First Watch sales rise after menu refresh, marketing push, expansion

First Watch’s latest quarter shows how a menu reset reaches far beyond the host stand. Same-restaurant sales rose 2.8% for the quarter ended March 29 even as traffic fell 2%, a sign that the chain’s February menu refresh and new marketing helped offset weaker guest counts and a weather hit that shaved about 100 basis points off traffic.

That matters on the line. The core menu update was the brand’s first major redesign in nearly 10 years, and it pushed more attention toward beverages and seasonal items while also changing how some familiar plates are built, including an avocado toast that now can be ordered with salmon. For cooks, that kind of change means new prep routines, tighter expo communication and more room for mistakes if training lags. For servers, it creates more chances to sell add-ons and drinks, but also more product knowledge to carry during a busy brunch rush.

The company said it opened 16 restaurants in the quarter, including 13 company-owned locations and three franchise units, bringing the system to 648 restaurants across 32 states. Expansion like that can create opportunities for hires, promotions and transfers, but it also stretches managers who have to train new teams while keeping existing stores steady. In a concept built around breakfast and lunch speed, any menu change that adds steps in prep can quickly show up in ticket times and labor pressure.

The top-line numbers were strong. First Watch reported total revenue of $331.0 million, up 17.3% year over year, while system-wide sales rose 13.8% to $367.6 million. Adjusted EBITDA climbed to $27.8 million from $22.8 million a year earlier, and restaurant-level operating profit margin improved to 18.5% from 16.5%. The net loss widened to $2.7 million, but the company also reaffirmed its full-year top-line outlook and raised the low end of adjusted EBITDA guidance.

The sales trend did not start with this quarter. First Watch ended 2025 with 633 restaurants after opening a record 64 units, and same-restaurant sales rose 3.6% that year with slightly positive traffic. In the fourth quarter of 2025, same-store sales rose 3.1% even as traffic fell 1.9%, suggesting that the brand was already leaning on menu mix and execution rather than pure guest growth.

Matt Eisenacher, First Watch’s chief brand officer, said customers are cautious and do not want to “gamble with their dollars.” That is also a warning for the kitchen and dining room: when a brand tries to win by making the menu more appealing, the payoff depends on whether the added complexity can be absorbed without burning out the crews expected to execute it.