Financial Performance - Revenue for the fiscal year ended December 29, 2024, was $676.826 million, an increase of 16% compared to $584.041 million in 2023[478]. - Net loss for the fiscal year ended December 29, 2024, was $90.373 million, compared to a net loss of $113.384 million in 2023, representing a reduction of about 20%[478]. - The company reported a basic and diluted net loss per share of $0.79 for 2024, an improvement from $1.01 in 2023[478]. - Total revenue for the fiscal year ended December 29, 2024, was $676.8 million, an increase of 15.9% from $584.0 million in 2023[553]. - The company recognized $730,000 in revenue from gift card liability in 2024, up from $480,000 in 2023[554]. - The net loss for the fiscal year ended December 31, 2023, was $113.384 million, resulting in a basic and diluted loss per share of $1.01[612]. Cash and Liquidity - As of December 29, 2024, the company had $214.8 million in cash and cash equivalents, down from $257.2 million as of December 31, 2023[461]. - Cash provided by operating activities increased to $43,390 thousand in fiscal year 2024, compared to $26,480 thousand in fiscal year 2023[482]. - Cash and cash equivalents decreased to $214.789 million in 2024 from $257.230 million in 2023, a decline of approximately 16%[477]. - Total current assets decreased to $234.537 million in 2024 from $276.111 million in 2023, a decline of approximately 15%[477]. Expenses and Costs - The company incurred total restaurant operating costs of $543.877 million in 2024, up from $482.121 million in 2023, an increase of approximately 13%[478]. - General and administrative expenses were $149.942 million in 2024, slightly up from $146.762 million in 2023, reflecting a marginal increase of about 1%[478]. - Marketing expenses for the fiscal year ended December 29, 2024, were $16.9 million, an increase from $14.3 million in 2023[538]. - The company incurred restructuring charges of $2,300 thousand in fiscal year 2024, down from $7,400 thousand in fiscal year 2023[502]. Supply Chain and Operational Challenges - The company experienced supply chain disruptions for tomatoes and cucumbers in Q4 FY 2024 due to extreme weather conditions, leading to higher prices or temporary discontinuation of these products in certain markets[460]. - The company has been facing supply chain disruptions for bowls and plates since the beginning of 2023, resulting in the use of alternative packaging solutions[460]. - The company is exposed to commodity price risks, with potential adverse effects on results if ingredient prices increase and menu prices do not adjust accordingly[458]. Growth and Expansion - The company opened 25 net new restaurants in fiscal year 2024, bringing the total to 246 restaurants across 22 states and Washington, D.C.[483]. - The company’s future growth is highly dependent on its ability to open new restaurants, which is subject to unpredictable factors[33]. - The company’s long-term success relies on effectively identifying and securing appropriate sites for new restaurants[33]. Assets and Liabilities - Total liabilities increased to $410.613 million in 2024 from $373.960 million in 2023, an increase of approximately 10%[477]. - Operating lease liabilities, net of current portion, rose to $288.941 million in 2024 from $271.439 million in 2023, an increase of about 6%[477]. - Total stockholders' equity decreased to $446.145 million in 2024 from $482.597 million in 2023, a decline of about 8%[477]. - Total property and equipment increased from $452.95 million in 2023 to $535.90 million in 2024, with accumulated depreciation rising from $186.05 million to $239.41 million[561]. Tax and Deferred Assets - The company had a net operating loss carryforward of $794.8 million as of December 29, 2024, with $692.9 million eligible for indefinite carryforward[606]. - The total deferred tax assets, net of valuation allowance, amounted to $53.6 million as of December 29, 2024[604]. - The company recorded an income tax benefit of $(1.3) million for the fiscal year ended December 29, 2024[602]. Stock and Equity - The Company recognized stock-based compensation expense of $39.0 million for the fiscal year ended December 29, 2024, a decrease from $49.5 million in the previous year[601]. - The total intrinsic value of options exercised in fiscal year 2024 was $50.8 million, significantly higher than $7.5 million in 2023[586]. - The Company issued 535,789 restricted stock units (RSUs) during the fiscal year ended December 29, 2024, with a weighted average grant date fair value of $20.81[592]. - The Company had 13,169,869 stock options outstanding as of December 29, 2024, with a weighted average exercise price of $9.88[586]. Legal and Regulatory Matters - The Company is subject to various claims and lawsuits, but does not anticipate a material effect on its financial position from these matters[616]. - The Company has various operating leases with contingent rent obligations based on sales exceeding specified thresholds[614].

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $160.9 million, up from $153 million in Q4 2023, representing a growth of approximately 4% [39] - Same-store sales for Q4 grew by 4%, driven by a 4% benefit from menu price increases and flat traffic and mix [39] - For the fiscal year 2024, same-store sales grew by 6%, with a 4% benefit from menu price increases and 2% from traffic and mix [40] - Adjusted EBITDA for the fiscal year was $18.7 million, a significant improvement from a loss of $2.8 million in 2023, marking the first full year of positive adjusted EBITDA in the company's history [45][46] - Net loss for Q4 was $29 million, compared to a loss of $27.4 million in the prior year, primarily due to increased impairment and pre-opening costs [44] Business Line Data and Key Metrics Changes - Restaurant level profit margin for Q4 was 17.4%, compared to 16.2% a year ago, marking the eighth consecutive quarter of year-over-year margin expansion [42] - Restaurant level profit for Q4 was $28 million, up 13% year-over-year [42] - The company opened 10 new restaurants in Q4, bringing the total to 246, with 12 of these being Infinite Kitchens [41][42] Market Data and Key Metrics Changes - The company expanded into three new markets in 2024, achieving strong opening weeks in Seattle, Columbus, and Charlotte [12] - The 2024 class of new restaurants is on track to hit $2.8 million in year one sales, aligning with year two targets [13] Company Strategy and Development Direction - The company aims to revolutionize fast food through menu and technology innovation, strengthen guest connection, and strategically expand its footprint [10] - Plans for 2025 include opening at least 40 new restaurants, with half featuring Infinite Kitchens, and a focus on menu innovation and loyalty program enhancements [16][49] - The company is committed to leveraging its G&A while scaling its real estate footprint and investing in marketing [9][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged external challenges in early 2025, including weather disruptions and the impact of wildfires in Los Angeles, which affected guest traffic [47][48] - Despite these challenges, management remains confident in the fundamental strength of the business and anticipates sequential improvement throughout the year [70] - The company expects revenue for fiscal year 2025 to range from $760 million to $780 million, with same-store sales growth between 1% and 3% [49] Other Important Information - The company introduced new menu items in 2024, including grass-fed steak, and plans to launch Ripple Fries and a revamped loyalty program in 2025 [11][22] - The Infinite Kitchen locations have shown at least 7 percentage points in labor savings and improved cost of goods sold compared to traditional restaurants [14][123] Q&A Session Summary Question: Can you speak specifically to what you're doing from a media and marketing perspective? - Management highlighted a shift towards more frequent menu launches and increased marketing support, particularly in Q2 and beyond, to drive customer engagement [56][60] Question: Can you provide more texture around how 2025 is going to unfold? - Management noted that external factors have created a headwind, but they expect sales to build throughout the year, with improvements anticipated in Q2, Q3, and Q4 [70] Question: What are the learnings from the Infinite Kitchen performance? - Management reported strong performance from Infinite Kitchens, with significant labor savings and high customer satisfaction, and plans to deploy more in 2025 [123] Question: How sustainable is the current food cost structure? - Management expressed confidence in maintaining and improving restaurant level margins, with opportunities in labor productivity and cost of goods as the company scales [106][108] Question: What are the plans for menu innovation and simplification? - Management confirmed ongoing efforts to simplify operations while introducing new menu items, ensuring that the restaurants can handle the innovation [116]

Core Viewpoint - Sweetgreen, Inc. reported a quarterly loss of $0.25 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.21, marking a 19.05% earnings surprise [1] - The company has struggled to meet consensus EPS estimates over the last four quarters, with revenues of $160.9 million for the quarter ended December 2024, missing the estimate by 0.83% [2] Financial Performance - The loss per share of $0.25 compares to a loss of $0.24 per share a year ago, indicating a slight deterioration [1] - Sweetgreen's revenues increased from $153.03 million a year ago to $160.9 million, showing a year-over-year growth [2] Stock Performance - Sweetgreen shares have declined approximately 30.1% since the beginning of the year, contrasting with the S&P 500's gain of 1.3% [3] - The current Zacks Rank for Sweetgreen is 3 (Hold), suggesting that the stock is expected to perform in line with the market in the near future [6] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is -$0.17 on revenues of $179.49 million, and for the current fiscal year, it is -$0.49 on revenues of $787.54 million [7] - The trend of estimate revisions for Sweetgreen is mixed, which could change following the recent earnings report [6] Industry Context - The Retail - Restaurants industry, to which Sweetgreen belongs, is currently ranked in the top 24% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Total revenue for Q4 2024 was $160.9 million, a 5% increase from $153.0 million in Q4 2023[3] - For fiscal year 2024, total revenue reached $676.8 million, a 16% increase from $584.0 million in fiscal year 2023[3] - Revenue for the fiscal year ended December 29, 2024, was $676.8 million, a 15.9% increase from $584.0 million in the previous year[32] - Adjusted EBITDA for Q4 2024 was $(0.6) million, an improvement from $(1.8) million in the prior year[3] - Adjusted EBITDA for the fiscal year 2024 was $18,708,000, a significant improvement from a loss of $2,795,000 in fiscal year 2023[45] - Net loss for Q4 2024 was $(29.0) million, consistent with a net loss margin of (18)%[3] - Net loss for the fiscal year ended December 29, 2024, was $90.4 million, compared to a net loss of $113.4 million in the previous year, representing a 20.3% improvement[32] - Net loss for the fiscal year ended December 29, 2024, was $90,373,000, an improvement from a net loss of $113,384,000 in the previous year, representing a 20.2% reduction[35] Restaurant Operations - Same-Store Sales Change was 4%, compared to 6% in the prior year period[3] - Restaurant-Level Profit was $28.0 million with a margin of 17%, up from $24.8 million and 16% in the prior year[3] - Restaurant operating costs as a percentage of revenue decreased from 83% in the previous year to 80% in the current year[32] - Restaurant-Level Profit for the fiscal year 2024 was $132,949,000, compared to $101,920,000 in fiscal year 2023, reflecting a 30.5% increase[42] - Average Unit Volume (AUV) for the fiscal year 2024 was $2,924, unchanged from the previous year, while Same-Store Sales increased by 6%[37] Future Outlook - The company plans to open at least 40 new restaurants in fiscal year 2025, including 20 featuring the Infinite Kitchen[9] - Revenue guidance for fiscal year 2025 is projected between $760 million and $780 million[9] - Restaurant-Level Profit Margin for Q1 2025 is expected to be between 19.8% and 20.5%[9] - Adjusted EBITDA for Q1 2025 is anticipated to be between $32 million and $38 million[9] Assets and Liabilities - Total current assets decreased to $234.5 million from $276.1 million year-over-year[27] - Total liabilities increased to $410.6 million from $374.0 million year-over-year[27] - Cash and cash equivalents decreased to $214.8 million from $257.2 million year-over-year[27] - Cash and cash equivalents at the end of the fiscal year 2024 were $217,429,000, a decrease from $257,355,000 at the end of fiscal year 2023[35] Expenses - General and administrative expenses for the fiscal year were $149.9 million, representing 22% of total revenue, compared to 25% in the previous year[32] - The company incurred $1,830,000 in impairment and closure costs during the fiscal quarter ended December 29, 2024[42] Digital Revenue - Total Digital Revenue Percentage for the fiscal year 2024 was 56%, a decrease from 59% in fiscal year 2023[37] Share Information - The weighted average shares used in computing net loss per share increased to 114.3 million from 111.9 million year-over-year[32]

Company Performance - Sweetgreen, Inc. (SG) closed at $23.48, reflecting a +0.99% change from the previous day's close, outperforming the S&P 500's 0.43% loss [1] - The stock has decreased by 20.19% over the past month, underperforming the Retail-Wholesale sector's gain of 5.51% and the S&P 500's gain of 2.6% [1] Upcoming Earnings Report - Sweetgreen, Inc. is set to release its earnings report on February 26, 2025, with projected earnings per share (EPS) of -$0.21, indicating a 12.5% increase from the same quarter last year [2] - The Zacks Consensus Estimate for revenue is $162.38 million, representing a 6.11% increase from the previous year [2] Analyst Estimates and Rankings - Recent changes in analyst estimates for Sweetgreen, Inc. reflect short-term business trends, with positive revisions indicating analysts' confidence in the company's performance [3] - The Zacks Rank system, which assesses estimate changes, currently ranks Sweetgreen, Inc. as 2 (Buy), with a historical average annual return of +25% for 1 ranked stocks since 1988 [5] Industry Context - The Retail - Restaurants industry, part of the Retail-Wholesale sector, holds a Zacks Industry Rank of 66, placing it in the top 27% of over 250 industries [6] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [6]

Company Performance - Sweetgreen, Inc. (SG) closed at $33.05, with a daily increase of +0.46%, outperforming the S&P 500's gain of 0.39% [1] - Over the past month, shares of Sweetgreen have appreciated by 3.01%, underperforming the Retail-Wholesale sector's gain of 8.29% but outperforming the S&P 500's gain of 1.7% [1] Upcoming Earnings - Sweetgreen is set to disclose its earnings on February 26, 2025, with a forecasted EPS of -$0.21, reflecting a 12.5% increase from the same quarter last year [2] - The consensus estimate for revenue is $162.38 million, which represents a 6.11% increase from the prior-year quarter [2] Analyst Estimates - Recent changes to analyst estimates for Sweetgreen indicate shifting short-term business dynamics, with positive revisions suggesting a favorable business outlook [3] - The Zacks Rank system, which incorporates these estimate changes, provides a practical rating system for stocks [4] Zacks Rank and Industry Performance - Sweetgreen currently holds a Zacks Rank of 2 (Buy), with the Zacks Consensus EPS estimate having increased by 0.41% over the last 30 days [5] - The Retail - Restaurants industry, part of the Retail-Wholesale sector, has a Zacks Industry Rank of 50, placing it in the top 20% of over 250 industries [6]

Core Viewpoint - Sweetgreen, Inc. (SG) shows potential for upside with a mean price target of $41.30, indicating a 25.5% increase from the current price of $32.90 [1] Price Target Analysis - The average price target consists of 10 estimates ranging from $28 to $49, with a standard deviation of $5.76, suggesting variability in analyst opinions [2] - The lowest estimate indicates a potential decline of 14.9%, while the highest suggests a 48.9% upside [2] - A low standard deviation indicates a high degree of agreement among analysts regarding the stock's price movement [7] Analyst Sentiment - Analysts are increasingly optimistic about SG's earnings prospects, as evidenced by upward revisions in EPS estimates [9] - The Zacks Consensus Estimate for the current year has increased by 0.4% due to one upward revision and no negative revisions in the last 30 days [10] - SG holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [11] Caution on Price Targets - Price targets should not be the sole basis for investment decisions, as they can often mislead investors [5][8] - Analysts may set overly optimistic price targets due to business incentives, which can inflate expectations [6]

Company Performance - Sweetgreen, Inc. closed at $33.65, reflecting a -0.18% change from the previous day, underperforming the S&P 500 which gained 0.53% [1] - Over the past month, Sweetgreen's shares appreciated by 5.15%, which is lower than the Retail-Wholesale sector's gain of 5.57% but higher than the S&P 500's gain of 1.24% [1] Upcoming Earnings - Sweetgreen is set to release its earnings report on February 26, 2025, with analysts expecting earnings of -$0.21 per share, indicating a year-over-year growth of 12.5% [2] - The consensus estimate for revenue is $162.38 million, reflecting a 6.11% growth compared to the same quarter last year [2] Analyst Forecasts - Recent revisions to analyst forecasts for Sweetgreen are important as they reflect short-term business trends, with positive changes indicating optimism regarding the company's business and profitability [3] Zacks Rank and Performance - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a strong track record, with stocks rated 1 producing an average annual return of +25% since 1988 [5] - Sweetgreen currently holds a Zacks Rank of 2 (Buy), with the Zacks Consensus EPS estimate having increased by 0.41% in the past month [5] Industry Context - Sweetgreen operates within the Retail - Restaurants industry, which has a Zacks Industry Rank of 46, placing it in the top 19% of over 250 industries [6] - The top 50% rated industries outperform the bottom half by a factor of 2 to 1, indicating a favorable environment for Sweetgreen within its industry [6]

Core Viewpoint - Sweetgreen's stock experienced a decline of over 10% following a price target cut by Morgan Stanley analyst Brian Harbour, reflecting broader concerns about the U.S. restaurant industry's growth prospects [1][2][3] Company Summary - Morgan Stanley reduced Sweetgreen's price target from $32 to $28 per share while maintaining an equal weight recommendation, indicating a hold stance on the stock [2] - The decline in price target is attributed to Harbour's cautious outlook on the U.S. restaurant industry, expecting growth to be less than 5% in 2024, compared to a 4% increase in the previous year [3] - Sweetgreen's stock had a remarkable performance in 2024, more than tripling in value, driven by excitement around its Infinite Kitchen model, which focuses on automating salad preparation [4] Industry Summary - The overall sentiment in the restaurant sector appears cautious, with analysts predicting a sluggish rebound for the industry [3] - Sweetgreen is heavily investing in its Infinite Kitchen initiative, which has seen a rapid increase in the number of kitchens equipped with robotic salad chefs, growing from two to five within a short period [5] - The automation initiative is expected to significantly reduce labor costs, making it a noteworthy development for the company's future [6]

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Sweetgreen, Inc. (SG), and emphasizes the importance of using these recommendations in conjunction with other analytical tools like the Zacks Rank for making informed investment decisions [1][4][9]. Brokerage Recommendations - Sweetgreen has an average brokerage recommendation (ABR) of 1.75, indicating a consensus between Strong Buy and Buy, based on recommendations from 12 brokerage firms [2]. - Out of the 12 recommendations, seven are classified as Strong Buy and one as Buy, which accounts for 58.3% and 8.3% of all recommendations respectively [2]. Limitations of Brokerage Recommendations - The article highlights that brokerage recommendations may not be reliable indicators of stock performance due to analysts' biases stemming from their firms' vested interests [5][9]. - Research indicates that brokerage firms issue five "Strong Buy" recommendations for every "Strong Sell," suggesting a tendency towards overly optimistic ratings [5]. Zacks Rank as an Alternative - The Zacks Rank categorizes stocks into five groups based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements [10]. - The Zacks Rank is updated more frequently than the ABR, making it a more timely indicator of future price movements [11]. Sweetgreen's Earnings Estimates - The Zacks Consensus Estimate for Sweetgreen has increased by 0.4% over the past month to -$0.74, reflecting growing optimism among analysts regarding the company's earnings prospects [12]. - The recent change in the consensus estimate, along with other factors, has resulted in a Zacks Rank of 2 (Buy) for Sweetgreen, suggesting potential for stock appreciation [13].