Sweetgreen Inc. (SG) shares dropped in after-hours trading on Thursday following the release of their fourth-quarter results and outlook. The plant-based fast-food chain’s stock fell 9% after closing at $9.29 with a 4.7% decline during regular trading.
The company reported a net loss of $49.3 million, or 44 cents per share, for the fourth quarter of 2020. This was a decrease from the $66.2 million, or $1.14 per share, loss from the same period in the prior year. Revenue for the quarter increased to $118.6 million from $96.4 million in the year-ago quarter.
The results and outlook were below what analysts had forecast. Analysts surveyed by FactSet had estimated a loss of 40 cents per share on revenue of $124.7 million. Sweetgreen’s outlook for the first quarter of 2021 was for revenue between $124 million and $127 million, and for the full year between $575 million and $595 million. The analysts’ estimates for the first quarter were $134.8 million in revenue and $628.9 million for the year.
The fourth-quarter results and outlook indicate that Sweetgreen is still feeling the effects of the COVID-19 pandemic. The company has had to adapt to the ever-changing landscape, including the implementation of contactless delivery and takeout options, as well as the closure of some of its locations. Sweetgreen has also had to adjust its marketing and promotional strategies to meet the needs of its customers.
The pandemic has also had an impact on the company’s supply chain. Sweetgreen has had to find new sources for some of its ingredients due to the disruption of the global food supply chain. This has caused prices to rise, which has in turn affected the company’s bottom line.
Sweetgreen has also had to make changes to its workforce in order to remain competitive. The company has reduced its workforce by 20% and has implemented new technology to streamline operations. These changes have enabled the company to remain profitable despite the challenging environment.
Despite the challenges, Sweetgreen has seen some positive signs. The company’s digital sales have increased significantly, with digital orders now making up more than half of all sales. This shift in consumer behavior has enabled the company to reach a wider audience and expand its reach.
Overall, Sweetgreen’s fourth-quarter results and outlook indicate that the company is still feeling the effects of the COVID-19 pandemic. The company has had to adapt to the changing environment and has implemented a number of strategies to remain competitive. Despite the challenges, Sweetgreen has seen some positive signs, including increased digital sales, which have enabled the company to reach a wider audience. As the pandemic continues, Sweetgreen will need to remain agile and continue to adjust its strategies in order to remain successful.