Sweetgreen Stock Turns Bitter: What’s Spoiling the Salad Chain’s Rally?

Another green dream sours on Wall Street. Sweetgreen's stock tanks as investors lose appetite for overpriced kale and questionable unit economics.

The rot runs deeper than bad lettuce

Same-store sales wilt while expansion costs balloon—classic growth stock indigestion. The market's brutal when your $15 salad can't justify its valuation.

Institutional investors bolt for the exits

Hedge funds dump shares faster than expired dressing. Turns out 'farm-to-table' doesn't always translate to 'portfolios-to-profits.'

Another cautionary tale in the cult of unprofitable growth. Maybe next time try pairing those grain bowls with actual earnings?

Image source: Getty Images.

Sweetgreen faces more challenges

Same-store sales fell 7.6% in the quarter after jumping 9.3% the year before, and overall revenue ticked up just 0.5% to $185.6 million, missing estimates at $191.8 million.

Management noted several headwinds weighing on the business, including macroeconomic pressures, a challenging comparison with the quarter a year ago, and a transition in its loyalty program.

On the bottom line, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) fell from $12.4 million to $6.4 million, and the loss per share according to generally accepted accounting principles (GAAP) widened from $0.13 to $0.20, which was significantly worse than expectations at $0.05.

CEO Jonathan Niman said, "While we're not satisfied with today's results, we're confident in our ability to improve in the back half of 2025. Early signs from our new loyalty program are encouraging, our summer menu is bringing customers back more often, and we remain fully committed to raising the bar on execution across every restaurant."

What's next for Sweetgreen

Looking ahead, management's guidance didn't call for any immediate recovery. For the full year, it expects a same-store sales decline of 4%-6%, and revenue of $700 million-$715 million, which compares to the consensus at $713.8 million, and represents growth of less than 5% at the midpoint.

The company continues to expand its footprint with 40 new restaurants expected this year, but it will have to improve profitability and return to comparable sales growth in order for the stock to recover.