Wingstop Inc.

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Wingstop Inc.'s fiscal third quarter 2026 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. Please note that this conference call is being recorded today, Wednesday, October 28, 2026. On the call today are Michael Skipworth, President and Chief Executive Officer of Alex Kaleida, Senior Vice President and Chief Financial Officer, and Sarah Niehaus, Senior Director of Investor Relations. I would now like to turn the conference over to Sarah. Please go ahead.

Thank you and welcome to the fiscal third quarter 2026 earnings conference call for Wingstop. Our results were published earlier this morning and are available on our investor relations website at ir.wingstop.com. Our discussion today includes forward-looking statements. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties that could cause our actual results to differ materially from what we currently expect. Our SEC filings describe various risks that could affect our future operating results and financial condition. We use certain non-GAAP financial measures that we believe can be useful in evaluating our performance. Presentation of such information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. Reconciliations to comparable GAAP measures are contained in our earnings release. Lastly, for the Q&A session, we ask that each of you please keep to one question and a follow-up to allow as many participants as possible to ask a question. With that, I would like to turn the call over to Michael.

Thank you, Sarah. Good morning, everyone, and thank you for joining us. I would like to start by taking a moment to recognize our brand partners, restaurant team members, and global support center team members for their continued commitment to Wingstop. We've asked a lot from our team this year as we've advanced several important strategic initiatives across our business, and I genuinely appreciate their focus, hard work, and dedication. This year we've made significant investments in our talent, our operations, launched our first loyalty program, and continued building capabilities that we believe will support our next phase of growth. Our top priority is improving sales performance and rebuilding transaction growth. We are moving with urgency on the actions we can control in this current operating environment. During the third quarter, domestic same-store sales declined 5.4%, below our expectations. While we're beginning to see positive signals from the changes we've made, the improvement in sales performance is taking longer than we initially anticipated, and the macro trends we are seeing among customers have intensified over the last few months. With that in mind, we've updated our full year domestic same store sales outlook to a decline of approximately 6.5% to 7%. This does not change our focus on returning to sustained same store sales growth, and we are confident the actions we are taking will do just that. We also are not waiting for the consumer environment to improve. We are taking deliberate action across our business to strengthen performance, drive greater guest frequency and acquire new guests. Over the past several quarters, as the operating environment has continued to evolve, we've continued to deepen our understanding of our guest behaviors, key choice drivers for restaurant occasions, and what Wingstop can do better to more consistently win those occasions. Last quarter, we outlined actions to sharpen our creative messaging and media mix. More clearly connecting the quality and bold flavor our guests expect with the compelling value Wingstop can deliver. As you will hear today, we are encouraged by the early response to those actions while recognizing there is more work to do. In addition to marketing, we are also intensified our focus on operations, bringing in new talent and capabilities to strengthen our execution across the business. One of the key things we've learned is that our marketing campaigns over index on building awareness. The opportunity in front of us is around driving consideration. We recognize that our marketing wasn't consistently connecting our differentiated food, flavor, and value into a compelling reason to choose Wingstop, particularly around occasions where we have the greatest opportunity to win. As we discussed in our second quarter earnings call, we needed to do a better job of clearly communicating the value we offer beyond price alone while giving guests more reasons to return. We have put those insights into action by sharpening our marketing approach to drive greater consideration and acquisition, leveraging Club Wingstop and personalization to test and learn how we can deepen guest relationships and drive greater frequency and strengthen restaurant execution through Wingstop Smart Kitchen. Ultimately, our objective is to give consumers more compelling reasons to choose Wingstop more often. We are doing this by concentrating our media investment on occasions where guest interest and Wingstop's relevance are the highest. We are layering in menu, value, and promotional levers that are being amplified by more compelling creative and paid media. Most of the changes in our marketing came to life in the second week of September with the kickoff of the NFL regular season, with limited impact on our third quarter results. The initial readout suggests we are on the right track and reinforce our conviction in this strategy. I'm excited to lay out more detail on our messaging approach, which we believe is beginning to gain traction with our guests. Our marketing strategy is to build reach by front-loading our video investment with more premium placement and leveraging 30-second spots. And from there, we plan to sustain efficient reach and frequency through a weekly presence of 15-second spots and an always-on social strategy to keep Wingstop top of mind. We are concentrating investments around high-relevance occasions, pairing it with creative that more clearly communicates Wingstop's quality, bold flavor, and compelling value and sustaining engagement through paid and owned channels between those moments. We are leaning into our brand strengths, bone and wings, flavor and quality, while ensuring we are clearly communicating value. The response to the watch party bundle and our Thursday night football activation suggest we are on the right path. But the objective is not a short-term promotion. This is just the first step to establish with guests repeatable group occasions that build transactions, frequency, and long-term brand relevance. We're supporting this strategy with incremental investment from our G&A dollars. If we continue to execute our plan, we will continuously measure results and sharpen our marketing investment based on the data. Flavor innovation has always been core to Wingstop's identity and remains one of our greatest points of differentiation alongside our ranch, seasoned fries, and bone-in wings. And we know continued innovation and product news is key to driving consideration. We're taking a more integrated approach to flavor innovation, including dedicated creative support for flavor LTOs like our recent lemon pepper trio. Part of this is doubling down on what we know our customers already love, our lemon pepper, and giving them reasons to reengage through LTOs which are both new and familiar at the same time. This brings me to Club Wingstop, Wingstop's first ever loyalty program. Club Wingstop is another way we can deliver additional value to our guests and keep them coming back for more. Our initial priority following the national launch in May was to build awareness and drive enrollment into the club. And we've made great progress. Enrollment continues to pace ahead of our plan, giving us a solid foundation to where we are now focused on strategies and tactics that most effectively engage our members and drive frequency. We're seeing evidence of stronger retention among club Wingstop members. New guests who enroll in the program are returning within 30 days at 13 points higher than non-members, a trend that has remained consistent across enrollment cohorts. There are also positive signs of behavioral changes with purchase frequency increasing almost 20% among members who have completed a full 90 days in the program. We are building on these early learnings with initiative design to give members more reasons to return. Over the past several weeks, we've introduced exclusive offerings like Wing Pass, which sold out in less than one minute. The Wing Stop watch party bundled punch card, merchandise drops, early access to new flavors, and unique experiences that leverage our partnerships across sports and entertainment. As we progress beyond the initial launch of Club Wings Up, our focus is now on testing and learning exactly which tactics increase purchase frequency and maximize the lifetime value of our members. And when we consider the typical maturity curve for loyalty programs, we're happy with the direction of this initiative, including the early response from our most loyal guests. In September, we activated our AI-driven personalization engine, initially focusing on testing more relevant offers and messages with targeted guest segments. In those initial tests, guests receiving personalized offers generated higher total sales compared to those who did not receive offers. This demonstrates the value of more relevant messages and the offers at the individual guest level and give us a foundation to scale this capability. As our marketing strategy drives guests to our restaurants, it is paramount that every guest who chooses Wingstop has a great experience. The Wingstop Smart Kitchen is an enabler for our back of house operations, and now it's up to our restaurant team members to deliver that guest experience consistently. Along with our brand partners and restaurant team members, we are laser focused on delivering great tasting, cooked to order wings, hot seasoned fries, and an accurate order every time. To deliver on that consistently, we've retrained the entire system in the last three months and established new operating standards. We have just launched a new, more comprehensive restaurant scorecard and an operating toolkit that brings together guest feedback and restaurant performance data with a focus on food quality, order accuracy, and speed of service. We also launched an AI assistant for our field team to create quicker insights, greater clarity, and focus on performance outliers for the restaurants they support. This strengthens insights for our field teams, providing a more consistent way to identify opportunities, coach restaurant teams, and measure improvement. We recognize that consumers are making more deliberate decisions about where they spend their money, and when they choose to spend that money on Wingstop, we have to deliver. They expect the quality, flavor, and experience that makes Wingstop special, and it's our responsibility to deliver on that expectation every time. That's how we earn their trust and keep them coming back, and we are making good progress. Throughout 2026, the rate of guest complaints related to food quality and preparation declined approximately 30% compared to the same period last year. However, we know there is more work to do and this is something that is entirely within our control. Technology has always been at the forefront of our business, and we've invested significant time and resources in our proprietary platforms and data capabilities to build what we believe is a competitive advantage for Wingstop. Today, those investments are coming together through the Wingstop Smart Kitchen, Club Wingstop, and personalization, giving us greater visibility into our business and more effective ways to serve and engage with our guests. With a dedicated chief AI officer helping lead the next phase of our AI and data strategy, we're excited about the foundation we've built and the opportunity to continue to strengthen our competitive advantage as we scale. Technology will continue to be a long-term compounder for our business as we improve our execution. Our growth engine remains strong, supported by compelling restaurant-level economics and continued brand partner confidence in the Wingstop opportunity. During the third quarter, we opened 76 net new restaurants globally, bringing our system to 3,331 restaurants, an increase of nearly 14% year over year. Importantly, 98% of the restaurant openings through the first nine months of this year came from existing brand partners. reinforcing their continued confidence in the Wingstop model and commitment to reinvesting in the brand. As we scale domestically, our enhanced market planning capabilities are allowing us to more effectively evaluate trade areas, restaurant spacing, and delivery overlap. We're seeing the benefits of that approach. During the third quarter, we made restaurant level investments to support our strategies and protect our core consumer occasion. The underlying economics of our business remain compelling. With domestic average unit volumes of approximately $1.8 million, our current restaurant level model supports unlevered cash on cash returns of approximately 60%. These attractive returns continue to support brand partner investment in the brand. And our development pipeline remains robust with over 2,300 committed restaurants globally. Outside of the U.S., we opened 21 restaurants during the quarter, bringing our international footprint to 544 restaurants, an increase of more than 27% year-over-year. We've opened eight new markets in the last year and a half. I'm excited by the response and engagement we're seeing from guests and how our brand partners are operating and, importantly, the opportunity in front of us to scale these markets. We've launched flagship restaurants in Thailand, Spain, and Italy. And in August, we celebrated our 100th restaurant opening in the UK. India, which is a thousand restaurant opportunity, is our next market and is anticipated to open by early 2027. Our development opportunity is supported by attractive brand partner returns, disciplined market planning, and significant white space, both domestically and internationally. Those fundamentals give us the confidence in our ability to grow the global footprint and scale towards our long-term goal of 10,000 plus restaurants. As I wrap up, I want to reiterate that returning to sustained sales growth remains a top priority for our team. We're taking deliberate actions across the business that we believe will deliver sustained sales growth. We have an incredibly differentiated brand, compelling unit economics, a strong development pipeline, and significant white space ahead of us, both domestically and internationally. Our optimism is grounded in the early evidence we are seeing and the work still in front of us. We will continue to execute with the discipline, speed, and determination required to deliver sustaining same-store sales growth. We are building something incredibly special at Wingstop, and I couldn't be more confident in our ability to capture the tremendous growth opportunity ahead of us as we scale Wingstop into a top 10 global restaurant brand. Thank you, and with that, I'll turn the call over to Alex.