Jack in the Box (NASDAQ: JACK) reported better-than-expected second-quarter earnings, but a revenue shortfall and shrinking margins dragged shares down more than 2% in pre-market trading.
The fast-food chain posted adjusted earnings per share of $1.20, beating analyst expectations of $1.07. However, revenue fell 7.8% year-over-year to $336.7 million, below the $345.76 million consensus estimate.
Same-store sales declined 4.4% at Jack in the Box locations and 3.6% at Del Taco restaurants, as macroeconomic headwinds continued to pressure consumer spending across the industry.
Profitability metrics weakened during the quarter. Jack in the Box’s restaurant-level margin dropped to 19.6% from 23.6% a year ago; Del Taco’s margin fell to 12.8% from 16.8% due to lower sales volumes, inflationary pressures, and elevated operating costs.
The company recorded a non-cash impairment charge of $203.2 million tied to Del Taco’s goodwill and intangible assets, resulting in a diluted net loss of $7.47 per share for the quarter.
Despite the challenging environment, management reaffirmed its full-year guidance and expressed optimism about marketing initiatives planned for H2 2025. The company did not repurchase any shares in the quarter and retains $175 million under its current buyback authorization.
In April, Jack in the Box introduced its “JACK on Track” plan to improve financial performance and streamline operations. As part of the initiative, the company discontinued its dividend, ending a 12-year streak, and announced plans to sell select real estate assets to enhance cash flow and reduce debt.
These steps are part of a broader shift toward an asset-light model as the company seeks to position itself for long-term growth.
As of the latest update, Jack in the Box (NASDAQ: JACK) shares are down 2.61%, trading at $25.
David Kirakosyan is a seasoned financial journalist with nearly a decade of hands-on experience in covering the U.S. stock markets. Since 2016, he has written thousands of equity news articles, detailed market analyses, and investment insights for trusted platforms like Benzinga, Investing.com, and StreetInsider. David holds a Master of Science in Finance and is a Level 2 CFA® candidate, reflecting his deep commitment to financial expertise and ethical standards. His reporting combines real-world market experience with a strong academic foundation, helping readers make informed decisions backed by reliable information. Read Full Bio
