Fast-food chain Wendy’s (NYSE:WEN) boosted its full-year outlook on Thursday after a rise in same-store sales helped to sharply narrow its third-quarter loss.
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However, investors were unimpressed as sales lagged expectations, and its shares fell close to 8% to $8.40 in pre-market trade.
Revenue for the three months ended Sept. 29 was $640.8 million, up slightly from $636.3 million a year ago, missing the Street’s view of $645 million.
Same-store sales, a key growth metric for retailers, increased 3.2% in North America.
The Dublin, Ohio-based quick-service restaurant chain, which is currently undergoing a restructuring, recorded a loss of $1.9 million, or breakeven earnings per share, improved from a year-earlier loss of $26.2 million, or 7 cents.
Adjusted for special items, Wendy’s said it earned 8 cents a share, topping average analyst estimates in a Thomson Reuters poll by two pennies.
In a statement, Wendy’s CEO Emil Brolick pointed to “continued momentum” in the company’s longer-term overhaul strategy that aims to re-brand the restaurant. It is hoping to emerge from the transformation appearing a “cut above” traditional fast food.
“We are contemporizing our consumer touch points and transforming our brand, with bold restaurant designs, new packaging and innovative menu introductions such as our Pretzel Bacon Cheeseburger," Brolick said.
On Thursday, Wendy's raised its full-year outlook to 25 cents from an earlier view of between 20 cents and 22 cents, which tops the consensus view by two pennies.
The restaurant chain, which competes with McDonald’s (NYSE:MCD) and Burger King (NYSE:BKW), said it plans to make incremental fourth-quarter investments to drive future growth.