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Noodles & Co. sales surge, thanks to Zoodles

The company’s zucchini noodles helped same-store sales and traffic in the second quarter.
Noodles & Company

People apparently like noodles made from zucchini.

Noodles & Co. on Wednesday said that its same-store sales increased 5.4% in the quarter ended July 3, with traffic up 3.1%—the chain’s best performance in six years.

Company executives said that zoodles, or zucchini noodles, helped drive traffic to the company’s restaurants, while efforts to improve its takeout sales helped drive business in the period.

“We have been especially pleased with the performance of zoodles, which is driving increased frequency from existing guests, and reintroducing the brand to lapsed and new users,” CEO Dave Boennighausen said in a statement.

The company’s stock rose more than 4% in after-hours trading on Wednesday.

Noodles has struggled for years to generate positive same-store sales. Boennighausen was named CEO last year, and former Del Taco CEO Paul Murphy was named executive chairman.

The company has sought to improve operations and focus more on takeout sales. But it also sought to expand beyond traditional noodles and get customers more concerned about health.

In May, it launched zoodles to give customers a veggie-focused, low-carb meal option.

“There is still tremendous opportunity to meaningfully grow both our top and bottom line results,” Murphy said in a statement.

Revenue in the quarter increased 4.1% to $117.4 million in the period thanks largely to the comparable-store sales.

But the company reported a net loss of $5.9 million, or 14 cents per share, from a loss of $1.8 million in the same period a year ago.

Noodles recognized a charge of $3.4 million related to liabilities related to a 2016 data breach.

When adjusted for one-time events, net income was $400,000, or 1 cent per share, up from $300,000 in the same period a year ago.

Noodles has 469 locations, 404 of which are company-operated.

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