• Total Revenue Growth (2024): 33% increase.
• New Shop Openings (2024): 151 new shops, 128 company-operated.
• System Same-Shop Sales Growth (2024): 5.3% increase.
• Adjusted EBITDA Growth (2024): 44% increase.
• Adjusted EBITDA Margin (2024): Expanded by 140 basis points to 18%.
• Adjusted EPS (2024): $0.49 per share.
• Q4 Revenue: $343 million, a 35% increase year over year.
• Q4 System Same-Shop Sales Growth: 6.9% increase.
• Q4 Company-Operated Same-Shop Sales Growth: 9.5% increase.
• Q4 Adjusted EBITDA: $49 million, a 41% increase year over year.
• Q4 Adjusted EPS: $0.07 per share.
• System-Wide AUVs: $2 million.
• Cash and Cash Equivalents (End of 2024): $293 million.
• Net Cash Position (End of 2024): Approximately $59 million.
• 2025 Revenue Guidance: $1.555 billion to $1.575 billion, 21% to 23% growth.
• 2025 New Shop Openings Guidance: At least 160 new shops.
• 2025 System Same-Shop Sales Growth Guidance: 2% to 4%.
• 2025 Adjusted EBITDA Guidance: $265 million to $275 million, 15% to 20% growth.

• Warning! GuruFocus has detected 6 Warning Sign with BROS.

Release Date: February 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Dutch Bros Inc (NYSE:BROS) achieved a 33% total revenue growth in 2024, driven by 18% new shop growth and 5.3% system same-shop sales growth.
• The company opened 151 new shops in 2024, with strong new shop performance and improved productivity.
• Adjusted EBITDA grew by 44% in 2024, with a 41% increase in Q4 alone, reflecting strong financial health.
• The Dutch rewards program saw a record 71% of transactions from members, indicating high customer engagement.
• Mobile order functionality is now available in 96% of system shops, contributing to increased transaction growth and customer convenience.

Negative Points

• Coffee prices have risen, and Dutch Bros Inc (NYSE:BROS) expects approximately 110 basis points of net COGS margin pressure in 2025.
• The company anticipates making wage investments in 2025, which may offset expected leverage from sales growth.
• Capital expenditures for 2025 are estimated to be between $240 million and $260 million, primarily for new shop construction.
• The company is facing potential construction delays and raw material cost increases, which could impact the development pipeline.
• Despite strong growth, Dutch Bros Inc (NYSE:BROS) is rolling off about 3 points of net pricing in 2025, implying modest pricing power.

Q & A Highlights

Q: Can you elaborate on the factors behind the significant acceleration in company-operated comps? A: Christine Barone, CEO, explained that the acceleration was due to multiple factors working together, including the strength of the brand, the rewards program, paid advertising, and mobile order adoption. New shop performance, particularly in newer markets like Texas, also contributed significantly. Josh Guenser, CFO, added that strong traffic performance allowed them to reduce discounting, enhancing ticket flow.

Q: How did the company manage to achieve a strong finish to the year despite the lowest number of company openings since the IPO? A: Christine Barone noted that the focus on market planning and new shop productivity led to a strategic shift in unit openings towards the back half of the year. This approach resulted in strong new shop performance and lower per unit CapEx, which they are pleased with.

Q: What is the company's strategy regarding mobile order growth and its impact on sales? A: Christine Barone stated that the goal is to ensure stable and steady growth of mobile order adoption to maintain high service levels. The company sees incrementality from Dutch Rewards, new members joining due to mobile order, and throughput improvements. They are pleased with the current pace of mobile order growth.

Q: How is Dutch Bros planning to handle the expected coffee cost increases in 2025? A: Josh Guenser explained that they anticipate a 110 basis point impact on company margins due to elevated coffee prices. They are assuming coffee prices will remain high throughout the year but are not planning significant price increases to maintain their value proposition. If coffee prices remain high long-term, they may consider other offsets in the P&L.

Q: What are the expectations for the 2025 advertising strategy compared to 2024? A: Christine Barone mentioned that they learned a lot in 2024 and will continue to refine their advertising strategy. They plan to focus on targeted digital marketing to drive brand awareness and customer acquisition. The advertising cost is included in the SG&A guidance, and they may increase spending if they see opportunities for a good return on investment.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.