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Shake Shack shares tumble on news of delayed new unit openings

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Shake Shack is suffering from a logjam in unit expansion and expects to open the bulk of its new restaurants in the second half of 2018, slowing revenue growth for the fast-casual burger chain.

Shares of Shake Shack had fallen more than 11% by midday Friday on the news.

The company reported a same-store sales increase of 1.1% for the second quarter ended June 27, with an increase in total revenue of 27.3%.

"The unfortunate reality for timing is just that way more than we expected Shacks are going to open in the third and fourth quarter," Shake Shack CEO Randall Garutti said on a call with analysts. "So it will be a big push for us at the end of the year."

More than 70% of the 32 to 35 new units are expected to open late in the year due to permitting issues, labor shortages and construction equipment backlogs, company officials said.

Shake Shack, which started as a hot dog cart from Union Square Hospitality Group’s Danny Meyer in 2001, became a public company in 2015.

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