The 'bowl market' is over after Cava, Sweetgreen, and Chipotle's disappointing earnings

The 'bowl market' is over after Cava, Sweetgreen, and Chipotle's disappointing earnings originally appeared on TheStreet.

The 'bowl market' is over. Long live the bowl.

After disappointing back-to-back earnings seasons, Chipotle (CMG) , Cava Group (CAVA) , and sweetgreen (SG) are running into a wall of expectations. On one side, hungry fast casual shoppers, fed up with the high price of bowls and shrinking portions. And on the other side, investors who had grown accustomed to their fantastical growth.

All three had spent 2023 and 2024 on the rise, with successive strong earnings reports sending their stocks to new heights. But now, it's a different story, as 'one off' bad quarters for Chipotle and sweetgreen are turning into a trend, pressing 'reset' on investor expectations.

Not Very Bowl-ish

In Q2, Chipotle reported a 4% year-over-year decline in its same-store sales and cut its guidance. Sweetgreen followed with a 7.6% YoY decline in same-store sales and weaker guidance. After their respective reports, their stocks are down 28% and 69% year-to-date.

Even Cava, which made a strong first quarter showing, is feeling the drag too. On Tuesday, it reported that its same-store sales rose only 2.1% in the quarter. That's better than the decline seen by its competition, but about a third as much as analysts polled by StreetAccount were looking forward.

After its report today, its stock is down 20% in after hours trading. Before then, it was like Chipotle, down 26% this year. Tomorrow, the way it's shaping up, its YTD return might well end up being a stepping stone between the giant Chipotle and smaller Sweetgreen in terms of stock losses.

Less for More

There's a lot of reasons ascribed to the decline in same-store sales at fast-casual chains. Chief among them might be a consumer recession. That is, that consumers are spending less money eating out and restricting spend on value-oriented purchases.

However, there's another factor that's at play: that consumers feel they're getting less for more. Chipotle has been at the center of a years-long speculation over smaller portions and higher prices on its once-beloved burrito bowls. And, to a lesser extent, Sweetgreen has faced similar pressures as the price of its salads have risen.

In response, the companies are seeking to launch a 'value' blitz. Chipotle said last year that it hadn't changed its portion sizes, but it pledged to increase them amid complaints. After its Q2 earnings, Sweetgreen similarly promised to increase portions, promising 25% more protein in its salads and bowls, while expanding its 'budget' menu options.

Story Continues

It remains to be seen if Cava will employ similar measures to center the value of their product. At this stage, its same-store sales are still on the rise, which is more than can be said of its competition, which is currently tracking for negative growth this year.

Is the pullback an opportunity?

If skimping on portions really got them here, then it stands to reason they could win back customers by offering a better product. In theory, that should be really easy, seeing how all three companies have invested millions into salad and bowl-making robots.

Sweetgreen's Infinite Kitchen is now at dozens of the chain's location, turning its stores into assembly lines for salads and bowls, with the help of human labor. Chipotle and Cava have invested in robotics too, with both firms having invested in Hyphen, a company promising to automate various kitchen operations.

However, as Sweetgreen's independent ventures in robotics have demonstrated, robots might improve margins, but that might mean little if you're not passing along savings to consumers with a better product. Instead, kitchen robots seem to benefit businesses by standardizing portions, reducing staff, and speeding up tasks at locations.

Unfortunately, none of that matters to consumers if they don't feel like they're getting a fair shake. Robotics could be an opportunity to keep prices low and produce more product. But for now, that's not the case.

As a result, betting on a consumer play -- or indeed, a 'Bowl Market' stock -- would be as risky a bet as any. They're not just encumbered with the challenge of convincing consumers that they provide value, but with clouds in the macro which are causing consumers to pull back; toiling with once-hardy growth expectations.

And to that end, if the last two quarters are any indications, the problems for fast casual brands (and indeed, consumer plays at large) might still well be in their early innings.

The 'bowl market' is over after Cava, Sweetgreen, and Chipotle's disappointing earnings first appeared on TheStreet on Aug 12, 2025

This story was originally reported by TheStreet on Aug 12, 2025, where it first appeared.

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