Sweetgreen lowered its 2022 forecast, citing weaker sales that began around Memorial Day. The chain said it will lay off 5% of its support center workforce and downsize to a smaller office building to lower its operating expenses. Shares of the company fell about 20% after hours.

Sweetgreen's stock has fallen 37% since its initial public offering in November. The restaurant company also said it laid off 5% of its support center workforce. It will downsize to a smaller office building to lower its operating expenses. Sweetgreen sales softened around Memorial Day, the company said.

In the quarter ended June 26, Sweetgreen's net sales rose 45% to $124.9 million. Its same-store sales climbed 16%, boosted by 6% menu price hikes. Sweetgreen now expects annual revenue of $480 million to $500 million, down from its prior forecast of $515 million.

The chain also revised its outlook for same-store sales, predicting growth of 13% to 19%. Severance packages and related benefits are expected to cost the company between $500,000 to $800,000. The office move will cost $8.4 million to $9.9 million.

Sweetgreen reported a second-quarter net loss of $40 million, or 36 cents per share. The company blamed an increase in stock-based compensation for its increasing losses. The charges are expected to impact its third-quarter results, the company said. The loss was wider than the $26 million loss the company reported a year earlier.
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