Shake Shack, McDonald's, Domino's and Papa John's Report Positive but Slower Quarterly Sales Growth

Shake Shack joined other fast-food chains including McDonald's, Domino's and Papa John's in reporting weaker quarterly sales growth. The results pointed to softening demand at a time when customers face higher costs at the pump. Rising gas prices driven by the Iran war have put customer spending under pressure.

That dynamic contributed to the weaker quarterly sales growth reported by all four chains, according to Reuters. McDonald's reported weaker quarterly sales growth in the same period.

The shared slowdown comes as gasoline prices climbed amid the conflict involving Iran. Higher fuel costs appear to have left consumers with less discretionary income for dining out.

Fast-food chains have historically performed well during periods of economic strain because of their relatively low prices. The current reports of weaker quarterly sales growth from Shake Shack, McDonald's, Domino's and Papa John's suggest that even value-oriented dining is feeling the pinch from elevated gas prices driven by the Iran war.

That pressure translated into slower sales expansion at the four restaurant companies during the most recent quarter.