Wingstop (WING) Q2 Earnings call transcript Jul 31, 2024
AInvestWednesday, Jul 31, 2024 9:23 pm ET
1min read
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Wingstop, a leading chicken wing chain, recently held its fiscal second quarter 2024 earnings call, highlighting an impressive 28.7% same-store sales growth driven by transaction growth. The company opened a record 73 net new restaurants and reported adjusted EBITDA of $51.8 million, marking a 50.7% growth rate over the prior year. These figures underscore the company's ability to maintain strong growth despite industry challenges.

Michael Skipworth, President and CEO, attributed the success to the relentless focus on executing their long-term strategy and the team's commitment to the Wingstop Way. The company's AUV (average unit volume) has surpassed $2 million, and they announced a new target of $3 million, reflecting their confidence in their strategies.

One of the key themes that emerged from the call was the company's focus on brand awareness. Despite delivering over 20% same-store sales growth, Wingstop's brand awareness still lags behind more mature national brands. The company is investing heavily in media and advertising, particularly in live sports and streaming platforms, to close the gap. Their media strategy has proven effective, driving transaction growth and attracting new guests.

Another significant trend is the company's digital transformation. Digital sales now represent 68.3% of sales, with over 45 million users in their digital database. The launch of MyWingstop, their proprietary tech platform, is expected to enhance personalization and increase conversion rates, further driving growth.

Wingstop's supply chain strategy, centered around creating predictability and minimizing volatility in food costs, has been a key factor in their success. The company has navigated the recent bone-in wing price increase with discipline, maintaining their food cost target in the mid-30% range. This stability has contributed to the brand partners' confidence, fueling demand for growth.

The company is also expanding internationally, with strong growth trends in markets like the Asia Pacific region and Western Europe. They plan to scale globally, aiming to support over 10,000 restaurants worldwide.

Overall, Wingstop's earnings call highlighted their strong financial performance and strategic initiatives, demonstrating their ability to navigate industry challenges and capitalize on growth opportunities. The company's focus on brand awareness, digital transformation, and supply chain optimization positions them well for future success.

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