenses consist principally of depreciation and amortization of $464,000, amortization of debt issuance costs of $36,000, share-based compensation expense of $572,000, and a provision for credit losses of $63,000. In the fiscal 2026 period, accounts and other receivables increased by $7,612,000 due primarily to higher Branded Product Program receivables of $6,705,000, and higher receivables due to the Advertising Fund of $1,164,000. Prepaid expenses and other current assets decreased by $1,365,000 due principally to a decrease in prepaid income taxes of $493,000, a decrease in prepaid insurance of $288,000 and a decrease in prepaid marketing and other expenses of $588,000. Accounts payable, accrued expenses and other current liabilities increased by $1,020,000 due primarily to an increase in accounts payable of $1,979,000 due to the timing of seasonal product purchases for our Branded Product Program, an increase in accrued rebates of $319,000, and an increase in accrued corporate taxes of $639,000 due to the timing of estimated tax payments. Offsetting these increases was a reduction in accrued payroll and other benefits of $1,326,000 resulting from the payment of year-end compensation as well as the recognition of $677,000 of deferred revenue.

Investing activities

Cash used in investing activities of $276,000 is primarily attributable to capital expenditures incurred for our Branded Product Program and our Coney Island restaurants.

Financing activities

During fiscal 2026, we made $1,200,000 of mandatory principal repayments on our Term Loan borrowings under the Credit Agreement.

Additionally, the Company paid its first and second quarterly cash dividends of $0.50 per share totaling $4,089,000.

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Subsequent to the fiscal 2026 period, we paid our next quarterly mandatory principal repayment on our Term Loan borrowings of $600,000 on September 30, 2025.

Credit Agreement

The Credit Agreement provides for a term loan facility (“Term Loan”) of $60,000,000 and a revolving credit facility (“Revolving Loan”) of up to $10,000,000. The Credit Agreement also provides that the Company has the right from time to time during the term of the Credit Agreement to request the Lenders for incremental revolving loan borrowing increases of up to an additional $10,000,000 in the aggregate, subject to, among other items, the Lenders agreeing to lend any such additional amounts and compliance with terms specified in the Credit Agreement. The Credit Agreement matures on July 10, 2029.

The Company borrowed $60,000,000 in Term Loan borrowings on the Effective Date to refinance and redeem its 2025 Notes. The Company will use any Revolving Loan borrowings under the Credit Agreement for working capital and general corporate purposes. As of September 28, 2025, there were no outstanding borrowings under the Revolving Loan. See Note P – LONG TERM DEBT in the accompanying condensed consolidated financial statements for additional information on the Credit Agreement.

Share Repurchases

In 2016, the Board authorized increases to the sixth stock repurchase plan for the purchase of up to 1,200,000 shares of its common stock on behalf of the Company. As of September 28, 2025, Nathan’s has repurchased 1,101,884 shares at a cost of $39,000,000 under the sixth stock repurchase plan. At September 28, 2025, there were 98,116 shares remaining to be repurchased pursuant to the sixth stock repurchase plan. The plan does not have a set expiration date. Purchases under the Company’s stock repurchase program may be made from time to time, depending on market conditions, in open market or privately negotiated transactions, at prices deemed appropriate by management. There is no set time limit on the repurchases. There were no stock repurchases during the fiscal 2026 period. We may return capital to our stockholders through stock repurchases, subject to any restrictions in our Credit Agreement, although there is no assurance that the Company will make any repurchases under its existing stock repurchase plan.

Common Stock Dividends

As discussed above, we had cash and cash equivalents at September 28, 2025 aggregating $32,175,000. Our Board routinely monitors and assesses its cash position and our current and potential capital requirements. The Company paid its first and second quarterly cash dividends of fiscal 2026 on July 1, 2025 and September 5, 2025 aggregating $4,089,000.

Effective November 6, 2025, the Company declared its third quarter fiscal 2026 dividend of $0.50 per common share to stockholders of record as of the close of business on November 24, 2025, which is payable on December 5, 2025.

Additionally, effective November 6, 2025, the Board also declared a special cash dividend of $2.50 per share to stockholders of record as of the close of business on November 24, 2025 of approximately $10,224,000 payable on December 5, 2025.

If the Company pays regular quarterly cash dividends for the remainder of fiscal 2026 at the same rate as declared in the first and second quarter of fiscal 2026, the Company’s total cash requirement for dividends for all of fiscal 2026, inclusive of the special cash dividend of $2.50 per share, would be approximately $18,403,000 based on the number of shares of common stock outstanding at November 3, 2025. The Company intends to declare and pay quarterly cash dividends; however, there can be no assurance that any additional quarterly dividends will be declared or paid or of the amount or timing of such dividends, if any.

Our ability to pay future dividends is limited by the terms of our Credit Agreement. In addition, the payment of any cash dividends in the future are subject to final determination of the Board and will be dependent upon our earnings and financial requirements and the terms of our Credit Agreement.

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Cash Flow Outlook

We expect that in the future we will make investments in certain existing restaurants, support the growth of the Branded Product and Branded Menu Programs, service the principal and interest obligations under the Credit Agreement, fund our dividend program and may continue our stock repurchase programs, funding those investments from our operating cash flow. We may also incur capital and other expenditures or engage in investing activities in connection with opportunistic situations that may arise on a case-by-case basis. While our Credit Agreement bears interest at a fluctuating interest rate based on the SOFR plus a spread adjustment, if the Company makes cash interest payments on the Term Loan borrowings at the interest rate effective at November 6, 2025, then for the remainder of the fiscal year ended March 26, 2026, we expect to make cash interest payments of approximately $1,384,000 on the Term Loan borrowings.

We may from time to time seek to make voluntary prepayments of our Term Loan borrowings under our Credit Agreement. Such voluntary prepayments, if any, will depend on market conditions, our liquidity requirements, satisfactory compliance of covenants and conditions pursuant to our Credit Agreement and other factors.

Management believes that available cash and cash equivalents and cash generated from operations should provide sufficient capital to finance our operations, satisfy our debt service requirements, fund dividend distributions and, if any, stock repurchases for at least the next 12 months.

Contractual Obligations

At September 28, 2025, we sublet one property that we lease from a third party. We remain contingently liable for all costs associated with this property including rent, property taxes and insurance. We may incur future cash payments with respect to such property, consisting primarily of future lease payments, including costs and expenses associated with terminating such lease.

At September 28, 2025, our contractual obligations primarily consist of the Term Loan borrowings under our Credit Agreement and the mandatory debt principal repayments and the related interest payments, operating leases, and employment agreements with certain executive officers. These contractual obligations impact our short-term and long-term liquidity and capital resource needs. See Note P – LONG TERM DEBT and Note Q – LEASES in the accompanying condensed consolidated financial statements included in Part I, Item 1. for additional information and as disclosed in our Form 10-K for the fiscal year ended March 30, 2025 as filed with the SEC on June 10, 2025.

Inflationary Pressures

Inflationary pressures on labor and rising commodity prices, most notably for beef and beef trimmings, have impacted our consolidated results of operations during the fiscal 2026 period, and this trend may continue through the remainder of fiscal 2026. Our average cost of hot dogs during the fiscal 2026 period was approximately 16% higher than during the fiscal 2025 period. Our average cost of hot dogs during the fiscal year ended March 30, 2025 was approximately 7% higher than during the fiscal year ended March 31, 2024. Inherent volatility experienced in certain commodity markets, such as those for beef and beef trimmings due to seasonal shifts, climate conditions, industry demand, inflationary pressures and other macroeconomic factors could have an adverse effect on our results of operations. This impact will depend on our ability to manage such volatility through price increases and product mix. We are unable to predict the future cost of our hot dogs and expect to experience price volatility for our beef products during the remainder of fiscal 2026. To the extent that beef prices increase as compared to earlier periods, it could impact our results of operations. In the past, we entered into purchase commitments for a portion of our hot dogs to reduce the impact of increasing market prices. We may attempt to enter into similar purchase arrangements for hot dogs and other products in the future.

We have experienced competitive pressure on labor rates as a result of the increase in the minimum hourly wage for fast food workers where our Company-owned restaurants are located. On January 1, 2025, the minimum wage increased from $16.00 to $16.50 in New York City, Long Island and Westchester which will be followed by a $0.50 increase to $17.00 starting January 1, 2026. Further, beginning in 2027, the minimum wage across New York State will increase annually according to the Consumer Price Index.

We believe that these increases in the minimum wage and other changes in employment laws have had a significant financial impact on our financial results and the results of our franchisees that operate in New York State. Our business could be negatively impacted if the decrease in margins for our franchisees results in the potential loss of new franchisees or the closing of a significant number of franchised restaurants.

We expect to continue experiencing volatility in oil and gas prices on our distribution costs for food products and utility costs in the Company-owned restaurants, as well as volatile insurance costs resulting from rising rates.

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Continued increases in labor costs, commodity prices and other operating expenses, including health care, could adversely affect our operations. We attempt to manage inflationary pressure, and rising commodity costs, at least in part, through raising prices. Delays in implementing price increases, competitive pressures, a decline in consumer spending levels and other factors may limit our ability to offset these rising costs. Volatility in commodity prices, including beef and beef trimmings, could have a significant adverse effect on our results of operations.

The Company’s business, financial condition, operating results and cash flows can be impacted by a number of factors, including but not limited to those set forth above in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” any one of which could cause our actual results to vary materially from recent results or from our anticipated future results. For a discussion identifying additional risk factors and important factors that could cause actual results to differ materially from those anticipated, also see the discussions in “Forward-Looking Statements” and “Notes to Condensed Consolidated Financial Statements” in this Form 10-Q and “Risk Factors” in our Form 10-K for our fiscal year ended March 30, 2025.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Cash and Cash Equivalents

We have historically invested our cash in money market accounts, money market funds or short-term, fixed rate, highly rated and highly liquid instruments which are generally reinvested when they mature. Although these existing investments are not considered at risk with respect to changes in interest rates or markets for these instruments, our rate of return on short-term investments could be affected at the time of reinvestment as a result of intervening events. As of September 28, 2025, Nathan’s cash and cash equivalents balance aggregated $32,175,000. Earnings on this cash would increase or decrease by approximately $80,000 per annum for each 0.25% change in interest rates.

Borrowings

On July 10, 2024, we entered into a Credit Agreement and borrowed $60,000,000 in Term Loan borrowings to refinance and redeem the 2025 Notes. Our Credit Agreement bears interest at a fluctuating interest rate based on SOFR or a base rate plus a spread adjustment. Accordingly, a rising interest rate environment would result in higher interest expense due on borrowings. A hypothetical 100 bps increase in the interest rate on our $49,600,000 of outstanding unsecured Term Loan borrowings at September 28, 2025 would lead to an increase of approximately $496,000 in cash interest costs over the next twelve months. We currently do not anticipate entering into interest rate swaps or other financial instruments to hedge our borrowings.

Commodity Costs

We are exposed to market price fluctuations in commodities, most notably beef and beef trimmings. Inflationary pressures on commodity prices have directly impacted our consolidated results of operations during the fiscal 2026 period, most notably within our Branded Product Program segment. This trend may continue for the remainder of fiscal 2026. Our average cost of hot dogs during the fiscal 2026 period was approximately 16% higher than during the fiscal 2025 period.

We are unable to predict the future cost of our hot dogs and may continue to experience price volatility for our beef products for the remainder of fiscal 2026. Factors that affect beef prices are outside of our control and include foreign and domestic supply and demand, inflation, weather and seasonality. To the extent that beef prices increase as compared to earlier periods, it could impact our results of operations. In the past, we have entered into purchase commitments for a portion of our hot dogs to reduce the impact of increasing market prices. We may attempt to enter into purchase arrangements for hot dogs and other products in the future. Additionally, we may continue experiencing volatility in oil and gas prices on our distribution costs for our food products and utility costs in the Company-owned restaurants, as well as volatile insurance costs resulting from rising rates.

We have not attempted to hedge against fluctuations in the prices of the commodities we purchase using future, forward, option or other instruments. As a result, we expect that the majority of our future commodity purchases will be subject to market changes in the prices of such commodities. We have attempted to enter into sales agreements with our Branded Product Program customers that are correlated to our cost of beef, thus reducing our market volatility, or have passed through permanent increases in our commodity prices to our Branded Product Program customers that are not on formula pricing, thereby reducing the impact of long-term increases on our financial results. A short-term increase or decrease of 10% in the cost of our food and paper products for the period ended September 28, 2025 would have increased or decreased our cost of sales by approximately $5,680,000.

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Foreign Currencies

Foreign franchisees generally conduct business with us and make payments in United States dollars, reducing the risks inherent with changes in the values of foreign currencies. As a result, we have not purchased future contracts, options or other instruments to hedge against changes in values of foreign currencies and we do not believe fluctuations in the value of foreign currencies would have a material impact on our financial results.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined by Exchange Act Rule 13a-15(e) and Exchange Act Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls

There were no changes in our internal controls over financial reporting that occurred during the quarter ended September 28, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and our Chief Executive Officer and Chief Financial Officer have concluded that such controls and procedures are effective at the reasonable assurance level.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, “Item 1A. Risk Factors” in the Annual Report on Form 10-K for the fiscal year ended March 30, 2025, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing Nathan's. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Item 2. Unregistered Sales of Equity Securities, and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

Effective November 6, 2025, the Board declared its quarterly cash dividend of $0.50 per share which is payable on December 5, 2025 to shareholders of record as of the close of business on November 24, 2025.

Additionally, effective November 6, 2025, the Board also declared a special cash dividend of $2.50 per share which is payable on December 5, 2025 to shareholders of record as of the close of business on November 24, 2025.

During the quarter ended September 28, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended) adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non Rule 10b5-1 trading arrangement “ as such terms are defined under Item 408 of Regulation S-K.

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Item 6. Exhibits.

31.1

*Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

*Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

*Certification by Eric Gatoff, CEO, Nathan’s Famous, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2

*Certification by Robert Steinberg, CFO, Nathan’s Famous, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.1

*The following materials from the Nathan’s Famous, Inc., Quarterly Report on Form 10-Q for the quarter ended September 28, 2025 formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Earnings, (iii) the Condensed Consolidated Statements of Changes in Stockholders’ Deficit, (iv) the Condensed Consolidated Statements of Cash Flows and (v) related notes.

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

*Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	NATHAN'S FAMOUS, INC.

Date: November 6, 2025	By:	/s/ Eric Gatoff
		Eric Gatoff
		Chief Executive Officer
		(Principal Executive Officer)

Date: November 6, 2025	By:	/s/ Robert Steinberg
		Robert Steinberg
		Vice President - Finance and Chief Financial Officer
		(Principal Financial and Accounting Officer)

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NATHANS FAMOUS, INC. 10-Q