Dutch Bros (BROS) Earnings: Strong Q1 Momentum & Confident 2025 Outlook
- Hardik Shah
- May 7
- 3 min read
TL;DR
Robust Revenue Growth: Revenue surged 29% year-over-year to $355.2 million, fueled by same shop sales gains and new openings.
Operational Excellence: Company-operated same shop sales rose 6.9%, backed by 3.7% transaction growth and improved throughput.
Optimistic Outlook: Management raised confidence in hitting the upper end of full-year guidance with 160+ new shops and continued EBITDA strength.
Business Overview
Dutch Bros (NYSE: BROS) is a rapidly expanding operator and franchisor of drive-thru shops offering hand-crafted beverages, known for speed, quality, and exceptional service. Founded in 1992, Dutch Bros now operates 1,012 shops across 18 states, offering a mix of coffee, energy drinks, and other specialty beverages through a community-driven, customer-first model.
Dutch Bros Earnings - Q1'25 Highlights
Total Revenues: $355.2M (+29.1% YoY), driven by new shops and higher same shop sales.
Same Shop Sales Growth:
Systemwide: +4.7%
Company-operated: +6.9% (Transaction growth +3.7%)
Net Income: $22.5M, up from $16.2M YoY.
Adjusted EBITDA: $62.9M (+19.7% YoY).
EPS (Diluted): $0.13, up from $0.08 YoY.
“We delivered exceptional results in the first quarter... Our brand continues to resonate with our customers, giving us confidence that our foundational transaction drivers are working.” — Christine Barone, CEO
Forward Guidance
Management reaffirmed and expressed confidence in reaching the upper half of prior guidance:
Revenue: $1.555B to $1.575B
Same Shop Sales Growth: 2% to 4%
Adjusted EBITDA: $265M to $275M
New Shops: At least 160 systemwide openings expected in 2025.
"Given the strong performance in Q1 and continued momentum into Q2, 2025 total revenues, same shop sales growth, and adjusted EBITDA are trending towards the top half of the ranges." — Josh Guenser, CFO
Operational Performance
New Shops: 30 shops opened in Q1, 25 of which were company-operated.
Company-Operated Shop Contribution: $96.1M (+30% YoY) with a contribution margin of 29.4%.
Order Ahead Success: Order ahead accounted for ~11% of transactions, with nearly double penetration in new markets.
Food Pilot Expansion: The limited food pilot expanded from 8 to 32 stores and is expected to roll out more broadly by 2026.
Throughput Gains: Focused execution on bottlenecks and improved visibility with dashboards has driven higher peak-hour productivity.
"We are encouraged by the continued success of our order ahead program... This is encouraging as we recognize that at times we have long lines." — Christine Barone, CEO
Market Insights
Macro Trends: Despite broader consumer pressures, traffic trends have been resilient into Q2.
Tariff Impact: Management expects tariffs on coffee imports (~10%) to be manageable within COGS expectations for 2025.
Paid Advertising: Strategic increase in paid media has driven higher awareness and shop productivity, especially in new markets.
Loyalty Growth: Dutch Rewards penetration hit 71.8% of transactions, up 5 points YoY, driving repeat visits and engagement.
Strategic Initiatives
Order Ahead: Accelerating adoption and incremental morning daypart traffic.
Food Program: Targeted, low-complexity SKU mix aimed to capture incremental beverage attachment.
Real Estate and Development: Investment in market planning and leadership aimed at achieving the "2029 Shops by 2029" vision.
Team and Culture: Focus on broista training and leadership pipeline (450 operator candidates with 7+ years average tenure) as key enablers for scale.
Capital Allocation
CapEx: ~$1.67M per shop in Q1, down 10% QoQ, benefiting from more capital-efficient lease arrangements.
Liquidity: $658M total liquidity including $316M cash and undrawn revolver.
No dividend or share buyback programs were discussed, aligning with growth-first capital allocation priorities.
The Bottom Line
Dutch Bros delivered a standout Q1 2025 with double-digit revenue and EBITDA growth, propelled by new shops, same shop sales momentum, and smart execution on transaction-driving strategies. With confidence in top-half guidance achievement, a robust shop pipeline, and scalable innovation across order ahead, food, and loyalty programs, Dutch Bros is poised for multi-year expansion while navigating macro headwinds like tariffs. The brand’s vibrant culture, strategic focus, and disciplined investments continue to set the stage for sustained shareholder value creation.
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