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Earnings analysis · 10-Q

FWRG earnings analysis

Filed November 3, 2026 · Our reading of the company's report

The latest report

First Watch delivered Q3 revenue of $349.861 million and diluted EPS of $0.08, improving year over year and sequentially, while Adjusted EBITDA reached $39.748 million. The outlook is mixed: FY2026 Adjusted EBITDA…

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First Watch delivered Q3 revenue of $349.861 million and diluted EPS of $0.08, improving year over year and sequentially, while Adjusted EBITDA reached $39.748 million. The outlook is mixed: FY2026 Adjusted EBITDA guidance increased to approximately $136.0 million and revenue growth guidance is approximately 13.5%, but same-restaurant sales guidance narrowed to approximately 2.0% and planned capital expenditures remain approximately $145.0 million. The 10-Q reported no material changes to the risk factors in the 2025 Form 10-K and disclosed additional interest-rate swaps covering $50.0 million initially and $80.0 million beginning December 24, 2026.

Read the original on SEC.gov

Gross and operating margin

How much of each revenue dollar the business keeps.

78% Gross margin Operating margin May 2023 Aug 2026

One point per quarterly or annual filing. Both margins are shares of that report's revenue.

How we read each report

Our analysis across the last few reports.

Read as bullish Read as bearish May 2023 Nov 2026

Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.

Reported figures

Earnings per share
$0.08

What stood out

  • Revenue grew year over year

    Q3 revenue was $349.861 million, up approximately 10.7% from $316 million in Q3 2025, but down approximately 1.4% from $355 million in Q2 2026.

  • EPS improved year over year and sequentially

    Diluted EPS was $0.08, compared with $0.05 in Q3 2025 and $0.04 in Q2 2026, representing increases of $0.03 and $0.04, respectively.

  • Adjusted EBITDA guidance raised

    Adjusted EBITDA increased to $39.748 million in Q3, and full-year 2026 Adjusted EBITDA guidance was raised to approximately $136.0 million.

  • Revenue outlook remains positive

    Full-year 2026 revenue growth guidance was set at approximately 13.5%, while same-restaurant sales guidance was narrowed to approximately 2.0%.

  • Additional interest-rate hedging

    The company entered into interest-rate swaps with an initial aggregate notional amount of $50.0 million, increasing to $80.0 million on December 24, 2026, at a weighted-average fixed rate of 4.08%.

  • Commodity inflation expected flat

    Management expects full-year commodity inflation to be approximately flat, which may limit food-cost pressure relative to a more inflationary environment.

What to watch

  • Residual interest-rate exposure

    The company remains exposed to variable-rate debt despite new hedges: the swaps cover an initial $50.0 million and increase to $80.0 million, while the weighted-average fixed rate is 4.08%. Changes in SOFR on unhedged borrowings could still affect interest expense and cash flow.

  • Comparable-sales momentum narrowed

    Same-restaurant sales guidance was narrowed to approximately 2.0%, indicating less operating momentum than the prior 1.5%-3.0% range. The filing's outlook therefore carries comparable-sales execution risk even as revenue growth guidance is approximately 13.5%.

  • Material capital-spending requirement

    Capital expenditures are expected to be approximately $145.0 million for FY2026. This remains a material funding requirement relative to the company's quarterly revenue of $349.861 million and could constrain discretionary cash flow if operating performance weakens.

Management's outlook

Management raised FY2026 Adjusted EBITDA guidance to approximately $136.0 million and set revenue growth guidance at approximately 13.5%. Same-restaurant sales guidance was narrowed to approximately 2.0%, while capital expenditures are now expected to be approximately $145.0 million. The 10-Q also states that full-year commodity inflation is expected to be approximately flat; no numeric EPS or revenue-dollar range was provided.

Earlier filings 4

10-Q · August 4, 2026

First Watch delivered strong Q2 top-line growth, with revenue up 15.2% to $354.672 million, 18 system-wide openings, and restaurant-level margin expansion to 18.8%. However, GAAP operating margin fell 10 basis points to…

10-Q · May 5, 2026

First Watch Restaurant Group, Inc. reported strong financial results for Q1 2026, with total revenues of $331.0 million, reflecting a 17.3% increase year-over-year. However, the company faced a larger net loss of $2.7…

10-K · February 24, 2026

First Watch’s 10-K emphasizes continued unit growth and a scalable daytime-dining model: the system reached 633 restaurants (560 company-owned, 73 franchise-owned) and opened 64 new restaurants in 2025 while acquiring…

10-Q · November 4, 2025

First Watch reported Q3 revenues of $316,022,000, up from $251,609,000 year-over-year, with income from operations rising to $10,050,000 and diluted EPS of $0.05 (vs $0.03 a year ago). Operating cash flow for the 39…

This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.