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Thursday, May 19, 2022

Sweetgreen losses widen regardless of 67% soar in quarterly gross sales

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A Sweetgreen banner on the NYSE, November 18, 2021.

Source: NYSE

Sweetgreen on Thursday reported widening losses for its first quarter, however gross sales jumped 67% as staff returned to their workplaces and resumed their previous lunchtime routines.

Shares of the corporate rose greater than 5% in prolonged buying and selling.

Here’s what the corporate reported in contrast with what Wall Street was anticipating, primarily based on a survey of analysts by Refinitiv:

  • Loss per share: 45 cents vs. 41 cents anticipated
  • Revenue: $102.6 million vs. $101.5 million anticipated

The salad chain reported first-quarter internet lack of $49.2 million, or 45 cents per share, wider than its internet lack of $30 million, or $1.77 per share, a yr earlier. Analysts surveyed by Refinitiv had been anticipating a loss per share of 41 cents.

Sweetgreen stated a $21 million enhance in stock-based compensation was the first purpose for its widening losses this quarter. Higher wages and worker bonuses additionally weighed on the corporate’s restaurant-level margins, partially offset by its determination to finish its previous loyalty program.

Net gross sales rose 67% to $102.6 million, beating expectations of $101.5 million. Digital orders accounted for two-thirds of its quarterly income. More than 40% of gross sales got here from Sweetgreen’s personal app and web site, quite than third events.

Sweetgreen’s same-store gross sales climbed 35% within the quarter, after falling 26% a yr in the past. The chain credited increased buyer transactions and menu value will increase. The firm has raised costs 10% during the last yr, however executives stated that client conduct hasn’t shifted in any respect.

However, there may be one space the place clients have modified how they purchase Sweetgreen. As staff return to their workplaces, the preferred day of the week for Sweetgreen purchases has shifted from Monday pre-pandemic to Tuesday, Wednesday and Thursday.

The chain’s common unit volumes, which measures common gross sales per location, elevated to $2.8 million within the quarter. A yr in the past, the metric fell to $2.1 million. This quarter’s common unit volumes surpass pre-pandemic ranges, in line with CFO Mitch Reback.

Co-founder and CEO Jonathan Neman touted the profitable take a look at of a brand new loyalty program, known as Sweetpass. Customers concerned within the pilot doubled the frequency of their visits and tripled their spending on Sweetgreen’s salads and heat bowls. The program prices $10 a month however offers customers a $3 credit score on each buy price at the least $9.95.

Sweetgreen reiterated its forecast for 2022, predicting income of $515 million to $535 million and same-store gross sales development of 20% to 26%.It additionally expects to open at the least 35 internet new areas.

“We’re seeing nothing recently that would cause us to change our guidance,” Reback instructed analysts on the convention name.

Other restaurant corporations, comparable to Starbucks and Taco Bell proprietor Yum Brands, pulled their outlooks this quarter, citing inflation and circumstances in choose worldwide markets. Reback stated exterior elements have precipitated some issues, however the chain’s sturdy efficiency this quarter led the corporate to reiterate its full-year forecast.

Read the corporate’s earnings launch right here.

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