Sweetgreen, the fast-casual restaurant often referred to as a tech company rather than a restaurant company, is closer to closing its debt than the prior year, the brand announced during its first-quarter earnings call on Thursday.
The quarter, which ended on March 26, saw the Los Angeles-based chain increase same-store sales by 5% year-over-year.
It’s all looking up for Sweetgreen. In addition to closing its debt, the growing brand is opening its first Infinite Kitchen, a store design with an automated makeline. That store will open in Naperville, Ill. on May 10, according to CEO Jonathan Neman.
Later this year, a second location of the Infinite Kitchen will open in an existing unit.
“From these pilots, we hope to learn how we can create a more consistent customer experience, faster throughput, and make our team members’ jobs easier and more dynamic,” said Neman. “We believe this new concept, powered by automation, unlocks efficiencies that will enable us to grow more quickly and have higher profit margins.”
This comes on the heels of the brand’s 2021 acquisition of technology company Spyce.
Sweetgreen isn’t the only restaurant company testing automated makelines. Chipotle has been playing around with the very same idea alongside the company Hyphen.
Sweetgreen got into a bit of trouble earlier this year with Chipotle when it named its new bowl, meant to increase dinner occasions, the Chipotle Chicken Burrito Bowl, which caused Chipotle to file a lawsuit against Sweetgreen. Sweetgreen changed the name of the menu item the next day.
Neman said on the call that the bowl, now named the Chicken + Chipotle Pepper Bowl, is one of the chain’s top five performing items.
Amid rising costs, Sweetgreen increased menu prices again at the beginning of this year by 3% with another round of 1% price increases to a smaller, more targeted number of stores set to happen at the beginning of the second quarter.
Customers haven’t shown resistance to price hikes, according to Neman.
During the call, Neman also announced the departure of the chain’s chief marketing officer, Daniel Shlossman, who helped create the chain’s new loyalty program, Sweetpass. Shlossman left Sweetgreen to join Wonder, a food delivery startup based in New York City, as its chief marketing and growth officer, the Wall Street Journal reported.
Sweetgreen’s debt with loss from operations was at -28% versus -49% in the year prior.
Sweetgreen has often been compared to a tech company because of its debt structure. Despite the company’s high valuation when it went public two years ago, the restaurant hasn’t turned a profit in its 17 years in business, much like a tech company.
Net loss for Sweetgreen was -$33.7 million versus -$49.7 the year prior.
Restaurant-level profit margins remained relatively stable, 14% this year versus 13% the year prior while adjusted EBITDA was -$6.7 million versus $17 million the year prior or -5% versus -17%.
Revenue was up 22% versus the year prior for a total of $125.1 million.
