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Stocks•9 May 2026•

1 min read

First Watch Sales Rise Despite Traffic Slump as Lower Egg Prices Boost Margins

Key Facts

1First Watch same-store sales rose 2.8% despite a traffic decline of approximately 2%.

2Restaurant-level margins benefited from egg price deflation, with normalized margins expected between 18% and 19%.

3Net debt stood at approximately $229M with modestly positive free cash flow.

First Watch Restaurant Group reported a 2.8% increase in same-store sales, driven by higher average checks despite a 2% decline in customer traffic. Restaurant-level margins saw a significant boost from commodity price deflation, particularly lower egg prices, with normalized margins projected to stabilize between 18% and 19%. On the balance sheet, the company reported net debt of approximately $229M alongside modestly positive free cash flow. Analysts note that growth is becoming increasingly reliant on new restaurant openings as organic traffic faces headwinds. The company's premium positioning is currently being tested by broader macroeconomic challenges affecting consumer spending. Investors remain focused on whether margin expansion can offset the persistent decline in foot traffic for FWRG.