Shake Shack Q2 2017 earnings were released after closing bell, and the company reported adjusted earnings of 20 cents per share on $91.4 million in revenue. The consensus estimates stood at 16 cents per share in non-GAAP earnings and $89 million in sales. In last year’s second quarter, the fast food chain reported earnings of 14 cents per share on $66.5 million in sales.
Shake Shack Q2 2017 earnings
On a GAAP basis, Shake Shack Q2 2017 earnings rose to 19 cents per share from 14 cents per share in the year-ago quarter. Adjusted EBITDA grew by more than 36% year over year to $19.4 million. Shack sales increased 36.6% to $88 million, while same-Shack sales fell 1.8% year over year. Shack-level operating profits rose 27.6% to $25.3 million or 28.8% of Shack sales. In the previous quarter, same-Shack sales declined 2.5%, a surprising change from the 10% they grew in last year’s first quarter. However, Shake Shack management remained optimistic.
“We’re incredibly excited about the recently announced agreement we executed to open Shake Shacks in Hong Kong and Macau, as we build on the strength of our Asian business with an eye towards China and further development through the region,” CEO Randy Garutti said in a statement. “We’re also proud of the technology, personalized marketing and menu innovation initiatives we’ve launched to date and, as we look to the future, we’re focused on investing in these key areas and the tremendous growth ahead of us.”
Shake Shack updates guidance
Shake Shack expects full-year revenue to be between $351 million and $355 million, but that came up short of the consensus estimate of $356.7 million. The fast food chain now expects same-Shack sales to be down by 2% to 3% for the full year, while analysts had been forecasting growth of 0.3%. Previously, the dining chain had guided for same-Shack sales to be flat with last year.
The company expects to open 23 to 24 new domestic company-operated Shacks this year with average annual sales of at least $3.4 million, versus $3.3 million previously.
After Shake Shack Q2 2017 earnings were released, the company’s stock tumbled in after-hours trade, falling by as much as 3.5% to $32.