NEW YORK, May 20, 2026, 3:05 PM EDT
- First Watch shares were up 5 cents at $10.94 in afternoon trading, trailing a broader small-cap rally.
- The company’s annual meeting was scheduled for Wednesday morning, with director elections and pay votes on the agenda.
- Its latest quarterly report showed fast sales growth, but traffic fell and the company posted a net loss.
First Watch Restaurant Group shares were little changed in regular U.S. trading on Wednesday, as the breakfast-and-brunch chain lagged a stronger market and investors weighed its growth plan against softer guest traffic.
That matters now because First Watch is still being priced as an expanding restaurant concept. The stock’s next move may depend less on one day’s trading and more on whether new stores, menu changes and marketing can lift traffic without squeezing profit.
The Nasdaq-listed shares recently traded at $10.94, up 5 cents, or about 0.5%, after moving between $10.59 and $11.14. The company’s market value was about $670 million.
The backdrop was friendly. Wall Street’s main indexes rose on Wednesday, helped by a rebound in chip stocks ahead of Nvidia’s results, while the SPDR S&P 500 ETF was up about 0.9% and the iShares Russell 2000 ETF, a proxy for smaller companies, gained about 2.2%.
First Watch’s annual meeting was set for 8 a.m. Eastern time on Wednesday. A proxy filing showed shareholders were asked to elect three Class II directors, cast advisory votes on executive pay and pay-vote frequency, and ratify PricewaterhouseCoopers as auditor.
There was no fresh earnings release in the past day. The company’s investor filing page still showed its May 5 8-K and 10-Q as the latest major filings listed, keeping attention on the first-quarter update rather than a new corporate event.
In that quarter, First Watch said revenue rose 17.3% to $331.0 million and system-wide sales rose 13.8% to $367.6 million. Same-restaurant sales — sales at restaurants open long enough to be compared with the prior year — rose 2.8%, but traffic fell 2.0%. The company reported a net loss of $2.7 million and adjusted EBITDA, a profit measure that excludes interest, taxes, depreciation, amortization and some other items, of $27.8 million.
Chief Executive Chris Tomasso said the quarter showed “solid results” and that the company was “reaffirming our full-year top-line growth outlook.” First Watch opened 16 restaurants in 11 states in the quarter, ending the period with 648 system-wide restaurants. First Watch Restaurant Group, Inc
Chief Financial Officer Mel Hope said on the earnings call that First Watch expected “positive same-restaurant sales growth into each quarter of 2026.” He also said the company expected commodity inflation of 1% to 3%, restaurant-level labor cost inflation of 3% to 5%, adjusted EBITDA of $133 million to $140 million, and capital spending of $150 million to $160 million for the year. Investing
Restaurant peers were mixed but mostly firmer. Dine Brands, the parent of IHOP and Applebee’s, rose about 2.3%; Darden Restaurants gained about 2.2%; and Chipotle Mexican Grill was up about 0.4%. That left First Watch ahead on the day, but not with the force seen in some other consumer and restaurant names.
But the risk is clear enough: if traffic stays negative, or if labor and food costs rise faster than the company can offset, new-unit growth may not translate into stronger earnings. In its 10-Q, First Watch listed lower-than-expected same-restaurant sales, food costs, labor costs, new-restaurant execution and debt as risks; it also reported $23.6 million in cash and $265.3 million of borrowings under its credit facility at quarter-end.
For now, the stock is drifting rather than breaking out. The market has the broad rally. First Watch still has to prove the breakfast traffic.
