First Watch Raises 2026 Adjusted EBITDA Outlook

The Tip Desk · November 10, 2026 · 2 min read

The Daytime Dining operator posted $39.7 million of Adjusted EBITDA for the thirteen weeks ended September 27, 2026, and lifted full-year Adjusted EBITDA to about $136.0 million.

First Watch Restaurant Group (FWRG) raised its full-year 2026 Adjusted EBITDA outlook to about $136.0 million after a third quarter in which Adjusted EBITDA reached $39.7 million, up from $34.1 million a year earlier.

The leading Daytime Dining concept serving breakfast, brunch and lunch said the lift moved the 52-week fiscal year ending December 27, 2026, to the high end of the $133.0 million to $136.0 million range it had issued after the second quarter. The company also updated same-restaurant sales guidance to about 2.0% and total revenue growth to about 13.5%.

Chief Executive Officer and President Chris Tomasso said Adjusted EBITDA growth ran ahead of the company’s expectations and that the teams’ execution gave the company confidence to make the outlook change.

Same-restaurant sales growth slowed to 1.0% in the thirteen weeks ended September 27, 2026, after 3.4% in the second quarter and 2.8% in the first. Same-restaurant traffic growth was negative 1.9%. Tomasso described the period as the company’s toughest comparison of the year.

Total revenues increased 10.7% to $349.9 million, compared with $316.0 million in the same period of 2025. System-wide sales increased 10.9% to $391.2 million. Restaurant sales were $346.7 million and franchise revenues were $3.1 million.

Net income was $4.8 million, or $0.08 a share, versus $3.0 million, or $0.05 a share, a year earlier. Income from operations was $11.0 million, and the income from operations margin remained 3.2%. Adjusted EBITDA margin was 11.4%.

Restaurant level operating profit margin decreased to 19.4% from 19.7% a year earlier. Restaurant operating expenses included $77.4 million of food and beverage costs, $113.0 million of labor and other related expenses, $56.0 million of other restaurant operating expenses, $29.5 million of occupancy expenses and $3.5 million of pre-opening expenses. General and administrative expenses were $35.2 million. Transaction and restructuring expenses, net, were $1.3 million.

The company opened 16 system-wide restaurants in 11 states, bringing the system to 681 restaurants, including 601 company-owned and 80 franchise-owned locations across 33 states.

For the full year, the company now expects 60 net new system-wide restaurants, including 2 company-owned closures, 53 new company-owned restaurants and 9 new franchise-owned restaurants. Capital expenditures are expected at about $145.0 million, invested primarily in new restaurant projects and planned remodels. The revenue and Adjusted EBITDA outlooks include a net impact of approximately 1% in total revenue growth and approximately $2 million in Adjusted EBITDA associated with completed acquisitions.