Wingstop Stock Surges on Earnings Beat and Expansion Plans

(Dreamstime)

Wingstop stock soared as much as 29% on Wednesday after the chicken-wing chain beat both earnings and sales expectations for the second quarter, and raised its outlook for restaurant expansion.

Before Wednesday’s gain, the stock was roughly flat for the year.

For the three months ended in June, Wingstop reported adjusted earnings of $1 per share, up 1.6% from a year ago to a record high, and beating Wall Street estimates of 87 cents. Revenue climbed 12% year-over-year to $174.3 million, also ahead of consensus expectations.

Much of the growth came from the company’s expanded footprint. Wingstop net opened 129 new restaurants in the second quarter of 2025, which—along with other new openings in previous quarters—helped lift systemwide sales by 14% from a year ago to $1.3 billion.

Additional sales from the new stores were partly offset by weaker numbers at existing ones, however. Inflation and recession fears have driven many consumers to dine out less, which is hurting the restaurant industry overall.

Wall Street analysts expected Wingstop to post a 3.9% decline in domestic same-store sales, but the chain performed better, with just a 1.9% slip. That has given investors more confidence in Wingstop’s resilience amid a soft consumer environment.

Investors are also optimistic since management raised its outlook for the year. The company now expects its global units to grow 17% to 18% in 2025, up from a previous 16% to 17% range, including new markets in Italy and the Netherlands.

This marks the firm’s fourth consecutive quarter of opening more than 100 net new units. The higher number of planned new stores reflects franchisees’ confidence in the chain’s continued sales growth and profitability, even with a challenging consumer environment.

Wingstop has a strong engagement from its franchisee base—about 95% of new stores are opened by existing franchisees. The cash-on-cash returns, meaning how fast franchisees can recoup their cash investment in new restaurants, is strong compared with other chains.

“We continue to open new restaurants at a record pace, demonstrating our brand partners’ commitment to growing the Wingstop brand, furthering us towards our vision of becoming a Top 10 Global Restaurant Brand,” said CEO Michael Skipwort in a statement.

The company maintained its expectation of 1% domestic same-store sales growth for full year 2025, despite the declines in the first half of the year. The numbers should turn positive by the end of the current quarter, said CFO Alex Kaleida.

To boost customer experience, Wingstop is doubling down on technology. The company’s new “smart kitchen” system, now deployed in over 1,000 U.S. locations, leverages artificial intelligence and gamification to improve order speed and accuracy.

Stores equipped with the upgraded system are reporting meaningfully higher same-store sales growth than traditional locations, Skipworth said.

The company markets its brand on social media and through popular sporting events. It also benefits from the long-term shift away from red meat to poultry as a primary source of protein.

Last December, Wingstop issued $500 million of securitized notes, whose higher interests have suppressed earnings in 2025. But the business is highly profitable and has a strong cash flow. Wall Street expects earnings to grow 28% in 2026 once the interest expenses come down.

Write to Evie Liu at evie.liu@barrons.com