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Investing.com -- Portillo’s Inc. (NASDAQ:PTLO) on Tuesday reported second quarter revenue growth of 3.6% to $188.5 million, as the Chicago-style restaurant chain navigated what it described as a "tough traffic environment."
The company’s shares tumbled 7.6% following the earnings release, likely due to a significant reduction in its annual revenue growth forecast.
The restaurant chain posted a modest 0.7% increase in same-restaurant sales for the quarter ended June 29, 2025, driven by a 2.1% increase in average check that was partially offset by a 1.4% decrease in transactions.
Net income rose 17.7% to $10 million compared to $8.5 million in the same period last year.
Portillo’s implemented menu price increases of approximately 1.0% in April 2025 and 0.7% in June 2025 to address inflationary pressures, including a 1.9% increase in commodity prices.
"Our team operated well through a tough traffic environment in the second quarter, managing restaurant-level margins effectively and driving solid earnings," said Michael Osanloo, President and Chief Executive Officer of Portillo’s.
The company significantly reduced its full-year 2025 revenue growth target to 5-7%, down from the previous forecast of 10-12%. Portillo’s also lowered its adjusted EBITDA growth outlook to "flat to low single-digits" from the previous target of 5-8% growth.
These downward revisions likely contributed to the negative market reaction.
Despite these challenges, Portillo’s maintained its plan to open 12 new restaurants in 2025, with expansion focused on the Sunbelt region. The company plans to enter the Atlanta market in the second half of the year and will open its first in-line, walk-up restaurant format.
Portillo’s operated 95 restaurants as of its latest opening in Tomball, Texas, which occurred after the quarter ended.
The company continues to implement its "restaurant of the future" prototype, which features a more efficient 6,250 square foot design with a 47-foot production line.
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