Sweetgreen (SG) Q1 2026 earnings summary

Executive summary

• Entered 2026 focused on the Sweetgrowth transformation plan, prioritizing operational fundamentals and execution improvements.

• Revenue declined 2.9% year-over-year to $161.5 million, driven by a 12.8% decrease in same-store sales, with traffic down 11.2% and product mix down 2.3%, partially offset by a 0.7% menu price increase.

• Q1 was challenging due to tough comparisons, weather headwinds, and ongoing transformation work, but operational improvements and traffic gains emerged as the quarter progressed, especially in April.

• National launch of wraps followed a disciplined stage gate process, driving incremental traffic and positive guest response.

• Continued focus on menu innovation, digital engagement, and loyalty program enhancements to drive frequency and retention.

Financial highlights

• Q1 2026 revenue was $161.5 million, down from $166.3 million year-over-year.

• Comparable sales declined 12.8% year-over-year, driven by an 11.2% drop in traffic and a 2.3% decline in mix.

• Restaurant-level profit margin fell to 10.0% from 17.9%, impacted by higher ingredient usage, increased protein portions, and more promotional activity.

• Adjusted EBITDA was a loss of $8.1 million (margin -5.0%), compared to a gain of $285,000 (margin 0.2%) last year.

• Net income was $125.8 million, primarily due to a $160.6 million gain from the sale of Spyce.

• Ended Q1 with $156.8 million in cash, up from $89.2 million at year-end.

Outlook and guidance

• Reiterated FY2026 same-store sales guidance: decline of -4% to -2%.

• Restaurant-level margin expected between 14.2%-14.7%; adjusted EBITDA guidance of $1 million to $6 million.

• Plan to open approximately 13 net new restaurants in 2026, with nearly half featuring Infinite Kitchen technology.

• Q2 comparable sales expected to improve to around -4% as wraps roll out nationally and comps ease.