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‘Meaningful softness’ in sales activity blamed for Noodles performance drop

BROOMFIELD — Noodles Inc. (Nasdaq: NDLS) saw its year-over-year sales fall in the second quarter of 2023, a period in which the company posted a net loss after recording profits in the second quarter of last year. 

“During the beginning of the second quarter 2023, we saw meaningful softness in our guest trends. We attribute this in large part to being too aggressive on our pricing strategy, which included an incremental 5% increase in February of this year,” Noodles CEO Dave Boennighausen said in a prepared statement.

The fast-casual chain last week posted a net loss of $1.3 million on sales of $125.2 million in the second quarter. That’s compared with net income of $1.3 million on sales of $131.1 million in the same period last year.

“We are aggressively executing strategies to further drive comparable restaurant sales growth,” Boennighausen’s statement said. “We are particularly focused on price optimization, leverage of our new customer data platform and robust rewards database, and expansion of our growing catering business. Furthermore, we are assessing and reigniting our culinary offerings, including the launch of a broadly appealing Chicken Parmesan in September, as well as engagement of a leading industry culinary consultant to assist us in comprehensively evaluating and improving our menu. As we execute these strategies, our efforts to respond quickly and effectively will be further supported by digital menu boards, which we anticipate will be installed at 75% of company restaurants by the end of the third quarter.”

There were 465 restaurants systemwide at the end of the second quarter 2023, made up of 373 company-owned restaurants and 92 franchise restaurants.

Source: BizWest