Shake Shack Inc (NYSE:SHAK) posted second-quarter earnings that outperformed analyst forecasts, yet its shares dropped 7.7%, indicating investor disappointment despite the solid results.
The burger chain reported adjusted earnings of $0.44 per share for the quarter, beating the consensus estimate of $0.37 by $0.07. Revenue reached $356.5 million, slightly above the expected $353.58 million and marking a 12.6% increase year-over-year.
Same-Shack sales grew 1.8% compared to last year, while system-wide sales rose 13.7% to $549.9 million. Restaurant-level profit hit $82.2 million, representing 23.9% of Shack sales, and adjusted EBITDA increased 24.8% to $58.9 million.
“Our strong second quarter results demonstrate the continued momentum in our business as we focus on delivering exceptional guest experiences,” said Robert Lynch, CEO of Shake Shack. “We’re seeing positive trends across both our company-operated and licensed locations.”
During the quarter, Shake Shack opened 13 new company-operated locations, including two drive-thrus, and added nine licensed Shacks, bringing its global total to over 600 outlets — more than 390 in the U.S. and over 210 internationally.
Operating income more than doubled to $22.4 million from $10.8 million in the prior-year quarter, while net income increased to $18.5 million from $10.4 million.
Despite these encouraging numbers, the steep drop in share price suggests investors might have anticipated even stronger performance or guidance from the fast-casual restaurant chain.
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