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Sweetgreen, Inc. (NYSE:SG) shares are trading higher after the company reported better-than-expected second-quarter FY24 revenue results yesterday.
Revenue upped 21% Y/Y to $184.6 million, beating the consensus of $180.78 million, driven mainly by an additional $18.2 million from 36 net new restaurant openings during or after last year’s corresponding quarter.
Same-store sales rose 9% Y/Y, driven by a 5% boost from menu price increases implemented after the thirteen weeks ending June 25, 2023, and a 4% increase from higher traffic and a favorable product mix. Average unit volume (AUV), as adjusted, stood at $2.9 million.
Total digital revenue accounted for 56% of sales, with owned digital revenue making up 31%, compared to 59% and 37%, respectively, in the previous year.
Restaurant-level profit stood at $41.5 million, with a margin of 22%, up from $31.1 million and a 20% margin in the prior year.
Adjusted EBITDA came in at $12.4 million vs. $3.3 million in the prior year, with a margin of 7%, up from 2% the previous year. The company reported EPS loss of $0.13, missing the street view of $0.12 loss.
Jonathan Neman, Co-Founder and Chief Executive Officer, said, “We continue to open successful new restaurants across the country and our new Caramelized Garlic Steak has quickly become a customer favorite. Sweetgreen’s expanding menu is hitting the mark with customers, delivering on craveability, quality and value.”
Mitch Reback, Chief Financial Officer, stated, “Despite a heightened uncertain economic backdrop for the consumer, we are raising our guidance for 2024 given our results during the first half of the year.”
Outlook: For FY24, the company raised revenue guidance to $670 million – $680 million (vs. $660 million – $675 million) vs. street view of $674.248 million and same-store sales growth to 5% – 7% (from 4% – 6% prior).
Sweetgreen now projects new restaurant openings of 24 – 26 (vs. 23 – 27 expected earlier), a restaurant-level profit margin of 19% – 20% (vs. 18.5% – 20% prior), and adjusted EBITDA of $16 million – $19 million (vs. $10 million – $19 million earlier).
Investors can gain exposure to the stock via AdvisorShares Restaurant ETF (NYSE:EATZ) and Invesco Dorsey Wright Consumer Cyclicals Momentum ETF (NASDAQ:PEZ).
Price Action: SG shares are up 26% at $33.08 at the last check Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo via Shutterstock
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