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Moving on here. Sweetgreen having a sweet Friday. That stock up over 33% on the back of its second quarter earnings, which saw the salad chain post sales that outpaced market expectations, raising its outlook for the full year as well. Joining us now to discuss, we've got Jonathan Neman, Sweetgreen co-founder and CEO. I'm also joined by Yahoo Finance's Brooke DiPalma. Thank you so much for joining us, Jonathan. So listen, that stock price, you got to be happy with that over today up over 33%, but people who bought at the IPO, as you know, they've been underwater for a while. So I got to ask you about the profitability piece because the company is still not profitable. When do you expect to see a turn in that?

So we're very focused on driving profitability, and I'm very proud of the results of this quarter. So first, I want to just take a moment and thank the team for all of the hard work, all 7,000 team members that brought this to life. And if you look at this quarter, there's a few standouts. One, sales grew 21% with a 9% comp store sales. Our restaurant level margin increased to 22 and a half percent, and we had great controls over our G&A, leading to an adjusted EBITDA of about 12 and a half million dollars. So from an adjusted EBITDA perspective, we are profitable. We are working on driving it from a net income perspective and feel really good about our path to profitability as we continue to open more profitable stores and and continue to leverage our cost structure.

Jonathan, last week's Sweetgreen turned 17 years old. Kudos to you guys. I can't imagine. Almost going to college.

Sweetgreen was almost going to college.

Certainly, I know, I can't imagine that the price is still the same. I know that a bowl now is roughly $15. But you did see those same source sales comps up 9% year-over-year. Do you think Sweetgreen still has pricing power here?

Absolutely. I think I think we do. I think we're going to be very judicious in how we use it. You know, we are, we want to make sure Sweetgreen is the type of thing that people can should enjoy in a habitual way. And so we're very judicious about it. You know, I think one of the benefits we're seeing right now is we've taken less price than our competition over the past four years. So as you look at the relative pricing difference between Sweetgreen, some of our fast casual competitors, and then QSR, the gap has really narrowed. I mean, QSR, you can't get in and out of there for for under $15 today. And so I think consumers are seeing, as more and more people wake up and realize they want to eat real food that is good for them, good for the environment, but still fresh and craveable and convenient, Sweetgreen fits that perfectly. And I think in a lot of ways, our value proposition is only improving.

Infinite Kitchen is something that has lots of investors buzzing. That's, you know, the robotic, futuristic restaurant design you guys have. What sort of overall cost savings does this model present, especially in an environment where we're still seeing low single-digit labor inflation?

Yeah, so we're very excited about the Infinite Kitchen, and something we've been working on for many years. And the idea with the Infinite Kitchen was how do we really make a true win-win-win? Make a better experience for our customers, which we are doing. You can now get a Sweetgreen meal in about three and a half minutes, which is just phenomenal, perfectly portioned, and the food quality is even better. From a team member perspective, it's more enjoyable to work in the store, a little bit less stressful. They have this co-pilot to help them. And we're seeing about a 45% reduction in turnover in those pilot stores. So really encouraging from a team member perspective. And from a financial perspective, what we've said is we expect about seven or eight points of margin leverage with the Infinite Kitchen. We've had a really good pilot, we're seeing almost 10 points of leverage from a restaurant level margin perspective. And so it's it is a true win-win-win, and we think over time it'll give us a lot of strategic opportunities in terms of expanding our white space and going into more places. We do think labor is going to continue to go up and up, you know, is going to continue to compound, and we think this will be a very strategic asset for both the experience and for the financials of the company.

Yeah, Jonathan, you just mentioned the potential margin improvements that can be attributed back to Infinite Kitchens. How much of that do you anticipate coming from a decrease in labor?

Yeah, so a lot of it a lot of it comes from being able to utilize less labor. And what we've done is we're able to use our teams for different things. So they get to focus on the hospitality piece of the business and the culinary piece of the business. So I want to be clear, in these restaurants, there's still a lot of team members. It's just that one part of that work is taken away. So you're seeing a lot of the leverage from labor. We are seeing some in terms of just being able to, you know, manage our food costs a little bit tighter, but it is mostly from labor.

Jonathan, Jonathan, what amount of team member dilution do you anticipate in each store? If you have a certain amount of team members in a store now, how many do you anticipate being in the Infinite Kitchen stores as a comparison point?

It really depends on the volume of the store and at what time, but typically where the entire team on staff is about a third a third of the number of employees needed. Um, and you know, these again, they're they're more enjoyable jobs for them. In the stores, you know, we're mostly opening them in new stores. In the chances that we do a retrofit, we're not nobody has lost a job. We're able to move employees to other locations if needed and make sure we find them their hours. So it's very important for us to take care of our team members as well.

Jonathan, menu innovation was a huge growth driver this past quarter. Now investors are really honed in on the potential of wraps, drinks, and desserts. What sort of capacity do you have left in the kitchen to include these new options, and will we see more robots going forward in the kitchen as well?

Yeah, so you're absolutely right. What's driven the growth this past quarter and really the past year has been a lot of the menu innovation. So shout out to Chef Chad and our culinary team and our marketing team for an amazing, amazing job. And so with plates launched last year, we started to see a big shift in dinner and weekends, a broadening of our consumer, caramelized garlic steak, continue to build on that. It's really helped unlock a lot of white space, and really, you know, one of the things we mentioned in the call yesterday is we've seen a three-point shift from lunch to dinner. We've also broadened the consumer we're seeing more men. So very exciting where that's gone and a lot of opportunity for where we go. So things like a handheld option, more of a house-made beverage, a treat option are all things that we're testing and piloting and expect to be rolling out in the next year or so. And so we have a ton of capacity very intentionally when we built Sweetgreen. We built it as, you know, the restaurants with some modularity to be able to take on other other types of food and food and formats. And so we're very excited about kind of broadening that the occasion for Sweetgreen, broadening the menu, and bringing more guests in inside the brand.

Jonathan, thank you so much for joining us and thanks for coming to Yahoo Finance to talk about that earnings print. Have a great weekend, and also huge thanks to our very own Brooke DiPalma for bringing us the conversation as well.

Thank you for having me.