Core Insights - Noodles & Company has established a successful turnaround with a reported same-store sales growth of 6.6% for Q4 2025, driven by improved operations, a popular value option, and successful limited-time offers (LTOs) that contributed to a 1.4% increase in traffic [1] Group 1: Menu Innovations - The introduction of the Chili Garlic Ramen in October was a significant success, becoming one of the strongest LTOs in the company's history and appealing to both loyal customers and new consumers [2][3] - The company is exploring additional ramen recipes, believing that a dedicated ramen section could perform as well as its popular mac & cheese offerings [4] Group 2: Sales Performance - The momentum from Q4 continued into 2026, with same-store sales up by more than 9% and traffic increasing by over 4% in the first quarter [5] - The success is attributed to a menu relaunch in March and the introduction of the Delicious Duos option, which pairs a small entrée with a side starting at $9.95, addressing the value-conscious consumer trend [5] Group 3: Operational Improvements - The closure of 33 underperforming restaurants during the year positively impacted unit economics, leading to improved sales at neighboring locations that remained open [6]

Core Insights - The company achieved system-wide comparable sales growth of nearly 7% in 2025 by enhancing food quality and launching the most comprehensive menu in its history [1] - Traffic and brand awareness were driven through high-impact limited-time offers, such as Steak Stroganoff, which exceeded prior launch results and strengthened guest engagement [1] - A value-based pricing strategy was implemented with 'Delicious Duos' to address consumer price sensitivity through variety and satisfaction rather than temporary discounting [1] Financial Performance - Restaurant-level margins expanded by 290 basis points to 14.1% due to improved labor productivity, disciplined food cost management, and sales leverage [1] - The Operational Excellence Review (OER) program was launched to establish a structured coaching model, resulting in overall guest satisfaction scores reaching 72% in January [1] Strategic Initiatives - The restaurant portfolio was optimized by closing underperforming locations, facilitating a material transfer of sales to nearby sites and increasing baseline average unit volumes [1] - Marketing transitioned to an 'always-on' performance-optimized engine that dynamically adjusts investment based on real-time return and audience response data [1]

Core Insights - The company has launched its most comprehensive menu in history, introducing craveable limited-time offers (LTOs) like chili garlic ramen, which has attracted new customer groups [1][10][11] - The company achieved system-wide comparable sales growth of nearly 7% in 2025, with an increase to over 9% in 2026, indicating strong momentum and profitability improvements [2][21] - A thorough review of the restaurant portfolio led to the closure of underperforming locations, resulting in increased sales at nearby restaurants and improved margins [5][26] Menu and Product Strategy - The introduction of Delicious Duos provided guests with appealing meal combinations at attractive price points, enhancing consumer awareness of new menu offerings [1][14] - Limited-time offers, such as steak stroganoff, have driven significant engagement and sales, reinforcing the brand's authority in noodles [7][10] - The company is evaluating additional ramen recipes to expand its menu further, aiming to replicate the success of its macaroni offerings [11] Operational Excellence - The Operational Excellence Review program has improved accountability and consistency across restaurants, leading to better guest experiences and higher satisfaction scores [12][13] - The company has focused on tightening execution, improving food consistency, and managing costs effectively, which has contributed to stronger operational performance [5][19] Financial Performance - In Q4, total revenue increased by 0.8% to $122.8 million, with comparable restaurant sales rising by 6.6% [21] - The restaurant contribution margin improved to 14.1%, up from 11.2% in the previous year, driven by better cost management and sales leverage [22][18] - Adjusted EBITDA for Q4 was $7.6 million, an increase of over 88% compared to the previous year [25] Future Outlook - The company expects continued growth in 2026, projecting comparable sales growth of approximately 9% and adjusted EBITDA between $30 million and $35 million [27][28] - Plans to close an additional 30 to 35 restaurants in 2026 are anticipated to further enhance restaurant-level profitability [26][29] - The company aims to be free cash flow positive and reduce its debt balance by $5 million to $10 million in 2026 [29]

Financial Data and Key Metrics Changes - Total revenue in Q4 2025 increased by 0.8% year-over-year to $122.8 million [19] - System-wide comparable restaurant sales in Q4 increased by 6.6%, with company-owned restaurants up 7.3% and franchise restaurants up 3.8% [19] - Average unit volumes for company restaurants increased by 9.9% to $1.44 million [19] - Restaurant contribution margin improved to 14.1% in Q4 2025, up from 11.2% in Q4 2024 [20] - Adjusted EBITDA in Q4 was $7.6 million, an increase of over 88% compared to $4 million in Q4 2024 [22] Business Line Data and Key Metrics Changes - The company closed 9 company-owned and 3 franchise restaurants in Q4 2025 as part of a portfolio optimization project [22] - The closures resulted in a transfer of sales to nearby locations, positively impacting average unit volumes and restaurant-level profits [24] Market Data and Key Metrics Changes - System-wide comparable sales growth accelerated to over 9% in Q1 2026, with traffic growth over 4% [4] - The company has seen consistent performance, significantly outperforming the industry average of 0%-1% same-store sales growth [35] Company Strategy and Development Direction - The company focused on four strategic goals: developing winning teams, igniting growth, driving guest satisfaction, and delivering strong financial results [9] - A renewed emphasis on operational excellence and a structured coaching model has been implemented to improve consistency and accountability across restaurants [12] - The company is exploring strategic alternatives to maximize shareholder value, including potential refinancing or other financial transactions [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the foundation built in 2025 and the strong sales acceleration into 2026, positioning the company for sustainable growth [27] - The company is addressing consumer value consciousness by offering appealing meal combinations without temporary discounts [14] Other Important Information - The company expects to close 30-35 restaurants in 2026 as part of ongoing optimization efforts [24] - Capital expenditures for 2026 are estimated at $9.5 million-$10.5 million, with expectations to be free cash flow positive [26] Q&A Session Summary Question: Insights on 2026 guidance and sales transfer impact - Management indicated that approximately half of the expected EBITDA improvement in 2026 is attributed to restaurant closures, with the remainder from core business improvements [33] Question: Impact of external factors on sales performance - Management noted no significant impact from early tax refunds or geopolitical tensions on current performance, maintaining consistency in sales growth [35] Question: Mix of Delicious Duos offerings - The Delicious Duos mix is around 5%, influenced by the presence of strong limited-time offers [38]

Financial Data and Key Metrics Changes - Total revenue in Q4 2025 increased by 0.8% year-over-year to $122.8 million [19] - System-wide comparable restaurant sales in Q4 increased by 6.6%, with company-owned restaurants up 7.3% and franchise restaurants up 3.8% [19] - Average unit volumes for company restaurants rose by 9.9% to $1.44 million [19] - Restaurant contribution margin improved to 14.1% in Q4 2025, up from 11.2% in Q4 2024, reflecting a 290 basis point increase [20] - Adjusted EBITDA for Q4 was $7.6 million, an increase of over 88% compared to $4 million in Q4 2024 [22] Business Line Data and Key Metrics Changes - The company closed nine company-owned restaurants and three franchise restaurants in Q4 2025, continuing a trend of closing underperforming locations [22] - The closures resulted in a transfer of sales to nearby locations, positively impacting average unit volumes and restaurant-level profits [24] Market Data and Key Metrics Changes - System-wide comparable sales growth accelerated to over 9% in Q1 2026, with traffic growth exceeding 4% [4] - The company has seen consistent performance, significantly outperforming the industry average of 0%-1% same-store sales growth [36] Company Strategy and Development Direction - The company focused on enhancing its menu with new offerings and limited-time promotions, such as the Chili-Garlic Shrimp Ramen and Steak Stroganoff, to attract new customer groups [5][11] - A renewed emphasis on operational excellence through the Operational Excellence Review program has improved consistency and accountability across restaurants [12] - The company aims to optimize its restaurant portfolio further, with plans to close an estimated 30-35 restaurants in 2026 [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum, citing strong execution of fundamentals and improved guest experience as key drivers of performance [27] - The company anticipates continued growth in adjusted EBITDA for 2026, projecting total revenue between $478-493 million and comp restaurant sales growth of 6%-9% [25] Other Important Information - The company is undergoing a review of strategic alternatives to maximize shareholder value, which may include refinancing existing debt [17] - The company has a debt balance of $110.2 million and expects to be free cash flow positive in 2026 [23] Q&A Session Summary Question: Insights on 2026 guidance and sales transfer impact - Management indicated that approximately half of the expected $10 million EBITDA improvement for 2026 is attributed to restaurant closures, with the remainder from core business improvements [33] Question: Impact of external factors on sales performance - Management noted no significant impact from early tax refunds or geopolitical tensions on current performance, maintaining consistent sales growth [36] Question: Mix of Delicious Duos offerings - The Delicious Duos mix is around 5%, influenced by the presence of strong limited-time offers [39]

Financial Data and Key Metrics Changes - Total revenue in Q4 2025 increased by 0.8% year-over-year to $122.8 million [19] - System-wide comparable restaurant sales in Q4 increased by 6.6%, with company-owned restaurants up 7.3% and franchise restaurants up 3.8% [19] - Restaurant contribution margin in Q4 improved to 14.1%, up from 11.2% in Q4 2024, reflecting a 290 basis point increase [20] - Adjusted EBITDA in Q4 was $7.6 million, an increase of over 88% compared to $4 million in Q4 2024 [22] - Net loss for Q4 was $6.8 million, or a loss of $1.16 per diluted share, compared to a net loss of $9.7 million or a loss of $1.70 per diluted share in the previous year [22] Business Line Data and Key Metrics Changes - Company average unit volumes in Q4 increased by 9.9% to $1.44 million [19] - Average check increased by 5.8% in Q4, which included a 2% effective pricing increase [19] - The company closed 9 company-owned restaurants and 3 franchise restaurants in Q4 [22] Market Data and Key Metrics Changes - System-wide comparable sales growth accelerated to over 9% in Q1 2026 year-to-date [4] - Company comp traffic in Q4 increased by 1.4% [19] - The closures of underperforming restaurants positively impacted comparable sales by approximately 100-150 basis points in Q4 [24] Company Strategy and Development Direction - The company focused on strengthening its core business and restoring consistency across the system in 2025 [10] - Strategic goals for 2026 include developing winning teams, igniting growth, driving guest satisfaction, and delivering strong financial results [9] - The company is exploring strategic alternatives to maximize shareholder value, including refinancing existing debt [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the consistency of performance across the business, citing improved food quality and execution [17] - The company anticipates continued sales momentum and margin improvement in 2026, projecting total revenue of $478 million to $493 million [25] - Management noted that the current macroeconomic environment has made consumers more value-conscious, which the company is addressing through its menu offerings [14] Other Important Information - The company expects to close 30-35 restaurants in 2026 as part of its portfolio optimization project [24] - Capital expenditures for 2026 are estimated to be between $9.5 million and $10.5 million [26] - The company aims to be free cash flow positive and reduce its debt balance by $5 million to $10 million in 2026 [26] Q&A Session Summary Question: What is the contribution of sales transfer to the 2026 guidance? - Management indicated that approximately half of the expected EBITDA improvement in 2026 will be due to closures, with the rest attributed to core business improvements [34] Question: Are there any stimulative benefits from early tax refunds or pressures from external factors? - Management noted no significant impact from tax refunds or external pressures on performance, maintaining consistency in sales growth [36] Question: How does the Delicious Duos mix perform? - The Delicious Duos mix is expected to be around 5%, influenced by strong limited-time offers [38]

Core Viewpoint - Noodles & Company is facing imminent delisting from the Nasdaq Stock Market due to its stock price falling below the required minimum of $1 per share, with a current price of 63 cents as of December 22, 2025 [1] Group 1: Delisting and Compliance - The company received a delisting warning on June 24, 2025, and was given 180 days to comply with the minimum share price requirement [2] - Noodles & Company plans to request a hearing to stay the delisting process, which will allow it to continue trading while the hearing is pending [2] - A special stockholder meeting is scheduled for February 4, where the company will propose a reverse stock split to increase its share price [2] Group 2: Financial Performance and Strategy - The company has been attempting a turnaround for over a year, launching a revamped menu and operational improvements [4] - For the quarter ending September 30, the company reported a 4% increase in same-store sales, with October showing an 8% increase, despite a 0.5% decrease in total revenue and a net loss of $9.2 million [4] - Noodles & Company has engaged Piper Sandler to explore options for maximizing shareholder value, including a potential sale of the company [4] Group 3: Investor Actions - Activist investor Galloway Capital Partners has urged Noodles & Company to sell approximately 200 of its 349 company-owned restaurants [4]

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]

Company Overview - Scott Davis has left Noodles & Company after 16 months as chief concept officer to join Tatte Bakery & Cafe as senior vice president of menu innovation [1][2] - Noodles & Company is currently evaluating its long-term strategic direction following Davis's departure [3] Leadership Changes - Drew Madsen, who was appointed as permanent CEO in March, left Noodles & Company at the end of August for personal health reasons [4] - Joseph Christina, former CEO of Tijuana Flats, has taken over as the new CEO [4] Operational Improvements - Noodles & Company has been working on improving operations through technology upgrades, including digital menu boards and enhanced training [5] - A new menu was rolled out in March, which has been adjusted to address consumer price sensitivity, introducing a "Delicious Duos" combo meal starting at $9.95 [5] Financial Strategy - The company has hired Piper Sandler to explore "strategic alternatives" to maximize shareholder value, including the potential sale of the company [6] - Noodles & Company is at risk of delisting from Nasdaq due to a low share price of less than $1, which is out of compliance with exchange rules [6] - The company has considered a reverse stock split to regain compliance with Nasdaq [7]