Sweetgreen(SG) - 2024 Q1 - Quarterly Report

Revenue Performance - Revenue for the thirteen weeks ended March 31, 2024, was $157,850,000, representing a 26.2% increase from$ 125,062,000 for the same period in 2023[25]. - Total revenue for the thirteen weeks ended March 31, 2024, was $157.85 million, a 26.2% increase from$ 125.06 million for the same period in 2023[41]. - Owned digital channels revenue increased to $51.81 million, up 7.1% from$ 48.26 million year-over-year[41]. - In-store channel revenue rose to $64.93 million, a 31.5% increase compared to$ 49.39 million in the prior year[41]. - Marketplace channel revenue grew significantly to $41.11 million, up 50% from$ 27.41 million in the same quarter last year[41]. - The company recognized $664,000 in revenue from gift card liability during the thirteen weeks ended March 31, 2024, compared to$ 325,000 in the same period of 2023[42]. Net Loss and Profitability - The net loss for the thirteen weeks ended March 31, 2024, was $26,067,000, compared to a net loss of$ 33,657,000 for the same period in 2023, indicating a 22.5% improvement[25]. - The company reported a net loss of $26.067 million for the thirteen weeks ended March 31, 2024, compared to a net loss of$ 33.657 million for the same period in 2023, representing a 22.5% improvement[89]. - Restaurant-Level Profit for the thirteen weeks ended March 31, 2024, was $28,537,000, compared to$ 16,937,000 in the prior year[123]. - Adjusted EBITDA for the same period was $113,000, a significant improvement from a loss of$ 6,694,000 in the previous year[127]. - The loss from operations margin improved to (17)% from (28)% year-over-year[123]. Restaurant Expansion - The company opened 6 net new restaurants during the thirteen weeks ended March 31, 2024, bringing the total to 227 restaurants across 19 states and Washington, D.C.[31]. - For the thirteen weeks ended March 31, 2024, net new restaurant openings were 6, down from 9 in the same period of 2023[112]. - The company plans to return to a new restaurant growth rate of 15-20% per year starting in fiscal year 2025[114]. - The company had 9 facilities under construction as of March 31, 2024, all expected to open during fiscal year 2024[50]. Financial Position - Total current assets decreased to $263,688,000 as of March 31, 2024, from$ 276,111,000 as of December 31, 2023, a decline of 4.5%[24]. - Total liabilities decreased slightly to $372,424,000 as of March 31, 2024, from$ 373,960,000 as of December 31, 2023[24]. - Cash and cash equivalents at the end of the period were $243,881,000, down from$ 296,953,000 at the end of the same period in 2023, reflecting a decrease of 17.9%[29]. - Cash and cash equivalents as of March 31, 2024, were $243.76 million, down from$ 257.23 million as of December 31, 2023[39]. - As of March 31, 2024, the company had $243.8 million in cash and cash equivalents, down from$ 257.2 million at the end of 2023[174]. - The company has access to a $43.1 million revolving loan under its 2020 Credit Agreement, with no draws made as of March 31, 2024[174]. Operating Expenses - Food, beverage, and packaging costs increased to$ 43,718,000, a 23% rise from $35,587,000, maintaining 28% of total revenue[152]. - Labor and related expenses rose to$ 45,766,000, a 17% increase from $39,243,000, decreasing as a percentage of revenue from 31% to 29%[154]. - Occupancy and related expenses increased to$ 14,448,000, a 14% rise from $12,630,000, with a decrease in percentage of revenue from 10% to 9%[156]. - Other restaurant operating costs increased to$ 25,381,000, a 23% rise from $20,665,000, decreasing as a percentage of revenue from 17% to 16%[158]. - General and administrative expenses were$ 36,865,000, a 6% increase from $34,907,000[150]. - Depreciation and amortization expenses increased to$ 16,427,000, a 25% rise from $13,110,000[150]. - Pre-opening costs decreased to$ 1,432,000, a 57% decline from $3,366,000[150]. - Impairment and closure costs decreased by 17% to$ 0.16 million, reflecting closure costs related to previously closed restaurants[166]. - Restructuring charges fell by 21% to $0.51 million, associated with the former Sweetgreen Support Center[167]. Stock and Compensation - As of March 31, 2024, the Company had 14,569,140 stock options outstanding, with a weighted average exercise price of$ 8.63[77]. - The Company recognized stock-based compensation expense of $0.8 million related to the vested portion of shares from the Spyce acquisition for the thirteen weeks ended March 26, 2023[74]. - The weighted-average fair value of options granted during the thirteen weeks ended March 31, 2024, was$ 7.58, compared to $8.43 for the same period in 2023[78]. - As of March 31, 2024, there was$ 23.4 million in unrecognized compensation expense related to unvested stock-based compensation arrangements, expected to be recognized over a weighted average period of 2.22 years[79]. - The total stock-based compensation expense for the thirteen weeks ended March 31, 2024 was $9.626 million, a decrease of 32.5% from$ 14.265 million for the same period in 2023[84]. - Unrecognized compensation expense related to performance stock units (PSUs) was $22.8 million as of March 31, 2024, expected to be recognized over a weighted average period of 1.25 years[82]. Market and Operational Challenges - The company experienced a disruption in packaging supply during the first fiscal quarter of 2023, negatively impacting restaurant operating costs[106]. - Revenue is derived from five sales channels, with historical fluctuations impacting margins, particularly in Native Delivery, Outpost and Catering, and Marketplace Channels[109]. - Company operates solely within the United States, facing market risks including commodity price risks, interest rate risk, inflation effects, and macroeconomic risks[197].