Noodles & pany(NDLS) - 2026 Q2 - Quarterly Results

Financial Performance Overview Noodles & Company's Q2 2025 saw revenue decline, increased net loss, and revised full-year guidance amidst strategic shifts Q2 2025 Financial Highlights Q2 2025 saw a slight revenue decline to $126.4 million, increased net loss to $17.6 million, and reduced Adjusted EBITDA Q2 2025 vs. Q2 2024 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $126.4 million | $127.4 million | -0.7% | | Comparable Restaurant Sales | +1.5% | +2.0% | -0.5 p.p. | | Net Loss | $(17.6) million | $(13.6) million | Increased Loss | | Loss per Diluted Share | $(0.38) | $(0.30) | Increased Loss | | Restaurant Contribution Margin | 12.8% | 15.5% | -2.7 p.p. | | Adjusted EBITDA | $6.0 million | $9.2 million | -34.8% | - During the second quarter of 2025, the company opened one new company-owned restaurant while closing six company-owned and two franchise locations[5] Management Commentary CEO Drew Madsen discussed positive comparable sales despite a tough market, new value platform success, and his CEO transition - The company achieved positive comparable restaurant sales of 1.5% in Q2 despite a challenging consumer environment marked by heightened industry-wide promotions[3] - A new value-focused platform, "Delicious Duos," launched in early August has shown strong initial results, with comparable restaurant sales averaging a 5% increase over the first two weeks[3] - CEO Drew Madsen is transitioning out of his role, with Joe Christina set to become the new CEO; Madsen will remain on the Board of Directors[3] Liquidity and Financial Position As of July 1, 2025, the company reported $2.3 million cash, $108.3 million debt, and $13.7 million available credit Liquidity Position as of July 1, 2025 | Metric | Amount | | :--- | :--- | | Cash and Cash Equivalents | $2.3 million | | Outstanding Debt | $108.3 million | | Available Revolving Credit | $13.7 million | Full Year 2025 Business Outlook Revised full-year 2025 guidance projects $487M-$495M revenue, 2.5%-4.0% comparable sales, and portfolio optimization Revised Full Year 2025 Guidance | Metric | Expected Range | | :--- | :--- | | Total Revenue | $487M - $495M | | Comparable Restaurant Sales Growth | 2.5% - 4.0% | | Restaurant Level Contribution Margins | 11.8% - 12.6% | | General & Administrative Expenses | $48M - $50M | | Capital Expenditures | $12M - $13M | - The company plans significant portfolio changes, with two new company-owned restaurant openings and 28 to 32 company-owned restaurant closures expected in 2025[12] Detailed Financial Statements This section presents Noodles & Company's condensed consolidated statements of operations, balance sheet, and operating data Condensed Consolidated Statements of Operations Q2 2025 revenue slightly decreased to $126.4 million, with operating loss widening to $14.8 million due to impairments Q2 Statement of Operations Summary (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue | $126,433 | $127,352 | | Total Costs and Expenses | $141,211 | $138,870 | | Loss from Operations | $(14,778) | $(11,518) | | Net Loss | $(17,552) | $(13,625) | | Loss per Share (Basic & Diluted) | $(0.38) | $(0.30) | - Restaurant impairments, closure costs, and asset disposals were a significant expense, totaling $13.7 million in Q2 2025, an increase from $12.1 million in Q2 2024[20] Consolidated Balance Sheet and Operating Data As of July 1, 2025, total assets were $294.6M, liabilities $325.4M, and total restaurant count decreased to 453 Balance Sheet Summary (in thousands) | Metric | July 1, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets | $294,575 | $324,648 | | Total Liabilities | $325,350 | $330,227 | | Total Stockholders' Deficit | $(30,775) | $(5,579) | Restaurant Count Trend | Restaurant Type | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Company-owned | 364 | 379 | (15) | | Franchise | 89 | 94 | (5) | | Total | 453 | 473 | (20) | - System-wide comparable restaurant sales increased by 1.5% in Q2 2025, a slowdown from the 4.4% growth seen in Q1 2025 but an improvement over the 1.3% for company-owned restaurants in Q2 2024[22] Non-GAAP Financial Measures and Reconciliations Reconciliation of GAAP net loss to non-GAAP measures (EBITDA, Adjusted Net Loss, Restaurant Contribution) and key definitions Reconciliation of Net Loss to EBITDA and Adjusted EBITDA Q2 2025 GAAP Net Loss of $17.6 million reconciled to Adjusted EBITDA of $6.0 million, primarily adjusted for impairments Q2 EBITDA and Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Loss | $(17,552) | $(13,625) | | EBITDA | $(7,639) | $(4,151) | | Adjustments (Impairments, Stock Comp, etc.) | $13,655 | $13,346 | | Adjusted EBITDA | $6,016 | $9,195 | - The largest adjustment to reconcile Net Loss to Adjusted EBITDA was restaurant impairments, which amounted to $11.9 million for the quarter[24] Reconciliation of Net Loss to Adjusted Net Loss Q2 2025 GAAP Net Loss of $17.6 million adjusted for special items, resulting in an Adjusted Net Loss of $5.4 million Q2 Adjusted Net Loss Reconciliation (in thousands, except per share) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Loss | $(17,552) | $(13,625) | | Adjustments (Impairments, etc.) | $12,131 | $11,177 | | Adjusted Net Loss | $(5,421) | $(2,448) | | Adjusted Loss per Share (Diluted) | $(0.12) | $(0.05) | Reconciliation of Operating Loss to Restaurant Contribution Q2 2025 operating loss of $14.8 million reconciled to Restaurant Contribution of $15.8 million, with a 12.8% margin Q2 Restaurant Contribution Reconciliation (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Loss from Operations | $(14,778) | $(11,518) | | Adjustments (G&A, D&A, Impairments, etc.) | $30,613 | $30,903 | | Restaurant Contribution | $15,835 | $19,385 | | Restaurant Contribution Margin | 12.8% | 15.5% | Key Definitions and Disclosures Definitions for AUV, Comparable Restaurant Sales, and Restaurant Contribution Margin, plus forward-looking statements disclaimer - Comparable Restaurant Sales are defined as year-over-year sales comparisons for restaurants open at least 18 full periods, generated by changes in traffic and per-person spend[9] - Restaurant Contribution Margin is a non-GAAP measure representing restaurant revenue less restaurant-level operating costs (cost of sales, labor, occupancy, other) as a percentage of restaurant revenue[10] - The report includes a forward-looking statements section that warns actual results may differ materially from projections due to various risks, including economic conditions, inflation, supply chain challenges, and labor costs[18]