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Dutch Bros Expands Menu: Can Innovation Drive Foot Traffic?
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Key Takeaways
BROS posted 1.3% same-shop transaction growth and 29% revenue gain on strong limited-time menu launches.
A new hot food pilot has expanded to 32 stores, targeting morning traffic and boosting beverage attachment.
BROS Rewards now drives 72% of transactions, with Order Ahead growing to 11% of the overall sales mix.
Dutch Bros Inc. (BROS - Free Report) is leaning into innovation as a key lever to boost traffic and deepen customer engagement across its rapidly growing footprint.
In first-quarter 2025, the coffee chain rolled out a series of creative limited-time offerings (LTOs), including Sweet Cereal Sips and the Spring Fever Dream Trio, playful concoctions featuring nostalgic flavors and eye-catching elements like Poppin’ Boba and rubber ducks. These menu innovations helped the company lap last year’s strong LTOs, driving solid same-shop transaction growth of 1.3% and overall revenue growth of 29%.
But Dutch Bros is not stopping at beverages. A new food pilot has expanded from eight to 32 shops, testing hot protein items aimed at capturing additional morning visits, a highly competitive daypart. While food currently accounts for less than 2% of sales, leadership sees it as a strategic opportunity to lift frequency and beverage attachment without compromising throughput or employee satisfaction. Early results are promising, with further expansion and a broader rollout expected in 2026.
This innovation-driven approach is part of a broader strategy to develop multiple sales layers, supported by the Dutch Rewards loyalty program, now responsible for 72% of transactions, and a growing Order Ahead business, which has reached 11% of the mix.
As competition in the beverage sector intensifies, Dutch Bros’ ability to turn product experimentation into sustained foot traffic could be pivotal.
How Dutch Bros Stacks Up Against Starbucks and Krispy Kreme
In the race to drive customer traffic through innovation, Dutch Bros faces strong competition from both legacy brands and reinvented players. Starbucks (SBUX - Free Report) continues to lead in beverage innovation and digital engagement, frequently launching seasonal drinks and leveraging its mobile app and loyalty program to drive repeat visits. Its extensive food menu gives Starbucks a strong edge in the morning daypart, an area Dutch Bros is aggressively targeting with the new food pilot.
On the other hand, Krispy Kreme (DNUT - Free Report) is broadening its brand beyond doughnuts, with increasing emphasis on coffee and limited-time beverage offerings. Krispy Kreme is testing new menu combinations and partnerships to encourage bundled purchases and drive frequency, particularly during breakfast and snack hours.
BROS’ Price Performance, Valuation and Estimates
Dutch Bros stock has lost 10% in a month against the industry and the S&P 500’s growth of 1.7% and 4.3%, respectively.
Price Performance
Image Source: Zacks Investment Research
BROS is trading at a premium to the industry, with a forward 12-month price-to-sales of 5.8X. The figure is well above the industry average of 4.03X.
P/S(F12M)
Image Source: Zacks Investment Research
Over the past 30 days, BROS' 2025 earnings estimates have inched down to 59 cents per share from 61 cents.
Image Source: Zacks Investment Research
The stock currently carries a Zacks Rank #4 (Sell).
Image: Bigstock
Dutch Bros Expands Menu: Can Innovation Drive Foot Traffic?
Key Takeaways
Dutch Bros Inc. (BROS - Free Report) is leaning into innovation as a key lever to boost traffic and deepen customer engagement across its rapidly growing footprint.
In first-quarter 2025, the coffee chain rolled out a series of creative limited-time offerings (LTOs), including Sweet Cereal Sips and the Spring Fever Dream Trio, playful concoctions featuring nostalgic flavors and eye-catching elements like Poppin’ Boba and rubber ducks. These menu innovations helped the company lap last year’s strong LTOs, driving solid same-shop transaction growth of 1.3% and overall revenue growth of 29%.
But Dutch Bros is not stopping at beverages. A new food pilot has expanded from eight to 32 shops, testing hot protein items aimed at capturing additional morning visits, a highly competitive daypart. While food currently accounts for less than 2% of sales, leadership sees it as a strategic opportunity to lift frequency and beverage attachment without compromising throughput or employee satisfaction. Early results are promising, with further expansion and a broader rollout expected in 2026.
This innovation-driven approach is part of a broader strategy to develop multiple sales layers, supported by the Dutch Rewards loyalty program, now responsible for 72% of transactions, and a growing Order Ahead business, which has reached 11% of the mix.
As competition in the beverage sector intensifies, Dutch Bros’ ability to turn product experimentation into sustained foot traffic could be pivotal.
How Dutch Bros Stacks Up Against Starbucks and Krispy Kreme
In the race to drive customer traffic through innovation, Dutch Bros faces strong competition from both legacy brands and reinvented players. Starbucks (SBUX - Free Report) continues to lead in beverage innovation and digital engagement, frequently launching seasonal drinks and leveraging its mobile app and loyalty program to drive repeat visits. Its extensive food menu gives Starbucks a strong edge in the morning daypart, an area Dutch Bros is aggressively targeting with the new food pilot.
On the other hand, Krispy Kreme (DNUT - Free Report) is broadening its brand beyond doughnuts, with increasing emphasis on coffee and limited-time beverage offerings. Krispy Kreme is testing new menu combinations and partnerships to encourage bundled purchases and drive frequency, particularly during breakfast and snack hours.
BROS’ Price Performance, Valuation and Estimates
Dutch Bros stock has lost 10% in a month against the industry and the S&P 500’s growth of 1.7% and 4.3%, respectively.
Price Performance
Image Source: Zacks Investment Research
BROS is trading at a premium to the industry, with a forward 12-month price-to-sales of 5.8X. The figure is well above the industry average of 4.03X.
P/S(F12M)
Image Source: Zacks Investment Research
Over the past 30 days, BROS' 2025 earnings estimates have inched down to 59 cents per share from 61 cents.
Image Source: Zacks Investment Research
The stock currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.