• For the first quarter, revenue came in at $540.6 million and adjusted earnings per share were $0.12, both ahead of estimates.
• U.S. sales declines were offset by contributions from new restaurant openings during the quarter.
• For the full year, the company guided global systemwide sales growth to be flat and expects adjusted EPS in the range of $0.56 to $0.60.

Shares of fast-food chain Wendy’s (WEN) shot up nearly 6% in Friday’s premarket after the company reported first-quarter results and shared a major expansion plan in Asia to offset slowing sales in its home market.

Wendy’s said that it has signed a new franchise agreement with an unnamed “experienced restaurant operator” in China who will help open up to 1,000 outlets over the next ten years.

WEN’s Long-Term Value Creation

The firm stated that these actions are strengthening its foundation and positioning Wendy's to regain momentum and deliver sustainable growth and long-term value creation.

The move to expand overseas comes as the company struggles to drive traffic to its U.S. outlets. The first quarter (Q1) saw a 5.5% decline in global systemwide sales, which was driven largely by lower U.S. same-restaurant sales, partially offset by contributions from new restaurant openings, the company said.

Wendy's noted that a decline in margins from its U.S. restaurants was primarily due to low traffic, commodity inflation, and labor rate inflation.

In the U.S., same-restaurant sales growth fell 7.8% during the quarter, from a fall of 2.8% for the same period last year.

WEN Q1 Earnings

In Q1, revenue came in at $540.6 million, beating the $518 million estimate polled by Fiscal AI. The company’s adjusted earnings per share (EPS) were $0.12, ahead of the $0.09 per share estimate.

For the full year, the company guided global systemwide sales growth to be flat and expects adjusted EPS in the range of $0.56 to $0.60, with the midpoint in line with the $0.58 estimate.

What Retail Traders Think Of WEN Stock

On Stocktwits, retail sentiment about WEN turned ‘extremely bullish’ from ‘bullish’ amid ‘high’ message volumes over the last 24 hours.

One user on the platform said the company is moving in the right direction.

Another user believes the stock is good for the long term.

WEN stock is down more than 16% so far this year and has lost 41% in the past 12 months, underperforming the S&P 500.

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