Dutch Bros CoffeeBROS

The company reported a strong second quarter, with revenue growing about 32 percent to $551 million. This was better than the $530 million analysts expected. Profits also came in higher than predicted, at $0.33 per share. Most importantly, sales at existing shops grew nearly 6 percent, driven by a nearly 2 percent increase in the number of customer visits.

Management is feeling confident enough to raise its full-year outlook for revenue and shop-level profits. The stock fell sharply today despite these results, which suggests that even with strong performance, the market had priced in even higher expectations for this growth-focused business.

See the full quarter, and how our tracked metrics did

Source: 8-K filing

Key highlights

• Full year outlook raised: Management now expects 2026 revenue between $2.1 billion and $2.13 billion, up from previous targets, as the company benefits from strong sales momentum and a recent franchise acquisition. This higher forecast follows a quarter where total revenue grew 32.5% compared to the same period last year.
• Store traffic increasing: Customer transactions at company-operated shops grew 3.4% compared to a year ago, signaling that the brand is attracting more visits even as it opens new locations. This is a vital sign of health for a growing chain, as systemwide transactions also rose 1.7% over the same timeframe.
• Shop profitability holds steady: Shop contribution margin, which measures the profit from individual locations before corporate costs, was 30.6% for company-operated shops. While this is slightly lower than the 31.1% reported a year ago, it remains well above the company's long-term targets and shows efficient operations across the 1,225 total locations.
• Expansion pace accelerating: The company opened 48 new shops this quarter, with 44 of those being run by the company itself rather than franchisees. This brings the total shop count to 1,225 and keeps the company on track to open at least 185 new locations for the full year.
• Average unit volumes climbing: The average annual sales for a company-operated shop rose to $2.16 million, up from $1.98 million a year ago. Higher sales per store help the company cover fixed costs more easily, which contributed to net income rising to $51.6 million this quarter.

Our take: This was an exceptionally strong quarter that proved Dutch Bros can grow its store count while simultaneously getting more productive at existing locations. The combination of 3.4% transaction growth and record sales per shop is rare for a rapidly expanding chain. It reinforces our confidence that the brand has significant room to run across the country.