What Happened?

Shares of fast-food chain Jack in the Box (NASDAQ: JACK) fell 9.4% in the morning session after the company reported weak first-quarter 2025 results as revenue and same-store sales fell slightly short of Wall Street's estimates. Sales fell nearly 5% across both the Jack in the Box and Del Taco brands, mainly because fewer people visited their restaurants. 

Margins got squeezed on both fronts. Restaurant-level profitability dropped sharply, hurt by rising costs for labor, food, and utilities. Still, EBITDA both came in better than expected. The company had a large accounting charge for Del Taco, which led to a steep loss on paper, but that didn't affect its operating results. 

Management didn't change its outlook, choosing instead to focus on a new plan to improve operations in the back half of the year. That included stepped-up marketing efforts to bring more customers through the door. Overall, this was a weak quarter where cost control helped ease the blow, but soft sales remained a big concern.

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What The Market Is Telling Us

Jack in the Box’s shares are very volatile and have had 25 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

Jack in the Box is down 41.4% since the beginning of the year, and at $24.02 per share, it is trading 60% below its 52-week high of $60.07 from July 2024. Investors who bought $1,000 worth of Jack in the Box’s shares 5 years ago would now be looking at an investment worth $361.94.

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