Activist investor takes stake in Noodles & Company

Core Insights - Noodles & Company is closing underperforming units and plans to accelerate closures, with 20 restaurants closed last year and an expected 31 to 34 closures in 2025 [3][4] - The company has faced activist pressure, conceding a board seat to an activist investor in 2024, and is exploring strategic alternatives including a potential sale [3][6] - Galloway Capital Partners, which holds a 6% stake, recommends selling 200 company-owned locations to generate approximately $60 million to reduce high-cost debt [5][6] Company Performance - Noodles & Company has seen an increase in sales and profits at nearby locations following the closure of underperforming restaurants, expecting to retain about 30% of sales from closed stores [4] - Despite outperforming some competitors in same-store sales growth, the company is experiencing growing net losses, revenue declines, and negative operating margins [6] - As of September 30, the company had 349 company-owned units and only 86 franchised units, indicating a shift towards an asset-light model [4][6]