Same-store sales at Dutch Bros surged 10% in Q1, a sign of healthy performance at existing locations. Competition in the coffee industry is fierce, and it's unclear this business has an economic moat.
Dutch Bros has been growing steadily, and management has big aspirations for multiplying its store count. New locations are quick to start contributing positively to the company's financial results.
Restaurants' gross margins are increasing because the prices that they pay for goods, services and labor are no longer rising rapidly. Some of their costs are increasing slowly, while others are falling.