Sweetgreen (NYSE: SG) Cuts 2025 Outlook, Sells Spyce Robotics to Wonder for $186.4M After Weak Q3 — 11/7/2025

• Q3 FY2025 revenue slipped 0.6% to $172.4M; same‑store sales fell 9.5% on lower traffic and mix. Digital sales were 61.8% of revenue.
• Full‑year 2025 guidance cut: revenue now $682–$688M, comps ‑8.5% to ‑7.7%, restaurant-level margin 14.5%–15%, adjusted EBITDA ‑$13M to ‑$10M.
• Sweetgreen agreed to sell its Spyce robotics unit (developer of “Infinite Kitchen”) to Wonder for $186.4M ($100M cash + $86.4M preferred stock); Sweetgreen will license the tech to keep deploying Infinite Kitchen in its stores. Q4 Capital Data
• Management cited weaker spending among 25–35‑year‑olds; the CFO said spend from that cohort (about 30% of customers) declined 15% in the quarter.
• Shares slumped after hours on Thursday following the results and outlook cut; Bloomberg noted the stock fell as much as 20% in extended trading.

What happened

Sweetgreen reported third‑quarter FY2025 revenue of $172.4 million, down 0.6% year over year. Same‑store sales fell 9.5%, driven by an 11.7% drop in traffic and product mix, partly offset by 2.2% of price increases. Digital remained a majority of sales (61.8%), with 35.3% coming through owned digital channels. Restaurant‑level profit margin compressed to 13.1% from 20.1% a year ago, and adjusted EBITDA swung to ‑$4.4M from +$6.8M. The company opened six net new restaurants in the quarter.

Management cut full‑year guidance, now expecting $682–$688M in revenue, comps of ‑8.5% to ‑7.7%, restaurant‑level margins of 14.5%–15%, and adjusted EBITDA of ‑$13M to ‑$10M. Sweetgreen still plans 37 net new openings in 2025, 18 of which will feature Infinite Kitchen.

A pivot in automation: sale of Spyce to Wonder

In a significant strategic shift, Sweetgreen entered into an agreement to sell Spyce, the in‑house robotics group that developed the Infinite Kitchen assembly technology, to Marc Lore’s Wonder for $186.4 million ($100M cash + $86.4M Series C preferred stock). Crucially, Sweetgreen signed supply and license agreements so it can continue deploying Infinite Kitchens under Wonder’s ownership. The company said more than 20 locations already use Infinite Kitchens; 38 Spyce engineers (including the founders) will join Wonder.

Industry trade publications framed the move as an effort to refocus on restaurant operations and profitability while keeping access to the automation platform via licensing. Restaurant Dive, for example, reported the $186M price and the plan to reinvest proceeds to shore up performance after several quarters of sales declines.

Why demand softened

Sweetgreen joined peers in flagging pressure from younger diners. On the earnings call, CFO Jamie McConnell said spending from the 25–35 age group—about 30% of the customer base—fell 15% in Q3. That mirrors broader fast‑casual commentary about cost‑conscious Gen Z and millennials trading down or choosing to eat at home.

Did results meet expectations?

They missed Wall Street estimates. Investing.com’s transcript summary pegged Q3 EPS at ‑$0.31 (vs. ‑$0.15 expected) on revenue of $172.4M (vs. $179.4M expected), alongside the 9.5% same‑store sales decline.

Market reaction

Shares slid in extended trading Thursday after the results and guidance cut. Bloomberg reported the stock fell up to 20% after hours and is sharply lower year‑to‑date.

Management’s message and near‑term priorities

CEO Jonathan Neman said the company remains focused on operational excellence, menu innovation, and disciplined growth, and that partnering on Infinite Kitchen allows Sweetgreen to scale automation while strengthening the balance sheet. The company also highlighted the transition from Sweetpass+ to the new SG Rewards program (rolled out in Q2) as it works to rebuild traffic and customer frequency.

Analyst moves today

Post‑print, Piper Sandlerlowered its price target on Sweetgreen to $9 while maintaining a Neutral rating, citing a cautious near‑term outlook—one of several recent trims across the Street.

By the numbers (Q3 FY2025)

• Revenue: $172.4M (‑0.6% Y/Y)
• Same‑store sales:‑9.5% (traffic ‑11.7%)
• Digital mix:61.8% (owned digital 35.3%)
• Restaurant‑level margin:13.1% (vs. 20.1% LY)
• Adjusted EBITDA:‑$4.4M (vs. +$6.8M LY)
• Net new units:6 (Q3); 37 planned for FY2025, 18 with Infinite Kitchen
• FY2025 outlook: Revenue $682–$688M; comps ‑8.5% to ‑7.7%; restaurant‑level margin 14.5%–15%; adjusted EBITDA ‑$13M to ‑$10M.

What to watch next

• Closing of the Spyce/Wonder deal and the cadence of new Infinite Kitchen deployments under the license arrangement.
• Traffic recovery among younger guests as SG Rewards matures and menu/value actions flow through comps.
• Unit economics on 2025 openings and any update to the 2026 build plan (15–20 openings; ~half with Infinite Kitchen).

Sources

• Q3 results & guidance: Sweetgreen press release (Business Wire) and investor materials.
• Guidance confirmation: MarketScreener summary.
• Spyce sale details: Sweetgreen Business Wire PDF; Restaurant Dive.
• Estimate misses: Investing.com transcript summary.
• Gen Z/Millennial spend: Business Insider reporting on management commentary.
• Stock reaction: Bloomberg markets coverage.
• Analyst move: GuruFocus note on Piper Sandler target cut.