By Evie Liu

Wingstop shares were climbing Wednesday after a group of Wall Street analysts reported positive responses to the company's new Smart Kitchen system, revealed at an investor field trip earlier this week.

The new system, powered by artificial intelligence, uses more than 100 different data points to predict upcoming demand in 15-minute increments. This could help the restaurant team stay ahead of the demand curve and reduce order preparation time.

The system also features a kitchen display system that clearly visualizes special order requests and helps improve delivery accuracy. The last component is a screen at the register that allows guests to confirm the status of their order without asking team members to manually check.

Wingstop has been running on paper tickets for its entire 30-year history. The Smart Kitchen system would reduce the average fulfillment time by half, to about 10 minutes.

Even during periods of heavy interest, such as Super Bowl Sunday, delivery times increased to just 16 minutes at test stores, according to the firm. Previously, this could run 30 to 60 minutes -- or even longer -- during periods of peak demand.

The system has rolled out to all stores in the Dallas/Fort Worth and Las Vegas markets and is on track to be in all domestic stores by the end of the year, according to the company. At test stores, both customer satisfaction and restaurant team engagement have improved, the company said.

While Wingstop management hasn't shared specific numbers on how the new system could impact top and bottom lines, analysts are generally positive.

The new system is "highly intuitive" and "meaningfully reduces the complexity for crew members," wrote Stifle analyst Chris O'Cull on Wednesday: "We came away impressed by the new system. The power of the Smart Kitchen system appears to be a 'game changer.'"

Benchmark analyst Todd Brooks sees Wingstop as "another example of a scaled leader in the restaurant space investing in transformational operating platforms and capabilities which only deepen competitive moats."

The improving consistency and speed of delivery time should help unlock new consumption occasions, boost order volume, and increase customer retention, said O'Cull.

He isn't the only one who sees big potential from the new system. "Wingstop has always scored very well in our survey work on brand perception, loyalty, intent to return, and other metrics, so it makes sense to us that combining this with better and more consistent throughput would unlock occasions," echoes Morgan Stanley analyst Brian Harbour.

Harbour expects the firm's same-store sales to grow by mid-single-digit percent in 2026.

A consistently faster speed of service could also help Wingstop receive more prominent placement on delivery apps, such as landing it in the "fastest near you" section on DoorDash.

"Customers that are sorting by delivery speed on third-party delivery apps when choosing where to order now see Wingstop displayed as an option in the less than 30 minute bucket (both at off-peak and peak periods), which should prove to be an immediate boon for delivery transaction growth," wrote Benchmark's Brooks.

The analyst believes the new system will accelerate the brand's annual average store sales toward its $3 million target from the current $2.1 million.

Delivery orders made up about 30% of the firm's sales last year, up from 13% in 2019. With the help of the new system and faster fulfillment speed, there is a chance for the rate to approach 50% over time more akin to a pizza chain, management said.

Shares of Wingstop have gained 7% to $306.28 in early afternoon trading, while the S&P 500 is little changed, and the Dow Jones Industrial Average has declined 0.2%.

Write to Evie Liu at evie.liu@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

May 14, 2025 13:27 ET (17:27 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.