Sweetgreen (SG) Earnings Date & Reports

Key Takeaways

• Total revenue rose 2.1% year over year to $176.0 million, topping Wall Street's consensus estimate of roughly $170 million.
• GAAP (Generally Accepted Accounting Principles) net loss narrowed to $30.7 million, or $0.26 per share, roughly in line with analyst expectations of a $0.27 per-share loss.
• Same-store sales fell 6.4%, a meaningful improvement from the 9.5% decline a year earlier, as traffic recovered from a summer cyclospora (foodborne parasite) outbreak.
• Restaurant-level profit margin compressed to 10.4% from 13.1%, pressured by sales deleverage and higher labor costs.
• Management said comparable sales turned positive in October (up about 5%) and guided to roughly 4% growth in the fourth quarter.
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Earnings Context and Why It Matters

Sweetgreen's third-quarter report is a key checkpoint for a company attempting a turnaround after a difficult stretch. The fast-casual salad chain has spent the past two years grappling with negative same-store sales and consumer pushback on value, and its summer was disrupted by a cyclospora outbreak that temporarily scared diners away from leafy greens. This quarter tests whether the company's "Sweet Growth Transformation Plan" — its effort to boost traffic, sharpen operations, and expand the menu — is gaining traction. For investors, the report matters less for the headline loss than for the trajectory of same-store sales and restaurant-level margins, which signal whether the business can eventually self-fund growth and move toward profitability.

Reported Results

Sweetgreen reported total revenue of $176.0 million for its third fiscal quarter ended September 27, 2026, up 2.1% from $172.4 million a year earlier and above the roughly $170 million consensus estimate. Growth was driven primarily by new restaurant openings, partially offset by a $10.7 million decline in comparable-restaurant revenue.

The company posted a net loss of $30.7 million, or $0.26 per share, compared with a net loss of $36.1 million a year ago. The loss was essentially in line with analyst expectations of a $0.27 per-share loss. Loss from operations narrowed to $31.8 million from $36.3 million.

Same-store sales declined 6.4%, reflecting a 4.9% drop in traffic and a 2.1% product-mix headwind, partially offset by 0.6% of pricing — an improvement from the prior year's 9.5% decline. Restaurant-level profit was $18.3 million, with a restaurant-level profit margin of 10.4%, down from 13.1% year over year, as sales deleverage and higher labor costs weighed on results. Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization, adjusted for certain items) was a loss of $6.8 million, versus a loss of $4.4 million a year earlier.

Sweetgreen updated its fiscal 2026 outlook to same-store sales of about -5.5%, a restaurant-level profit margin of 11.0% to 11.5%, Adjusted EBITDA between -$23.0 million and -$20.0 million, and roughly 10 net new restaurant openings.

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Market Reaction and Investor Sentiment

Shares were little changed immediately after the release, with Sweetgreen trading around $11.62 following the report. The muted initial reaction reflected a mixed picture: revenue beat expectations and same-store sales improved sequentially, but restaurant-level margins compressed and Adjusted EBITDA weakened year over year. Sentiment appeared to be shaped more by the company's forward commentary than by the headline loss. Management's disclosure that comparable sales turned positive in October and its guidance for roughly 4% fourth-quarter same-store sales growth offered investors a tangible sign that the turnaround is beginning to materialize. At the same time, the decision to slow unit growth into fiscal 2027 signaled a more conservative capital-allocation posture that some investors may view favorably amid ongoing margin pressure.

Forward Outlook and Key Factors to Monitor

The most important signal to watch is whether the recent traffic recovery is durable. Sweetgreen estimated that the summer cyclospora outbreak reduced traffic by roughly 500 basis points, and management said comparable sales rose about 5% in October. Sustaining that momentum into the fourth quarter and beyond will depend on consumer demand holding up and on the success of new menu items aimed at rebuilding lunch traffic.

Margins are the second key theme. Labor and related expenses rose to 30.5% of revenue from 29.1%, reflecting sales deleverage, labor inefficiencies, and wage inflation. Management is implementing a revised staffing model and supply-chain initiatives it believes can improve restaurant-level margins by roughly 150 basis points in 2027. Investors should monitor whether food, beverage, and packaging cost improvements — already visible this quarter — continue to offset labor pressures.

Finally, the company's plan to roughly halve net new restaurant openings in fiscal 2027 indicates a pivot toward operational execution and cash preservation over aggressive expansion. The rollout of its Infinite Kitchen automation technology, featured in about half of planned fiscal 2026 openings, remains a longer-term watch item. None of these factors constitute a forecast of the stock's future performance, but they are the metrics most likely to drive the next phase of the narrative.

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