78 F
San Fernando
Friday, Nov 22, 2024

Cheesecake Plunges on Lower Sales Outlook

Shares of Cheesecake Factory Inc. lost nearly 10 percent of their value Tuesday after the restaurateur announced an updated outlook for its second-quarter comparable sales. The Calabasas company said it expects sales at its restaurants to decline 1 percent in the quarter, which will impact earnings per share. “We have continued to outperform the casual dining industry quarter to date, with over half of our regions posting positive comparable sales for the period, including key markets of California, Texas and Florida,” Chief Executive David Overton said in a statement. “More broadly, however, we have seen heightened volatility in week-to-week sales trends, indicative of uncertainty on the part of many consumers. Specifically, we have seen pockets of softness as we moved through the quarter, notably in the East and Midwest where we also faced unfavorable weather that reduced patio usage.” Overton also stated that the company is managing for the long term and he believes the Cheesecake brand is “as strong as ever.” The company released the updated financial outlook before the market opened Tuesday. Cheesecake (CAKE) shares closed down $5.75, or 9.9 percent, to $52.58 on the Nasdaq.

Joel Russel
Joel Russel
Joel Russell joined the Los Angeles Business Journal in 2006 as a reporter. He transferred to sister publication San Fernando Valley Business Journal in 2012 as managing editor. Since he assumed the position of editor in 2015, the Business Journal has been recognized four times as the best small-circulation tabloid business publication in the country by the Alliance of Area Business Publishers. Previously, he worked as senior editor at Hispanic Business magazine and editor of Business Mexico.

Featured Articles

Related Articles