NDLS · Noodles & Company

Noodles & Company delivered strong Q1 2026 results, exceeding its outlook with 9.1% system-wide comparable restaurant sales growth driven by improved menu offerings like Delicious Duos and Steak Stroganoff, stronger execution, and effective marketing, leading to sequential guest satisfaction gains and sustained traffic. This momentum, including positive same-store sales for 16 consecutive months and continuation into April above 9%, supported significant profitability improvements: restaurant contribution margin expanded 560 basis points to 14.9%, operating margin turned less negative to (0.7)%, and Adjusted EBITDA more than tripled to $7.7 million. Portfolio optimization via closing 20 underperforming stores transferred sales to nearby locations, boosting local profitability amid high off-premise mix. Management raised FY2026 guidance across key metrics, including revenue to $483-498 million with 7-10% comps, restaurant margins to 15.5-17.0%, and Adjusted EBITDA to $32.5-37.5 million, signaling confidence despite planning 30-35 company-owned and 5 franchised closures and only 1-2 new franchise openings. Liquidity remains tight at $1.4 million cash against $106.8 million debt, with $15.2 million revolver availability as of March 31. The ongoing strategic review initiated September 3, 2025, explores alternatives like refinancing, refranchising, or sale to maximize shareholder value.