A once-popular restaurant chain is facing a potential disaster after its stock price fell below $1 for 30 consecutive business days, threatening its listing on the Nasdaq Global Select Market. Noodles & Company, a fast casual pasta chain with over 450 locations across 26 states, reported a 3.3% decline in sales during Q3, according to earnings data. The company experienced a net loss of $6.8 million compared to a net income of $0.7 million in Q3 2023.
Despite efforts to restructure in 2024, the situation remains dire. Noodles & Company has until June 23 to raise its share price to at least $1 or risk delisting. The company has indicated its intention to explore options for regaining compliance, including a potential reverse stock split, requiring stockholder approval. Noodles & Company expresses hope for a turnaround through new menu items and its mobile app. CEO Drew Madsen acknowledged the challenging consumer environment, citing increased industry-wide promotions, discounts, and a decline in third-party delivery sales. Madsen outlined a multi-faceted approach to improve sales, including financial tightening measures like reducing capital expenditures, slowing new store growth, researching more affordable restaurant prototypes, and enhancing operational efficiencies. The company plans to close 15-20 restaurant locations in 2025
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