Proving there’s no shame in having a healthy salad with a side of fries, Sweetgreen is rolling out its air-fried Ripple Fries systemwide in March.
The Los Angeles-based chain began testing the new fries—which are air-fried with avocado oil, offering a healthful spin—last year and it seems they were a hit.
“Fries and salad have long been an iconic duo,” said CEO Jonathan Neman on Wednesday. “Ripple Fries, our Sweetgreen take on this classic pairing, offers our guest a signature, craveable side that complements our vibrant, produce-driven menu.”
The fry rollout is one of a number of new menu innovations coming this year, which will be underpinned by the launch of a new loyalty program in April. The expanded marketing calendar planned for this year is a return to Sweetgreen’s more seasonally driven menu focus, which Neman said will help drive traffic after a rough beginning to the year for the brand.
Same-store sales were up 4% for the fourth quarter, primarily as a result of menu price increases with traffic being flat. But then came a horrible January and February.
There was extreme weather across much of the country. And Sweetgreen was also hit hard by the Los Angeles wildfires. Team members were safe and restaurants weren’t physically damaged, but sales and operations were seriously disrupted, Neman said. About 15% of Sweetgreen’s revenue base is in Los Angeles.
Mitch Reback, Sweetgreen’s CFO, illustrated the point by saying the Los Angeles market delivered high-single-digit same-store sales increases in 2024. But in the first quarter to date, comparable sales declined in double digits.
The impact was temporary, however, and he expressed confidence that sales will get back on track for the remainder of the year.
The new loyalty program, in which guests can earn points toward rewards for every dollar spent, is also expected to help beat the drum of “new news,” which Sweetgreen has learned is something their guests want more of.
“We recognize the need for newness,” Neman said.
Last year, the rollout of steak as a protein and an air-fried brussels sprouts dish helped drive traffic, for example, but there were fewer menu additions than in the past. This year the chain is planning to invest in more marketing with the new products coming to the menu, though he did not reveal details.
Neman has mentioned the possibility of hand-held menu items coming to the menu, and he said something might go into test later this year. There’s also a collaboration with a Michelin-starred chef in the works.
Sweetgreen is also continuing to work on labor optimization and deployment with a new AI-powered workforce management system that gives team members a platform to manage their schedules, and align their availability with restaurant needs. The system, deployed across about half of the 246-unit fleet, has freed up head coaches to focus more on team development, and team members are getting 10% more hours per week, on average, while reducing overtime expense, Neman said.
The labor tool is expected to be rolled out systemwide by the end of the second quarter.
After opening 25 new restaurants in 2024, Sweetgreen is picking up the pace on growth, with an estimated 40 net new restaurants expected to open this year. Of those, 20 will be the Infinite Kitchen format with an automated makeline.
The chain now has 12 Infinite Kitchen locations open, and those units have proven to have higher margins and guest satisfaction rates. Infinite Kitchens can produce 500 bowls an hour, and the chain has re-worked the finishing station—the part that involves humans—a bit to avoid bottlenecks, which puts meals in the hands of guests in less than 5 minutes.
For the full year, same-store sales grew 6%, which included a 2% increase in traffic and mix, along with 4% in pricing.
The company narrowed its full-year net loss of $90.4 million, compared with a loss of $113.4 million in fiscal 2023. For the fourth quarter, the net loss of $29 million increased from the loss of $27.4 million a year ago.
This year, Sweetgreen projected same-store sales would increase between 1% and 3%, including the challenges of the first quarter.
The Los Angeles-based chain’s stock price plunged more than 14% in after-hours trading after missing analyst expectations, but rebounded somewhat to $20.70 later in the day, which was still about 10% down from its high of $23.14.
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