Guzman y Gomez recorded a first-half net profit that beat analyst forecasts, but the upbeat result did not prevent a sharp share price fall as investors reacted to softer-than-expected U.S. top-line performance. The stock slid as much as 16.5% in early trading to A$17.00, a level about 23% below its IPO price of A$22 and 63% below its peak of A$45.99 reached a year ago.
The company, which made its Australian Securities Exchange debut in June 2024, raised A$335.1 million in what was then the third-biggest initial public offering in five years and carried a valuation of A$2.2 billion. Market participants have treated the listing as a barometer for sentiment toward Australia’s quick-service restaurant sector, and Guzman y Gomez’s aggressive plans to scale in the United States have become a focal point for investor concern amid weak sales, higher prices and muted consumer spending.
U.S. network sales for the first half rose 67% to A$8.2 million, but that figure fell short of Visible Alpha’s consensus of A$9.2 million. The company also said inclement weather in the greater Chicago area during the December quarter weighed on comparable sales growth. In response to the trading update, Citi analysts commented that "The company is executing well, but not as fast as the market is expecting," adding that "It’s hard to see what’s new in this result that would make investors chase the stock higher, especially given the valuation."
Guzman y Gomez signaled it expects U.S. losses to increase slightly in the year to June compared with an A$13.2 million loss in fiscal 2025. Management also flagged short-term pressure on sales momentum after ending its partnership with DoorDash and transitioning to Uber Eats as its delivery provider in the U.S.
By contrast, the company’s Australia operations remained the dominant driver of sales. First-half network sales in Australia reached A$673.6 million, up 17.5% from the prior year, and the business forecast full-year profit margins of up to 6.2%, relative to 5.7% last year. Group-level metrics showed network sales increased 18% to A$681.8 million, although that aggregate result missed the Visible Alpha consensus of A$687.3 million.
For the six months ended December 31, Guzman y Gomez reported net profit after tax of A$10.6 million, above Visible Alpha’s consensus of A$9.2 million and ahead of the prior year’s A$7.3 million. The board declared an interim dividend of 7.4 Australian cents per share. The company cited an exchange reference of $1 = 1.4172 Australian dollars.
Investors and market watchers will be closely monitoring the company’s U.S. execution and the near-term sales impact of the delivery partner transition. While the Australian business delivered underlying growth and margin improvement guidance, the faster-than-expected deceleration in U.S. momentum was sufficient to weigh on the stock and investor sentiment.