Potbelly (PBPB) Q2 2025 earnings summary

Executive summary

• System-wide sales grew 6.7% year-over-year to $154.2 million in Q2 2025, with same-store sales up 3.2% and positive traffic growth.

• Adjusted EBITDA increased 13% to $9.6 million, and shop-level profit margin improved to 16.7% from 15.7% year-over-year.

• Eight new shops opened and 54 new franchise shop commitments signed, bringing total open and committed shops to 816.

• Digital sales exceeded 41% of total shop sales, supported by a new website and mobile app launch in late June.

• Menu innovation, including the Prime Rib Steak Sandwich and new branded chips, drove customer engagement and top-line growth.

Financial highlights

• Total revenues rose 3.4% year-over-year to $123.7 million, with company-operated shop sales at $118.4 million and franchise royalties and fees at $5.3 million.

• Adjusted EBITDA was $9.6 million (7.8% of revenue), up from $8.5 million last year.

• Net income was $2.5 million; adjusted net income $2.9 million, up from $2.5 million last year.

• Shop-level profit rose to $19.7 million from $18.1 million year-over-year.

• Average weekly sales for company-operated shops increased to $27,040 from $26,110 year-over-year.

Outlook and guidance

• Full-year 2025 guidance raised: same-store sales growth 2.0%-3.0%, at least 38 new shop openings, adjusted EBITDA $34.0-$35.0 million.

• Q3 2025 guidance: same-store sales growth 3.25%-4.25%, at least 8 new units, adjusted EBITDA $9.0-$10.0 million.

• Long-term targets include low- to mid-single-digit same-store sales CAGR and low double-digit new unit growth.

• Management expects sufficient liquidity for at least the next twelve months, supported by cash flow and a $30 million revolving credit facility.

• Company shop development will remain limited, with focus on franchise growth and multi-unit agreements.