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BROS' Food Pilot Gains Momentum: Can It Unlock Morning-Daypart Growth?
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Key Takeaways
BROS expanded its eight-item food pilot to 64 shops across Arizona, Kansas, Missouri and Oklahoma.
Early results show ticket and transaction gains, supporting higher average unit volumes and loyalty.
A 2026 rollout is planned as BROS scales digital ordering and loyalty to drive transaction momentum.
Dutch Bros Inc. (BROS - Free Report) is focusing on the targeted expansion of its food pilot program to capture the untapped potential in the high-frequency morning daypart. The company, best known for its customizable beverages and energetic drive-thru culture, is testing an eight-item food menu aimed at complementing its drink lineup and deepening customer engagement. During the second quarter of 2025, BROS expanded the pilot to 64 company-operated shops across Arizona, Kansas, Missouri and Oklahoma, and reported solid feedbaack from the same. Early data reveals ticket and transaction lifts, underscoring the program’s potential to enhance average unit volumes (AUVs) and strengthen customer loyalty.
Dutch Bros has designed the initiative with operational discipline at its core. The program integrates efficiently into existing workflows, ensuring that throughput remains unaffected. The company is installing new equipment, including ovens and freezers, to enable broader implementation while maintaining efficiency. Dutch Bros plans to continue testing through 2025, followed by a systemwide rollout in 2026, following a phased and data-driven approach.
The food pilot complements Dutch Bros’ broader transaction-driving initiatives focused on digital adoption, throughput optimization and loyalty engagement. Order-ahead represented approximately 11.5% of total transactions during the second quarter, with newer markets achieving adoption rates more than double the system average. This feature has been particularly effective in the morning hours, where Dutch Bros sees significant white space. The company’s loyalty platform, Dutch Rewards — accounting for 72% of total system transactions — continues to support customer retention and targeted marketing. Together, these levers are reinforcing transaction momentum, reflected in the 6.1% system same-shop sales growth and 3.7% transaction increase reported in the second quarter.
With over 1,000 locations and a long-term goal of 7,000 shops nationwide, Dutch Bros is executing on a clear multiyear growth roadmap. As the food pilot matures, the initiative has the potential to become a high-margin revenue driver — enhancing morning-daypart penetration, increasing customer frequency and reinforcing BROS’ position as a leading growth story in the specialty beverage sector.
How It Stacks Up to Competitors
Starbucks Corporation (SBUX - Free Report) is accelerating its food innovation pipeline to drive growth. In the third quarter of fiscal 2025, it introduced a refreshed breakfast sandwich lineup and expanded its protein-forward options, including egg wraps and portable bakery additions designed for on-the-go customers. Management noted that these enhancements have driven improved morning-daypart performance and higher food attachment rates, particularly in the United States and Canada. Starbucks is also testing a revamped food prep and warming process under its Reinvention Plan to improve consistency and speed during peak hours. With over 40% of transactions already including a food item, Starbucks is demonstrating how a scaled, data-driven approach to menu innovation can deepen engagement and lift average ticket size without compromising throughput.
Sweetgreen, Inc. (SG - Free Report) is also leaning into food innovation through its warm bowls, dinner-focused entrees and Infinite Kitchen automation platform, positioning itself as a fast-casual leader in operational precision and culinary expansion. In the second quarter of 2025, Sweetgreen advanced tests of heartier, protein-based dinner options, broadening its relevance beyond lunch and tapping into higher-margin evening occasions.
Sweetgreen’s Infinite Kitchen locations (which automate salad and bowl assembly) are already delivering faster service times, improved accuracy and stronger unit economics. Management noted that the model enables greater menu flexibility, supporting the rollout of new recipes and seasonal offerings without slowing throughput. Looking ahead, Sweetgreen plans to expand the Infinite Kitchen footprint in 2026, viewing food innovation and automation as twin catalysts for sustained traffic growth and margin improvement.
BROS’ Price Performance, Valuation & Estimates
Shares of Dutch Bros have declined 3.5% so far this year compared with the industry’s fall of 6.8%.
BROS YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Dutch Bros trades at a forward price-to-sales ratio of 4.41X, above the industry’s average of 3.53X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BROS’ fiscal 2025 and 2026 earnings per share (EPS) implies a year-over-year uptick of 38.8% and 27.5%, respectively. The EPS estimates for fiscal 2025 and 2026 have remained unchanged in the past 30 days.
Image: Bigstock
BROS' Food Pilot Gains Momentum: Can It Unlock Morning-Daypart Growth?
Key Takeaways
Dutch Bros Inc. (BROS - Free Report) is focusing on the targeted expansion of its food pilot program to capture the untapped potential in the high-frequency morning daypart. The company, best known for its customizable beverages and energetic drive-thru culture, is testing an eight-item food menu aimed at complementing its drink lineup and deepening customer engagement. During the second quarter of 2025, BROS expanded the pilot to 64 company-operated shops across Arizona, Kansas, Missouri and Oklahoma, and reported solid feedbaack from the same. Early data reveals ticket and transaction lifts, underscoring the program’s potential to enhance average unit volumes (AUVs) and strengthen customer loyalty.
Dutch Bros has designed the initiative with operational discipline at its core. The program integrates efficiently into existing workflows, ensuring that throughput remains unaffected. The company is installing new equipment, including ovens and freezers, to enable broader implementation while maintaining efficiency. Dutch Bros plans to continue testing through 2025, followed by a systemwide rollout in 2026, following a phased and data-driven approach.
The food pilot complements Dutch Bros’ broader transaction-driving initiatives focused on digital adoption, throughput optimization and loyalty engagement. Order-ahead represented approximately 11.5% of total transactions during the second quarter, with newer markets achieving adoption rates more than double the system average. This feature has been particularly effective in the morning hours, where Dutch Bros sees significant white space. The company’s loyalty platform, Dutch Rewards — accounting for 72% of total system transactions — continues to support customer retention and targeted marketing. Together, these levers are reinforcing transaction momentum, reflected in the 6.1% system same-shop sales growth and 3.7% transaction increase reported in the second quarter.
With over 1,000 locations and a long-term goal of 7,000 shops nationwide, Dutch Bros is executing on a clear multiyear growth roadmap. As the food pilot matures, the initiative has the potential to become a high-margin revenue driver — enhancing morning-daypart penetration, increasing customer frequency and reinforcing BROS’ position as a leading growth story in the specialty beverage sector.
How It Stacks Up to Competitors
Starbucks Corporation (SBUX - Free Report) is accelerating its food innovation pipeline to drive growth. In the third quarter of fiscal 2025, it introduced a refreshed breakfast sandwich lineup and expanded its protein-forward options, including egg wraps and portable bakery additions designed for on-the-go customers. Management noted that these enhancements have driven improved morning-daypart performance and higher food attachment rates, particularly in the United States and Canada. Starbucks is also testing a revamped food prep and warming process under its Reinvention Plan to improve consistency and speed during peak hours. With over 40% of transactions already including a food item, Starbucks is demonstrating how a scaled, data-driven approach to menu innovation can deepen engagement and lift average ticket size without compromising throughput.
Sweetgreen, Inc. (SG - Free Report) is also leaning into food innovation through its warm bowls, dinner-focused entrees and Infinite Kitchen automation platform, positioning itself as a fast-casual leader in operational precision and culinary expansion. In the second quarter of 2025, Sweetgreen advanced tests of heartier, protein-based dinner options, broadening its relevance beyond lunch and tapping into higher-margin evening occasions.
Sweetgreen’s Infinite Kitchen locations (which automate salad and bowl assembly) are already delivering faster service times, improved accuracy and stronger unit economics. Management noted that the model enables greater menu flexibility, supporting the rollout of new recipes and seasonal offerings without slowing throughput. Looking ahead, Sweetgreen plans to expand the Infinite Kitchen footprint in 2026, viewing food innovation and automation as twin catalysts for sustained traffic growth and margin improvement.
BROS’ Price Performance, Valuation & Estimates
Shares of Dutch Bros have declined 3.5% so far this year compared with the industry’s fall of 6.8%.
BROS YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Dutch Bros trades at a forward price-to-sales ratio of 4.41X, above the industry’s average of 3.53X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BROS’ fiscal 2025 and 2026 earnings per share (EPS) implies a year-over-year uptick of 38.8% and 27.5%, respectively. The EPS estimates for fiscal 2025 and 2026 have remained unchanged in the past 30 days.
Image Source: Zacks Investment Research