Sweetgreen 2025 Q3 Earnings Revenue Miss and 73.6% Wider Loss Signal Struggles

Sweetgreen (SG) reported fiscal 2025 Q3 earnings on Nov 8, 2025, with total revenue declining 0.6% to $172.39 million, missing estimates by 4.23%. The company’s net loss widened to $36.15 million ($0.31 EPS), a 73.6% increase in losses year-over-year. Management cut full-year 2025 guidance, projecting revenue of $682–$688 million and same-store sales declines of 7.7%–8.5%.

Revenue

Sweetgreen’s total revenue in Q3 2025 fell to $172.39 million, a 0.6% decline from $173.43 million in the prior-year quarter. The drop primarily stemmed from softer sales in key markets like the Northeast and Los Angeles, which account for 60% of its base. Digital sales remained a bright spot, contributing 61.8% of revenue, though this was partially offset by a 11.7% decline in customer traffic.

Earnings/Net Income

The company’s net loss expanded to $36.15 million ($0.31 EPS) in Q3 2025, representing a 73.6% increase in losses compared to $20.82 million ($0.18 EPS) in Q3 2024. This marked the fifth consecutive quarter of losses, underscoring persistent financial challenges. The EPS decline reflects broader operational pressures, including higher protein costs and tariffs on packaging.

Post-Earnings Price Action Review

Despite a modest revenue beat relative to internal expectations, Sweetgreen’s stock plummeted post-earnings due to a starkly bearish outlook. The company’s strategic sale of Spyce to Wonder for $186.4 million, aimed at refocusing on core operations, failed to offset investor concerns over declining traffic and same-store sales. Historical backtests of similar revenue-beating stocks showed potential gains, but Sweetgreen’s case highlights the risks of relying solely on revenue performance. Analysts remain divided: some see upside from menu innovations and operational refinements, while others caution against ongoing sales declines and strategic uncertainties. The effectiveness of the Spyce divestiture and loyalty program transition will be pivotal in determining the stock’s trajectory.

CEO Commentary

Jonathan Neman, CEO of Sweetgreen, acknowledged the quarter’s challenges, emphasizing a need for operational excellence and menu innovation. He highlighted initiatives like the Sweet Growth Transformation Plan, which includes the Sweet Path framework and a new restaurant scorecard to improve execution. Neman also noted the sale of Spyce as a strategic move to strengthen liquidity and focus on core operations.

Guidance

Sweetgreen revised its full-year 2025 guidance downward, projecting revenue of $682–$688 million and same-store sales declines of 7.7%–8.5%. The company anticipates adjusted EBITDA losses of $10–$13 million, a stark reversal from prior-year projections. Management remains cautious about near-term growth, with plans to open 15–20 net new restaurants in 2026, contingent on operational improvements.

Additional News

Sweetgreen’s strategic sale of Spyce to Wonder for $186.4 million marked a significant pivot, injecting $100 million in liquidity. The company also announced leadership changes, including the hiring of Zipporah Allen as Chief Commercial Officer and Jason Cochran as Chief Operating Officer, to drive brand and operational improvements. Additionally, the loyalty program transition from Sweetpass+ to SG Rewards aims to boost customer engagement. These moves reflect a broader effort to stabilize operations and address declining sales amid competitive pressures and shifting consumer preferences.