Financial Data and Key Metrics Changes - System-wide sales increased by 5.1% to $146.2 million, driven by new company-owned restaurants despite a challenging sales environment [8][20] - Total revenue decreased by 5.4% to $87.1 million compared to $92.1 million in the previous year [20] - Net loss for the quarter was $12.1 million, compared to a loss of $9.2 million in the prior year [27] Business Line Data and Key Metrics Changes - Twin Peaks revenue was $51 million, up 5.9% from $48.1 million in the prior year, driven by new lodge openings [20][21] - Smoky Bones revenue decreased by 17.8% to $36.1 million, down from $43.9 million, due to ongoing conversions to Twin Peaks lodges [21] - Restaurant level contribution margin for Twin Peaks decreased to 16.9% from 17.4% in the previous year [25] Market Data and Key Metrics Changes - Same store sales decreased by 1.5%, with a 2.7% decline at company-owned locations and a 1% decline at franchise locations [9] - Alcohol sales comprised nearly 50% of restaurant revenue, significantly higher than typical casual dining competitors [13] Company Strategy and Development Direction - The company plans to open three to four new units in 2025, building on a robust development pipeline of 100 units [7][12] - A strategic five-unit development deal was initiated to enter untapped markets in South Dakota and Montana [12] - The focus on high-margin beverage sales and local community engagement through grassroots marketing is expected to drive traffic [13][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of weather and macroeconomic factors on sales but expressed optimism about upcoming promotional events and major sporting events [9][10] - The company is confident in achieving its full annual equity target raise over the next twelve months despite current market volatility [27][28] Other Important Information - Twin Peaks was awarded the Black Box Intelligence 2025 Voice of the Customer Award, highlighting strong brand loyalty and customer experience [17][18] - The company is enhancing its menu with new food innovations and promotions to maintain brand relevance [14][19] Q&A Session Summary - No questions were taken following the prepared remarks, and the call concluded without a Q&A session [3][29]

Financial Data and Key Metrics Changes - System-wide sales for Q1 2025 increased approximately 4.8% year over year to $140.7 million, with total revenue rising approximately 2.3% year over year to $113.7 million [20] - Adjusted EBITDA for Q1 was $5.5 million, representing 4.9% of total revenue, a 2.8% decrease year over year due to a prior year settlement payment [20][24] - Company-operated shop revenue increased approximately 1.3% year over year to $109 million, while franchise revenue surged approximately 30.8% year over year to $4.7 million [21] Business Line Data and Key Metrics Changes - Same store sales growth was 0.9% for the quarter, driven by a 1.1% increase in average check, partially offset by a 0.2% decrease in transactions [21] - Franchise units increased by 26%, contributing to the significant rise in franchise revenue [21] Market Data and Key Metrics Changes - Digital sales represented over 42% of total shop sales during Q1, an increase of approximately 200 basis points compared to the previous year [14] - The company expects to open at least six new shops in Q2 2025, with a total of at least 38 new shops anticipated for the year [16][27] Company Strategy and Development Direction - The company is focused on driving same store sales growth through menu innovation, digital investments, and disciplined cost management [10][19] - Plans include modernizing the shop footprint and accelerating unit openings through franchising efforts, aiming for a total of 2,000 units in the U.S. [16][29] - The introduction of new menu items, such as the prime rib steak sandwich and other innovative offerings, is part of the strategy to enhance customer appeal [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth plan despite potential pressures from tariffs and a challenging consumer environment [26] - The company anticipates same store sales growth of 1.5% to 2.5% for the full year 2025, with adjusted EBITDA projected at approximately $33 million to $34 million [27][30] Other Important Information - The company reported a slight net loss of $62,000 for the quarter, an improvement of $2.7 million over the prior year [24] - The company purchased approximately 117,000 shares of common stock for about $1.1 million during the first quarter [25] Q&A Session Summary Question: What is driving the outsized performance in same store sales? - Management attributed the performance to menu innovation, digital marketing efforts, and improved value offerings [32][34] Question: Can you provide insights on franchising initiatives and unit level economics? - Management noted strong interest from franchisees due to positive trends and unit level economics, despite macroeconomic uncertainties [39][40] Question: What are the trends in digital ordering and loyalty penetration? - Digital sales exceeded 42% of total sales, with ongoing investments in technology and consumer-facing digital assets to enhance customer experience [50][51] Question: What are the expectations for inflation and pricing for the rest of the year? - The company anticipates a full-year inflation rate of 2% to 3% for commodities, with pricing increases planned to align with input cost movements [60][63] Question: What is the status of the PDK rollout and its impact on operations? - The company is on track to retrofit half of its company shops with the new PDK system, which is expected to improve labor efficiency and throughput [68][70]

Financial Data and Key Metrics Changes - For Q1 2025, total revenue was $119.2 million, up from $116.2 million in Q1 2024, representing a year-over-year increase of 2.6% [21] - Company-operated restaurant revenue increased by 1.2% to $98.4 million from $97.2 million in the same period last year, driven by a 0.6% increase in comparable restaurant sales [21][22] - GAAP net income for Q1 2025 was $5.5 million, or $0.19 per diluted share, compared to $5.9 million, or $0.19 per diluted share in the prior year [28][29] Business Line Data and Key Metrics Changes - Franchise revenue increased by 16.2% to $13.2 million, driven by IT pass-through revenue related to the franchisee rollout of a new point of sale system [23] - The increase in franchise revenue was partially offset by a 1.3% decrease in comparable restaurant sales [23] Market Data and Key Metrics Changes - System-wide comparable store sales decreased by 1.2% in Q2 to date through April 23, 2025, with a 0.1% decrease in company-operated restaurants and a 1.8% decrease in franchise restaurants [24] Company Strategy and Development Direction - The company is focused on a brand turnaround, emphasizing long-term sustainable growth without shortcuts [5] - Upcoming initiatives include a brand relaunch and menu innovations, such as the launch of Fresca wraps and salads, and quesadillas [6][9] - The company aims to open at least 10 new restaurants in 2025, marking the largest system-wide unit growth since 2022 [16][17] Management Comments on Operating Environment and Future Outlook - Management acknowledged that the first quarter results were underwhelming but expressed confidence in the steps being taken to improve performance [6] - The company expects sequential quarterly acceleration in comparable sales trends in Q3 and Q4, driven by the brand relaunch and new product launches [24] - Management noted that the consumer pullback is real, but they are focused on what they can control, including reinforcing quality and value [35] Other Important Information - Food and paper costs as a percentage of company restaurant sales decreased by 120 basis points year-over-year to 25.2% due to higher menu pricing [24][25] - Labor and related expenses increased by 120 basis points year-over-year to 32.7%, with wage inflation of approximately 12% in Q1 2025 [25][26] - The company expects to remodel between 60 to 70 system-wide restaurants in 2025, with eight already completed [19][30] Q&A Session Summary Question: Expectations for Q2 same store sales - Management indicated that headwinds are expected to continue in Q2, but they are focused on their brand relaunch and menu innovations to drive sales [34][35] Question: Impact of new product launches on comp trends - Management noted that the Mango Habanero product drove initial trial, and they are optimistic about the upcoming launches of Fresca wraps and quesadillas [38][40] Question: Regional differences in consumer behavior - Management observed that the consumer pullback is widespread, affecting various income bands, including the Hispanic consumer [51][52] Question: Menu pricing expectations for the year - Management expects menu pricing to be around 3% for the year, with approximately 2% in Q3 and Q4 [53] Question: Operational gaps identified through consumer feedback - Management is implementing a back-to-basics program to address operational gaps, focusing on accuracy and hospitality [70][72] Question: Kiosk rollout status and benefits - Kiosks are in most company restaurants, with plans to complete the rollout in the remaining locations, and management sees opportunities to enhance guest engagement through kiosks [73][74]

Financial Data and Key Metrics Changes - For Q1 2025, total revenue was $119.2 million, up from $116.2 million in Q1 2024, representing a 1.7% increase [19] - Company-operated restaurant revenue increased by 1.2% to $98.4 million, driven by a 0.6% increase in comparable restaurant sales and additional sales from two new restaurant openings [19] - The effective price increase was approximately 4.4% compared to 2024 [20] - GAAP net income for Q1 2025 was $5.5 million, or $0.19 per diluted share, compared to $5.9 million, or $0.19 per diluted share in the prior year [26] Business Line Data and Key Metrics Changes - Franchise revenue increased by 16.2% to $13.2 million, driven by IT pass-through revenue related to a new point of sale system and new franchise openings [20] - Comparable restaurant sales decreased by 1.3% for franchise-operated restaurants [20] Market Data and Key Metrics Changes - System-wide comparable store sales decreased by 1.2% in Q2 to date, with a 0.1% decrease in company-operated restaurants and a 1.8% decrease in franchise restaurants [21] Company Strategy and Development Direction - The company is focused on a brand turnaround, emphasizing long-term sustainable growth without shortcuts [5] - Upcoming initiatives include a brand relaunch and menu innovations, such as the launch of Fresca wraps and salads, and quesadillas [6][8] - The company aims to open at least 10 new restaurants in 2025, marking the largest system-wide unit growth since 2022 [14][15] - Remodeling efforts are ongoing, with plans to remodel 60 to 70 restaurants in partnership with franchisees [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging consumer environment but remains confident in the brand's long-term potential [6] - The company expects sequential quarterly acceleration in comparable sales trends in Q3 and Q4, driven by the brand relaunch and new product launches [22] - Wage inflation is anticipated to be between 4% to 5% for the year, with Q1 experiencing a 12% increase [23][24] Other Important Information - The company has transitioned to a new distribution partner, which is expected to enhance margins and support future growth [14] - The restaurant contribution margin for Q1 was 16%, down from 17.6% in the previous year, primarily due to labor inflation and occupancy costs [24][25] - General and administrative expenses decreased to 9.5% of total revenue, aided by prior year restructuring costs [26] Q&A Session Summary Question: Expectations for Q2 same store sales - Management noted that consumer pullback is real and expects headwinds to continue into Q2, but is focused on brand relaunch and value innovation [32][33] Question: Impact of new product launches on comp trends - The Mango Habanero product drove initial trial, and upcoming launches of Fresca wraps and quesadillas are expected to attract different consumer segments [36][38] Question: Timing of kitchen equipment rollout and labor cost impact - Equipment rollout is ongoing, with expectations of improved labor efficiency as new systems are implemented [41] Question: Regional differences in consumer behavior - Management observed similar consumer pullback across markets, with particular pressure on the Hispanic consumer segment [50][51] Question: Menu pricing expectations for the year - The company expects menu price increases to be around 3% for the year, with variations across quarters [52] Question: Development pipeline momentum - Management expressed optimism about the development pipeline, with confidence in opening at least 10 new units this year and potential for more in the following year [59][60]

Financial Data and Key Metrics Changes - The company reported total revenues of $927 million for the first quarter, finishing towards the high end of guidance, with a 27% year-over-year increase in adjusted earnings per share [7][16] - Adjusted net income margin was 4.9%, exceeding the high end of the guidance range [16] - GAAP diluted net income per share was $0.67, while adjusted diluted net income per share was $0.93 [20] Business Line Data and Key Metrics Changes - Comparable sales at The Cheesecake Factory restaurants increased by 1%, with total sales reaching $673 million, up 1% from the prior year [7][17] - North Italia's total sales were $83.4 million, an 18% increase from the prior year, with comparable sales declining by 1% [17][14] - Flower Child sales totaled $43.5 million, up 26% from the prior year, with comparable sales increasing by 5% [17][14] Market Data and Key Metrics Changes - The Cheesecake Factory's off-premise sales mix was 22%, consistent with the previous year [18][102] - North Italia's annualized average unit volumes (AUVs) increased to $7.75 million, while Flower Child's AUV was over $4.6 million, reflecting strong consumer demand [13][14] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025, with eight openings expected in the second quarter [9][26] - The company has been recognized on Fortune Magazine's 100 Best Companies to Work For list for the twelfth consecutive year, highlighting its commitment to employee satisfaction [9] - The focus remains on menu innovation, operational execution, and maintaining restaurant design and ambiance [9][27] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment feels less robust than three months ago, citing unprecedented weather and economic factors [30][31] - The company anticipates total revenues for fiscal 2025 to be approximately $3.76 billion at the midpoint of estimates, with adjusted net income margin expectations around 4.75% [24][25] - Management expressed confidence in navigating near-term uncertainties while delivering sustainable long-term value [27] Other Important Information - The company returned $153.8 million to shareholders during the quarter through dividends and share repurchases [17] - The company ended the quarter with total available liquidity of approximately $501.9 million [20] Q&A Session Summary Question: Has the uncertain macro environment already impacted the business? - Management acknowledged that there has been a lot of noise in the first four months of the year, but the business remains stable and predictable [30][31] Question: Can you quantify the expected impact of tariffs on the P&L? - Management indicated that the biggest impact would be in other operating expenses, with potential pricing adjustments of 50 to 75 basis points if necessary [35][40] Question: What are the same-store sales components for The Cheesecake Factory? - The Cheesecake Factory experienced 4% effective pricing, with traffic down 1.2% [50] Question: How is the performance of Flower Child differentiating in a slowing environment? - Management highlighted the strong food quality and operational stability as key factors driving Flower Child's performance [70] Question: What is the expected pricing for the year? - Management confirmed that the pricing expectation remains at 4% for the year [75]

Core Viewpoint - Yum China Holdings, Inc. (YUMC) has experienced a 10.8% stock price increase over the past three months, outperforming the industry average of 3.6%, driven by unit expansion, menu innovation, and digitalization efforts, despite concerns regarding an uncertain macro environment [1] Group 1: Growth Drivers - The company is focused on aggressive unit growth, having opened 534 net new stores in Q4 2024, bringing the total to 16,395, with KFC and Pizza Hut showing strong performance and quick payback periods of two to three years [2] - Yum China is optimistic about long-term growth in China, targeting underserved areas and enhancing accessibility through customized store formats, aiming for a franchise proportion of 40-50% for KFC and 20-30% for Pizza Hut in the coming years [3] - Menu innovation plays a crucial role, with KFC and Pizza Hut regularly introducing new items that cater to evolving consumer preferences, maintaining transaction growth while broadening the customer base [4] Group 2: Digitalization and Sales - The company has significantly invested in digitization, with digital sales reaching $9.6 billion in 2024, accounting for approximately 90% of total sales, supported by automation and AI to enhance customer experience [5] Group 3: Cost Concerns - Yum China faces high structural costs related to labor and rentals, with total costs and expenses rising to $2.44 billion in Q4 2024 from $2.38 billion in the previous year, and anticipates a 5.4% increase in restaurant expenses to $9.5 billion in 2025 due to wage inflation [7]

Core Insights - Sweetgreen achieved its first full year of positive adjusted EBITDA in 2024, reporting $18.7 million, a $21.5 million improvement from the previous year [2][3] - The company is focusing on expanding its Infinite Kitchen technology, which has shown to deliver significant labor cost reductions and improved operational efficiency [4][5] - Sweetgreen plans to enhance its menu innovation and launch a revamped loyalty program to increase customer frequency and broaden its customer base [6][7] Financial Performance - Sweetgreen's adjusted EBITDA for 2024 was $18.7 million, marking a key milestone in the company's history [2][3] - The restaurant-level margin expanded by over 200 basis points year over year to 19.6%, indicating improved operational efficiency [3] - For 2025, the company expects revenue between $760 million and $780 million, with same-store sales growth of 1%-3% and adjusted EBITDA between $32 million and $38 million [8] Strategic Initiatives - The Infinite Kitchen technology is operational in 12 locations, with plans to install it in 20 of the 40 new restaurant locations planned for 2025 [5] - Sweetgreen is launching a new loyalty program, SG Rewards, in April 2025, offering customers 10 points for every eligible dollar spent [7] - The company aims to drive traffic through menu innovation and enhance the digital experience, focusing on strengthening brand engagement [9]

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]