Red Robin CEO Weighs In On Q2 Earnings

Shares of Red Robin Gourmet Burgers, Inc. RRGB fell 9.24 percent on Tuesday on back of the weaker-than-expected second-quarter numbers. While EPS for the quarter at $0.78 matched analysts' estimate, revenue at $293 million came below Wall Street’s estimates of $298 million.

Shares were up more than 2 percent in Wednesday's session.

Steve Carly, Red Robin CEO, was on CNBC to weigh in on the company's earnings.

Traded A Little Revenue And Traffic

"We're very proud of what second quarter numbers we put up. Our profits were up 20 percent year-over-year, our traffic is up 50 basis points, which outperformed the industry by over 200 basis points, so we're taking market share. And the formula that we have got, which is to profitably grow traffic did exactly what we hoped and in some cases we traded a little revenue and traded a little traffic for that."

The Formula Still Works

Carly elaborated on the thought process behind company's revenue growth, saying, "We want to make sure that we look at a couple of important metrics. The first one is profitability quarter-over-quarter and year-over-year and we're very comfortable that we're in great shape there. The second one is market share and when we grow our traffic 50 basis points and the rest of our competitors are down 200, we're growing market share and that's another key metric."

"And the formula we have is based on value that's based on value with Red's Tavern Double at $6.99 with the finest line being a barbell program. And then with the quality which we did this last quarter about repositioning our salad line and our kid's menu. We're confident that the formula still works well," Carly said.