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Noodles & Company Q4 Earnings and Revenues Miss Estimates, Decline Y/Y

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Noodles & Company (NDLS - Free Report) reported fourth-quarter fiscal 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. The top and bottom lines declined on a year-over-year basis.

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Noodles & Company reported positive sales and traffic trends in early 2025, buoyed by the introduction of new menu items, promotional initiatives and strengthened third-party delivery momentum. In the first eight weeks of the first quarter of 2025, the company achieved over 3% growth in both traffic and comparable restaurant sales.

Operational improvements, menu innovation and a refined pricing strategy have bolstered growth, with Steak Stroganoff and new menu additions driving higher guest satisfaction. Looking ahead, NDLS is set to launch its menu transformation, introducing nine new dishes, including a revamped Mac & Cheese lineup and improved classics like Basil Pesto Cavatappi. The company remains optimistic about enhanced training, new plateware and a robust marketing push — including PR, influencer partnerships and paid media — to elevate brand visibility and guest engagement. The initiatives pave the path for a promising turnaround.

Following the announcements, the company’s shares surged 18.1% during the after-hours trading session yesterday.

NDLS’ Q4 Earnings & Revenues

For the fiscal fourth quarter, the company reported an adjusted loss per share of 15 cents, wider than the Zacks Consensus Estimate of a loss of 13 cents. The company reported a loss of 7 cents in the prior-year quarter.

Noodles & Company Price, Consensus and EPS Surprise

Noodles & Company Price, Consensus and EPS Surprise

Noodles & Company price-consensus-eps-surprise-chart | Noodles & Company Quote

Quarterly revenues of $121.8 million missed the consensus mark of $123 million. The top line declined 2% on a year-over-year basis.

During the quarter, restaurant revenues came in at $119.2 million compared with $121.8 million reported in the prior-year quarter. Franchise royalties and fees and other during the quarter came in at $2.6 million compared with $2.5 million reported in the prior-year quarter.

NDLS Q4 Comps

In the fiscal fourth quarter, system-wide comparable restaurant sales increased 0.8% year over year against a 3.3% decline reported in the previous quarter. The improved comparable sales trajectory was driven by new menu items, supported by increased media coverage and a new commercial titled Come Taste the Start of Something Great. Additionally, renewed momentum in the third-party delivery channel and promotional offers contributed to the growth.

Company-owned comparable restaurant sales during the quarter inched up 0.5% year over year against a 3.4% fall reported in the prior quarter.

Franchise comparable restaurant sales in the fiscal fourth quarter increased 1.9% year over year against a 3.3% fall reported in the prior-year quarter.

NDLS Q4 Operating Highlights

During the fiscal fourth quarter, general and administrative expenses came in at $11.3 million compared with $13.9 million reported in the prior-year quarter. The downside can be attributed to lower severance and executive transition costs and lower stock compensation expenses.

During the quarter, the restaurant contribution margin declined 350 basis points year over year to 11.2%. In the fiscal fourth quarter, the operating margin came in at 6% compared with 3.7% reported in the year-ago quarter.

Adjusted net loss during the quarter came in at $6.7 million compared with $3 million reported in the prior-year quarter.

Adjusted EBITDA in the fiscal fourth quarter came in at $4 million compared with $7.5 million reported in the prior-year quarter.

Balance Sheet

As of Dec. 31, 2024, cash and cash equivalents totaled $1.1 million compared with $3.3 million as of Oct. 1, 2024. At the end of the fiscal fourth quarter, outstanding debt amounted to $103 million compared with $89.9 million at the end of the third quarter of fiscal 2024.

NDLS’ Fiscal 2024 Highlights

Total revenues in fiscal 2024 amounted to $493.3 million compared with $503.4 million in fiscal 2023.

Adjusted EBITDA in fiscal 2024 totaled $23.6 million compared with $33 million in fiscal 2023.

In fiscal 2024, the adjusted loss per share came in at 45 cents compared with 11 cents reported in the previous year.

NDLS’ Fiscal 2025 Outlook

For fiscal 2025, the company anticipates total revenues to be between $503 million and $512 million, with comparable restaurant sales in the mid-single-digit range.

Restaurant-level contribution margins are projected in the range of 12.5-14%. General and administrative expenses are estimated to amount to between $49 million and $52 million. Depreciation and amortization costs are expected to range from $27 to $29 million, while net interest expenses are forecast to be between $8 million and $10 million.

The company plans to open 12-15 new company-owned restaurants and four franchise-owned establishments during fiscal 2025. It expects capital expenditures to be between $11 million and $13 million.

NDLS’ Zacks Rank & Other Key Picks

Noodles & Company currently has a Zacks Rank #2 (Buy).

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