A worker wears a Sweetgreen Inc. hat while preparing food inside the company’s restaurant in Boston, Massachusetts.
Adam Glanzman | Bloomberg | Getty Images
Shares of Sweetgreen plunged about 20% in extended trading Tuesday after the salad chain lowered its 2022 forecast.
The restaurant company also said it laid off 5% of its support center workforce and will downsize to a smaller office building to lower its operating expenses.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Loss per share: 36 cents, in line with estimates
- Revenue: $124.9 million vs. $130.2 million expected
Sweetgreen sales softened around Memorial Day, leading the company to revise its forecast lower, CFO Mitch Reback said in a statement.
For 2022, Sweetgreen now expects annual revenue of $480 million to $500 million, down from its prior forecast of $515 million to $535 million. The chain also revised its outlook for same-store sales, predicting growth of 13% to 19%, down from the previous projection of 20% to 25%.
Moreover, Sweetgreen also changed its outlook for adjusted losses before interest, taxes, depreciation and amortization to a range of $45 million to $35 million, wider than its previous range of $40 million to $33 million.
But the chain shared the steps it’s taking to achieve profitability, including layoffs and reducing its real estate footprint by moving to a smaller office. Severance packages and related benefits are expected to cost the company between $500,000 to $800,000, while the office move will cost $8.4 million to $9.9 million. The charges are expected to impact its third-quarter results.
This is a developing story. Check back for updates.
Image and article originally from www.cnbc.com. Read the original article here.