First Watch Restaurant Group added a record 64 system‑wide restaurants during fiscal 2025, comprising 55 company‑owned and nine franchise locations, and closed three sites. The expansion lifted the chain’s total to 633 restaurants—560 company‑owned and 73 franchise—across 32 states, underscoring the company’s aggressive growth strategy in the daytime‑dining niche.
For the full fiscal year 2025, First Watch posted a 3.6% increase in same‑restaurant sales and a 0.5% rise in same‑restaurant traffic, both positive indicators of brand strength. However, the 13‑week period ending December 28, 2025 (Q4) saw a 3.1% sales lift but a 1.9% decline in traffic, reflecting a short‑term slowdown that mirrors broader industry headwinds.
The full‑year sales growth was driven by a mix of higher average check sizes and a strong performance of new second‑generation sites, which typically generate higher revenue per square foot. The Q4 traffic dip is attributed to seasonal demand shifts and increased competition for lunch‑time traffic in key markets, a trend noted by industry analysts. Pricing power remained intact, allowing the company to offset the traffic decline with higher average spend per visit.
CEO Chris Tomasso highlighted the company’s confidence in its expansion pipeline, noting that the record new‑restaurant class “continues to outperform the comparable base and our underwriting expectations.” He added that the firm remains focused on maintaining its lead in daytime dining while navigating the current traffic slowdown.
Analysts have maintained “Buy” ratings for First Watch, but have lowered their Q4 same‑restaurant sales growth forecast to 3% from 4% and adjusted revenue estimates downward to reflect the traffic decline. The guidance shift signals that while the long‑term growth trajectory remains positive, short‑term demand is softer than previously anticipated.
The combination of record openings, solid full‑year sales growth, and a cautious outlook for Q4 traffic suggests that First Watch’s expansion model is still effective, but the company must address the recent foot‑fall to sustain momentum. Management’s emphasis on pricing and new‑site performance indicates a strategy to counteract traffic headwinds while continuing to build a robust portfolio of high‑performing locations.
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