Shake Shack Restaurant Sales Disappoint, Stock Drops

EarningsReuters

Shake Shack Inc, known for indulgent antibiotic-free hamburgers, crinkle-cut fries and frozen custard shakes, on Wednesday reported a weaker-than-expected rise in quarterly sales at established restaurants.

Shares in the company tumbled 9 percent to $37.20 in extended trading after the chain said closely watched same-restaurant sales were up 4.5 percent during the second quarter. Analysts had expected a 5.4 percent rise, according to research firm Consensus Metrix.

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Traffic to U.S. fast-food chains has been weak due in part to competition from grocery stores, which have been raising food prices at a slower pace than restaurants.

(Reporting by Lisa Baertlein in Los Angeles; Editing by Marguerita Choy)

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