Jersey Mike’s Subs reports 2.3% same-store sales rise in quarter

Jersey Mike's Subs Inc. (NYSE: JMKE ) stock edged higher Wednesday after the sandwich chain's first earnings report since its initial public offering showed stronger store traffic and higher adjusted earnings, while revenue came in roughly in line with Wall Street expectations. Revenue Rises 10%, Lands Near Estimates Jersey Mike's reported fiscal second-quarter revenue of $208 million, up 10% year over year and roughly in line with the $208.79 million analyst consensus estimate. Systemwide sales also rose 10% to $1.21 billion. Same-store sales increased 2.3%, primarily due to transaction growth. However, growth slowed from 3.6% a year earlier. Digital orders accounted for 43% of sales, up from 41%. Average unit volume increased to $1.38 million from $1.35 million. Jersey Mike's opened 83 stores during the quarter. It ended the period with 3,378 locations, up 8.1% year over year. CEO Charlie Morrison said same-store sales accelerated during the quarter as transaction growth improved despite weak restaurant industry traffic. He added that the company plans to attract more customers, expand digital sales and introduce new products. See More: Top Value Stocks Profit Falls, Adjusted EBITDA Climbs Net income fell to $37 million from $59 million. The latest quarter included higher interest costs and other expenses. A $14 million gain from the sale of company-owned stores partly offset those pressures. Adjusted EBITDA rose 7% to $114 million. Excluding a $10 million adverse impact tied to advertising fund timing, adjusted EBITDA increased 18%. Operating cash flow totaled $105 million during the first two fiscal quarters. Capital spending was $4 million, implying free cash flow of about $101 million. Cash, cash equivalents and restricted cash totaled $265 million. Jersey Mike's Issues 2026 Outlook The company expects full-year same-store sales growth of 2.5% to 3%. It forecast third-quarter growth of 3% to 4%. Jersey Mike's also expects net unit growth of at least 8% and adjusted EBITDA growth of at least 20% for the year. Following the report, TD Cowen analyst Andrew Charles reiterated a Buy rating and maintained a $26 price forecast. JMKE Price Action: Jersey Mike's Subs shares were up 1.06% at $21.04 during premarket trading on Wednesday, according to Pro data. Image via Shutterstock Read Also: Mark Carney Says Canada Relied 'Too Much' on US as Trump Trade War Forces Economic Shift