MW Wingstop's stock slides 7% as higher chicken costs lead to revenue shortfall

By Ciara Linnane

Revenue hit by higher costs of food, beverages, packaging and bone-in chicken wings

Wingstop Inc.'s stock slid 7.8% early Wednesday, after the operator of chicken restaurants reported fourth-quarter revenue that fell short of estimates. The revenue miss - driven by higher costs of food, beverage, packaging and bone-in chicken wings - offset a profit beat.

Dallas-based Wingstop $(WING.UK)$ had net income of $26.7 million, or 92 cents a share, for the quarter - up from $18.8 million, or 64 cents a share, a year ago, ahead of the 86-cent FactSet consensus.

Revenue rose to $161.8 million from $127.1 million a year ago, but was below the $165.0 million FactSet consensus.

Same-store sales rose 10.1%. FactSet did not provide a same-store sales consensus.

Cost of sales rose to $23.3 million from $19.7 million a year ago, and accounted for 77.6% of sales, up from 75.1% a year ago. The company had benefited from lower bone-in chicken wing prices in the spot market in the year-earlier period.

Selling, general and administrative costs rose to $31.2 million from $28.1 million a year ago, mostly due to higher employment costs.

The company had 2,563 restaurants in total at quarter-end, up from 2,214 a year ago. Domestic franchise restaurants totaled 2,154 at quarter-end, up from 1,877 a year ago.

The company is now expecting fiscal 2025 same-store sales to rise in the low to mid-single digits.

The stock is down 4% in the last 12 months, while the S&P 500 SPX has gained 22.5%.

-Ciara Linnane

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February 19, 2025 08:37 ET (13:37 GMT)

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