Sweetgreen, Inc. Q1 FY2026 earnings call

Jonathan Neiman discussed executing the Sweet Growth Transformation Plan. Focus on operational excellence, building consistency via Project One Best Way. Menu innovation with wraps launch after rigorous testing, strong test results, and progress in New York market. Personalized digital experience via SG Rewards, including Craving of the Month program and upcoming loyalty program changes.

For the first quarter of fiscal 2026, revenue was $161.5 million with comparable sales down 12.8%. Opened four net new restaurants, including three infinite kitchens. Restaurant-level margin was 10%, and adjusted EBITDA was a loss of $8.1 million. Wraps launch drove incremental traffic from new and returning guests while expanding serving occasions.

Reiterates same store sales guidance with wraps launched nationally, expecting comparable sales to decline in the range of negative 4 to negative 2%. Restaurant-level margin is expected to range from 14.2% to 14.7%, and adjusted EBITDA to range between $1 million and $6 million. Expect to open approximately 13 net new restaurants this year, with nearly half featuring the Infinite Kitchen.

Operational execution still has challenges; market competition and weather conditions may impact performance. Ensuring consistent execution across the system remains an ongoing concern.

Q: Jeff Bernstein asked about April traffic improvement; A: Jamie McConnell said April traffic improved to around negative 8% decline, with Q2 comp expected around negative 4%.

Q: Brian Bittner asked about wraps incrementality and operational guardrails; A: James Meeker stated wraps were tested disciplinedly, showed incremental traffic and high return rates, and ops foundation laid via Project One Best Way.

Q: Sarah Sinator asked about menu additions learnings; A: Said will continue innovating wraps and core plates.

Q: Sharon Zakvia asked about consumer value perception quantifiable research; A: Said wraps and loyalty program are resonating.

Q: John Tower asked about incremental flow and low price points; A: Said flow through around 40%, RAPs have check dilution but favorable COGS.

Q: Rahul Krathapali asked about reestablishing coolness and digital customer frequency; A: Said rebuilt marketing team, leaning into lifestyle, and scan to pay at 20% of in-store.

Q: Carrie Merrill asked about digital and third-party delivery; A: Said invested in digital ecosystem, third-party delivery improving.

Q: Brian Mullin asked about development outlook; A: Said disciplined high ROI, tempered year.

Q: Dennis Geiger asked about consumer behavior shift and development mix; A: Said younger cohort improving, focused on lightly penetrated markets