Dive Brief:
- Wingstop’s average unit volume in Q2 2024 passed the $2 million goal the brand set for itself in 2022, as the company managed whopping 28.7% year-over-year same-store sales growth.
- Wingstop set $3 million as its new AUV target, CEO Michael Skipworth said in the chain’s earnings release. Continued strength in its unit economics is driving growth for the brand, which opened 73 new stores in Q2.
- The surging growth for the fast casual brand — driven primarily by traffic growth — stands in stark contrast to brands like McDonald’s and Starbucks that have struggled with same-store sales in recent months.
Dive Insight:
Wingstop hit another major milestone this quarter: 2,000 stores in the U.S. The brand’s domestic store count reached 2,040, with 1,988 of those being franchised units, up from 1,973 total U.S. outlets in the year-ago period and 1,924 franchised in Q1 2024.
The chain’s digital sales mix was 68.3%, unchanged proportionally compared to Q1, but still quite high. Wingstop has invested $50 million in building out its in-house tech stack as it transitions away from Olo’s technology. The new tech stack is oriented towards creating “an entirely new level of personalization with our guests, one that we believe over time will drive conversion, retention rates and frequency,” Skipworth said on the chain’s Q1 earnings call.
Wingstop’s dramatic traffic and sales gains highlight its strength relative to other fast casual and QSR brands. Chipotle also saw strong traffic growth last quarter, with transactions up 8%, while Starbucks and McDonald’s struggled with negative comparable sales.
Wingstop same-store sales
It is still too early in earnings season to say definitively whether fast casuals like Wingstop and Chipotle are outperforming QSRs, since Cava, Yum Brands and Restaurant Business International have yet to report their earnings.
However, it’s unlikely other major publicly traded chains will match Wingstop this quarter, given the reticence of cash-strapped consumers to dine out. So far, this earnings season is showcasing a broad divergence between those brands whose strategies have worked exceptionally well, and those whose value perceptions remain challenged.
