You can find original article here Nrn. Subscribe to our free daily Nrn newsletters. Noodles & Company, in its ongoing struggle to keep its shares listed on the Nasdaq Stock Market, was advised of its imminent delisting unless it sought a hearing with the stock exchange.  The deadline to bring its stock price above $1 per share, the minimum allowed by Nasdaq, or face delisting, passed on Dec. 22, with a share price still well below that level. It closed at 63 cents per share that day. It had recei ...

Core Insights - Noodles & Company has reported sequential improvements in same-store sales and traffic for the quarter ending September 30, driven by operational enhancements and the introduction of a new value menu [1][2] Sales Performance - For Q3, same-store sales increased by 4%, with a notable rise from 1.6% in July to 4.5% in August and 5.5% in September, continuing into October with an 8% growth [2] - Average unit volumes rose by 5.4% to $1.34 million, while average checks increased by 4.6%, which included a 2% price hike [6] Menu Innovations - The launch of the Delicious Duos value platform on July 30, offering a small entrée with a side starting at $9.99, contributed to the sales growth [3] - The introduction of the Chili Garlic Ramen as a limited-time offer at $8.95 in October also played a significant role in boosting sales [3][4] Digital Sales - Digital sales experienced a 12% increase, primarily driven by third-party delivery services, highlighting the importance of digital channels for growth [5][6] Financial Results - Despite the sales improvements, the company reported a net loss of $9.2 million, or 20 cents per share, compared to a loss of $6.8 million, or 15 cents per share, in Q3 of 2024 [7]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 decreased by 0.5% year-over-year to $122.1 million [15] - Comparable sales grew by 4% in Q3, with an increase of 8% in October [5][16] - Average check increased by 4.6%, including a 2% effective pricing during the quarter [16] - Net loss for Q3 was $9.2 million, or a loss of $0.20 per diluted share, compared to a net loss of $6.8 million, or a loss of $0.15 per diluted share last year [18] - Adjusted EBITDA improved by $1.6 million, or approximately 33%, to $6.5 million [11][18] Business Line Data and Key Metrics Changes - Digital sales channel saw a meaningful year-over-year improvement, driven largely by third-party delivery, which increased by 12% [6] - Restaurant contribution margins improved by 40 basis points to 13.2% from 12.8% in Q3 2024 [16][18] - COGS as a percentage of sales was 25.7%, a 20 basis point increase from last year [17] Market Data and Key Metrics Changes - Company comp traffic decreased slightly by 0.6% in Q3, but was positive in the second half of the quarter [16] - Year-over-year traffic was positive over 1.5% quarter-to-date, extending a positive traffic trend that began midway through Q3 [9] Company Strategy and Development Direction - The company is focusing on closing underperforming restaurants to improve overall sales leverage and enhance profitability [10][20] - The introduction of the Delicious Duos platform is aimed at providing value while maintaining brand equity and profitability [7] - The company is executing a comprehensive cost-savings plan expected to deliver over $5 million in savings across its P&L in 2025 [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the path ahead, citing strong sales trends and the success of recent initiatives [4][6] - The company anticipates continued strength in sales and margins, particularly as it laps over a period of heavy promotions and discounts from the previous year [9][21] - Management is optimistic about the impact of restaurant closures on future profitability, expecting a positive contribution of over $2 million in 2026 [20][21] Other Important Information - The board of directors has initiated a review of strategic alternatives to explore ways to maximize shareholder value [15] - The company plans to introduce new menu items, including a collaboration with a popular candy bar, in December [13] Q&A Session Summary Question: Can you discuss the success of the Delicious Duos and its impact on value perception? - Management noted that Delicious Duos filled a value void and is mixing around 4-5% across restaurants, with positive value scores from guests [23][24] Question: How does the company account for organic traffic versus sales transfer from closed stores? - Management indicated that closures have contributed about a 1% lift in sales, with positive traffic outside of sales transfer [25] Question: What are the learnings from the Ramen limited-time offer (LTO)? - Management is encouraged by the trial and repeat business from the Ramen LTO and sees potential for it to be a permanent menu item [26][27]

Core Insights - Noodles & Company reported a 4% increase in comparable restaurant sales for Q3 2025, outperforming the fast casual benchmark, with October sales accelerating to an 8% increase [3][6] - The company experienced a net loss of $9.2 million in Q3 2025, compared to a net loss of $6.8 million in Q3 2024, largely due to $5.3 million in pre-tax restaurant impairments [6][24] - Adjusted EBITDA rose by 32.7% to $6.5 million in Q3 2025, up from $4.9 million in the same quarter of the previous year [6][26] Financial Performance - Total revenue for Q3 2025 decreased by 0.5% to $122.1 million from $122.8 million in Q3 2024 [6][21] - Restaurant contribution margin improved to 13.2% in Q3 2025 from 12.8% in Q3 2024, indicating better restaurant-level productivity [6][36] - Operating margin was reported at (5.2)% for Q3 2025, compared to (3.9)% in Q3 2024 [6][21] Liquidity and Debt - As of September 30, 2025, the company had cash and cash equivalents of $4.7 million and outstanding debt of $109.8 million [4] - The available amount for future borrowings under its revolving credit facility was $12.2 million [4] Business Outlook - The company revised its guidance for fiscal year 2025, expecting total revenue between $492 million and $495 million, with comparable restaurant sales growth projected at 3.6% to 4.2% [7] - The company plans to close 31 to 34 company-owned restaurants and 7 to 8 franchise restaurants, while opening two new company-owned locations [7] Strategic Review - On September 3, 2025, the Board of Directors initiated a review of strategic alternatives to maximize stockholder value, which may include refinancing, refranchising, or selling parts of the business [8]

Core Insights - Noodles & Company is facing challenges in increasing guest counts and is implementing catering discounts to attract customers during the holiday season [1][2] - The company has been developing its catering business over the past two years, successfully promoting its noodle trays as suitable for catering [3] - Noodles & Company is also encouraging gift card purchases and running a promotional giveaway to engage customers [4][5] Catering Discounts - The chain is offering a 25% discount on the second catering pan ordered through November with the code PANS25 [2] - From November 18 to the end of the year, a 15% discount is available on catering orders over $150 using the code MERRYNOODLES [2] - The discounts cannot be combined [2] Catering Business Development - Noodles & Company has focused on its catering business, highlighting that its noodle trays, including popular mac & cheese, are well-suited for catering [3] - The company has seen some success in this area, aiming to provide varied options to avoid customer veto votes [3] Gift Card Promotions - The company is promoting gift card sales by offering a $10 bonus card for purchases of $50 or more on gift cards from November 5 to the end of the year [3] - A giveaway of 100 $50 gift cards is being held from November 17 to 24, aimed at consumers who prefer noodles over pizza during the holidays [4] Sales Performance and Management Changes - Sales began to decline in early 2023 due to aggressive price hikes, with new CEO Drew Madsen indicating deeper operational issues [6] - A new menu was introduced in March, and the "Delicious Duos" combo meal was launched on July 30, initially boosting sales and traffic [7] - The company has engaged Piper Sandler to explore potential sale options among other strategies [7]