Shake Shack Inc. on Wednesday raised its revenue guidance for the year, despite a swing to a first-quarter loss, as the boutique burger chain reported sales grew a better-than-expected 56%.
Continue Reading Below
The company's share price surged 8% in recent after-market trading.
The New York-based company now expects revenue of between $161 million and $165 million, up from its previous forecast range of $159 million to $163 million. Analysts, however, had been expecting $165 million.
In the latest reporting period, total revenue, which includes restaurant sales and licensing revenue, reached $37.8 million, above estimates of analysts polled by Thomson Reuters for $34 million. Sales at domestic company-owned restaurants open at least two years rose 12%.
But Shake Shack also reported a loss of $12.7 million, or $1.06 a share, compared with a year-earlier profit of $1.1 million, or four cents a share. Adjusted pro forma net income was four cents a share, up from two cents a share a year earlier. Analysts had expected a per-share loss of three cents.
Shake Shack is among a wave of so-called fast casual chains across the restaurant industry that offer fresh, made-to-order items. It is one of a handful of upmarket burger chains that have weighed on results at much larger restaurants like McDonald's Corp.
Some analysts had been skeptical about whether the Shake Shack would be able to hold on to its lofty valuation once it reported its quarterly results.
The shares more than doubled in their stock-market debut Jan. 30, reaching their high of $52.50, up from their initial public offering price of $21.
Shake Shack opened three domestic company-owned locations during the quarter, including its first restaurant in Baltimore.
(By Angela Chen)