Sweetgreen at TD Cowen Conference: Strategic Moves and Market Challenges

On Tuesday, June 3, 2025, Sweetgreen (NYSE:SG) took the stage at the TD Cowen 9th Annual Future of the Consumer Conference to discuss its strategic initiatives amid a challenging market environment. The company highlighted its focus on menu innovation, loyalty programs, and international expansion while addressing obstacles such as sales performance in major metro markets and managing general and administrative (G&A) expenses.

Key Takeaways

• Sweetgreen launched a new loyalty program in April, attracting 20,000 sign-ups per week.
• Menu innovation includes seasonal items and lower-priced offerings to drive traffic.
• Infinite Kitchens are yielding significant labor gains, with 10 currently operational.
• The company is focusing on international expansion through licensing opportunities.
• Sweetgreen aims for free cash flow profitability by prioritizing new Infinite Kitchens.

Financial Results

• Sweetgreen anticipates flat same-store sales growth for the year, with acceleration expected in the second half.
• The loyalty program, initially a Q2 headwind, is projected to become neutral to positive later in the year.
• From 2022 to 2024, the company noted a 7-point revenue increase.
• Margins are benefiting from Infinite Kitchen labor gains and effective G&A expense management.

Operational Updates

• The loyalty program, featuring a spend $10 get one point system, surpasses the previous SuitePass Plus.
• Seasonal menu items like the Peach and Goat Cheese salad and Elote Bowl are back, alongside new "Monday Bowls" priced under $13.
• Infinite Kitchens are key to efficiency, with 700-point labor gains and positive team feedback.
• Speed of service improvements focus on order sequencing and labor management.
• New stores in locations like Columbus and Charlotte are performing well, supporting growth plans.

Future Outlook

• Sweetgreen plans to accelerate net restaurant growth in 2026, targeting new markets such as Arkansas and Sacramento.
• International expansion is under consideration, leveraging Infinite Kitchen technology through licensing.
• Achieving free cash flow profitability remains a priority, driven by new Infinite Kitchens.

Q&A Highlights

• Legacy customers prioritize seasonal menus and loyalty programs.
• The pause in China tariffs aids in optimizing supply chain costs.
• Sweetgreen’s digital engagement offers a competitive edge in loyalty program implementation.

For further details, readers are encouraged to refer to the full transcript below.

Full transcript - TD Cowen 9th Annual Future of the Consumer Conference:

Andrew Charles, Restaurant Analyst, TD Cowen: Alright. Well, good morning everyone. I’m Andrew Charles. I’m TD Cowen’s restaurant analyst. Appreciate everyone joining us today for the Future of the Consumer conference, our ninth annual.

I’m joined today by Sweetgreen’s VP of IR as well as Chief of Staff Rebecca Nunu. For those not familiar in the room, we are in New York, so shame on you. But Sweet Green is the largest fast casual salad concept, over two fifty stores, and really appreciate Rebecca joining us today to dive a little bit more into the business. So, thanks so much for joining us.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Thank you for having me.

Andrew Charles, Restaurant Analyst, TD Cowen: Maybe just to kick it off, you know, a lot of exciting developments that you guys have driven, you know, so far in 2025. You know, maybe first we can start on the loyalty program, though. Yeah. You know, what has been the, you know, thesis behind the revamp and what you’re looking to accomplish with that?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. So we recently launched a loyalty program on April second of this year. It is a spend $10 get one point. A very, what I would call generic, easy to understand program in line with the industry. We think that it has broad appeal and we’re starting to see that in some of the early signs.

So we’ve shared before signing up about 20,000 customers a week, thanks in part to our team members in Source, I really want to thank them for that push. Really excited and just for context, the 20,000 is more than we had in SuitePass plus and we’re starting to see some early signs of driving frequency.

Andrew Charles, Restaurant Analyst, TD Cowen: That’s great. The other thing that’s been great is that the collaboration with Kote Korean barbecue that began a few weeks ago. Can you talk more about that and, you know, what you’ve observed with customer behavior from Absolutely.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: So, Coat Steakhouse is the first Michelin starred Korean steakhouse in The US. It’s part of a history of collaborations with chefs that really uniquely only Sweetgreen can do. These chefs are friends of the brand and really want to work with Sweetgreen. We know that Korean flavors are really of the moment and seeing really great customer reception, particularly as we comp over steak from last year.

Andrew Charles, Restaurant Analyst, TD Cowen: Great. Know, full year guidance of flat same store sales, you know, improves, it applies a large step up in the back half of the year relative to 1Q and, you know, what you guys disclosed in April. So can you kind of walk us through the cadence of sales for the year and what’s embedded in guidance to help bridge that gap around how you’re going to accelerate for the back half?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. But first, if I could just give some context to kind of H1 which had exogenous factors at the beginning of the year with weather, LA fires. And then in Q2 we talked about having a loyalty headwind and, you know, some tough comps with stake. We very much see the back half of the year as having easier comps. We’re really excited about our menu calendar innovation around seasonals, have been huge drivers of of frequency in transactions.

And we see that the loyalty headwind that we disclosed kind of being in, you know, the start of or throughout q two will become neutral to a positive tailwind in the second half of the year.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. Let’s talk more about the seasonal menus. Know, I guess why remove them in 2024 and bring them back in ’25? You know, curious about what gives you confidence this could be a material sales driver given the strong 2024 performance without them.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. So we have a lot of data prior to ’24 about the PMICs of these bowls, we know that they perform extremely well. We are relaunching two of our fan favorites that historically have over indexed in seasonals. And 2024, you know, we took a break really to focus on delivering steak and leaning more into hot, which have been incredible drivers in our newer markets, which have been comping double digits. So, for us, 2024 was a year of broadening our menu, expanding the dinner percentage now sitting at 40%.

And this year, it’s about, you know, continuing to be an and company, driving seasonals continuing to deliver menu innovation.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. You know, you’ve called out weakness in some of the key major metro markets so far this year. You know, what’s driving that relative to your more suburban markets? Is there anything you can do to specifically target improvement in the core urban markets?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. Would say suburban markets are our newer markets, so, you know, our twenty twenty four menu has really been a driver of the strength there. Our legacy markets, you know, the customer has been saying, you know, we really want two things. One is seasonals, and the second is loyalty. We’re starting, you know, we launched loyalty in April.

We’re starting to see frequency pick up. And the second is seasonals, and they’re launching middle of the summer.

Andrew Charles, Restaurant Analyst, TD Cowen: Great. Okay. And then you mentioned before the prioritization of speed of service in 2025. And with the change in COO last month, is this progress on track or does it require Jason to get up to speed? Yeah.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: I have to say, Jason has hit the ground running. He joined at the May and comes with a playbook that he deployed both at Chipotle and at Pizza Hut and we knew that coming in. I have been in market with him and personally witnessed on day one, him coaching the teams around standards. You know, it’s not about best practice, it’s about consistency and standards and he’s incredibly focused on ensuring speed of service on the back line, know, and really comes with a playbook. So needs no time to ramp.

Andrew Charles, Restaurant Analyst, TD Cowen: Yep. And what inning would you say you’re in of speed of service enhancements? Mean, know, this is something you’ve been talking about more over the last year, but you know, the work had already been started, so is there anything you can put on this?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Are probably in, call it, inning two or three. Certainly have seen some really great progress on frontline. We certainly see opportunities on digital, we, know, Sweetgreen has some of the highest digital percentage, a lot of volume going through, call it a two hour period, particularly here in New York in midtown restaurants. I think we do a great job today. There’s an opportunity to continue to elevate the standard.

We think we’re probably in inning two or three.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. And what are those key efforts that Jason’s focused on? His key priorities to help improve speed of service at the non IK locations.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. It’s about sequencing of orders, throttle, and then just sort of standards, making sure we have enough labor, you know, on the back line.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. You’ve also recently started talking about some lower price point offerings. You know, we noticed yesterday a Monday bowl drop. Yep. Can you share more with us about kind of the initiatives that you’re focused on and what you’re looking to accomplish with the approach that started yesterday?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: So for the next three Mondays, we will be launching a bowl under $13 that has no compromise in terms of quality. The Power Bowl launched yesterday has both avocado and chicken, so still featuring premium ingredients and allows us celebrate kind of seasonality in the rest of the bowl. You know, one is we find that LTOs do drive, you know, in newness do drive traffic and interest in coming back into our restaurants and give our guests a reason to come in. And for us, it’s really about how do we continue to build out opportunities within our pricing structure so there’s something on offer for everybody.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. And forgive an analyst for not reading the fine print, but do you have to order these digitally or they can be ordered to

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: the front as well? They can be ordered on the

Andrew Charles, Restaurant Analyst, TD Cowen: front as Okay, gotcha. Okay, great. Okay, let’s talk a little bit about Infinite Kitchens. You know, there’s been a lot of discussion whether the company will let the margin savings, you know, from Infinite Kitchen, which is the robotic technology, flow through entirely to the bottom line or if the company is willing to share savings with the customers through lower pricing. You know, what’s the current what’s the team’s current view on this and when will we likely see this play out?

Well,

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: I may just take a moment to explain the Infinite Kitchen for those who don’t know it or who haven’t experienced it. The Infinite Kitchen allows us to assemble the bowls and what we’re seeing is about 700 points in labor gains from that. You know, we certainly see an opportunity to give back to the customer as we continue to densify our fleet with the Infinite Kitchen and we have said that will be the predominant operating model for us going forward. We’re really pleased with it from both a customer perspective, speed of service, quality and consistency, but also our team members really love it and I go around meeting head coaches across the country who work an IK, held a roundtable about two weeks ago to get their feedback and they’ll tell me they’ll never go back to a classic. I mean really the team member feedback for us which is so critical has been incredible and we’re seeing lower turnover.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. You know, shortly after the 1Q conference call, there was a pause in China tariffs, you know, was announced. You you guys shared a lot of detail on the call, and I will call kind of a worst case scenario, if you will, around what the impact was on tariffs, you know, with IK. You know, where do we sit now though with the increased costs associated with IK? And I guess the other question I had as well with that is during the pause, are you able to bring over as much components as possible to help, you know, them sit in a warehouse, for lack of a better word, to avoid the tariffs on them?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: So at the time of our call, the tariffs were about 145%. Who knows what they are today? I haven’t confirmed that, but what we did share was 15% of our components come from China and even at the 145%, it was ROIC accretive. We do have tenant IKs on hand and we are in the process of working through this kind of lower tariff rate with our contract manufacturer to make sure that we are purchasing at the most effective cost.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. Okay. You know, you’ve now had three retrofits that have been completed now sometime between six and ten months. You know, what are you observing with the sales lifts at these locations?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: We’re incredibly happy. Would say that each retrofit is a little bit different. You have Willis Tower, which is a hybrid, so we took some space next door to the existing restaurant. So we have a front line and an infinite kitchen and seeing really you know, great customer feedback and natural lift as we’ve added more lines. We’re also seeing our IKs in New York kind of out comping the market.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. And then what is the long term vision for retrofits? I mean, you know, it’s not all stores that are capable of supporting an IK, but you know, is there a way to think about the portion that could, you know, where it is physically possible?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Yeah, I would start by saying we are deploying IKs predominantly in new restaurants. Like that is the focus, is to put as many IKs into new restaurants as possible. Where a restaurant, a new restaurant will not get it, it is being designed to have both an Infinite Kitchen and a Classic to make retrofits easier in the future. Certainly a large chunk of our fleet today could be retrofitted, but as they age, are considering whether we want to retrofit or relocate and we did disclose we are relocating two restaurants here in New York to a kind of a corner location if they’re in line with patio space and putting in an infinite kitchen. So there there’s a combination of both retrofit and reload that that we’re strategizing around.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. Great. And then as you focus on achieving free cash flow profitability, you know, you may be made you mentioned this, but just put a finer point, you know, the the the priority is really on building new Infinite Kitchens over the over retrofits?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: No. Okay. Yes.

Andrew Charles, Restaurant Analyst, TD Cowen: Great. Okay. Maybe just on the margins, you know, beyond Infinite Kitchens, what do you view as the largest area for opportunity for margin expansion over the medium term?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Yeah. I would start with sales leverage first, and then as we continue to open in new markets, what you’re seeing is this lower occupancy and you’ll start over time to see that flow through.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. Know, talk a little bit more just on the, you know, I guess just on the on the occupancy, you know, the Suite Lane, you know, the new drive through prototype that you guys have done. It’s one store so far, but I believe you have another store coming with us.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Yep, we have two coming this year. One will be a classic and one will be with an IK.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. And and for the folks in the room, you know, unfortunately I haven’t visited the one in Illinois yet, but can you talk a bit more about what

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Suite Lane is? We have a Suite Lane in Schaumburg, Illinois. What it is, it allows you to order on your app or digitally prior coming to the office and then pick up, prior to coming to the office, prior to coming to the drive thru and then picking up your order. We don’t have a full drive thru yet, but that is also in the works.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. Shifting back to margins, 2025 adjusted EBITDA guidance appears to embedding roughly flat support center G and A dollars versus 2024. Can you talk about the efforts underway to manage G and A spend, especially the backdrop of increased advertising spend?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. I would say we’ve been really good stewards of capital and cost when it comes to our G and A. We have gotten leverage on G and A consistently. I look at compared to two years ago, from 2022 to 2024, you’re getting about seven points on revenue, and we’ve taken those dollar costs down. We’re continuing to be disciplined in terms of how we allocate our G and A dollars, moving it towards comp driving initiatives, so whether that’s marketing, menu innovation or, you know, to spice and the Infinite Kitchen.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, great. You know, new store performance has been very strong over the last twelve to eighteen months. As you’ve noted with recent classes, you’re tracking to your two targets within year one. What’s been different about the recent class of openings, you know, relative to what saw about two or three years ago? Yeah.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: You know, I would say two to three years ago, you were still dealing with a little bit of a COVID overhang, and I think the data’s gotten a lot clearer now as we start to, you know, come up with site selection. And the second thing is as we go went back to our NRO playbook, which we knew prior to COVID really worked. It’s about how do you get out in the community, create community connections, create that excitement. And I would say the brand continues to be more and more powerful every day. You see references in pop culture, whether you’re watching hacks or watching late night TV and you’re getting a mention there.

And so, there’s, you know, really customer love for the brand and folks are excited when we come into new markets.

Andrew Charles, Restaurant Analyst, TD Cowen: That’s great. And and do you view the recent strength sustainable as you broaden geographies and go from, you know, roughly 15% development to scaling to the into the 15 to 20% target for new new restaurant growth.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. Yes? Yeah.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay. Great. Okay. You know, you’ve you’ve alluded to accelerating net restaurant growth in 2026 both in terms of number of stores and percentage growth. What’s given you the confidence to continue to accelerate net restaurant growth?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. I mean, think certainly the performance of the pipeline today, both our 2024 class and 2025 class, you know, I would say Short North, Columbus, Charlotte, Raleigh continue to have some of the highest opening weeks in the company’s history and so that gives us confidence particularly as we go into new markets like Arkansas this year, Cincinnati, Sacramento.

Andrew Charles, Restaurant Analyst, TD Cowen: Yep, okay. Maybe moving back into the sales environment a little bit. You know, there’s a lot of exciting news, you know, coming into the menu this year. But, you know, curious about what are you most excited about in 2025 to help durably grow same store sales. It’s kind of been unclear in this foggy consumer backdrop that we’re in that consumers are seeking healthier options.

I think it was pretty prevalent and apparent last year. So, you know, what initiatives are you most excited about of all the stuff you’re working on?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Do have pick just one?

Andrew Charles, Restaurant Analyst, TD Cowen: Yes. You can go in order if you want or you can go give a couple. That’s fine.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: I mean, for me, seasonals are the most exciting. As an avid sweet green eater, I think for me what I really value is the opportunity to try new things. And yes, you know, I customize but to come back to have peach and goat cheese which is such a fan favorite as well as the Elote Bowl is something I know I personally miss. So, I’m personally really excited both as a customer to have the seasonals come back. I think they’re huge drivers and I get reach outs all the time from customers saying when are they coming back.

So, excited about that for this year and I would say second is loyalty. Think it was a really important component considering how digitally connected Sweetgreen is to the customer. I’m really excited to see that continue to pick up. We’re gonna have some, you know, personalized CRM and better target segmentation in the back half of the year. So really excited about that and I would say third, would say, you know, for me, like opening in Arkansas.

You know, I I think most people would kinda look at me and go, Arkansas? But have such brand love there, I’m really excited about that. So I would say that’s number three.

Andrew Charles, Restaurant Analyst, TD Cowen: Awesome. Can we talk a little bit about the loyalty headwind that we saw? Don’t recall if you guys you guys may not have quantified this, but is there a frame for how investors can kind of gauge the magnitude of impact that’s just weighed on 2Q numbers by?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Yeah, so a competitor of ours in about 2022 talked about it being about a hundred bp headwind at the time. I would say we have a higher, you know, digital percentage, so that’s how I would kind of guide it. What I would say is though, yes, is a headwind in Q2, a material headwind in Q2, but I think the frequency that we’re lift that we’re starting to see really kind of reinforces the optimism that I have that it’ll go from neutral to positive at the back half of the year.

Andrew Charles, Restaurant Analyst, TD Cowen: Yep. Okay. And then, you know, you talked a little bit on the last call at the AI Workforce Management tool. Yes. You know, can we talk about what that does to help with labor?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Absolutely. So our workforce management tool is a third party tool that we’re using. And what it allows us to do is plan headcount to match the sales volume. And whether it’s how do we schedule people to come in in fifteen minute increments and making sure that we are staffing appropriately. What we have found is that there are opportunities to add staff to drive additional sales volume And so we’re really excited.

We just finished deploying it this past week across the fleet and excited to see some of the results. So we had talked about California being one of the last markets to get deployed and that happened this week.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, very good. And I guess, it’s a compliment to your ability to improve throughput by staffing more during those peak

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Exactly.

Andrew Charles, Restaurant Analyst, TD Cowen: Okay, very good. I want to touch maybe just on the opportunity for international. Is this something, you know, this obviously the brand is laser focused on US development, but I would imagine, you know, you can’t help but notice that there’s a lot of geographies out there that share your food ethos. You know, what are your thoughts? Is that

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: a polite way of saying copycats? No, you can

Andrew Charles, Restaurant Analyst, TD Cowen: say it that way. Yeah, absolutely. Invitation is the most sincerest form of flattery, of course. So, know, what are your thoughts on international? Is this something, you know, that you’ve looked further up to at this point?

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: I would say, I think the IK certainly makes it easier as you think about kind of licensing to go into international markets. It’s something we’re always, you know, we get a photo probably every week of a coffee cat somewhere. So certainly there is demand for Sweetgreen. I mean, you’re right, imitation is the sincerest form of flattery. So certainly something we’re keeping an eye on and kind of really excited about and how do we think about licensing

Andrew Charles, Restaurant Analyst, TD Cowen: Very good.

Rebecca Nunu, VP of IR as well as Chief of Staff, Sweetgreen: Using IK.

Andrew Charles, Restaurant Analyst, TD Cowen: Great. That was a very efficient use of our time. We really ran through all the questions I had. Maybe just to end and keep everyone on time, you know, we really appreciate everyone’s participation today and at the Future of the Consumer conference this week. Your TD Cowen values the annual Xcel, formerly II investor poll that recently began opening for balloting.

We’d be very grateful for your recognition with a five star vote for TD Cowen restaurants. With that, I’ll end the presentation and say thank you to Rebecca for her time and insights today. Thank you for having me. Thank you everyone for joining.

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