Oil and gas firms have been tightening their belts and the spending slowdown in is now hitting businesses far beyond the oil patch.
While the fast-food chain’s second quarter earnings per share of $0.47 were in line with analysts expectations the company missed analysts earnings targets, according to Seeking Alpha.
Popeyes booked $61.7 million in second quarter revenues, up nearly 4 percent year-over-year but just over $1.6 million shy of analyst targets.
Popeye’s cut its same-store sales guidance down to between 1 to 2 percent on Wednesday, down for its prior guidance of 3 percent, Seeking Alpha said.
Second quarter spending slowdowns in oil-rich states have also been reported by the Cheesecake Factory and Harley Davidson, Business Insider said.
Major producing states such as Texas and Oklahoma have borne the brunt of several waves of energy sector layoffs over the past two years.
Over 200,000 oil and gas workers have been laid off since oil prices began falling in late 2014 as company’s shelved projects and cut back on expenses to whether low prices.
The U.S. Energy Information Administration said earlier this month that the number of oil and gas production jobs fell by 26 percent from October 2014 to May 2016.
Employment in oil and natural gas production reached a high of 538,000 jobs in October 2014 before losing more than 42,000 jobs through May 2016, the EIA said.
According to a transcript provided by Seeking Alpha, Popeyes domestic same-store sales were flat for the second quarter.
Popeye’s CFO Will Matt said during the company’s second quarter earnings call that the fast-food chain began to see the impact of low oil prices about six months ago.
“We have been monitoring very closely, whether or not, the change in oil prices would be affecting our stores that are in those regions, and only recently, in the last six to nine months, has there been a slight decline,” Matt said during the company’s second quarter earnings call.
Popeyes CEO Cheryl Bachelder added during the call that softness in the quick-service food sector was also likely tied to lower grocery prices and “pretty stable but not robust” consumer confidence.