Potbelly (PBPB) 10-Q 5 May 22 2022 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 27, 2022	Apr. 24, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 27, 2022
Document Transition Report	false
Entity File Number	001-36104
Entity Registrant Name	Potbelly Corporation
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-4466837
Entity Address, Address Line One	111 N. Canal Street
Entity Address, Address Line Two	Suite 325
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60606
City Area Code	312
Local Phone Number	951-0600
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	PBPB
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Bankruptcy Proceedings, Reporting Current	true
Entity Common Stock, Shares Outstanding		28,858,420
Entity Central Index Key	0001195734
Document Fiscal Period Focus	Q1
Amendment Flag	false
Document Fiscal Year Focus	2022
Current Fiscal Year End Date	--12-25

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 27, 2022	Dec. 26, 2021
Current assets
Cash and cash equivalents	$ 9,493	$ 14,353
Accounts receivable, net of allowances of $30 and $27 as of March 27, 2022 and December 26, 2021, respectively	7,148	6,032
Inventories	3,305	3,491
Prepaid expenses and other current assets	4,231	4,178
Total current assets	24,177	28,054
Property and equipment, net	47,080	49,805
Right-of-use assets for operating leases	161,836	166,084
Indefinite-lived intangible assets	3,404	3,404
Goodwill	2,222	2,222
Deferred expenses, net and other assets	3,629	3,668
Total assets	242,348	253,237
Current liabilities
Accounts payable	9,233	8,140
Accrued expenses	26,422	30,859
Short-term operating lease liabilities	27,770	28,548
Current portion of long-term debt	2,833	2,333
Total current liabilities	66,258	69,880
Long-term debt, net of current portion	21,467	17,517
Long-term operating lease liabilities	162,698	166,291
Other long-term liabilities	1,952	1,966
Total liabilities	252,375	255,654
Commitments and contingencies (Note 11)
Equity (deficit)
Common stock, $0.01 par value—authorized 200,000 shares; outstanding 28,461 and 28,380 shares as of March 27, 2022 and December 26, 2021, respectively	381	380
Warrants	2,566	2,566
Additional paid-in-capital	453,245	452,570
Treasury stock, held at cost, 9,831 and 9,785 shares as of March 27, 2022, and December 26, 2021, respectively	(114,856)	(114,577)
Accumulated deficit	(351,174)	(343,261)
Total stockholders’ equity (deficit)	(9,838)	(2,322)
Non-controlling interest	(189)	(95)
Total equity (deficit)	(10,027)	(2,417)
Total liabilities and equity (deficit)	$ 242,348	$ 253,237

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Mar. 27, 2022	Dec. 26, 2021
Statement of Financial Position [Abstract]
Accounts receivable, net of allowances	$ 30	$ 27
Common stock (in USD per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	200,000,000	200,000,000
Common stock, outstanding (in shares)	28,461,000	28,380,000
Treasury stock (in shares)	9,831,000	9,785,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Revenues
Total revenues	$ 98,221	$ 78,063
Sandwich shop operating expenses, excluding depreciation
Labor and related expenses	33,253	28,614
Occupancy expenses	13,845	13,599
Other operating expenses	18,105	14,003
Franchise marketing expenses	120	43
General and administrative expenses	8,518	7,172
Depreciation expense	3,136	4,174
Impairment, loss on disposal of property and equipment and shop closures	1,319	3,122
Total expenses	105,604	92,196
Loss from operations	(7,383)	(14,133)
Interest expense, net	327	288
Loss before income taxes	(7,710)	(14,421)
Income tax expense	177	53
Net loss	(7,887)	(14,474)
Net income (loss) attributable to non-controlling interest	26	(2)
Net loss attributable to Potbelly Corporation	$ (7,913)	$ (14,472)
Net loss per common share attributable to common stockholders:
Basic (in USD per share)	$ (0.28)	$ (0.56)
Diluted (in USD per share)	$ (0.28)	$ (0.56)
Weighted average shares outstanding:
Basic (in shares)	28,396,000	25,944,000
Diluted (in shares)	28,396,000	25,944,000
Product
Revenues
Total revenues	$ 97,431	$ 77,501
Sandwich shop operating expenses, excluding depreciation
Food, beverage and packaging costs	27,308	21,469
Franchise royalties and fees
Revenues
Total revenues	$ 790	$ 562

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Treasury Stock	Warrants	Additional Paid-In- Capital	Accumulated Deficit	Non- Controlling Interest
Beginning balance at Dec. 27, 2020	$ 5,495	$ 339	$ (113,266)	$ 0	$ 438,174	$ (319,477)	$ (275)
Beginning balance (in shares) at Dec. 27, 2020		24,323
Net loss	(14,474)					(14,472)	(2)
Stock-based compensation plans	0	$ 1			(1)
Stock-based compensation plans (in shares)		63
Issuance of common shares and warrants, net of fees	14,940	$ 32		2,566	12,342
Issuance of common shares and warrants, net of fees (in shares)		3,250
Contributions from non-controlling interest	136						136
Stock-based compensation expense	193				193
Ending balance (in shares) at Mar. 28, 2021		27,636
Ending balance at Mar. 28, 2021	6,290	$ 372	(113,266)	2,566	450,708	(333,949)	(141)
Beginning balance at Dec. 26, 2021	$ (2,417)	$ 380	(114,577)	2,566	452,570	(343,261)	(95)
Beginning balance (in shares) at Dec. 26, 2021	28,380	28,380
Net loss	$ (7,887)					(7,913)	26
Stock-based compensation plans	(278)	$ 1	(279)
Stock-based compensation plans (in shares)		81
Distributions to non-controlling interest	(120)						(120)
Stock-based compensation expense	$ 675				675
Ending balance (in shares) at Mar. 27, 2022	28,461	28,461
Ending balance at Mar. 27, 2022	$ (10,027)	$ 381	$ (114,856)	$ 2,566	$ 453,245	$ (351,174)	$ (189)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Cash flows from operating activities:
Net loss	$ (7,887)	$ (14,474)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	3,136	4,174
Noncash lease expense	6,487	6,287
Deferred income tax	5	5
Stock-based compensation expense	675	193
Asset impairment, loss on disposal of property and equipment and shop closures	1,319	2,741
Other operating activities	67	85
Changes in operating assets and liabilities:
Accounts receivable, net	(1,116)	(282)
Inventories	186	306
Prepaid expenses and other assets	(171)	(12)
Accounts payable	1,039	(274)
Operating lease liabilities	(7,055)	(8,991)
Accrued expenses and other liabilities	(4,424)	542
Net cash used in operating activities:	(7,739)	(9,700)
Cash flows from investing activities:
Purchases of property and equipment	(1,378)	(1,300)
Net cash used in investing activities:	(1,378)	(1,300)
Cash flows from financing activities:
Borrowings under revolving credit facility	10,000	8,000
Repayments under revolving credit facility	(5,550)	(11,500)
Payment of debt issuance costs	(40)	(195)
Proceeds from issuance of common shares and warrants, net of fees	0	14,940
Employee taxes on certain stock-based payment arrangements	(33)	0
Contributions from non-controlling interest	0	136
Distributions to non-controlling interest	(120)	0
Net cash provided by financing activities:	4,257	11,381
Net increase (decrease) in cash and cash equivalents	(4,860)	381
Cash and cash equivalents at beginning of period	14,353	11,126
Cash and cash equivalents at end of period	9,493	11,507
Supplemental cash flow information:
Income taxes paid	0	10
Interest paid	159	238
Supplemental non-cash investing and financing activities:
Unpaid liability for purchases of property and equipment	460	421
Unpaid liability for employee taxes on certain stock-based payment arrangements	$ 246	$ 0

Organization and Other Matters

Organization and Other Matters	3 Months Ended
	Mar. 27, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Other Matters	(1) Organization and Other Matters Business Potbelly Corporation (the “Company”, “Potbelly”, “we”, “us” or “our”), through its wholly owned subsidiaries, owns and operates 394 company-owned shops in the United States. Additionally, Potbelly franchisees operate 46 shops in the United States. Basis of Presentation The unaudited condensed consolidated financial statements and notes herein should be read in conjunction with the audited consolidated financial statements of Potbelly Corporation and its subsidiaries and the notes thereto included in our Annual Report on Form 10-K for the year ended December 26, 2021. The unaudited condensed consolidated financial statements included herein have been prepared by us without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to the SEC rules and regulations. In the opinion of management, all adjustments, which are of a normal and recurring nature (except as otherwise noted), that are necessary to present fairly our balance sheet as of March 27, 2022 and December 26, 2021, our statement of operations for the quarters ended March 27, 2022 and March 28, 2021, the statement of equity for the quarters ended March 27, 2022 and March 28, 2021, and our statement of cash flows for the quarters ended March 27, 2022 and March 28, 2021 have been included. The condensed consolidated statements of operations for the interim periods presented herein are not necessarily indicative of the results to be expected for the full year. Beginning in the first quarter of 2022, we reclassified certain advertising and marketing expenses within the condensed consolidated statement of operations. Refer to discussion of the Potbelly Brand Fund in the paragraphs below. These reclassifications had no impact on the loss from operations, balance sheets or statements of cash flows. We do not have any components of other comprehensive income recorded within our consolidated financial statements and therefore, do not separately present a statement of comprehensive income in our condensed consolidated financial statements. COVID-19 On January 30, 2020, the WHO announced a global health emergency because of COVID-19 and the risks to the international community as the virus spreads globally. On March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The COVID-19 pandemic significantly impacted economic conditions in the United States where all our shops are located. In response to the pandemic, many states and jurisdictions in which we operate issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus, resulting in significant changes to our operations and a sudden and drastic decrease in revenues. While the pandemic continues to have an impact on our business, the distribution of COVID-19 vaccines and lifting of local restrictions has resulted in a gradual improvement to our sales during 2021 and 2022. Nearly all of our shops, including those in central business districts, have reopened their dining rooms and are no longer subject to operating restrictions and capacity limits related to COVID-19. We will continue to follow guidance from local authorities in determining the appropriate restrictions to put in place for each shop, including mask mandates, hours of operation, and the suspension or reduction of in-shop dining if required due to changes in the pandemic response in each jurisdiction and restaurant operating protocols, which could result in lower in-shop dining revenue or higher operating costs . Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Potbelly Corporation; its wholly owned subsidiary, Potbelly Illinois, Inc. (“PII”); PII’s wholly owned subsidiaries, Potbelly Franchising, LLC and Potbelly Sandwich Works, LLC (“PSW”); seven of PSW’s wholly owned subsidiaries and PSW’s six joint ventures, collectively, the “Company.” All intercompany balances and transactions have been eliminated in consolidation. For consolidated joint ventures, non-controlling interest represents a non-controlling partner’s share of the assets, liabilities and operations related to the six joint venture investments. Potbelly has ownership interests ranging from 51- 80% in these consolidated joint ventures. Fiscal Year We use a 52/53-week fiscal year that ends on the last Sunday of the calendar period. Approximately every five or six years a 53rd week is added. Fiscal year 2022 and 2021 both consist of 52 weeks. The fiscal quarters ended March 27, 2022 and March 28, 2021 each consisted of 13 weeks. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Significant estimates include amounts for long-lived assets and income taxes. Actual results could differ from those estimates. Potbelly Brand Fund We maintain the Potbelly Brand Fund (the "Brand Fund") for the purpose of collecting and administering funds to be used for advertising, customer research, marketing technology, agencies, and other activities that promote the Potbelly brand in order to deliver sales at our shops. Company-operated and franchised shops both contribute to the Brand Fund based on a percentage of sales. Beginning in the first quarter of fiscal year 2022, we manage these advertising and marketing expenses through the Brand Fund using the funds contributed by our shops. We manage these funds separately from our general operating expenses, but we are not obligated to maintain them in separate accounts or entities. We may spend more or less in any fiscal period than the amounts contributed to the Brand Fund, and we may choose to roll over any unused contributions to the following fiscal period or return them to our shops. Cash held related to the Brand Fund is not considered to be restricted cash as there are no restrictions on the use of the funds. Brand Fund contributions made by company-operated shops are eliminated from the consolidated financial statements. Franchisee contributions are included within franchise royalties and fees in the condensed consolidated statements of operations. Expenses incurred by the Brand Fund are allocated to company-operated and franchised shops based on their relative contributions. The allocation of company-operated Brand Fund expense is included within other operating expenses in our condensed consolidated statements of operations. The allocation of franchisee Brand Fund expense is presented as franchise marketing expenses in our condensed consolidated statements of operations. Prior periods have been reclassified to conform to the current presentation of these expenses. Recent Accounting Pronouncements

Revenue

Revenue	3 Months Ended
	Mar. 27, 2022
Revenue from Contract with Customer [Abstract]
Revenue	(2) Revenue We primarily earn revenue at a point in time for sandwich shop sales, which can occur in person at the shop, over our online or app platform, or through a third-party platform. Sales taxes collected from customers are excluded from revenues and the obligation is included in accrued liabilities until the taxes are remitted to the appropriate taxing authorities. We have other revenue generating activities outlined below. Franchise Revenue We earn an initial franchise fee, a franchise development agreement fee and ongoing fees for royalties and Brand Fund contributions under our franchise agreements. Initial franchise fees are considered highly dependent upon and interrelated with the franchise right granted in the franchise agreement. As such, these franchise fees are recognized over the contractual term of the franchise agreement. We record a contract liability for the unearned portion of the initial franchise fees. Franchise development agreement fees represent the exclusivity rights for a geographical area paid by a third party to develop Potbelly shops for a certain period of time. Franchise development agreement fee payments received by us are recorded in the consolidated balance sheets as accrued expenses or other long-term liabilities, and amortized over the life of the franchise development agreement. Royalties and Brand Fund contributions are based on a percentage of sales and are recorded as revenue as they are earned and become receivable from the franchisee. Gift Card Redemptions / Breakage Revenue Potbelly sells gift cards to customers, records the sale as a contract liability and recognizes the associated revenue as the gift card is redeemed. A portion of these gift cards are not redeemed by the customer ("breakage"), which is recognized as revenue as a percentage of customers gift card redemptions. The expected breakage amount recognized is determined by a historical data analysis on gift card redemption patterns. We recognize gift card breakage income within net sandwich shop sales in the consolidated statements of operations. We recognized gift card breakage income of $0.2 million and $0.1 million for the quarters ended March 27, 2022 and March 28, 2021, respectively, which is recorded within net sandwich shop sales in our condensed consolidated statements of operations. Loyalty Program We offer a customer loyalty program for customers using the Potbelly Perks application at the point of sale. The customer will typically earn 10 points for every dollar spent, and the customer will earn a free entrée after earning 1,000 points. We defer revenue associated with the estimated selling price of points earned by Potbelly Perks members towards free entrées as each point is earned, and a corresponding liability is established in deferred revenue. The deferral is based on the estimated value of the product for which the reward is expected to be redeemed, net of estimated unredeemed points. Once a customer earns a free entrée, that entrée reward will expire after 30 days. Any point in a customer’s account that does not go toward earning a full entrée will expire after the customer's account has been inactive for a year. The breakage amount recognized is estimated based on a historical data analysis of loyalty reward redemptions and is recognized in net shop sandwich sales in the consolidated statement of operations. When points are redeemed, we recognize revenue for the redeemed product and reduce accrued expenses. For the quarter ended March 27, 2022 revenue recognized from all revenue sources on point in time sales was $97.9 million, and revenue recognized from sales over time was $0.3 million. For the quarter ended March 28, 2021, revenue recognized from all revenue sources on point in time sales was $77.5 million and revenue recognized from sales over time was $0.1 million. Contract Liabilities As described above, we record current and noncurrent contract liabilities in accrued expenses and other long-term liabilities, respectively, for initial franchise fees, gift cards, and loyalty programs. We have no other contract liabilities or contract assets recorded. The opening and closing balances of our current and noncurrent contract liabilities from contracts with customers were as follows: Current Contract Liability Noncurrent Contract Liability (Thousands) (Thousands) Beginning balance as of December 26, 2021 $ 6,533 $ 1,428 Ending balance as of March 27, 2022 6,193 1,403 Increase (decrease) in contract liability $ (340) $ (25) The aggregate value of remaining performance obligations on outstanding contracts was $7.6 million as of March 27, 2022. We expect to recognize revenue related to contract liabilities as follows (in thousands), which may vary based upon franchise activity as well as gift card redemption patterns: Years Ending Amount 2022 $ 5,342 2023 495 2024 251 2025 361 2026 137 Thereafter 1,010 Total revenue recognized $ 7,596 For the quarter ended March 27, 2022, the amount of revenue recognized related to the December 26, 2021 liability ending balance was $1.1 million. For the quarter ended March 28, 2021, the amount of revenue recognized related to the December 27, 2020 liability ending balance was $0.6 million. This revenue is related to the recognition of gift card redemptions and upfront franchise fees. For the quarters ended March 27, 2022 and March 28, 2021, we did not recognize any revenue from obligations satisfied (or partially satisfied) in prior periods.

Fair Value Measurement

Fair Value Measurement	3 Months Ended
	Mar. 27, 2022
Fair Value Disclosures [Abstract]
Fair Value Measurement	(3) Fair Value Measurement The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and all other current liabilities approximate fair values due to the short maturities of these balances. The book value of the long-term debt under the Credit Agreement, subsequently amended most recently as of January 28, 2022 and further discussed in Note 7, is considered to approximate its fair value as of March 27, 2022 as the interest rates are considered in line with current market rates. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Assets recognized or disclosed at fair value on the consolidated financial statements on a nonrecurring basis include items such as leasehold improvements, property and equipment, operating lease assets, goodwill, and other intangible assets. These assets are measured at fair value if determined to be impaired. We assess potential impairments to our long-lived assets, which includes property and equipment and lease right-of-use assets, on a quarterly basis or whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Shop-level assets and right-of-use assets are grouped at the individual shop-level for the purpose of the impairment assessment. Recoverability of an asset group is measured by a comparison of the carrying amount of an asset group to its estimated undiscounted future cash flows expected to be generated by the asset group. If the carrying amount of the asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset group exceeds the fair value of the asset group. The fair value of the shop assets is determined using the discounted future cash flow method of anticipated cash flows through the shop’s lease-end date using fair value measurement inputs classified as Level 3. The fair value of right-of-use assets is estimated using market comparative information for similar properties. Level 3 inputs are derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. After performing a periodic review of our shops during the quarter ended March 27, 2022, it was determined that indicators of impairment were present for certain shops as a result of continued underperformance, primarily related to the impacts of COVID-19. We performed an impairment analysis related to these shops and recorded an impairment charge of $1.1 million for the quarter ended March 27, 2022. T he ultimate severity and longevity of the COVID-19 pandemic is unknown, and therefore, it is possible that impairments could be identified in future periods, and such amounts could be material.

Loss Per Share

Loss Per Share	3 Months Ended
	Mar. 27, 2022
Earnings Per Share [Abstract]
Loss Per Share	(4) Loss Per Share Basic and diluted loss per common share attributable to common stockholders are calculated using the weighted average number of common shares outstanding for the period. Diluted loss per common share attributable to common stockholders is computed by dividing the loss allocated to common stockholders by the weighted average number of fully diluted common shares outstanding. In periods of a net loss, no potential common shares are included in diluted shares outstanding as the effect is anti-dilutive. For the quarters ended March 27, 2022 and March 28, 2021, we had a loss per share, and therefore potentially dilutive shares were excluded from the calculation. The following table summarizes the loss per share calculation: For the Quarter Ended March 27, March 28, Net loss attributable to Potbelly Corporation $ (7,913) $ (14,472) Weighted average common shares outstanding-basic 28,396 25,944 Plus: Effect of potentially dilutive shares — — Weighted average common shares outstanding-diluted 28,396 25,944 Loss per share available to common stockholders-basic $ (0.28) $ (0.56) Loss per share available to common stockholders-diluted $ (0.28) $ (0.56) Potentially dilutive shares that are considered anti-dilutive: Shares 1,735 2,544

Income Taxes

Income Taxes	3 Months Ended
	Mar. 27, 2022
Income Tax Disclosure [Abstract]
Income Taxes	(5) Income Taxes The interim tax provision is determined using an estimated annual effective tax rate and is adjusted for discrete taxable events that occur during the quarter. We regularly assess the need for a valuation allowance related to our deferred tax assets, which includes consideration of both positive and negative evidence related to the likelihood of realization of such deferred tax assets to determine, based on the weight of the available evidence, whether it is more-likely-than-not that some or all of our deferred tax assets will not be realized. In our assessment, we consider recent financial operating results, projected future taxable income, the reversal of existing taxable differences, and tax planning strategies. We recorded a full valuation allowance against our net deferred tax assets during the first quarter of 2019, resulting in a non-cash charge to income tax expense of $13.6 million. We continue to maintain a valuation allowance against all of our deferred tax assets as of March 27, 2022. We did not provide for an income tax benefit on our pre-tax loss for the quarters ended March 27, 2022 and March 28, 2021. We assess the likelihood of the realization of our deferred tax assets each quarter and the valuation allowance is adjusted accordingly.

Leases

Leases	3 Months Ended
	Mar. 27, 2022
Leases [Abstract]
Leases	(6) Leases We determine if an arrangement is a lease at inception of the arrangement. We lease retail shops, warehouse, and office space under operating leases. Our leases generally have terms of ten years and most include options to extend the leases for additional five-year periods. For leases with renewal periods at our option, we determine the expected lease period based on whether the renewal of any options are reasonably assured at the inception of the lease. Operating leases result in the recording a right-of-use asset and lease liability on the consolidated balance sheet. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the lease commencement date, which is the date we take possession of the property. Operating lease liabilities represent the present value of lease payments not yet paid. Operating right-of-use assets represent the operating lease liability adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. In determining the present value of lease payments not yet paid, we estimate our incremental secured borrowing rates corresponding to the maturities of our leases. We estimate this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment. Our leases typically contain rent escalations over the lease term and lease expense is recognized on a straight-line basis over the lease term. Tenant incentives used to fund leasehold improvements are recognized when earned and reduce right-of-use assets related to the lease. The tenant incentives are amortized through the right-of-use asset as reductions of rent expense over the lease term. We elected a short-term lease exception policy, permitting us to not apply the recognition requirements of ASC 842, Leases, to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components as a single component for certain classes of assets. In fiscal year 2020, as a result of COVID-19, we held discussions with landlords regarding restructuring of our leases in light of various contractual and legal defenses, and we subsequently entered into a total of 350 amendments with our respective landlords through December 26, 2021. The vast majority of these lease amendments were completed during fiscal year 2020, and we are fully complete with COVID-19-related lease amendments as of December 26, 2021. During the quarter ended March 27, 2022, we terminated one lease. The terminated lease had a month-to-month term and, as a result, we did not incur any lease termination fees or record a gain or loss related to this lease termination for the quarter ended March 27, 2022. For the Quarter Ended March 27, March 28, Leases terminated 1 2 Lease termination fees — 177 Right-of-use assets derecognized upon lease termination — 587 Lease liabilities derecognized upon lease termination — 689 Gain recognized upon lease termination — 102 Operating lease term and discount rate were as follows: For the Quarter Ended March 27, March 28, Weighted average remaining lease term (years) 7.06 7.65 Weighted average discount rate 8.06 % 7.83 % Certain of our operating lease agreements include variable payments that are passed through by the landlord, such as common area maintenance and real estate taxes, as well as variable payments based on percentage rent for certain of our shops. Pass-through charges and payments based on percentage rent are included within variable lease cost. The components of lease cost were as follows: For the Quarter Ended Classification March 27, March 28, Operating lease cost Occupancy and General and administrative expenses 10,305 10,411 Variable lease cost Occupancy 3,462 3,239 Total lease cost 13,767 13,650 Supplemental disclosures of cash flow information related to leases were as follows: For the Quarter Ended March 27, March 28, Operating cash flows rent paid for operating lease liabilities 10,594 12,914 Operating right-of-use assets obtained in exchange for new operating lease liabilities 3,382 1,718 Reduction in operating right-of-use assets due to lease terminations and modifications — 3,294 As of March 27, 2022, we had no real estate leases entered into that had not yet commenced. Maturities of lease liabilities were as follows as of March 27, 2022: Operating Leases Remainder of 2022 31,643 2023 38,423 2024 36,430 2025 33,647 2026 29,829 2027 24,546 Thereafter 59,440 Total lease payments 253,958 Less: imputed interest (63,490) Present value of lease liabilities 190,468

Debt and Credit Facilities

Debt and Credit Facilities	3 Months Ended
	Mar. 27, 2022
Debt Disclosure [Abstract]
Debt and Credit Facilities	(7) Debt and Credit Facilities The components of long-term debt were as follows: March 27, December 26, Revolving credit facility $ 14,300 $ 9,850 Paycheck Protection Program loan 10,000 10,000 Less: current portion of long-term debt (2,833) (2,333) Total long-term debt $ 21,467 $ 17,517 Revolving credit facility On August 7, 2019, we entered into a second amended and restated revolving credit facility agreement (the "Credit Agreement") with JPMorgan Chase Bank, N.A. (“JPMorgan”). The Credit Agreement amends and restates the revolving credit facility agreement, dated as of December 9, 2015, and amended on May 3, 2019 (collectively, the "Prior Credit Agreement") with JPMorgan. As disclosed in our Annual Report on Form 10-K for the fiscal year ended December 26, 2021, we subsequently amended the Credit Agreement during fiscal years 2020 and 2021. The Credit Agreement provides for a revolving credit facility in a maximum principal amount of $25 million. On January 28, 2022, we entered into Amendment No. 6 (the “Sixth Amendment”) to the Credit Agreement. The Sixth Amendment, among other things, (i) extended the maturity date under the Credit Agreement from January 31, 2023 to May 31, 2023, (ii) changed the benchmark interest rates under the Credit Agreement for borrowings from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (SOFR) subject to certain adjustments in the Sixth Amendment, (iii) increased the interest rate margin by 75 basis points with respect to any CBFR Loan (as defined in the Credit Agreement), (iv) sets the interest rate margin at 600 basis points with respect to any Term Benchmark Loan (as defined in the Credit Agreement), (v) amended certain financial covenant testing levels, and (vi) amended the definition of subsidiary to exclude the Potbelly Employee Relief Fund NFP, an Illinois not-for-profit corporation. As of March 27, 2022, we had $14.3 million outstanding under the Credit Agreement. As of December 26, 2021, we had $9.9 million outstanding under the Credit Agreement. We are currently in compliance with all financial debt covenants. Paycheck Protection Program Loan On August 10, 2020, PSW, an indirect subsidiary of the Company, entered into a loan agreement with Harvest Small Business Finance, LLC in the aggregate amount of $10.0 million (the “Loan”), pursuant to the PPP under the CARES Act. The Loan was necessary to support our ongoing operations due to the economic uncertainty resulting from the COVID-19 pandemic and lack of access to alternative sources of liquidity. The Loan is scheduled to mature five years from the date on which PSW applies for loan forgiveness under the CARES Act, bears interest at a rate of 1% per annum and is subject to the terms and conditions applicable to loans administered by the U.S. Small Business Administration under the CARES Act. The PPP provides that the use of the Loan amount shall be limited to certain qualifying expenses and may be partially or wholly forgiven in accordance with the requirements set forth in the CARES Act. We have used all of the PPP proceeds toward qualifying expenses and are pursuing forgiveness of the full Loan amount, but we are not able to determine the likelihood or the amount of forgiveness that will be obtained. We have recorded the amount of the Loan as long-term debt (current and non-current) in our condensed consolidated balance sheet and the related interest has been recorded to interest expense in our condensed consolidated statement of operations.

Restructuring

Restructuring	3 Months Ended
	Mar. 27, 2022
Restructuring and Related Activities [Abstract]
Restructuring	(8) Restructuring On November 3, 2020, as part of our COVID-related cost reduction efforts and to better align our general and administrative expenses with future strategy, we made the determination to reorganize and restructure our corporate team. The restructuring plan implemented resulted in general and administrative expense savings in 2021 and 2022. This was accomplished through corporate expense optimization, consolidating our shop support services, and through other expense and staff reductions. As a result, we reduced corporate employment levels by approximately 35 employees in the fourth quarter of 2020. We substantially completed our planned restructuring actions during 2020, but we will continue to evaluate our cost structure and seek opportunities for further efficiencies and cost savings as part of our ongoing strategy. As of March 27, 2022, we have fully paid our remaining obligations as a result of the restructuring plan implemented in the fourth quarter of 2020. Total (Thousands) Balance as of December 26, 2021 $ 122 Charges incurred — Payments made (122) Balance at March 27, 2022 $ —

Capital Stock

Capital Stock	3 Months Ended
	Mar. 27, 2022
Equity [Abstract]
Capital Stock	(9) Capital Stock On May 8, 2018, we announced that our Board of Directors authorized a stock repurchase program for up to $65.0 million of our outstanding common stock. The program permits us, from time to time, to purchase shares in the open market (including in pre-arranged stock trading plans in accordance with the guidelines specified in Rule 10b5-1 under the Securities and Exchange Act of 1934, as amended) or in privately negotiated transactions. The number of common shares actually repurchased, and the timing and price of repurchases, will depend upon market conditions, SEC requirements and other factors. Purchases may be started or stopped at any time without prior notice depending on market conditions and other factors. For the quarter ended March 27, 2022, we did not repurchase any shares of our common stock under the stock repurchase program. In light of the COVID-19 pandemic, we do not have plans to repurchase any common stock under our stock repurchase program at this time. On February 9, 2021, we closed on a Securities Purchase Agreement (the “SPA”) for the sale by us of 3,249,668 shares of our common stock at a par value of $0.01 per share and the issuance of warrants to purchase 1,299,861 shares of common stock at an exercise price of $5.45 per warrant for gross proceeds of $16.0 million, before deducting placement agent fees and offering expenses of approximately $1.0 million. The warrants are initially exercisable commencing August 13, 2021 through their expiration date of August 12, 2026. The proceeds received from the SPA were allocated between shares and warrants based on their relative fair values at closing. The warrants were valued utilizing the Black-Scholes method. On November 3, 2021, we entered into a certain Equity Sales Agreement (the “Sales Agreement”) with William Blair & Company, L.L.C., as agent (“William Blair”) pursuant to which we may sell shares of our common stock having an aggregate offering price of up to $40.0 million (the “Shares”), from time to time, in our sole discretion, through an “at the market” equity offering program under which William Blair will act as sales agent. As of March 27, 2022, we have not sold any shares under the sales agreement.

Stock-Based Compensation

Stock-Based Compensation	3 Months Ended
	Mar. 27, 2022
Share-based Payment Arrangement [Abstract]
Stock-Based Compensation	(10) Stock-Based Compensation Stock options We have awarded stock options to certain employees including the senior leadership team. The number of shares and exercise price of each option is determined by a committee designated by our Board of Directors. The options granted are generally exercisable over a 10-year period from the date of the grant. Options outstanding expire on various dates through the year 2028. The range of exercise prices for the options outstanding as of March 27, 2022 is $9.47 and $20.53 per option, and the options generally vest in one-fourth and one-fifth increments over four A summary of stock option activity is as follows: Options Shares (Thousands) Weighted Average Exercise Price Aggregate Intrinsic Value (Thousands) Weighted Average Remaining Term (Years) Outstanding—December 26, 2021 538 $ 12.03 $ — 2.35 Granted — — Exercised — — Canceled (11) 8.16 Outstanding—March 27, 2022 527 12.11 $ — 2.14 Exercisable—March 27, 2022 527 $ 12.11 $ — 2.14 Stock-based compensation related to stock options is measured at the grant date based on the calculated fair value of the award, and is recognized as expense over the requisite employee service period, which is generally the vesting period of the grant with a corresponding increase to additional paid-in capital. For the quarter ended March 27, 2022, we recognized stock-based compensation expense related to stock options of less than $0.1 million. For the quarter ended March 28, 2021, we recognized stock-based compensation expense related to stock options of $0.1 million. As of March 27, 2022, we do not have unrecognized stock-based compensation expense related to stock options. We record stock-based compensation expense within general and administrative expenses in the condensed consolidated statements of operations. Restricted stock units We award restricted stock units (“RSUs”) to certain employees and certain non-employee members of our Board of Directors. Prior to 2021, the Board of Director grants had a vesting schedule of 50% on the first anniversary of the grant date and 50% on the second anniversary of the grant date. Beginning with the annual grant made in the second quarter of 2021, the Board of Director grants fully vest on the first anniversary of the grant date, or upon termination from the Board of Directors for any reason other than for cause, a pro rata portion of the shares vest on the termination date. The employee grants vest in one-third increments over a three-year period. A summary of RSU activity is as follows: RSUs Number of RSUs (Thousands) Weighted Average Fair Value per Share Non-vested as of December 26, 2021 1,151 $ 4.87 Granted — — Vested (130) 6.06 Canceled — — Non-vested as of March 27, 2022 1,021 $ 4.87 For the quarter ended March 27, 2022, we recognized stock-based compensation expense related to RSUs of $0.6 million. For the quarter ended March 28, 2021, we recognized stock-based compensation expense related to RSUs of $0.1 million. As of March 27, 2022, unrecognized stock-based compensation expense for RSUs was $4.1 million, which will be recognized through fiscal year 2024. Performance stock units We award performance share units (“PSUs”) to certain of our employees. The PSUs have certain vesting conditions based upon our stock price and relative stock performance. Because these PSUs are subject to service and market vesting conditions, we determine the fair market value of each grant using a Monte Carlo simulation model. Participants are entitled to receive a specified number of shares of our common stock contingent on achievement of a stock return on our common stock. For the quarter ended March 27, 2022, we recognized stock-based compensation expense for PSUs with market vesting conditions of $0.1 million. A summary of activity for PSUs with market vesting conditions for the quarter ended March 27, 2022 is as follows: PSUs Number of PSUs (Thousands) Weighted Average Fair Value per Share Non-vested as of December 26, 2021 130 8.43 Granted — — Vested — — Canceled — — Non-vested as of March 27, 2022 130 8.43

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 27, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	(11) Commitments and Contingencies We are subject to legal proceedings, claims and liabilities, such as employment-related claims and slip and fall cases, which arise in the ordinary course of business and are generally covered by insurance. We accrue for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Such accruals are based on developments to date, our estimates of the outcomes of these matters and its experience in contesting, litigating and settling other similar matters. In the opinion of management, the amount of ultimate liability with respect to those actions should not have a material adverse impact on our financial position or results of operations and cash flows. Many of the food products we purchase are subject to changes in the price and availability of food commodities, including, among other things, beef, poultry, grains, dairy and produce. We work with our suppliers and use a mix of forward pricing protocols for certain items including agreements with our supplier on fixed prices for deliveries at a time in the future and agreements on a fixed price with our suppliers for the duration of those protocols. We also utilize formula pricing protocols under which the prices we pay are based on a specified formula related to the prices of the goods, such as spot prices. Our use of any forward pricing arrangements varies substantially from time to time and these arrangements tend to cover relatively short periods (i.e., typically twelve months or less). Such contracts are used in the normal purchases of our food products and not for speculative purposes, and as such are not required to be evaluated as derivative instruments.

Organization and Other Matters

Organization and Other Matters (Policies)	3 Months Ended
	Mar. 27, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business	BusinessPotbelly Corporation (the “Company”, “Potbelly”, “we”, “us” or “our”), through its wholly owned subsidiaries, owns and operates 394 company-owned shops in the United States. Additionally, Potbelly franchisees operate 46 shops in the United States.
Basis of Presentation	Basis of Presentation The unaudited condensed consolidated financial statements and notes herein should be read in conjunction with the audited consolidated financial statements of Potbelly Corporation and its subsidiaries and the notes thereto included in our Annual Report on Form 10-K for the year ended December 26, 2021. The unaudited condensed consolidated financial statements included herein have been prepared by us without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to the SEC rules and regulations. In the opinion of management, all adjustments, which are of a normal and recurring nature (except as otherwise noted), that are necessary to present fairly our balance sheet as of March 27, 2022 and December 26, 2021, our statement of operations for the quarters ended March 27, 2022 and March 28, 2021, the statement of equity for the quarters ended March 27, 2022 and March 28, 2021, and our statement of cash flows for the quarters ended March 27, 2022 and March 28, 2021 have been included. The condensed consolidated statements of operations for the interim periods presented herein are not necessarily indicative of the results to be expected for the full year. Beginning in the first quarter of 2022, we reclassified certain advertising and marketing expenses within the condensed consolidated statement of operations. Refer to discussion of the Potbelly Brand Fund in the paragraphs below. These reclassifications had no impact on the loss from operations, balance sheets or statements of cash flows. We do not have any components of other comprehensive income recorded within our consolidated financial statements and therefore, do not separately present a statement of comprehensive income in our condensed consolidated financial statements.
Principles of Consolidation	Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of Potbelly Corporation; its wholly owned subsidiary, Potbelly Illinois, Inc. (“PII”); PII’s wholly owned subsidiaries, Potbelly Franchising, LLC and Potbelly Sandwich Works, LLC (“PSW”); seven of PSW’s wholly owned subsidiaries and PSW’s six joint ventures, collectively, the “Company.” All intercompany balances and transactions have been eliminated in consolidation. For consolidated joint ventures, non-controlling interest represents a non-controlling partner’s share of the assets, liabilities and operations related to the six joint venture investments. Potbelly has ownership interests ranging from 51- 80% in these consolidated joint ventures.
Fiscal Year	Fiscal Year We use a 52/53-week fiscal year that ends on the last Sunday of the calendar period. Approximately every five or six years a 53rd week is added. Fiscal year 2022 and 2021 both consist of 52 weeks. The fiscal quarters ended March 27, 2022 and March 28, 2021 each consisted of 13 weeks.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Significant estimates include amounts for long-lived assets and income taxes. Actual results could differ from those estimates.
Recent Accounting Pronouncements	Recent Accounting PronouncementsWe reviewed all recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the condensed consolidated financial statements.
Potbelly Brand Fund	Potbelly Brand Fund We maintain the Potbelly Brand Fund (the "Brand Fund") for the purpose of collecting and administering funds to be used for advertising, customer research, marketing technology, agencies, and other activities that promote the Potbelly brand in order to deliver sales at our shops. Company-operated and franchised shops both contribute to the Brand Fund based on a percentage of sales. Beginning in the first quarter of fiscal year 2022, we manage these advertising and marketing expenses through the Brand Fund using the funds contributed by our shops. We manage these funds separately from our general operating expenses, but we are not obligated to maintain them in separate accounts or entities. We may spend more or less in any fiscal period than the amounts contributed to the Brand Fund, and we may choose to roll over any unused contributions to the following fiscal period or return them to our shops. Cash held related to the Brand Fund is not considered to be restricted cash as there are no restrictions on the use of the funds. Brand Fund contributions made by company-operated shops are eliminated from the consolidated financial statements. Franchisee contributions are included within franchise royalties and fees in the condensed consolidated statements of operations. Expenses incurred by the Brand Fund are allocated to company-operated and franchised shops based on their relative contributions. The allocation of company-operated Brand Fund expense is included within other operating expenses in our condensed consolidated statements of operations. The allocation of franchisee Brand Fund expense is presented as franchise marketing expenses in our condensed consolidated statements of operations. Prior periods have been reclassified to conform to the current presentation of these expenses.

Revenue (Tables)

Revenue (Tables)	3 Months Ended
	Mar. 27, 2022
Revenue from Contract with Customer [Abstract]
Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers	The opening and closing balances of our current and noncurrent contract liabilities from contracts with customers were as follows: Current Contract Liability Noncurrent Contract Liability (Thousands) (Thousands) Beginning balance as of December 26, 2021 $ 6,533 $ 1,428 Ending balance as of March 27, 2022 6,193 1,403 Increase (decrease) in contract liability $ (340) $ (25)
Summary of Expected Revenue Recognition Related to Contract Liabilities	We expect to recognize revenue related to contract liabilities as follows (in thousands), which may vary based upon franchise activity as well as gift card redemption patterns: Years Ending Amount 2022 $ 5,342 2023 495 2024 251 2025 361 2026 137 Thereafter 1,010 Total revenue recognized $ 7,596

Loss Per Share (Tables)

Loss Per Share (Tables)	3 Months Ended
	Mar. 27, 2022
Earnings Per Share [Abstract]
Summary of Loss Per Share Calculation	The following table summarizes the loss per share calculation: For the Quarter Ended March 27, March 28, Net loss attributable to Potbelly Corporation $ (7,913) $ (14,472) Weighted average common shares outstanding-basic 28,396 25,944 Plus: Effect of potentially dilutive shares — — Weighted average common shares outstanding-diluted 28,396 25,944 Loss per share available to common stockholders-basic $ (0.28) $ (0.56) Loss per share available to common stockholders-diluted $ (0.28) $ (0.56) Potentially dilutive shares that are considered anti-dilutive: Shares 1,735 2,544

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 27, 2022
Leases [Abstract]
Gain Loss Recognized Upon Termination of Lease Contracts	The terminated lease had a month-to-month term and, as a result, we did not incur any lease termination fees or record a gain or loss related to this lease termination for the quarter ended March 27, 2022. For the Quarter Ended March 27, March 28, Leases terminated 1 2 Lease termination fees — 177 Right-of-use assets derecognized upon lease termination — 587 Lease liabilities derecognized upon lease termination — 689 Gain recognized upon lease termination — 102
Schedule of Weighted Average Lease Terms and Discount Rates	Operating lease term and discount rate were as follows: For the Quarter Ended March 27, March 28, Weighted average remaining lease term (years) 7.06 7.65 Weighted average discount rate 8.06 % 7.83 %
Components of Lease Cost	The components of lease cost were as follows: For the Quarter Ended Classification March 27, March 28, Operating lease cost Occupancy and General and administrative expenses 10,305 10,411 Variable lease cost Occupancy 3,462 3,239 Total lease cost 13,767 13,650 Supplemental disclosures of cash flow information related to leases were as follows: For the Quarter Ended March 27, March 28, Operating cash flows rent paid for operating lease liabilities 10,594 12,914 Operating right-of-use assets obtained in exchange for new operating lease liabilities 3,382 1,718 Reduction in operating right-of-use assets due to lease terminations and modifications — 3,294
Maturities of Lease Liabilities	Maturities of lease liabilities were as follows as of March 27, 2022: Operating Leases Remainder of 2022 31,643 2023 38,423 2024 36,430 2025 33,647 2026 29,829 2027 24,546 Thereafter 59,440 Total lease payments 253,958 Less: imputed interest (63,490) Present value of lease liabilities 190,468

Debt and Credit Facilities (Tab

Debt and Credit Facilities (Tables)	3 Months Ended
	Mar. 27, 2022
Debt Disclosure [Abstract]
Component of Long-term Debt	The components of long-term debt were as follows: March 27, December 26, Revolving credit facility $ 14,300 $ 9,850 Paycheck Protection Program loan 10,000 10,000 Less: current portion of long-term debt (2,833) (2,333) Total long-term debt $ 21,467 $ 17,517

Restructuring (Tables)

Restructuring (Tables)	3 Months Ended
	Mar. 27, 2022
Restructuring and Related Activities [Abstract]
Schedule Future Cash Payments Required to Satisfy Our Remaining Obligations	As of March 27, 2022, we have fully paid our remaining obligations as a result of the restructuring plan implemented in the fourth quarter of 2020. Total (Thousands) Balance as of December 26, 2021 $ 122 Charges incurred — Payments made (122) Balance at March 27, 2022 $ —

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 27, 2022
Share-based Payment Arrangement [Abstract]
Summary of Stock Option Activity	A summary of stock option activity is as follows: Options Shares (Thousands) Weighted Average Exercise Price Aggregate Intrinsic Value (Thousands) Weighted Average Remaining Term (Years) Outstanding—December 26, 2021 538 $ 12.03 $ — 2.35 Granted — — Exercised — — Canceled (11) 8.16 Outstanding—March 27, 2022 527 12.11 $ — 2.14 Exercisable—March 27, 2022 527 $ 12.11 $ — 2.14
Summary of RSU Activity	A summary of RSU activity is as follows: RSUs Number of RSUs (Thousands) Weighted Average Fair Value per Share Non-vested as of December 26, 2021 1,151 $ 4.87 Granted — — Vested (130) 6.06 Canceled — — Non-vested as of March 27, 2022 1,021 $ 4.87
Summary of PSU Activity	A summary of activity for PSUs with market vesting conditions for the quarter ended March 27, 2022 is as follows: PSUs Number of PSUs (Thousands) Weighted Average Fair Value per Share Non-vested as of December 26, 2021 130 8.43 Granted — — Vested — — Canceled — — Non-vested as of March 27, 2022 130 8.43

Organization and Other Matter_2

Organization and Other Matters - Additional Information (Detail)	3 Months Ended
	Mar. 27, 2022JointVentureShopSubsidiary
Nature Of Business And Basis Of Presentation [Line Items]
Number of shops franchisees operate	46
Number of wholly owned subsidiaries | Subsidiary	7
Number of joint ventures | JointVenture	6
Minimum
Nature Of Business And Basis Of Presentation [Line Items]
Number of shops Potbelly Corporation owns or operates	394
Ownership interest rate	51.00%
Maximum
Nature Of Business And Basis Of Presentation [Line Items]
Ownership interest rate	80.00%

Revenue - Additional Informatio

Revenue - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Disaggregation Of Revenue [Line Items]
Revenue recognized related to prior periods	$ 200,000	$ 100,000
Amount of revenue recognized	98,221,000	78,063,000
Aggregate value of remaining performance obligation on outstanding contracts	7,596,000
Revenue recognized related to prior periods	0	0
December 26, 2021 and December 27, 2020 liability ending balance
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	1,100,000	600,000
Point in time sales
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	97,900,000	77,500,000
Over time sales
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	$ 300,000	$ 100,000

Revenue - Summary of Current an

Revenue - Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers (Detail) $ in Thousands	3 Months Ended
	Mar. 27, 2022USD ($)
Current Contract Liability
Beginning balance	$ 6,533
Ending balance	6,193
Increase (decrease) in contract liability	(340)
Noncurrent Contract Liability
Beginning balance	1,428
Ending balance	1,403
Increase (decrease) in contract liability	$ (25)

Revenue - Summary of Expected R

Revenue - Summary of Expected Revenue Recognition Related to Contract Liabilities (Detail) $ in Thousands	Mar. 27, 2022USD ($)
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 7,596
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 5,342
Revenue, remaining performance obligation, expected timing of satisfaction, period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 495
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 251
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2025-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 361
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2026-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 137
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2027-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 1,010
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year

Fair Value Measurement (Detail)

Fair Value Measurement (Detail) $ in Millions	3 Months Ended
	Mar. 27, 2022USD ($)
Fair Value Disclosures [Abstract]
Impairment charge	$ 1.1

Loss Per Share - Additional Inf

Loss Per Share - Additional Information (Detail)	3 Months Ended
	Mar. 27, 2022shares
Common Share Options
Loss Per Share [Line Items]
Potential common shares included in diluted shares outstanding (in shares)	0

Loss Per Share - Summary of Los

Loss Per Share - Summary of Loss Per Share Calculation (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Loss Per Share [Line Items]
Net loss attributable to Potbelly Corporation	$ (7,913)	$ (14,472)
Weighted average common shares outstanding-basic (in shares)	28,396,000	25,944,000
Weighted average common shares outstanding-diluted (in shares)	28,396,000	25,944,000
Loss per share available to common stockholders-basic (in USD per share)	$ (0.28)	$ (0.56)
Loss per share available to common stockholders-diluted (in USD per share)	$ (0.28)	$ (0.56)
Common share options
Loss Per Share [Line Items]
Potentially dilutive shares that are considered anti-dilutive (in shares)	1,735,000	2,544,000

Income Taxes - (Detail)

Income Taxes - (Detail) $ in Millions	Mar. 27, 2022USD ($)
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance	$ 13.6

Leases - Additional Information

Leases - Additional Information (Detail) $ in Thousands	3 Months Ended
	Mar. 27, 2022USD ($)store	Mar. 28, 2021USD ($)store	Dec. 26, 2021store
Leases [Abstract]
Operating leases, terms	10 years
Operating leases, option to extend	five-year
Number of shops with lease amendments | store			350
Leases terminated | store	1,000	2,000
Lease termination fees	$ 0	$ 177
Right-of-use assets derecognized upon lease termination	0	587
Lease liabilities derecognized upon lease termination	0	689
Gain recognized upon lease termination	0	$ 102
Additional operating leases payments related to shops not yet open, amount	$ 0

Leases - Gain Loss Recognized U

Leases - Gain Loss Recognized Upon Termination of Lease Contracts (Details) $ in Thousands	3 Months Ended
	Mar. 27, 2022USD ($)store	Mar. 28, 2021USD ($)store
Leases [Abstract]
Leases terminated | store	1,000	2,000
Lease termination fees	$ 0	$ 177
Right-of-use assets derecognized upon lease termination	0	587
Lease liabilities derecognized upon lease termination	0	689
Gain recognized upon lease termination	$ 0	$ 102

Leases - Operating Lease Term a

Leases - Operating Lease Term and Discount Rate (Detail)	Mar. 27, 2022	Mar. 28, 2021
Leases [Abstract]
Weighted average remaining lease term (years)	7 years 21 days	7 years 7 months 24 days
Weighted average discount rate	8.06%	7.83%

Leases - Components of Lease Co

Leases - Components of Lease Cost (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Lessee Lease Description [Line Items]
Operating lease cost	$ 13,767
Total lease cost		$ 13,650
Occupancy and General and administrative expenses
Lessee Lease Description [Line Items]
Operating lease cost	10,305	10,411
Occupancy
Lessee Lease Description [Line Items]
Variable lease cost	$ 3,462	$ 3,239

Leases - Supplemental Disclosur

Leases - Supplemental Disclosures of Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Leases [Abstract]
Operating cash flows rent paid for operating lease liabilities	$ 10,594	$ 12,914
Operating right-of-use assets obtained in exchange for new operating lease liabilities	3,382	1,718
Reduction in operating right-of-use assets due to lease terminations and modifications	$ 0	$ 3,294

Leases - Maturities of Lease Li

Leases - Maturities of Lease Liabilities (Detail) $ in Thousands	Mar. 27, 2022USD ($)
Operating Leases
Remainder of 2022	$ 31,643
2023	38,423
2024	36,430
2025	33,647
2026	29,829
2027	24,546
Thereafter	59,440
Total lease payments	253,958
Less: imputed interest	(63,490)
Present value of lease liabilities	$ 190,468

Debt and Credit Facilities - Co

Debt and Credit Facilities - Component of Long-term Debt (Detail) - USD ($) $ in Thousands	Mar. 27, 2022	Dec. 26, 2021
Debt Instrument [Line Items]
Total long-term debt	$ 21,467	$ 17,517
Less: current portion of long-term debt	(2,833)	(2,333)
Revolving credit facility
Debt Instrument [Line Items]
Total long-term debt	14,300	9,850
Paycheck Protection Program loan
Debt Instrument [Line Items]
Total long-term debt	$ 10,000	$ 10,000

Debt and Credit Facilities - Ad

Debt and Credit Facilities - Additional Information (Detail) - USD ($) $ in Thousands	Jan. 28, 2022	Dec. 26, 2021	Aug. 10, 2020	Mar. 27, 2022	Aug. 07, 2019
CARES Act of 2020 | Sixth credit agreement amendment | Minimum
Debt Instrument [Line Items]
Debt Instrument, maturity date	Jan. 31, 2023
CARES Act of 2020 | Sixth credit agreement amendment | Maximum
Debt Instrument [Line Items]
Debt Instrument, maturity date	May 31, 2023
Revolving credit facility | JPMorgan Chase Bank, N.A.
Debt Instrument [Line Items]
Credit facility agreement, maximum principal amount					$ 25,000
CBFR loan | Sixth credit agreement amendment
Debt Instrument [Line Items]
Debt instrument, CBFR loan, increase in interest rate	0.75%
Term benchmark loan | Sixth credit agreement amendment
Debt Instrument [Line Items]
Debt instrument, term benchmark loan, increase in interest rate	6.00%
Paycheck Protection Program loan | CARES Act of 2020 | Potbelly Sandwich Works, LLC
Debt Instrument [Line Items]
Loan maturity period			5 years
Credit facility agreement, interest rate			1.00%
Paycheck Protection Program loan | Harvest Small Business Finance L L C | Commercial loan | Potbelly Sandwich Works, LLC
Debt Instrument [Line Items]
Loan amount			$ 10,000
Paycheck Protection Program loan | Harvest Small Business Finance L L C | CARES Act of 2020 | Sixth credit agreement amendment
Debt Instrument [Line Items]
Credit facility agreement, amount outstanding		$ 9,900		$ 14,300

Restructuring - Additional Info

Restructuring - Additional Information (Detail)	3 Months Ended
	Dec. 27, 2020Employee
Restructuring and Related Activities [Abstract]
Number of employee reduce	35

Restructuring - Schedule Future

Restructuring - Schedule Future Cash Payments Required to Satisfy Our Remaining Obligations (Detail) $ in Thousands	3 Months Ended
	Mar. 27, 2022USD ($)
Restructuring Reserve [Roll Forward]
Beginning balance	$ 122
Charges incurred	0
Payments made	(122)
Ending balance	$ 0

Capital Stock (Detail)

Capital Stock (Detail) - USD ($)	Nov. 03, 2021	Feb. 09, 2021	Mar. 27, 2022	Mar. 28, 2021	Dec. 26, 2021	May 08, 2018
Equity Class Of Treasury Stock [Line Items]
Stock repurchase program, authorized amount						$ 65,000,000
Common stock, par value (in USD per share)			$ 0.01		$ 0.01
Issuance of common shares and warrants, net of fees				$ 14,940,000
Warrants
Equity Class Of Treasury Stock [Line Items]
Placement agent fees and offering expenses		$ 1,000,000
Issuance of common shares and warrants, net of fees				$ 2,566,000
William Blair [Member]
Equity Class Of Treasury Stock [Line Items]
Issuance of common shares and warrants, net of fees	$ 40,000,000
Securities purchase agreement
Equity Class Of Treasury Stock [Line Items]
Issuance of common shares and warrants, net of fees (in shares)		3,249,668
Common stock, par value (in USD per share)		$ 0.01
Securities purchase agreement | Warrants
Equity Class Of Treasury Stock [Line Items]
Issuance of common shares and warrants, net of fees (in shares)		1,299,861
Exercise price of warrants (in USD per share)		$ 5.45
Proceeds from securities purchase agreement		$ 16,000,000
Stock repurchase program
Equity Class Of Treasury Stock [Line Items]
Repurchases of common stock (in shares)			0

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 27, 2022	Mar. 28, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense	$ 675	$ 193
2019 long term incentive plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price of options outstanding, lower limit (in USD per share)	$ 9.47
Exercise price of options outstanding, higher limit (in USD per share)	$ 20.53
Maximum | Equity option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercisable period from the date of grant	10 years
Maximum | 2019 long term incentive plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options vesting period	5 years
Minimum | 2019 long term incentive plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options vesting period	4 years
Common share options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation forfeiture credit		100
Common share options | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense	$ 100
Unrecognized stock compensation expense	$ 0
Restricted stock units (RSUs) | Non-employee board of directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options vesting period	3 years
Recognized stock-based compensation expense	$ 600	$ 100
Unrecognized stock compensation expense	$ 4,100
Unrecognized stock compensation expense, recognition period	2024
Restricted stock units (RSUs) | Non-employee board of directors | First anniversary
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	50.00%
Restricted stock units (RSUs) | Non-employee board of directors | Second anniversary
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	50.00%
Performance stock units | Market vesting conditions
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense	$ 100

Stock-Based Compensation - Summ

Stock-Based Compensation - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 27, 2022	Dec. 26, 2021
Shares (Thousands)
Beginning balance (in shares)	538
Exercised (in shares)	0
Canceled (in shares)	(11)
Ending balance (in shares)	527	538
Exercisable (in shares)	527
Weighted Average Exercise Price
Outstanding at beginning balance (in USD per share)	$ 12.03
Exercised (in USD per share)	0
Canceled (in USD per share)	8.16
Outstanding at ending balance (in USD per share)	12.11	$ 12.03
Exercisable (in USD per share)	$ 12.11
Options outstanding aggregate intrinsic value	$ 0	$ 0
Options exercisable aggregate intrinsic value	$ 0
Weighted Average Remaining Term (Years)
Options outstanding weighted average remaining term	2 years 1 month 20 days	2 years 4 months 6 days
Options exercisable weighted average remaining term	2 years 1 month 20 days

Stock-Based Compensation - Su_2

Stock-Based Compensation - Summary of RSU Activity (Detail) - Restricted stock units (RSUs) shares in Thousands	3 Months Ended
	Mar. 27, 2022$ / sharesshares
Number of RSUs (Thousands)
Non-vested beginning balance (in shares) | shares	1,151
Granted (in shares) | shares	0
Vested (in shares) | shares	(130)
Canceled (in shares) | shares	0
Non-vested ending balance (in shares) | shares	1,021
Weighted Average Fair Value per Share
Weighted average fair value beginning balance (in USD per share) | $ / shares	$ 4.87
Granted (in USD per share) | $ / shares	0
Vested (in USD per share) | $ / shares	6.06
Canceled (in USD per share) | $ / shares	0
Weighted average fair value ending balance (in USD per share) | $ / shares	$ 4.87

Stock-Based Compensation - Su_3

Stock-Based Compensation - Summary of PSU Activity (Detail) - Performance stock units shares in Thousands	3 Months Ended
	Mar. 27, 2022$ / sharesshares
Number of RSUs (Thousands)
Non-vested beginning balance (in shares) | shares	130
Granted (in shares) | shares	0
Vested (in shares) | shares	0
Canceled (in shares) | shares	0
Non-vested ending balance (in shares) | shares	130
Weighted Average Fair Value per Share
Weighted average fair value beginning balance (in USD per share) | $ / shares	$ 8.43
Granted (in USD per share) | $ / shares	0
Vested (in USD per share) | $ / shares	0
Canceled (in USD per share) | $ / shares	0
Weighted average fair value ending balance (in USD per share) | $ / shares	$ 8.43