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Pedestrians pass by a Sweetgreen restaurant on Aug. 4, 2026 in San Francisco, California.
Heather Diehl | Getty Images
Sweetgreen on Thursday cut its full-year outlook and is now projecting steeper same-store sales declines due to diner fears of eating fresh produce during the ongoing cyclospora outbreak.
Shares of the salad chain fell more than 15% in extended trading.
Sweetgreen has not been implicated in the ongoing outbreak that has sickened at least 10,000 people and led to two deaths, according to data from the Centers for Disease Control and Prevention. The Food and Drug Administration has pointed to iceberg lettuce supplied by a Taylor Farms facility in central Mexico as the likely culprit, and the contaminated products have been recalled. The only nationwide restaurant chain linked to the outbreak is Yum Brands' Taco Bell, which is already seeing sales bounce back.
Still, fear of the water-borne parasite has weighed on many consumers' desire for fresh produce, particularly salad.
"The Company's updated outlook reflects reduced consumer demand for fresh prepared foods due to the multistate outbreak of cyclosporiasis since mid-July," Sweetgreen said in a statement. "The pace and timing of recovery remain uncertain."
For 2026, the company is now projecting its annual same-store sales could shrink 7% to 8%. Its previous forecast anticipated same-store sales declines of just 2% to 4%.
Sweetgreen is also expecting to report an adjusted loss before interest, taxes, depreciation and amortization of $27 million to $23 million. It was previously forecasting earnings before interest, taxes, depreciation and amortization of $1 million to $6 million.
Other restaurant chains not linked to the contaminated iceberg lettuce have also seen their sales fall. Chipotle Mexican Grill said in late July that cyclospora fears had about a 2 percentage point impact on sales in the second half of July. Salad and Go, an already struggling chain, filed for bankruptcy protection on Tuesday, saying that consumer mistrust from the outbreak excerbated its ongoing business challenges.
Sweetgreen also reported its second-quarter results after the bell on Tuesday. Its quarterly loss was steeper than expected, and its revenue fell short of Wall Street's expectations.
