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CHICAGO - Potbelly Corporation (NASDAQ:PBPB) reported fourth-quarter earnings that exceeded analyst expectations, but saw revenue decline YoY, leading to a 2.6% drop in its stock price.
The sandwich shop chain posted adjusted earnings per share of $0.13, beating the analyst estimate of $0.05. However, revenue fell 7.3% YoY to $116.63 million, though still slightly above the consensus estimate of $115.23 million. The revenue decline was attributed to the impact of the 53rd week in 2023 and the refranchising of 34 company-owned shops since Q2 2023.
Potbelly’s same-store sales increased 0.3% in Q4, compared to a 6.3% increase in the prior year. Average weekly sales rose 1.1% to $25,230.
"We are pleased with what we have accomplished in 2024 as our team did a tremendous job executing against our five-pillar strategy," said Bob Wright, President and CEO of Potbelly Corporation.
The company opened eight new shops in Q4, bringing the total new openings for the year to 23. Potbelly also signed franchise commitments for 29 new shops during the quarter.
For Q1 2025, Potbelly expects same-store sales growth between -1.5% and -0.5%, with adjusted EBITDA of $3.5 million to $4.5 million. For the full year 2025, the company projects same-store sales growth of 1.5% to 2.5% and adjusted EBITDA of $33 million to $34 million.
Despite the earnings beat, investors appeared to focus on the revenue decline, sending Potbelly shares down 2.6% following the report.
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