Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
May 31, 2024 | Jul. 02, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | May 31, 2024 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q3 | |
Title of 12(b) Security | Class A Common Stock, $0.001 par value per share | |
Trading Symbol | KRUS | |
Security Exchange Name | NASDAQ | |
Entity Registrant Name | KURA SUSHI USA, INC. | |
Entity Central Index Key | 0001772177 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity File Number | 001-39012 | |
Entity Tax Identification Number | 26-3808434 | |
Entity Address, Address Line One | 17461 Derian Avenue | |
Entity Address, Address Line Two | Suite 200 | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Postal Zip Code | 92614 | |
City Area Code | 657 | |
Local Phone Number | 333-4100 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Class A | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 10,244,893 | |
Class B | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,000,050 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 59,405 | $ 69,697 |
Short-term investments | 1,250 | 8,542 |
Accounts and other receivables | 5,510 | 5,048 |
Inventories | 2,132 | 1,747 |
Prepaid expenses and other current assets | 3,988 | 4,233 |
Total current assets | 72,285 | 89,371 |
Non-current assets: | ||
Property and equipment – net | 130,663 | 106,427 |
Operating lease right-of-use assets | 117,030 | 103,884 |
Deposits and other assets | 4,753 | 4,977 |
Total assets | 324,731 | 304,659 |
Current liabilities: | ||
Accounts payable | 8,063 | 7,248 |
Accrued expenses and other current liabilities | 3,412 | 2,821 |
Salaries and wages payable | 8,596 | 7,595 |
Operating lease liabilities – current | 11,734 | 9,225 |
Sales tax payable | 1,766 | 1,694 |
Total current liabilities | 33,694 | 29,138 |
Non-current liabilities: | ||
Operating lease liabilities – non-current | 123,848 | 110,234 |
Other liabilities | 763 | 646 |
Total liabilities | 158,305 | 140,018 |
Commitments and contingencies (Note 8) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 1,000 shares authorized, no shares issued or outstanding | ||
Additional paid-in capital | 194,202 | 188,771 |
Accumulated deficit | (27,787) | (24,184) |
Accumulated other comprehensive income | 0 | 43 |
Total stockholders' equity | 166,426 | 164,641 |
Total liabilities and stockholders' equity | 324,731 | 304,659 |
Affiliated Entity [Member] | ||
Current assets: | ||
Due from affiliate | 104 | |
Current liabilities: | ||
Due to affiliate | 123 | 555 |
Class A | ||
Stockholders' equity: | ||
Common stock | 10 | 10 |
Class B | ||
Stockholders' equity: | ||
Common stock | $ 1 | $ 1 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | May 31, 2024 | Aug. 31, 2023 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Class A | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common Stock, Shares, Issued | 10,243,000 | 10,147,000 |
Common stock, shares outstanding | 10,243,000 | 10,147,000 |
Class B | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common Stock, Shares, Issued | 1,000,000 | 1,000,000 |
Common stock, shares outstanding | 1,000,000 | 1,000,000 |
Condensed Statements of Operati
Condensed Statements of Operations and Comprehensive (Loss) Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Sales | $ 63,082 | $ 49,238 | $ 171,848 | $ 132,500 |
Restaurant operating costs: | ||||
Depreciation and amortization expenses | 3,124 | 1,975 | 8,294 | 5,309 |
Other costs | 9,076 | 6,165 | 25,023 | 17,352 |
Total restaurant operating costs | 55,287 | 40,826 | 151,596 | 113,356 |
General and administrative expenses | 8,857 | 7,012 | 25,634 | 20,776 |
Depreciation and amortization expenses | 107 | 92 | 318 | 265 |
Total operating expenses | 64,251 | 47,930 | 177,548 | 134,397 |
Operating (loss) income | (1,169) | 1,308 | (5,700) | (1,897) |
Other expense (income): | ||||
Interest expense | 15 | 23 | 35 | 53 |
Interest income | (686) | (436) | (2,280) | (593) |
(Loss) income before income taxes | (498) | 1,721 | (3,455) | (1,357) |
Income tax expense | 60 | 41 | 148 | 66 |
Net (loss) income | $ (558) | $ 1,680 | $ (3,603) | $ (1,423) |
Net (loss) income per Class A and Class B shares | ||||
Basic | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Diluted | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Weighted average Class A and Class B shares outstanding | ||||
Basic | 11,188 | 10,485 | 11,167 | 10,028 |
Diluted | 11,188 | 10,807 | 11,167 | 10,028 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | ||||
Unrealized loss on short-term investments | $ (76) | $ (7) | $ (43) | $ (7) |
Comprehensive (loss) income | (634) | 1,673 | (3,646) | (1,430) |
Food and Beverage Costs | ||||
Restaurant operating costs: | ||||
Cost of goods and services sold | 18,391 | 14,770 | 50,691 | 40,440 |
Labor and Related Costs | ||||
Restaurant operating costs: | ||||
Cost of goods and services sold | 20,378 | 14,362 | 55,409 | 40,751 |
Occupancy and Related Expenses | ||||
Restaurant operating costs: | ||||
Cost of goods and services sold | $ 4,318 | $ 3,554 | $ 12,179 | $ 9,504 |
Condensed Statements of Stockho
Condensed Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Class A | Class B | Common Stock Class A | Common Stock Class B | Additional Paid-in-Capital | Accumulated Deficit | Accumulated Other Comprehensive Income |
Beginning balances at Aug. 31, 2022 | $ 93,294 | $ 9 | $ 1 | $ 118,970 | $ (25,686) | |||
Beginning balance, shares at Aug. 31, 2022 | 8,788 | 1,000 | ||||||
Stock-based compensation | 650 | 650 | ||||||
Employee stock plan | 51 | 51 | ||||||
Employee stock plan, shares | 3 | |||||||
Net income (loss) | (2,088) | (2,088) | ||||||
Ending balances at Nov. 30, 2022 | 91,907 | $ 9 | $ 1 | 119,671 | (27,774) | |||
Ending balance, shares at Nov. 30, 2022 | 8,791 | 1,000 | ||||||
Beginning balances at Aug. 31, 2022 | 93,294 | $ 9 | $ 1 | 118,970 | (25,686) | |||
Beginning balance, shares at Aug. 31, 2022 | 8,788 | 1,000 | ||||||
Net income (loss) | (1,423) | |||||||
Ending balances at May. 31, 2023 | 159,740 | $ 10 | $ 1 | 186,845 | (27,109) | $ (7) | ||
Ending balance, shares at May. 31, 2023 | 10,101 | 1,000 | ||||||
Beginning balances at Nov. 30, 2022 | 91,907 | $ 9 | $ 1 | 119,671 | (27,774) | |||
Beginning balance, shares at Nov. 30, 2022 | 8,791 | 1,000 | ||||||
Stock-based compensation | 945 | 945 | ||||||
Employee stock plan | 533 | 533 | ||||||
Employee stock plan, shares | 28 | |||||||
Net income (loss) | (1,015) | (1,015) | ||||||
Ending balances at Feb. 28, 2023 | 92,370 | $ 9 | $ 1 | 121,149 | (28,789) | |||
Ending balance, shares at Feb. 28, 2023 | 8,819 | 1,000 | ||||||
Stock-based compensation | 975 | 975 | ||||||
Employee stock plan | 423 | 423 | ||||||
Employee stock plan, shares | 17 | |||||||
Issuance of common stock in connection with follow-on public offering, net of underwriter discounts and issuance costs | 64,299 | $ 1 | 64,298 | |||||
Issuance of common stock in connection with follow-on public offering, net of underwriter discounts and issuance costs, shares | 1,265 | |||||||
Net income (loss) | 1,680 | 1,680 | ||||||
Other comprehensive income (loss) | (7) | (7) | ||||||
Ending balances at May. 31, 2023 | 159,740 | $ 10 | $ 1 | 186,845 | (27,109) | (7) | ||
Ending balance, shares at May. 31, 2023 | 10,101 | 1,000 | ||||||
Beginning balances at Aug. 31, 2023 | 164,641 | $ 10 | $ 1 | 188,771 | (24,184) | 43 | ||
Beginning balance, shares at Aug. 31, 2023 | 10,147,000 | 1,000,000 | 10,147 | 1,000 | ||||
Stock-based compensation | 1,034 | 1,034 | ||||||
Employee stock plan | 110 | 110 | ||||||
Employee stock plan, shares | 8 | |||||||
Net income (loss) | (2,047) | (2,047) | ||||||
Other comprehensive income (loss) | 3 | 3 | ||||||
Ending balances at Nov. 30, 2023 | 163,741 | $ 10 | $ 1 | 189,915 | (26,231) | 46 | ||
Ending balance, shares at Nov. 30, 2023 | 10,155 | 1,000 | ||||||
Beginning balances at Aug. 31, 2023 | 164,641 | $ 10 | $ 1 | 188,771 | (24,184) | 43 | ||
Beginning balance, shares at Aug. 31, 2023 | 10,147,000 | 1,000,000 | 10,147 | 1,000 | ||||
Net income (loss) | (3,603) | |||||||
Ending balances at May. 31, 2024 | 166,426 | $ 10 | $ 1 | 194,202 | (27,787) | |||
Ending balance, shares at May. 31, 2024 | 10,243,000 | 1,000,000 | 10,243 | 1,000 | ||||
Beginning balances at Nov. 30, 2023 | 163,741 | $ 10 | $ 1 | 189,915 | (26,231) | 46 | ||
Beginning balance, shares at Nov. 30, 2023 | 10,155 | 1,000 | ||||||
Stock-based compensation | 1,080 | 1,080 | ||||||
Employee stock plan | 1,427 | 1,427 | ||||||
Employee stock plan, shares | 71 | |||||||
Net income (loss) | (998) | (998) | ||||||
Other comprehensive income (loss) | 30 | 30 | ||||||
Ending balances at Feb. 29, 2024 | 165,280 | $ 10 | $ 1 | 192,422 | (27,229) | 76 | ||
Ending balance, shares at Feb. 29, 2024 | 10,226 | 1,000 | ||||||
Stock-based compensation | 1,236 | 1,236 | ||||||
Employee stock plan | 544 | 544 | ||||||
Employee stock plan, shares | 17 | |||||||
Net income (loss) | (558) | (558) | ||||||
Other comprehensive income (loss) | (76) | $ (76) | ||||||
Ending balances at May. 31, 2024 | $ 166,426 | $ 10 | $ 1 | $ 194,202 | $ (27,787) | |||
Ending balance, shares at May. 31, 2024 | 10,243,000 | 1,000,000 | 10,243 | 1,000 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
May 31, 2024 | May 31, 2023 | |
Cash flows from operating activities | ||
Net loss | $ (3,603) | $ (1,423) |
Adjustments to reconcile net loss to net cash provided by operating activities | ||
Depreciation and amortization | 8,612 | 5,574 |
Stock-based compensation, net of amounts capitalized | 3,169 | 2,570 |
Loss on disposal of property and equipment | 53 | |
Non-cash lease expense | 3,407 | 2,820 |
Changes in operating assets and liabilities: | ||
Accounts and other receivables | (587) | (230) |
Inventories | (385) | (267) |
Due from affiliate | 104 | 156 |
Prepaid expenses and other current assets | 1,326 | (1,876) |
Deposits and other assets | 443 | 122 |
Accounts payable | 11 | (71) |
Accrued expenses and other current liabilities | 1,485 | (1,176) |
Salaries and wages payable | 1,001 | 977 |
Operating lease liabilities | 3 | (341) |
Due to affiliate | (23) | 26 |
Sales tax payable | (20) | 149 |
Net cash provided by operating activities | 14,943 | 7,063 |
Cash flows from investing activities | ||
Payments for property and equipment | (33,977) | (27,215) |
Payments for initial direct costs | (309) | (320) |
Payments for purchases of liquor licenses | (219) | (947) |
Purchases of short-term investments | (3,251) | (8,749) |
Redemption of short- term investments | 10,499 | |
Net cash used in investing activities | (27,257) | (37,231) |
Cash flows from financing activities | ||
Repayment of principal on finance leases | (60) | (446) |
Taxes paid on vested restricted stock awards | (217) | |
Proceeds from exercise of stock options | 2,299 | 1,007 |
Proceeds from the follow-on public offering, net of discounts and commissions | 64,895 | |
Payments of costs related to the follow-on offering | (596) | |
Net cash provided by financing activities | 2,022 | 64,860 |
Decrease in cash and cash equivalents | (10,292) | 34,692 |
Cash and cash equivalents, beginning of period | 69,697 | 35,782 |
Cash and cash equivalents, end of period | 59,405 | 70,474 |
Supplemental disclosures of cash flow information | ||
Cash paid for income taxes | 282 | 185 |
Noncash investing activities | ||
Amounts unpaid for purchases of property and equipment | $ 1,276 | $ 1,706 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
May 31, 2024 | Feb. 29, 2024 | Nov. 30, 2023 | May 31, 2023 | Feb. 28, 2023 | Nov. 30, 2022 | May 31, 2024 | May 31, 2023 | |
Pay vs Performance Disclosure | ||||||||
Net Income (Loss) | $ (558) | $ (998) | $ (2,047) | $ 1,680 | $ (1,015) | $ (2,088) | $ (3,603) | $ (1,423) |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
May 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
May 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Note 1. Organization and Basis of Presentation Kura Sushi USA, Inc. is a technology-enabled Japanese restaurant concept that provides guests with a distinctive dining experience by serving authentic Japanese cuisine through an engaging revolving sushi service model, which the Company refers to as the “Kura Experience.” Kura Sushi encourages healthy lifestyles by serving freshly prepared Japanese cuisine using high-quality ingredients that are free from artificial seasonings, sweeteners, colorings, and preservatives. Kura Sushi aims to make quality Japanese cuisine accessible to its guests across the United States through affordable prices and an inviting atmosphere. “Kura Sushi USA,” “Kura Sushi,” “Kura,” “our” and the “Company” refer to Kura Sushi USA, Inc. unless expressly indicated or the context otherwise requires. Basis of Presentation The accompanying unaudited condensed financial statements (the “Condensed Financial Statements”) have been prepared by the Company in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. As such, these Condensed Financial Statements should be read in conjunction with the Company’s audited financial statements and accompanying notes included in its Annual Report on Form 10-K for the fiscal year ended August 31, 2023. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 2, Basis of Presentation and Summary of Significant Accounting Policies, of the Notes to Financial Statements included in the Company’s Annual Report on Form 10‑K for the fiscal year ended August 31, 2023. In the opinion of management, all adjustments necessary to fairly state the Condensed Financial Statements have been made. All such adjustments are of a normal, recurring nature. The results of operations for interim periods are not necessarily indicative of results to be expected for the fiscal year ending August 31, 2024 or for any other future annual or interim period. Fiscal Year The Company’s fiscal year begins on September 1 and ends on August 31, and references made to “fiscal year 2024” and “fiscal year 2023” refer to the Company’s fiscal years ending August 31, 2024 and ended August 31, 2023, respectively. Use of Estimates Preparing financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods presented. Significant items subject to such estimates include asset retirement obligations, stock-based compensation, the useful lives of assets, the assessment of the recoverability of long-lived assets, and income taxes. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ materially from those estimates and assumptions. Short-Term Investments Short-term investments consist of certificates of deposits and Treasury bills. The Company considers all highly liquid investments with an original maturity date greater than three months but less than one year as short-term investments. The carrying value of the short-term investments is equivalent to their amortized cost basis. As of May 31, 2024 and August 31, 2023, short-term investments were $ 1.3 million and $ 8.5 million, respectively. The certificates of deposits are deposited at Federal Deposit Insurance Corporation (“FDIC”) insured banks. The certificates of deposits are in amounts of $ 250,000 and deposited in multiple banks to ensure that the entire deposit balance is eligible for FDIC insurance. Certificates of deposits and Treasury bills are classified as available-for-sale debt securities which are measured at fair value with unrealized gains or losses recorded in other comprehensive income (loss). As of May 31, 2024 , the Company recorded no unrealized gains or losses on short-term investments in accumulated other comprehensive income (loss). The Company reclassified $ 76 thousand out of accumulated other comprehensive income into earnings for the period related to maturities of certificates of deposits and a Treasury bill, which consisted of $ 75 thousand in realized gains on a Treasury bill and $ 1 thousand in realized gains on certificates of deposits. The Company determines realized ga ins or losses on the available-for-sale debt securities on a specific identification method basis. Base d on the evaluation of credit risk factors, the Company has concluded that an allowance for credit losses is unnecessary for its short-term investments. Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. The Company’s short-term investments consist of certificates of deposits and Treasury bills that are classified as available-for-sale debt securities which are measured at fair value with unrealized gains or losses recorded in other comprehensive income (loss). Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which requires greater disaggregation of income tax disclosures related to the income tax rate reconciliation and income taxes paid and effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments should be applied on a prospective basis although retrospective application is permitted. The Company is currently evaluating the effects of this pronouncement on its financial statements and expects the update to result in additional disclosures. In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance in this update is effective for all public entities for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the effects of this pronouncement on its financial statements and expects the update to result in additional disclosures. |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
May 31, 2024 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Components | Note 2. Balance Sheet Components Accounts and Other Receivables May 31, 2024 August 31, 2023 (amounts in thousands) Lease receivables $ 3,813 $ 3,973 Credit card and other receivables 1,697 1,075 Total accounts and other receivables $ 5,510 $ 5,048 Property and Equipment - net May 31, 2024 August 31, 2023 (amounts in thousands) Leasehold improvements $ 97,827 $ 75,472 Lease assets 6,229 6,247 Furniture and fixtures 49,114 34,213 Computer equipment 3,650 2,792 Vehicles 220 220 Software 1,017 1,016 Construction in progress 8,620 14,369 Property and equipment – gross 166,677 134,329 Less: accumulated depreciation and amortization ( 36,014 ) ( 27,902 ) Total property and equipment – net $ 130,663 $ 106,427 Depreciation and amortization expense for property and equipment was $ 3.2 million and $ 2.1 million for the three months ended May 31, 2024 and May 31, 2023 , respectively, and was $ 8.6 milli on and $ 5.6 million for the nine months ended May 31, 2024 and May 31, 2023 , respectively. |
Leases
Leases | 9 Months Ended |
May 31, 2024 | |
Leases [Abstract] | |
Leases | Note 3. Leases The Company has operating and finance leases for its corporate office, restaurant locations, office equipment, kitchen equipment and automobiles. The Company’s finance leases are immaterial. The Company’s leases have remaining lease terms of less than 1 year to 20 years, some of which include options to extend the leases. Lease related costs recognized in the statements of operations and comprehensive income (loss) are as follows: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 (amounts in thousands) Operating lease cost Classification Operating lease cost Occupancy and related expenses, other costs and general and administrative expenses $ 3,380 $ 3,208 $ 9,678 $ 7,450 Variable lease cost Occupancy and related expenses, and general and administrative expenses 992 1,072 2,567 2,307 Total operating lease cost $ 4,372 $ 4,280 $ 12,245 $ 9,757 Supplemental balance sheet information related to leases is as follows: Operating Leases May 31, 2024 August 31, 2023 (amounts in thousands) Right-of-use assets $ 117,030 $ 103,884 Lease liabilities – current $ 11,734 $ 9,225 Lease liabilities – non-current 123,848 110,234 Total lease liabilities $ 135,582 $ 119,459 Nine Months Ended May 31, 2024 2023 Weighted Average Remaining Lease Term (Years) Operating leases 16.5 16.3 Weighted Average Discount Rate Operating leases 7.1 % 6.6 % Supplemental disclosures of cash flow information related to leases are as follows: Nine Months Ended May 31, 2024 2023 (amounts in thousands) Operating cash flows paid for operating lease liabilities $ 7,769 $ 5,775 Operating right-of-use assets obtained in exchange for new operating lease liabilities $ 17,774 $ 18,415 As of May 31, 2024, the Company had an additional $ 44.7 million of operating leases related to restaurants for which the Company had not yet taken possession. Subsequent to May 31, 2024, the Company entered into two additional operating leases related to restaurants for which the Company has not yet taken possession. The lease liabilities associated with the leases after May 31, 2024 are $ 15.6 million . The operating leases are expected to commence in fiscal year 2025, with lease terms of up to 30 years. Maturities of lease liabilities, net of lease receivables, were as follows: Operating Leases (amounts in thousands) Remainder of 2024 $ 380 2025 9,940 2026 12,373 2027 13,111 2028 12,730 Thereafter 184,104 Total lease payments 232,638 Less: imputed interest ( 97,056 ) Present value of lease liabilities $ 135,582 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
May 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 4. Related Party Transactions Kura Sushi, Inc. (“Kura Japan”) is the majority stockholder of the Company and is incorporated and headquartered in Japan. In August 2019, the Company entered into a Shared Services Agreement with Kura Japan, pursuant to which Kura Japan provides the Company with certain strategic, operational and other support services, including assigning certain employees to work for the Company as expatriates to provide support to the Company’s operations, sending its employees to the Company on a short-term basis to provide support for the opening of new restaurants or renovation of existing restaurants, and providing the Company with certain supplies, parts and equipment for use in the Company’s restaurants. In addition, the Company has agreed to continue to provide Kura Japan with certain translational support services and market research. In exchange for such services, supplies, parts and equipment, the parties pay fees to each other as set forth under the Shared Services Agreement. A right of setoff is not required; however, from time to time, either party will net settle transactions as needed. Purchases of administrative supplies, expatriate salaries and travel and other administrative expenses payable to Kura Japan are included in general and administrative expenses in the accompanying statements of operations and comprehensive income (loss). Purchases of equipment from Kura Japan are included in property and equipment in the accompanying balance sheets. In August 2019, the Company entered into an Amended and Restated Exclusive License Agreement (the “License Agreement”) with Kura Japan. Pursuant to the License Agreement, the Company pays Kura Japan a royalty fee of 0.5 % of the Company’s net sales in exchange for an exclusive, royalty-bearing license for the use of certain of Kura Japan’s intellectual property rights, including, but not limited to, Kura Japan’s trademarks for “Kura Sushi,” “Mr. Fresh” and “Kura Revolving Sushi Bar,” and patents for a food management system and the Mr. Fresh protective dome, among other intellectual property rights necessary to continue operation of the Company’s restaurants. Royalty payments to Kura Japan are included in other costs at the restaurant level in the accompanying statements of operations and comprehensive income (loss). On April 10, 2020, the Company and Kura Japan entered into a Revolving Credit Agreement, as amended, to provide the Company a revolving credit line of $ 45.0 million (the “Revolving Credit Agreement”). For additional information, see “Note 6. Debt.” Balances with Kura Japan are as follows: May 31, 2024 August 31, 2023 (amounts in thousands) Due from affiliate $ — $ 104 Due to affiliate $ 123 $ 555 Reimbursements and other payments by the Company to Kura Japan were as follows: Three Months Ended May 31, Nine Months Ended May 31 2024 2023 2024 2023 (amounts in thousands) Related party transactions: Expatriate salaries expense $ 33 $ 33 $ 124 $ 87 Royalty payments 314 246 859 663 Travel and other administrative expenses — — 6 30 Purchases of equipment 374 568 1,811 2,024 Total related party transactions $ 721 $ 847 $ 2,800 $ 2,804 Reimbursements by Kura Japan to the Company were $ 42 thousand and $ 7 thousand for the three months ended May 31, 2024 and May 31, 2023, respectively and were $ 264 thousand and $ 67 tho usand for the nine months ended May 31, 2024 and May 31, 2023, respectively. The reimbursements were primarily for directors and officers liability insurance, travel, professional fees and other administrative expenses. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
May 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | Note 5. Stock-based Compensation The following table summarizes the stock option activity under the Company’s 2018 Incentive Compensation Plan, as amended and restated (the “Stock Incentive Plan”): Options Outstanding Number of Shares Weighted Average Outstanding — August 31, 2023 653,395 $ 34.25 Granted 16,360 $ 72.25 Exercised ( 7,241 ) $ 15.15 Cancelled/forfeited ( 3,816 ) $ 56.75 Outstanding — November 30, 2023 658,698 $ 35.27 Granted 49,420 $ 95.04 Exercised ( 64,581 ) $ 25.00 Cancelled/forfeited ( 6,786 ) $ 71.09 Outstanding — February 29, 2024 636,751 $ 40.57 Granted 3,199 $ 104.47 Exercised ( 16,391 ) $ 35.30 Cancelled/forfeited ( 2,169 ) $ 69.57 Outstanding — May 31, 2024 621,390 $ 40.94 The following table summarizes the restricted stock unit (“RSU”) activity under the Stock Incentive Plan: Number of Shares Weighted Average Outstanding — August 31, 2023 31,105 $ 69.88 Granted — — Vested ( 1,359 ) $ 73.58 Cancelled/forfeited ( 351 ) $ 62.14 Outstanding — November 30, 2023 29,395 $ 69.80 Granted 19,939 $ 98.13 Vested ( 8,095 ) $ 62.14 Cancelled/forfeited ( 436 ) $ 66.10 Outstanding — February 29, 2024 40,803 $ 85.20 Granted — — Vested ( 8 ) $ 62.14 Cancelled/forfeited ( 495 ) $ 83.73 Outstanding — May 31, 2024 40,300 $ 85.23 The total stock-based compensation recognized under the Stock Incentive Plan in the statements of operations and comprehensive income (loss) is as follows: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 (amounts in thousands) Restaurant-level stock-based compensation included in other costs $ 194 $ 163 $ 497 $ 382 Corporate-level stock-based compensation included in general and administrative expenses 1,003 812 2,672 2,188 Stock-based compensation, net of amounts capitalized 1,197 975 3,169 2,570 Amount capitalized to Property and Equipment - net 39 — 181 — Total stock-based compensation $ 1,236 $ 975 $ 3,350 $ 2,570 |
Debt
Debt | 9 Months Ended |
May 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Note 6. Debt On April 10, 2020, the Company and Kura Japan entered into a Revolving Credit Agreement, as amended, establishing a $ 45.0 million revolving credit line for the Company. The maturity date for each advance is 60 months from the date of disbursement and the last day of the period of availability for advances is April 10, 2025. The Revolving Credit Note under the Revolving Credit Agreement has an interest rate for advances fixed at 130 % of the Annual Compounding Long-Term Applicable Federal Rate (“AFR”) on the date such advance is made. There are no financial covenants under the Revolving Credit Agreement with which the Company must comply. As of May 31, 2024 and August 31, 2023, the Company had no o utstanding balance and $ 45.0 million of availability remaining under the Revolving Credit Agreement. For additional information, see “Note 4. Related Party Transactions.” |
(Loss) Income Per Share
(Loss) Income Per Share | 9 Months Ended |
May 31, 2024 | |
Earnings Per Share [Abstract] | |
(Loss) Income Per Share | Note 7 . (Loss) Income Per Share The net income (loss) per share attributable to common stockholders is allocated based on the contractual participation rights of the Class A common stock and Class B common stock as if the income for the year had been distributed. As the liquidation and dividend rights for Class A and Class B common stock are identical, the net loss attributable to all common stockholders is allocated on a proportionate basis. The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 Class A Class B Class A Class B Class A Class B Class A Class B (amounts in thousands, except per share data) Net income (loss) attributable to common stockholders $ ( 508 ) $ ( 50 ) $ 1,520 $ 160 $ ( 3,280 ) $ ( 323 ) $ ( 1,281 ) $ ( 142 ) Net income (loss) attributable to common stockholders – diluted $ ( 508 ) $ ( 50 ) $ 1,525 $ 155 $ ( 3,280 ) $ ( 323 ) $ ( 1,281 ) $ ( 142 ) Weighted average common shares outstanding – basic 10,188 1,000 9,485 1,000 10,167 1,000 9,028 1,000 Dilutive effect of stock-based awards — — 322 — — — — — Weighted average common shares outstanding – diluted 10,188 1,000 9,807 1,000 10,167 1,000 9,028 1,000 Net income (loss) per share attributable to common stockholders – basic $ ( 0.05 ) $ ( 0.05 ) $ 0.16 $ 0.16 $ ( 0.32 ) $ ( 0.32 ) $ ( 0.14 ) $ ( 0.14 ) Net income (loss) per share attributable to common stockholders – diluted $ ( 0.05 ) $ ( 0.05 ) $ 0.16 $ 0.16 $ ( 0.32 ) $ ( 0.32 ) $ ( 0.14 ) $ ( 0.14 ) The Company computes basic income (loss) per common share using net income (loss) and the weighted average number of common shares outstanding during the period, and computes diluted income (loss) per common share using net income (loss) and the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares include dilutive outstanding employee stock options and restricted stock units. For the three and nine months ended May 31, 2024, there were 662 thousand shares of common stock subject to outstanding employee stock options and RSUs that were excluded from the calculation of diluted loss per share because their inclusion would have been anti-dilutive. For the three months ended May 31, 2023 , there were 201 thousand shares of common stock subject to outstanding employee stock options and RSUs that were excluded from the calculation of diluted income per share because their inclusion would have been anti-dilutive. For the nine months ended May 31, 2023, there were 729 thousand shares of common stock subject to outstanding employee stock options and RSUs that were excluded from the calculation of diluted loss per share because their inclusion would have been anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
May 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 8. Commitments and Contingencies On January 19, 2024, two former employees initiated arbitration against the Company. Subsequently, on February 26, 2024, three additional former employees initiated a separate arbitration against the Company. Both sets of claimants allege violations of the Fair Labor Standards Act (“FLSA”) and violations of certain Washington, D.C. wage laws. Each arbitration will proceed separately. T he Company recorded an accrued liability of $ 0.6 million r elated to these matters within general and administrative expenses in the statements of operations during the three months ended May 31, 2024, as the liability associated with these matters became probable and reasonably estimable based on information available to the Company. As the Company receives new information, it will reevaluate its estimated liability, which may exceed the amount accrued and could adversely affect the Company’s financial position, results of operations or cash flows. Th e Company is involved from time to time in various legal proceedings that arise in the ordinary course of business, including but not limited to commercial disputes, environmental matters, employee related claims, intellectual property disputes and litigation in connection with transactions, including acquisitions and divestitures. In the opinion of management, the Company does not believe that such litigation, claims, and administrative proceedings will have a material adverse effect on its business, financial position, results of operations or cash flows. However, a significant increase in the number of these claims or an increase in amounts owing under successful claims, including the putative class action referenced above, could materially and adversely affect its business, financial condition, results of operations or cash flows. The Company records a liability when a loss is considered probable, and the amount can be reasonably estimated. |
Income Taxes
Income Taxes | 9 Months Ended |
May 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9. Income Taxes The Company recorded an income tax expense of $ 60 thousand and $ 41 thousand for the three months ended May 31, 2024 and May 31, 2023, respectively and income tax expense of $ 148 thousand and $ 66 thousand for the nine months ended May 31, 2024 and May 31, 2023, respectively. The Company’s effective tax rates for the three and nine months ended May 31, 2024 substantially differed from the federal statutory tax rate of 21 % primarily due to a valuation allowance for the Company’s deferred tax assets and permanent difference related to employer tip credit. The Company continually monitors and performs an assessment of the realizability of its deferred tax assets, including an analysis of factors such as future taxable income, reversal of existing taxable temporary differences, and tax planning strategies. In assessing the need for a valuation allowance, the Company considered both positive and negative evidence related to the likelihood of realization of deferred tax assets using a “more likely than not” standard. In making such assessment, more weight was given to evidence that could be objectively verified, including recent cumulative losses. Based on the Company’s review of this evidence, management determined that a full valuation allowance against all of the Company’s net deferred tax assets at May 31, 2024 was appropriate. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
May 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 10. Fair Value Measurements The following table sets forth the Company’s assets measured at fair value on a recurring basis as of May 31, 2024. Level 1 Level 2 Level 3 Total (amounts in thousands) Assets: Certificates of deposits $ — $ 1,250 $ — $ 1,250 Treasury bills — — — — Total assets at fair value $ — $ 1,250 $ — $ 1,250 The Company’s cash and cash equivalents include cash on hand, deposits in banks, certificates of deposits and money market funds. Due to their short-term nature, the carrying amounts reported in the accompanying balance sheets approximate the fair value of cash and cash equivalents. The fair value of our certificates of deposits are considered using Level 2 inputs of the fair value hierarchy. Level 2 inputs are based on market data that include factors such as interest rates, market and pricing activity and other market-based valuation techniques. The Company determines realized gains or losses on the available-for-sale debt securities on a specific identification method basis. |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 9 Months Ended |
May 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed financial statements (the “Condensed Financial Statements”) have been prepared by the Company in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. As such, these Condensed Financial Statements should be read in conjunction with the Company’s audited financial statements and accompanying notes included in its Annual Report on Form 10-K for the fiscal year ended August 31, 2023. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 2, Basis of Presentation and Summary of Significant Accounting Policies, of the Notes to Financial Statements included in the Company’s Annual Report on Form 10‑K for the fiscal year ended August 31, 2023. In the opinion of management, all adjustments necessary to fairly state the Condensed Financial Statements have been made. All such adjustments are of a normal, recurring nature. The results of operations for interim periods are not necessarily indicative of results to be expected for the fiscal year ending August 31, 2024 or for any other future annual or interim period. |
Fiscal Year | Fiscal Year The Company’s fiscal year begins on September 1 and ends on August 31, and references made to “fiscal year 2024” and “fiscal year 2023” refer to the Company’s fiscal years ending August 31, 2024 and ended August 31, 2023, respectively. |
Use of Estimates | Use of Estimates Preparing financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods presented. Significant items subject to such estimates include asset retirement obligations, stock-based compensation, the useful lives of assets, the assessment of the recoverability of long-lived assets, and income taxes. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ materially from those estimates and assumptions. |
Short-Term Investments | Short-Term Investments Short-term investments consist of certificates of deposits and Treasury bills. The Company considers all highly liquid investments with an original maturity date greater than three months but less than one year as short-term investments. The carrying value of the short-term investments is equivalent to their amortized cost basis. As of May 31, 2024 and August 31, 2023, short-term investments were $ 1.3 million and $ 8.5 million, respectively. The certificates of deposits are deposited at Federal Deposit Insurance Corporation (“FDIC”) insured banks. The certificates of deposits are in amounts of $ 250,000 and deposited in multiple banks to ensure that the entire deposit balance is eligible for FDIC insurance. Certificates of deposits and Treasury bills are classified as available-for-sale debt securities which are measured at fair value with unrealized gains or losses recorded in other comprehensive income (loss). As of May 31, 2024 , the Company recorded no unrealized gains or losses on short-term investments in accumulated other comprehensive income (loss). The Company reclassified $ 76 thousand out of accumulated other comprehensive income into earnings for the period related to maturities of certificates of deposits and a Treasury bill, which consisted of $ 75 thousand in realized gains on a Treasury bill and $ 1 thousand in realized gains on certificates of deposits. The Company determines realized ga ins or losses on the available-for-sale debt securities on a specific identification method basis. Base d on the evaluation of credit risk factors, the Company has concluded that an allowance for credit losses is unnecessary for its short-term investments. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. The Company’s short-term investments consist of certificates of deposits and Treasury bills that are classified as available-for-sale debt securities which are measured at fair value with unrealized gains or losses recorded in other comprehensive income (loss). |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which requires greater disaggregation of income tax disclosures related to the income tax rate reconciliation and income taxes paid and effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments should be applied on a prospective basis although retrospective application is permitted. The Company is currently evaluating the effects of this pronouncement on its financial statements and expects the update to result in additional disclosures. In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance in this update is effective for all public entities for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the effects of this pronouncement on its financial statements and expects the update to result in additional disclosures. |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
May 31, 2024 | |
Property, Plant and Equipment, Net [Abstract] | |
Schedule of Accounts and Other Receivables | Accounts and Other Receivables May 31, 2024 August 31, 2023 (amounts in thousands) Lease receivables $ 3,813 $ 3,973 Credit card and other receivables 1,697 1,075 Total accounts and other receivables $ 5,510 $ 5,048 |
Schedule of Property and Equipment Net | Property and Equipment - net May 31, 2024 August 31, 2023 (amounts in thousands) Leasehold improvements $ 97,827 $ 75,472 Lease assets 6,229 6,247 Furniture and fixtures 49,114 34,213 Computer equipment 3,650 2,792 Vehicles 220 220 Software 1,017 1,016 Construction in progress 8,620 14,369 Property and equipment – gross 166,677 134,329 Less: accumulated depreciation and amortization ( 36,014 ) ( 27,902 ) Total property and equipment – net $ 130,663 $ 106,427 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
May 31, 2024 | |
Leases [Abstract] | |
Summary of Lease Related Costs | Lease related costs recognized in the statements of operations and comprehensive income (loss) are as follows: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 (amounts in thousands) Operating lease cost Classification Operating lease cost Occupancy and related expenses, other costs and general and administrative expenses $ 3,380 $ 3,208 $ 9,678 $ 7,450 Variable lease cost Occupancy and related expenses, and general and administrative expenses 992 1,072 2,567 2,307 Total operating lease cost $ 4,372 $ 4,280 $ 12,245 $ 9,757 |
Summary of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases is as follows: Operating Leases May 31, 2024 August 31, 2023 (amounts in thousands) Right-of-use assets $ 117,030 $ 103,884 Lease liabilities – current $ 11,734 $ 9,225 Lease liabilities – non-current 123,848 110,234 Total lease liabilities $ 135,582 $ 119,459 Nine Months Ended May 31, 2024 2023 Weighted Average Remaining Lease Term (Years) Operating leases 16.5 16.3 Weighted Average Discount Rate Operating leases 7.1 % 6.6 % |
Summary of Supplemental Disclosures of Cash Flow Information Related to Leases | Supplemental disclosures of cash flow information related to leases are as follows: Nine Months Ended May 31, 2024 2023 (amounts in thousands) Operating cash flows paid for operating lease liabilities $ 7,769 $ 5,775 Operating right-of-use assets obtained in exchange for new operating lease liabilities $ 17,774 $ 18,415 |
Summary of Maturities of Lease Liabilities Net of Lease Receivables | Maturities of lease liabilities, net of lease receivables, were as follows: Operating Leases (amounts in thousands) Remainder of 2024 $ 380 2025 9,940 2026 12,373 2027 13,111 2028 12,730 Thereafter 184,104 Total lease payments 232,638 Less: imputed interest ( 97,056 ) Present value of lease liabilities $ 135,582 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
May 31, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions Due to and from Affiliates | Balances with Kura Japan are as follows: May 31, 2024 August 31, 2023 (amounts in thousands) Due from affiliate $ — $ 104 Due to affiliate $ 123 $ 555 |
Schedule of Related Party Reimbursements and Other Payments | Reimbursements and other payments by the Company to Kura Japan were as follows: Three Months Ended May 31, Nine Months Ended May 31 2024 2023 2024 2023 (amounts in thousands) Related party transactions: Expatriate salaries expense $ 33 $ 33 $ 124 $ 87 Royalty payments 314 246 859 663 Travel and other administrative expenses — — 6 30 Purchases of equipment 374 568 1,811 2,024 Total related party transactions $ 721 $ 847 $ 2,800 $ 2,804 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
May 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity under Stock Incentive Plan | The following table summarizes the stock option activity under the Company’s 2018 Incentive Compensation Plan, as amended and restated (the “Stock Incentive Plan”): Options Outstanding Number of Shares Weighted Average Outstanding — August 31, 2023 653,395 $ 34.25 Granted 16,360 $ 72.25 Exercised ( 7,241 ) $ 15.15 Cancelled/forfeited ( 3,816 ) $ 56.75 Outstanding — November 30, 2023 658,698 $ 35.27 Granted 49,420 $ 95.04 Exercised ( 64,581 ) $ 25.00 Cancelled/forfeited ( 6,786 ) $ 71.09 Outstanding — February 29, 2024 636,751 $ 40.57 Granted 3,199 $ 104.47 Exercised ( 16,391 ) $ 35.30 Cancelled/forfeited ( 2,169 ) $ 69.57 Outstanding — May 31, 2024 621,390 $ 40.94 |
Summary of Restricted Stock Unit (RSU) Activity Under Stock Incentive Plan | The following table summarizes the restricted stock unit (“RSU”) activity under the Stock Incentive Plan: Number of Shares Weighted Average Outstanding — August 31, 2023 31,105 $ 69.88 Granted — — Vested ( 1,359 ) $ 73.58 Cancelled/forfeited ( 351 ) $ 62.14 Outstanding — November 30, 2023 29,395 $ 69.80 Granted 19,939 $ 98.13 Vested ( 8,095 ) $ 62.14 Cancelled/forfeited ( 436 ) $ 66.10 Outstanding — February 29, 2024 40,803 $ 85.20 Granted — — Vested ( 8 ) $ 62.14 Cancelled/forfeited ( 495 ) $ 83.73 Outstanding — May 31, 2024 40,300 $ 85.23 |
Summary of Stock Based Compensation Recognized under Stock Incentive Plan | The total stock-based compensation recognized under the Stock Incentive Plan in the statements of operations and comprehensive income (loss) is as follows: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 (amounts in thousands) Restaurant-level stock-based compensation included in other costs $ 194 $ 163 $ 497 $ 382 Corporate-level stock-based compensation included in general and administrative expenses 1,003 812 2,672 2,188 Stock-based compensation, net of amounts capitalized 1,197 975 3,169 2,570 Amount capitalized to Property and Equipment - net 39 — 181 — Total stock-based compensation $ 1,236 $ 975 $ 3,350 $ 2,570 |
(Loss) Income Per Share (Tables
(Loss) Income Per Share (Tables) | 9 Months Ended |
May 31, 2024 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Income (Loss) Per Share | The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share: Three Months Ended May 31, Nine Months Ended May 31, 2024 2023 2024 2023 Class A Class B Class A Class B Class A Class B Class A Class B (amounts in thousands, except per share data) Net income (loss) attributable to common stockholders $ ( 508 ) $ ( 50 ) $ 1,520 $ 160 $ ( 3,280 ) $ ( 323 ) $ ( 1,281 ) $ ( 142 ) Net income (loss) attributable to common stockholders – diluted $ ( 508 ) $ ( 50 ) $ 1,525 $ 155 $ ( 3,280 ) $ ( 323 ) $ ( 1,281 ) $ ( 142 ) Weighted average common shares outstanding – basic 10,188 1,000 9,485 1,000 10,167 1,000 9,028 1,000 Dilutive effect of stock-based awards — — 322 — — — — — Weighted average common shares outstanding – diluted 10,188 1,000 9,807 1,000 10,167 1,000 9,028 1,000 Net income (loss) per share attributable to common stockholders – basic $ ( 0.05 ) $ ( 0.05 ) $ 0.16 $ 0.16 $ ( 0.32 ) $ ( 0.32 ) $ ( 0.14 ) $ ( 0.14 ) Net income (loss) per share attributable to common stockholders – diluted $ ( 0.05 ) $ ( 0.05 ) $ 0.16 $ 0.16 $ ( 0.32 ) $ ( 0.32 ) $ ( 0.14 ) $ ( 0.14 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
May 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets Measured at Fair Value on a Recurring Basis | The following table sets forth the Company’s assets measured at fair value on a recurring basis as of May 31, 2024. Level 1 Level 2 Level 3 Total (amounts in thousands) Assets: Certificates of deposits $ — $ 1,250 $ — $ 1,250 Treasury bills — — — — Total assets at fair value $ — $ 1,250 $ — $ 1,250 |
Organization and Basis of Pre_3
Organization and Basis of Presentation - Additional Information (Details) - USD ($) | 9 Months Ended | |
May 31, 2024 | Aug. 31, 2023 | |
Organization and Basis of Presentation [Line Items] | ||
Short-term investments | $ 1,250,000 | $ 8,542,000 |
Accumulated other comprehensive income into earnings | 0 | $ 43,000 |
Certificates of Deposit | ||
Organization and Basis of Presentation [Line Items] | ||
Short-term investments | 250,000 | |
Realized gains on short-term investments | 1,000 | |
Treasury Bills | ||
Organization and Basis of Presentation [Line Items] | ||
Accumulated other comprehensive income into earnings | 76,000 | |
Realized gains on short-term investments | $ 75,000 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Accounts and Other Receivables (Details) - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Receivables Net Current [Line Items] | ||
Accounts and other receivables | $ 5,510 | $ 5,048 |
Lease Receivables | ||
Receivables Net Current [Line Items] | ||
Accounts and other receivables | 3,813 | 3,973 |
Credit Card and Other Receivables | ||
Receivables Net Current [Line Items] | ||
Accounts and other receivables | $ 1,697 | $ 1,075 |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | $ 166,677 | $ 134,329 |
Accumulated depreciation | (36,014) | (27,902) |
Total property and equipment – net | 130,663 | 106,427 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 97,827 | 75,472 |
Lease Assets | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 6,229 | 6,247 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 49,114 | 34,213 |
Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 3,650 | 2,792 |
Vehicles | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 220 | 220 |
Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | 1,017 | 1,016 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment - gross | $ 8,620 | $ 14,369 |
Balance Sheet Components - Addi
Balance Sheet Components - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Property, Plant and Equipment, Net [Abstract] | ||||
Depreciation and amortization expenses | $ 3,200 | $ 2,100 | $ 8,612 | $ 5,574 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2024 | Jun. 01, 2024 | |
Lessee Lease Description [Line Items] | ||
Operating and finance leases, remaining lease start range terms description | less than 1 year | |
Operating lease liability not yet commenced, liability | $ 44.7 | |
Option to extend, existence, lease liabilities not yet commenced, operating lease | true | |
Maximum | ||
Lessee Lease Description [Line Items] | ||
Operating and finance leases, remaining lease terms | 20 years | |
Subsequent Event | ||
Lessee Lease Description [Line Items] | ||
Operating lease liability not yet commenced, liability | $ 15.6 | |
Subsequent Event | Maximum | ||
Lessee Lease Description [Line Items] | ||
Operating lease liabilities not yet commenced, lease term | 30 years |
Leases - Summary of Lease Relat
Leases - Summary of Lease Related Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Operating lease cost | ||||
Operating lease cost | $ 3,380 | $ 3,208 | $ 9,678 | $ 7,450 |
Variable lease cost | 992 | 1,072 | 2,567 | 2,307 |
Total operating lease cost | $ 4,372 | $ 4,280 | $ 12,245 | $ 9,757 |
Leases - Summary of Operating L
Leases - Summary of Operating Leases (Details) - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Leases [Abstract] | ||
Right-of-use assets | $ 117,030 | $ 103,884 |
Lease liabilities – current | 11,734 | 9,225 |
Lease liabilities – non-current | 123,848 | 110,234 |
Total lease liabilities | $ 135,582 | $ 119,459 |
Leases - Summary of Weighted Av
Leases - Summary of Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Details) | May 31, 2024 | May 31, 2023 |
Weighted Average Remaining Lease Term (Years) | ||
Operating leases | 16 years 6 months | 16 years 3 months 18 days |
Weighted Average Discount Rate | ||
Operating leases | 7.10% | 6.60% |
Leases - Summary of Supplementa
Leases - Summary of Supplemental Disclosures of Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands | 9 Months Ended | |
May 31, 2024 | May 31, 2023 | |
Leases [Abstract] | ||
Operating cash flows paid for operating lease liabilities | $ 7,769 | $ 5,775 |
Operating right-of-use assets obtained in exchange for new operating lease liabilities | $ 17,774 | $ 18,415 |
Leases - Summary of Maturities
Leases - Summary of Maturities of Lease Liabilities Net of Lease Receivables (Details) - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Operating Leases | ||
Remainder of 2024 | $ 380 | |
2025 | 9,940 | |
2026 | 12,373 | |
2027 | 13,111 | |
2028 | 12,730 | |
Thereafter | 184,104 | |
Total lease payments | 232,638 | |
Less: imputed interest | (97,056) | |
Present value of lease liabilities | $ 135,582 | $ 119,459 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - Kura Japan - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Aug. 31, 2019 | May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Apr. 10, 2020 | |
Professional Fees, Travel and Other Administrative Expenses | ||||||
Related Party Transaction [Line Items] | ||||||
Reimbursements by related party | $ 42 | $ 7 | $ 264 | $ 67 | ||
Revolving Credit Facility Agreement | COVID-19 | ||||||
Related Party Transaction [Line Items] | ||||||
Credit facility maximum borrowing capacity | $ 45,000 | |||||
Amended and Restated Exclusive License Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Royalty fee of net sales | 0.50% |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions Due to and from Affiliates (Details) - Kura Japan - USD ($) $ in Thousands | May 31, 2024 | Aug. 31, 2023 |
Related Party Transaction [Line Items] | ||
Due from affiliate | $ 104 | |
Due to affiliate | $ 123 | $ 555 |
Related Party Transactions - _2
Related Party Transactions - Schedule of Related Party Reimbursements and Other Payments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Related Party Transaction [Line Items] | ||||
Total related party transactions | $ 55,287 | $ 40,826 | $ 151,596 | $ 113,356 |
Kura Japan | ||||
Related Party Transaction [Line Items] | ||||
Total related party transactions | 721 | 847 | 2,800 | 2,804 |
Expatriate Salaries Expense | Kura Japan | ||||
Related Party Transaction [Line Items] | ||||
Total related party transactions | 33 | 33 | 124 | 87 |
Royalty Payments | Kura Japan | ||||
Related Party Transaction [Line Items] | ||||
Total related party transactions | 314 | 246 | 859 | 663 |
Travel and Other Administrative Expenses | Kura Japan | ||||
Related Party Transaction [Line Items] | ||||
Total related party transactions | 6 | 30 | ||
Purchases of Equipment | Kura Japan | ||||
Related Party Transaction [Line Items] | ||||
Total related party transactions | $ 374 | $ 568 | $ 1,811 | $ 2,024 |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Stock Option Activity under Stock Incentive Plan (Details) - Stock Incentive Plan - $ / shares | 3 Months Ended | ||
May 31, 2024 | Feb. 29, 2024 | Nov. 30, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options Outstanding, Number of shares underlying outstanding options, Beginning balance | 636,751 | 658,698 | 653,395 |
Options Outstanding, Number of shares underlying outstanding options, Options granted | 3,199 | 49,420 | 16,360 |
Options Outstanding, Number of shares underlying outstanding options, Options exercised | (16,391) | (64,581) | (7,241) |
Options Outstanding, Number of shares underlying outstanding options, Options cancelled/forfeited | (2,169) | (6,786) | (3,816) |
Options Outstanding, Number of shares underlying outstanding options, Ending balance | 621,390 | 636,751 | 658,698 |
Options Outstanding, Weighted Average Exercise Price Per Share, Beginning balance | $ 40.57 | $ 35.27 | $ 34.25 |
Options Outstanding, Weighted Average Exercise Price Per Share, Options granted | 104.47 | 95.04 | 72.25 |
Options Outstanding, Weighted Average Exercise Price Per Share, Options exercised | 35.3 | 25 | 15.15 |
Options Outstanding, Weighted Average Exercise Price Per Share, Options canceled/forfeited | 69.57 | 71.09 | 56.75 |
Options Outstanding, Weighted Average Exercise Price Per Share, Ending balance | $ 40.94 | $ 40.57 | $ 35.27 |
Stock-based Compensation - Su_2
Stock-based Compensation - Summary of Restricted Stock Unit (RSU) Activity Under Stock Incentive Plan (Details) - Stock Incentive Plan - Restricted Stock Units - $ / shares | 3 Months Ended | ||
May 31, 2024 | Feb. 29, 2024 | Nov. 30, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
RSUs Outstanding, Number of Shares Underlying Outstanding RSUs, Beginning balance | 40,803 | 29,395 | 31,105 |
RSUs Outstanding, Number of Shares Underlying Outstanding RSUs, RSUs granted | 19,939 | ||
RSUs Outstanding, Number of Shares Underlying Outstanding RSUs, RSUs vested | (8) | (8,095) | (1,359) |
RSUs Outstanding, Number of Shares Underlying Outstanding RSUs, RSUs cancelled/forfeited | (495) | (436) | (351) |
RSUs Outstanding, Number of Shares Underlying Outstanding RSUs, Ending balance | 40,300 | 40,803 | 29,395 |
Weighted average exercise price per share, RSUs outstanding Beginning | $ 85.2 | $ 69.8 | $ 69.88 |
Weighted average exercise price per share, RSUs granted | 98.13 | ||
Weighted average exercise price per share, RSUs vested | 62.14 | 62.14 | 73.58 |
Weighted average exercise price per share, RSUs cancelled/forfeited | 83.73 | 66.1 | 62.14 |
Weighted average exercise price per share, RSUs outstanding Endining | $ 85.23 | $ 85.2 | $ 69.8 |
Stock-based Compensation - Su_3
Stock-based Compensation - Summary of Stock Based Compensation Recognized under Stock Incentive Plan (Details) - Stock Incentive Plan - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation, net of amounts capitalized | $ 1,197 | $ 975 | $ 3,169 | $ 2,570 |
Total stock-based compensation | 1,236 | 975 | 3,350 | 2,570 |
Restaurant-level Stock Based Compensation Included In Other Costs | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation, net of amounts capitalized | 194 | 163 | 497 | 382 |
Corporate-level Stock Based Compensation Included In General and Administrative Expenses | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation, net of amounts capitalized | 1,003 | $ 812 | 2,672 | $ 2,188 |
Amount Capitalized to Property and Equipment - net | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation cost capitalized to Property and Equipment - net | $ 39 | $ 181 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | 9 Months Ended | ||
May 31, 2024 | Aug. 31, 2023 | Apr. 10, 2020 | |
Debt Instrument [Line Items] | |||
Revolving credit line interest rate | 130% | ||
Revolving Credit Facility Agreement | |||
Debt Instrument [Line Items] | |||
Outstanding balance | $ 0 | ||
Remaining availability under credit agreement | $ 45,000,000 | ||
Revolving Credit Facility Agreement | Kura Japan | |||
Debt Instrument [Line Items] | |||
Outstanding borrowings | $ 45,000,000 |
(Loss) Income Per Share - Compu
(Loss) Income Per Share - Computation of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Earnings Per Share Diluted [Line Items] | ||||
Weighted average common shares outstanding – basic | 11,188 | 10,485 | 11,167 | 10,028 |
Diluted | 11,188 | 10,807 | 11,167 | 10,028 |
Basic | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Diluted | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Class A | ||||
Earnings Per Share Diluted [Line Items] | ||||
Net income (loss) attributable to common stockholders | $ (508) | $ 1,520 | $ (3,280) | $ (1,281) |
Net income (loss) attributable to common stockholders - diluted | $ (508) | $ 1,525 | $ (3,280) | $ (1,281) |
Weighted average common shares outstanding – basic | 10,188 | 9,485 | 10,167 | 9,028 |
Dilutive effect of stock-based awards | 322 | |||
Diluted | 10,188 | 9,807 | 10,167 | 9,028 |
Basic | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Diluted | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Class B | ||||
Earnings Per Share Diluted [Line Items] | ||||
Net income (loss) attributable to common stockholders | $ (50) | $ 160 | $ (323) | $ (142) |
Net income (loss) attributable to common stockholders - diluted | $ (50) | $ 155 | $ (323) | $ (142) |
Weighted average common shares outstanding – basic | 1,000 | 1,000 | 1,000 | 1,000 |
Diluted | 1,000 | 1,000 | 1,000 | 1,000 |
Basic | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
Diluted | $ (0.05) | $ 0.16 | $ (0.32) | $ (0.14) |
(Loss) Income Per Share - Addit
(Loss) Income Per Share - Additional Information (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Earnings Per Share [Line Items] | ||||
Shares of common stock subject to outstanding employee stock options that were excluded from the calculation of diluted income (loss) per share | 662 | 201 | 662 | 729 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 3 Months Ended | ||
Feb. 26, 2024 Employees | Jan. 19, 2024 Employees | May 31, 2024 USD ($) | |
Loss Contingencies [Line Items] | |||
Number of former employees initiated arbitration against company | Employees | 3 | 2 | |
General and Administrative Expenses | |||
Loss Contingencies [Line Items] | |||
Accrued liability | $ | $ 0.6 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 60 | $ 41 | $ 148 | $ 66 |
Federal statutory tax rate | 21% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets Measured at Fair Value on a Recurring Basis (Details) - Fair Value Recurring $ in Thousands | May 31, 2024 USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total assets at fair value | $ 1,250 |
Certificates of Deposit | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total assets at fair value | 1,250 |
Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total assets at fair value | 1,250 |
Level 2 | Certificates of Deposit | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total assets at fair value | $ 1,250 |