Workflow
Sweetgreen(SG) - 2025 Q1 - Quarterly Report

FORM 10-Q Filing Information Registrant Information SWEETGREEN, INC. filed its Quarterly Report on Form 10-Q for the period ended March 30, 2025, incorporated in Delaware, trading Class A Common Stock under SG on the NYSE, and classified as a large accelerated filer - Registrant: SWEETGREEN, INC.2 - Filing Type: Quarterly Report on Form 10-Q for the period ended March 30, 20252 Trading Information | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Class A Common Stock | SG | New York Stock Exchange | - Filer Status: Large accelerated filer4 Outstanding Shares As of May 5, 2025, Sweetgreen, Inc. had 105,788,297 shares of Class A common stock and 11,893,558 shares of Class B common stock outstanding Shares Outstanding (as of May 5, 2025) | Class of Stock | Shares Outstanding (as of May 5, 2025) | | :--------------- | :------------------------------------- | | Class A Common Stock | 105,788,297 | | Class B Common Stock | 11,893,558 | Special Note Regarding Forward-Looking Statements Forward-Looking Statements Disclaimer This section outlines the company's forward-looking statements, which are subject to substantial risks and uncertainties, covering expectations regarding revenue, operating costs, new restaurant openings, Infinite Kitchen integration, macroeconomic trends, and profitability - Forward-looking statements are covered by safe harbor provisions and include expectations on revenue, operating costs, new restaurant openings, Infinite Kitchen units, macroeconomic trends, and profitability9 - Key risks and uncertainties include effective competition, changes in economic conditions, geopolitical events, ability to open new restaurants, impact of severe weather, profitability of new restaurants, ability to deploy Infinite Kitchen technology, brand value preservation, food safety concerns, labor costs, pandemics, and governmental regulations10 - The company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the report date, except as required by law1314 Glossary General Definitions This section defines 'Comparable Restaurant Base' as restaurants operating for at least twelve full months, excluding those with material temporary closures of 30 days or more - Comparable Restaurant Base: All restaurants operated for at least twelve full months, excluding those with material, temporary closures (at least 30 consecutive days)16 - One restaurant was excluded from the Comparable Restaurant Base for the thirteen weeks ended March 30, 2025, with no material change to key performance metrics16 Sales Channels Sweetgreen operates through five main sales channels: In-Store, Marketplace, Native Delivery, Outpost and Catering, and Pick-Up, with Owned Digital Channels encompassing Pick-Up, Native Delivery, Outpost and Catering, and digital In-Store purchases - Five main sales channels: In-Store, Marketplace, Native Delivery, Outpost and Catering, and Pick-Up17 - Owned Digital Channels include Pick-Up, Native Delivery, Outpost and Catering, and digital In-Store purchases via SG Rewards21 - Total Digital Channels comprise Owned Digital Channels and the Marketplace Channel, excluding Non-Digital In-Store transactions22 Key Performance Metrics and Non-GAAP Financial Measures Reference Definitions for key performance metrics and Non-GAAP financial measures are provided in the 'Management's Discussion and Analysis of Financial Condition and Results of Operations' section - Definitions for key performance metrics and Non-GAAP financial measures are located in 'Management's Discussion and Analysis of Financial Condition and Results of Operations'2324 Part I Financial Information Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements for Sweetgreen, Inc. and its subsidiaries, including balance sheets, statements of operations, stockholders' (deficit) equity, and cash flows, along with detailed notes Condensed Consolidated Balance Sheets Balance Sheet Summary (in thousands) | Metric (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :-------------------- | :------------------- | :---------------------- | | Total current assets | $206,166 | $234,537 | | Total assets | $834,320 | $856,758 | | Total current liabilities | $104,822 | $115,827 | | Total liabilities | $401,566 | $410,613 | | Total stockholders' equity | $432,754 | $446,145 | - Total assets decreased by $22.4 million, and total liabilities decreased by $9.0 million from December 29, 2024, to March 30, 202525 Condensed Consolidated Statements of Operations Statements of Operations Summary (in thousands, except per share) | Metric (in thousands, except per share) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Revenue | $166,304 | $157,850 | | Total restaurant operating costs | $136,617 | $129,313 | | Total operating expenses | $58,224 | $55,452 | | Loss from operations | $(28,537) | $(26,915) | | Net loss | $(25,039) | $(26,067) | | Net loss per share basic and diluted | $(0.21) | $(0.23) | - Revenue increased by $8.45 million (5.4%) year-over-year, while net loss decreased by $1.03 million (3.9%), leading to an improved net loss per share26 Condensed Consolidated Statement of Stockholders' (Deficit) Equity Stockholders' Equity Summary (in thousands) | Metric (in thousands) | Balances at December 29, 2024 | Balances at March 30, 2025 | | :-------------------- | :---------------------------- | :------------------------- | | Additional Paid-in Capital | $1,321,386 | $1,333,033 | | Accumulated Deficit | $(875,358) | $(900,397) | | Total Stockholders' Equity | $446,145 | $432,754 | - Total stockholders' equity decreased by $13.39 million, primarily due to a net loss of $25.04 million, partially offset by $10.22 million in stock-based compensation expense and proceeds from stock option exercises28 Condensed Consolidated Statements of Cash Flows Cash Flow Summary (in thousands) | Cash Flow Activity (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :-------------------------------- | :---------------------------------- | :---------------------------------- | | Net cash (used in) operating activities | $(13,128) | $3,426 | | Net cash used in investing activities | $(19,132) | $(15,022) | | Net cash provided by (used in) financing activities | $1,427 | $(1,878) | | Net decrease in cash and cash equivalents and restricted cash | $(30,833) | $(13,474) | | Cash and cash equivalents and restricted cash—end of period | $186,596 | $243,881 | - Operating activities shifted from a cash inflow of $3.43 million in Q1 2024 to a cash outflow of $13.13 million in Q1 202530 - Investing activities saw an increased cash outflow, primarily due to higher purchases of property and equipment and intangible assets30 Notes to the Condensed Consolidated Financial Statements 1. Description of Business and Summary of Significant Accounting Policies Sweetgreen, Inc. is a mission-driven restaurant brand serving healthy food, operating 251 restaurants in 22 states and Washington, D.C. as of March 30, 2025, with 5 Net New Restaurant Openings during the thirteen weeks ended March 30, 2025 - As of March 30, 2025, the Company owned and operated 251 restaurants in 22 states and Washington, D.C.32 - During the thirteen weeks ended March 30, 2025, the Company had 5 Net New Restaurant Openings32 - The Company's fiscal year is a 52- or 53-week period ending on the Sunday closest to the last day of December36 2. Revenue Recognition Sweetgreen recognizes revenue from food and beverage sales across Owned Digital Channels, In-Store Channel, and Marketplace Channel, with total revenue for the thirteen weeks ended March 30, 2025, at $166.3 million Revenue by Channel (in thousands) | Revenue Channel (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :----------------------------- | :---------------------------------- | :---------------------------------- | | Owned Digital Channels | $52,984 | $51,812 | | In-Store Channel (Non-Digital component) | $66,706 | $64,927 | | Marketplace Channel | $46,614 | $41,111 | | Total Revenue | $166,304 | $157,850 | - Revenue recognized from gift card liability balance at the beginning of the year decreased from $664 thousand in Q1 2024 to $411 thousand in Q1 202546 3. Fair Value The company's financial liabilities measured at fair value primarily consist of contingent consideration related to the Spyce acquisition, which decreased from $14.97 million as of December 29, 2024, to $13.29 million as of March 30, 2025 Contingent Consideration (in thousands) | Metric (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :-------------------- | :------------------- | :---------------------- | | Contingent consideration | $13,289 | $14,974 | - The fair value of contingent consideration is determined using the Monte Carlo method, considering equity value, contractual terms, liquidity event scenarios, discount rate, volatility, risk-free rate, and probability of milestone achievement49 - During Q4 2023, the first Spyce milestone was achieved, resulting in $2.1 million in Class A common stock and $3.9 million in cash paid to former Spyce equity holders in Q1 202449 4. Property and Equipment Property and equipment, net, increased slightly to $298.23 million as of March 30, 2025, from $296.49 million at December 29, 2024, with 9 facilities under construction expected to open in fiscal year 2025 Property and Equipment, Net (in thousands) | Metric (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :-------------------- | :------------------- | :---------------------- | | Total property and equipment | $552,612 | $535,897 | | Less: accumulated depreciation | $(254,378) | $(239,412) | | Property and equipment, net | $298,234 | $296,485 | - Depreciation expense for the thirteen weeks ended March 30, 2025, was $14.4 million, up from $13.7 million in the prior year period53 - As of March 30, 2025, 9 facilities were under construction, with 5 already opened in fiscal year 2025 and the remaining 4 due to open later in the year54 5. Goodwill and Intangible Assets, Net Goodwill remained unchanged at $36.0 million during the thirteen weeks ended March 30, 2025, while intangible assets, net, decreased slightly to $23.65 million, primarily due to amortization - Goodwill carrying amount remained $36.0 million with no changes during the thirteen weeks ended March 30, 202555 Intangible Assets, Net (in thousands) | Metric (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :-------------------- | :------------------- | :---------------------- | | Internal use software | $48,252 | $45,933 | | Developed technology | $20,050 | $20,050 | | Total intangible assets | $68,302 | $65,983 | | Accumulated amortization | $(44,650) | $(41,943) | | Intangible assets, net | $23,652 | $24,040 | - Amortization expense for intangible assets was $2.7 million for the thirteen weeks ended March 30, 2025, slightly down from $2.8 million in the prior year period56 6. Accrued Expenses Total accrued expenses decreased from $26.56 million as of December 29, 2024, to $25.99 million as of March 30, 2025, with notable changes including an increase in accrued general and sales tax and a decrease in fixed asset accrual and accrued settlements and legal fees Accrued Expenses Summary (in thousands) | Accrued Expense (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :----------------------------- | :------------------- | :---------------------- | | Accrued general and sales tax | $6,288 | $4,625 | | Fixed asset accrual | $4,689 | $5,983 | | Accrued settlements and legal fees | $1,869 | $3,529 | | Total accrued expenses | $25,998 | $26,564 | 7. Debt The company's Credit Facility with EagleBank, which allowed borrowing up to $45.0 million, expired on December 13, 2024, and was not renewed, leaving the company with no outstanding debt as of March 30, 2025 - The Credit Facility with EagleBank, allowing up to $45.0 million in borrowing, expired on December 13, 2024, and was not renewed59 8. Leases Sweetgreen leases restaurants and corporate office space, with total lease cost for the thirteen weeks ended March 30, 2025, increasing to $16.94 million from $15.44 million in the prior year Lease Costs (in thousands) | Lease Cost (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :------------------------ | :---------------------------------- | :---------------------------------- | | Operating lease cost | $13,724 | $12,382 | | Variable lease cost | $3,138 | $2,947 | | Short term lease cost | $79 | $114 | | Total lease cost | $16,941 | $15,443 | Lease Metrics | Lease Metric | March 30, 2025 | December 29, 2024 | | :-------------------------------- | :------------- | :---------------- | | Weighted average remaining lease term (years) | 7.28 | 7.32 | | Weighted average discount rate | 6.79 % | 6.75 % | - Future minimum lease payments for operating leases total $428.12 million, with $40.61 million due in 202562 9. Common Stock As of March 30, 2025, Sweetgreen had reserved 31.16 million shares of common stock for issuance under various equity plans, representing a slight decrease from 31.71 million shares reserved as of December 29, 2024 Reserved Shares (in thousands) | Reserved Shares (in thousands) | As of March 30, 2025 | As of December 29, 2024 | | :----------------------------- | :------------------- | :---------------------- | | Options outstanding | 14,099,610 | 13,169,869 | | Shares reserved for Spyce milestones | 500,000 | 500,000 | | Shares reserved for employee stock purchase plan | 4,111,331 | 4,111,331 | | RSUs and PSUs outstanding | 5,237,201 | 5,410,024 | | Shares available for future issuance under 2021 Plan | 7,209,966 | 8,516,216 | | Total reserved shares of common stock | 31,158,108 | 31,707,440 | 10. Stock-Based Compensation Total stock-based compensation expense for the thirteen weeks ended March 30, 2025, was $10.22 million, an increase from $9.63 million in the prior year period, including expenses for stock options, RSUs, and PSUs Stock-Based Compensation Expense (in thousands) | Stock-Based Compensation Expense (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :-------------------------------------------- | :---------------------------------- | :---------------------------------- | | Stock-options | $2,618 | $2,336 | | Restricted stock units | $4,208 | $1,648 | | Performance stock units | $3,395 | $5,642 | | Total stock-based compensation | $10,221 | $9,626 | - As of March 30, 2025, unrecognized compensation expense for unvested stock-based compensation arrangements was $33.0 million, expected to be recognized over a weighted average period of 2.25 years73 - Unrecognized compensation expense related to RSUs was $8.9 million, expected to be recognized over 1.71 years74 - Unrecognized compensation expense related to founder PSUs was $6.4 million, expected to be recognized over 0.66 years76 11. Income Taxes The company recorded $0.1 million in income tax expense for both the thirteen weeks ended March 30, 2025, and March 31, 2024, and has received $3.4 million in cash payments for Employee Retention Tax Credits (ERC) - Income tax expense was $0.1 million for both Q1 2025 and Q1 202480 - The Company has received $3.4 million in cash payments for Employee Retention Tax Credits (ERC), reducing the ERC receivable to $3.6 million as of March 30, 202581 12. Net Loss Per Share Net loss per share, basic and diluted, improved to $(0.21) for the thirteen weeks ended March 30, 2025, from $(0.23) in the prior year period, with potentially dilutive securities excluded due to their anti-dilutive effect Net Loss Per Share (in thousands) | Metric | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :------------------------------------------ | :---------------------------------- | :---------------------------------- | | Net loss | $(25,039) | $(26,067) | | Weighted-average common shares outstanding | 117,307,189 | 112,772,776 | | Earnings per share—basic and diluted | $(0.21) | $(0.23) | - Potentially dilutive securities, totaling 19,836,811 common stock equivalents as of March 30, 2025, were excluded from diluted EPS calculation due to their anti-dilutive effect84 13. Related-Party Transactions The company made payments totaling $1.5 million to Welcome to the Dairy, LLC, for its principal corporate headquarters lease during the thirteen weeks ended March 30, 2025, with certain founders and the CFO holding indirect minority passive interests in an entity that owns equity interests in Welcome to the Dairy, LLC - Total payments to Welcome to the Dairy, LLC, for the principal corporate headquarters lease were $1.5 million for the thirteen weeks ended March 30, 2025, an increase from $1.0 million in the prior year period85 14. Commitments and Contingencies Sweetgreen is subject to various operating lease and purchase obligations, with the majority of purchase obligations due within the next twelve months, and does not anticipate a material effect from legal proceedings - The Company is obligated under various operating leases for office facilities, restaurant locations, and equipment86 - Purchase obligations primarily relate to restaurant supplies and are due within the next twelve months87 - The Company does not believe that the ultimate resolution of current legal matters will have a material effect on its financial position, results of operations, liquidity, or capital resources88 15. Reportable Segment The company operates as one operating and reportable segment, deriving revenue from retail sales of food and beverages by company-owned restaurants in the United States, with the CEO serving as the chief operating decision maker - The Company operates as one operating segment and one reportable segment, with revenue from retail sales of food and beverages by company-owned restaurants in the United States89 General and Administrative Expenses (in thousands) | General and Administrative (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :---------------------------------------- | :---------------------------------- | :---------------------------------- | | Operating support center cost | $27,706 | $26,992 | | Stock-based compensation | $10,221 | $9,626 | | Other expenses | $410 | $247 | | Total General and administrative | $38,337 | $36,865 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of Sweetgreen's financial performance, key factors affecting its business, and a detailed analysis of its results of operations, liquidity, and capital resources for the thirteen weeks ended March 30, 2025 Overview Sweetgreen is a mission-driven restaurant and lifestyle brand focused on healthy food at scale, aiming to be as ubiquitous as traditional fast food, operating 251 restaurants across 22 states and Washington, D.C. as of March 30, 2025 - Sweetgreen is a mission-driven restaurant and lifestyle brand focused on healthy food at scale, aiming to be as ubiquitous as traditional fast food96 - As of March 30, 2025, the company operated 251 restaurants across 22 states and Washington, D.C.96 Factors Affecting Our Business The company plans to open at least 40 new restaurants and add at least 20 new Infinite Kitchen units in fiscal year 2025, while facing potential impacts from tariffs on supply chain costs and increased development costs - The company plans to open at least 40 new restaurants and add at least 20 new Infinite Kitchen units in fiscal year 202598 - Tariffs implemented in April 2025 are projected to impact Q2 food, beverage, and packaging supply chain costs by approximately 75 basis points, declining to 40 basis points in H2 2025 as packaging production transitions to alternative geographies104 - New restaurant development costs may increase by up to 10% on the average unit cost of $1.4-$1.5 million, and Infinite Kitchen unit costs (typically $450 thousand-$550 thousand) may increase by 15% due to tariffs, though 10 units are already tariff-insulated105 - Revenue is historically lower in Q1 and Q4 due to holidays and inclement weather, but recent consumer behavior shifts (hybrid/remote work) have made seasonality less predictable108 - A shift in sales towards Native Delivery, Outpost and Catering, and Marketplace channels could negatively impact margins due to third-party fees and higher refund rates, though margins are expected to improve with scale109 Key Performance Metrics and Non-GAAP Financial Measures Same-Store Sales Change decreased significantly to (3.1)% in Q1 2025 from 5.0% in Q1 2024, reflecting a 6.5% decrease in traffic and product mix, partially offset by a 3.4% benefit from menu price increases Key Performance Metrics | Metric | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :-------------------------------- | :---------------------------------- | :---------------------------------- | | Net New Restaurant Openings | 5 | 6 | | Average Unit Volume (as adjusted) | $2,907 | $2,889 | | Same-Store Sales Change (%) (as adjusted) | (3.1)% | 5.0 % | | Total Digital Revenue Percentage | 59.9 % | 58.9 % | | Owned Digital Revenue Percentage | 31.9 % | 32.8 % | - Same-Store Sales Change decreased significantly to (3.1)% in Q1 2025 from 5.0% in Q1 2024, reflecting a 6.5% decrease in traffic and product mix, partially offset by a 3.4% benefit from menu price increases149 - Total Digital Revenue Percentage increased to 59.9% in Q1 2025, while Owned Digital Revenue Percentage slightly decreased to 31.9%; the company anticipates an increase in Owned Digital sales with the introduction of a new loyalty program in Q2 2025112117 Non-GAAP Financial Measures (in thousands) | Non-GAAP Metric (in thousands) | Thirteen weeks ended March 30, 2025 | Thirteen weeks ended March 31, 2024 | | :----------------------------- | :---------------------------------- | :---------------------------------- | | Restaurant-Level Profit | $29,687 | $28,537 | | Restaurant-Level Profit Margin | 17.9 % | 18.1 % | | Adjusted EBITDA | $285 | $113 | | Adjusted EBITDA Margin | 0.2 % | 0.1 % | - Restaurant-Level Profit increased by $1.15 million, but Restaurant-Level Profit Margin slightly decreased by 0.2 percentage points123 - Adjusted EBITDA increased by $0.17 million, and Adjusted EBITDA Margin improved by 0.1 percentage points130 Components of Results of Operations Revenue growth is driven by opening additional restaurants, diversifying the menu, and investing in marketing initiatives, including a new loyalty program, while costs are influenced by customer orders, new restaurant openings, commodity prices, and labor market dynamics - Revenue growth is driven by opening additional restaurants, diversifying the menu, and investing in marketing initiatives, including a new loyalty program129 - Food, beverage, and packaging costs are expected to increase with customer orders and new restaurant openings, but as a percentage of revenue, they may vary due to menu mix, commodity costs, and inflation133 - Labor and related expenses are influenced by minimum wage legislation, inflation, labor market strength, and benefit costs134 - Other restaurant operating costs, including third-party delivery fees, are expected to increase in absolute dollars but may decline as a percentage of revenue for certain fixed costs like repairs and maintenance136137 - Pre-opening costs are expected to increase in fiscal year 2025 due to the acceleration of new restaurant growth140 - Restructuring charges include costs related to vacating former office spaces (Sweetgreen Support Center and New York office) and workforce reductions143 - Other expense (income) primarily reflects changes in the fair value of the contingent consideration liability from the Spyce acquisition145 Results of Operations Comparison (Thirteen weeks ended March 30, 2025 vs. March 31, 2024) Revenue increased by 5.4% to $166.3 million, primarily due to new restaurant openings, while net loss improved by 3.9% to $(25.04) million, despite increased operating costs and restructuring charges Results of Operations (in thousands) | Metric (in thousands) | March 30, 2025 | March 31, 2024 | Dollar Change | Percentage Change | | :-------------------- | :------------- | :------------- | :------------ | :---------------- | | Revenue | $166,304 | $157,850 | $8,454 | 5.4 % | | Food, beverage, and packaging | $43,992 | $43,718 | $274 | 0.6 % | | Labor and related expenses | $48,071 | $45,766 | $2,305 | 5.0 % | | Occupancy and related expenses | $15,674 | $14,448 | $1,226 | 8.5 % | | Other restaurant operating costs | $28,880 | $25,381 | $3,499 | 13.8 % | | General and administrative | $38,337 | $36,865 | $1,472 | 4.0 % | | Depreciation and amortization | $17,106 | $16,427 | $679 | 4.1 % | | Pre-opening costs | $1,696 | $1,432 | $264 | 18.4 % | | Impairment and closure costs | $94 | $157 | $(63) | (40.1 %) | | Restructuring charges | $905 | $505 | $400 | 79.2 % | | Interest income | $(1,903) | $(3,016) | $1,113 | (36.9 %) | | Other expense (income) | $(1,685) | $2,059 | $(3,744) | (181.8 %) | | Net loss | $(25,039) | $(26,067) | $1,028 | (3.9 %) | - Revenue increase was primarily due to $13.7 million from 30 Net New Restaurant Openings, partially offset by a $4.9 million decrease in Comparable Restaurant Base revenue149 - Food, beverage, and packaging costs as a percentage of revenue decreased to 26.5% from 27.7% due to ingredient management and menu price increases150151 - Other restaurant operating costs increased significantly by 13.8%, primarily due to new restaurant openings, increased advertising, utilities, delivery fees (Marketplace Channel), and credit card processing fees156157 - Restructuring charges increased by 79.2% due to vacating the former New York office space, including severance and related benefits165 - Other expense (income) shifted from an expense of $2.06 million to an income of $1.69 million, primarily due to a change in the fair value of contingent consideration170 Liquidity and Capital Resources As of March 30, 2025, cash and cash equivalents were $183.9 million, and the company believes existing liquidity will be sufficient to fund operating lease obligations, capital expenditures, and working capital needs for at least the next 12 months - As of March 30, 2025, cash and cash equivalents were $183.9 million, down from $214.8 million at December 29, 2024173 - The company believes existing cash and cash equivalents will be sufficient to fund operating lease obligations, capital expenditures, and working capital needs for at least the next 12 months173 - Primary liquidity and capital requirements are for new restaurant development (including Infinite Kitchen deployment), customer experience improvements, marketing, working capital, and general corporate needs174 - Capital expenditures for the thirteen weeks ended March 30, 2025, were approximately $16.7 million, expected to increase in 2025 for new store openings and Infinite Kitchens178 - The prior Credit Facility with EagleBank expired on December 13, 2024, and was not renewed, leaving the company with no outstanding debt179 - Net cash used in operating activities increased by $16.6 million, primarily due to a decrease in income (excluding non-cash items) and unfavorable working capital fluctuations182 Critical Accounting Estimates No material changes to critical accounting estimates were reported compared to the Annual Report on Form 10-K for the fiscal year ended December 29, 2024 - No material changes to critical accounting estimates were reported compared to the Annual Report on Form 10-K for the fiscal year ended December 29, 2024187 Recent Accounting Pronouncements Refer to Note 1 of the condensed consolidated financial statements for information on recently adopted and not yet adopted accounting pronouncements - Refer to Note 1 of the condensed consolidated financial statements for information on recently adopted and not yet adopted accounting pronouncements189 Item 3. Quantitative and Qualitative Disclosures About Market Risk Sweetgreen is exposed to market risks including commodity price risks, interest rate risk, effects of inflation, and macroeconomic risks, with no material changes reported since the previous Annual Report on Form 10-K - Primary market risks include commodity price risks, interest rate risk, effects of inflation, and macroeconomic risks190 - No material changes to market risk exposure were reported since the Annual Report on Form 10-K for the fiscal year ended December 29, 2024190 Item 4. Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 30, 2025, with no material changes to internal control over financial reporting during the fiscal quarter - Disclosure controls and procedures were evaluated and deemed effective as of March 30, 2025191 - No material changes to internal control over financial reporting occurred during the fiscal quarter ended March 30, 2025193 Part II Other Information Item 1. Legal Proceedings Sweetgreen is involved in various claims, lawsuits, governmental investigations, and administrative proceedings in the ordinary course of business, but does not anticipate these matters will have a material effect on its financial position or results of operations - The Company is subject to various claims, lawsuits, governmental investigations, and administrative proceedings in the ordinary course of business194 - Management does not believe the ultimate resolution of these matters will have a material effect on the Company's financial position, results of operations, liquidity, or capital resources194 Item 1A. Risk Factors For a comprehensive description of risks and uncertainties impacting the business, including those related to macroeconomic conditions, consumer spending, U.S. international trade policies (tariffs), and increased costs of ingredients and equipment, refer to Part I, Item 1A of the company's Annual Report on Form 10-K for the fiscal year ended December 29, 2024 - Refer to Part I, Item 1A. 'Risk Factors' in the Annual Report on Form 10-K for the fiscal year ended December 29, 2024, for a description of risks and uncertainties195 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities or use of proceeds to report during the period - None to report196 Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities to report during the period - None to report197 Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable198 Item 5. Other Information During the fiscal quarter ended March 30, 2025, no director or officer adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the fiscal quarter ended March 30, 2025199 Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including organizational documents, employment agreements, certifications, and XBRL interactive data files - Exhibits include Amended and Restated Certificate of Incorporation, Bylaws, Separation and Executive Employment Agreements, Certifications (31.1, 31.2, 32.1), and XBRL Instance Document and Taxonomy Extensions200201 Signatures Report Signatures The report was duly signed on behalf of SWEETGREEN, INC. by Mitch Reback, Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer, and Duly Authorized Signatory) on May 8, 2025 - The report was signed by Mitch Reback, Chief Financial Officer, on May 8, 2025206