Dutch Bros pops 40% after highlighting that it may be a bigger player in the food game

Dutch Bros (NYSE:BROS) soared more than 40% on Thursday after topping Q3 earnings estimates and hiking its full-year revenue guidance. The restaurant stock carved out a new 52-week high and may have sparked some short squeeze trading.

TD Cowen analyst Andrew Charles said the Dutch Bros (NYSE:BROS) update serviced the bull case on mobile order, and unexpectedly turned a spotlight on the food narrative with the stock beginning in 2026.

During the earnings call, Dutch Bros (BROS) management that it began a limited food test in 6 shops in Q3 The company explored a few potential menus, including an expanded bakery offering and sweet and savory hot food options. Based on the early results, Dutch Bros (BROS) had decided that a more robust food venue will play a role for it in the future.

“With food making up less than 2% of our sales right now, we clearly see the opportunity. We will be very diligent and measured as we determine the timing and role of an expanded fee program and how we best support our Broistas so that we can execute with speed, quality and service.”

Dutch Bros. (BROS) said it really believes food sales are more of a significant opportunity for 2026 and beyond.

Looking back at Q3, Dutch Bros (BROS) saw revenue jump 28% year-over-year to just slightly decelerate from the 30% growth in Q2. Meanwhile, the EPS mark of $0.16 topped the consensus estimate of $0.13. Company-operated same shop sales increased 2.7% relative to the same period in 2023.

Coffee chain rival Starbucks (SBUX) traded flat after one hour of action on Thursday.