Consumer anxiety threw a wrench into Wingstop’s high-flying sales trends in the second quarter, though CEO Michael Skipworth sees the impact as temporary.
The Dallas-based fast-casual chicken chain said same-store sales declined 1.9% systemwide for the June 28-ended quarter. It was the first negative result in three years, and only the third time same-store sales have declined since Wingstop went public in 2015.
Granted, it was a tough quarter for comparisons.
A year ago, the chain saw same-store sales grow an eye-popping 28.7%, and comparisons will be easier in the second half of the year.
And providing a counter point, Wingstop’s more than 160 company units saw same-store sales increase 3.6%, primarily driven by transactions. Skipworth said that’s because those stores, which are mostly in the Dallas/Fort Worth area, have implemented the new digital Smart Kitchen operating system, which the company has been touting as a game changer this year.
About 1,000 restaurants have the new Smart Kitchen, and it’s expected to be systemwide by the end of the year. Smart Kitchen units have cut speed down to about 10 minutes on average from the prior 18 to 20 minutes on a good day. That means Wingstop is showing up in algorithms based on searches for “food under 30 minutes,” and it has boosted sales at lunch and late-night dayparts, Skipworth said.
“I can’t tell you how many brand partners have told me how much they love the new system and how much of a game changer it is for their restaurant operation,” he said.
Still, Skipworth noted that the macroeconomic climate remains challenging, with “a good deal of uncertainty” regarding consumer behavior and spending habits.
The softness has mostly been seen in pockets, like lower-income Hispanic guests, which Skipworth noted is in line with broader industry trends.
“Through our regular consumer research, we hear concerns about elevated prices, future job prospects and general anxiety about the future,” Skipworth said. “But we remain focused on what we can control in this environment, in executing our strategy.”
One of those strategies is the planned test of a new loyalty program coming in the fourth quarter, with a full rollout scheduled next year.
Wingstop is also doing more marketing with sports events, like the recent NBA partnership, and football season later this year is expected to bring more results. Skipworth said the brand is also looking to expand with new sports marketing partnerships, like perhaps WWE and UFC events, saying those fans “look like Wingstop guests.”
The relaunch of chicken tenders earlier this year has also driven lapsed users back to the brand at a level the chain hasn’t seen from any menu innovation in two years, Skipworth said.
“In fact, the number of new and reactivated guests has tripled since launch, compared to the run rate at the end of 2024,” he said.
Skipworth expects comparable sales to turn positive again in the third quarter, and the company reiterated its projection for 1% domestic same-store sales growth for the year.
He also believes the chain remains on its path to become a top 10 restaurant chain, with 10,000 units and an average unit volume of $3 million. During the second quarter, the AUV ticked up slightly to $2.1 million.
Net income, however, decreased 2.6% for the chain to $26.8 million. Systemwide sales grew nearly 14% to $1.3 billion, which was boosted in part by the chain’s more than 20% growth rate.
Wingstop has added 255 net new units so far in 2025, which is about how many the chain opened in all of 2023, Skipworth said. And 95% of the new openings this year are with existing franchisees reinvesting in the brand.
The chain added 129 net new units during the second quarter, for a total of 2,818 globally. For the year, the chain is projecting the addition of 435 to 460 restaurants, which is global unit growth rate of 17% to 18%, up from earlier projections of between 16% and 17%.
That growth rate is an indicator of the strong results franchisees are seeing, with 70% cash-on-cash returns, Skipworth said, adding that Wingstop has the highest level of sold commitments on record.
Skipworth also sees growing potential internationally. The company has 407 units in other countries, including the first to open in Sydney, Australia, during the quarter, and the first flagship in Paris. Wingstop units are coming to the new markets of Italy and the Netherlands.
Wall Street appeared to be happy with Wingstop’s results, with the stock price up more than 25% in midday trading on Wednesday.
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