0001564590-20-051478 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 27, 2020	Oct. 25, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 27, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	PBPB
Security Exchange Name	NASDAQ
Entity Registrant Name	Potbelly Corporation
Entity Central Index Key	0001195734
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-27
Entity Filer Category	Accelerated Filer
Entity Shell Company	false
Entity Bankruptcy Proceedings, Reporting Current	true
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		24,212,000
Entity File Number	001-36104
Entity Tax Identification Number	36-4466837
Entity Address, Address Line One	111 N. Canal Street
Entity Address, Address Line Two	Suite 850
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Incorporation, State or Country Code	DE
Entity Address, Postal Zip Code	60606
City Area Code	312
Local Phone Number	951-0600
Document Quarterly Report	true
Document Transition Report	false

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 27, 2020	Dec. 29, 2019
Current assets
Cash and cash equivalents	$ 23,407	$ 18,806
Accounts receivable, net of allowances of $65 and $202 as of September 27, 2020 and December 29, 2019, respectively	4,575	4,257
Inventories	2,724	3,473
Prepaid expenses and other current assets	5,372	5,687
Total current assets	36,078	32,223
Property and equipment, net	64,852	79,032
Right-of-use assets for operating leases	196,070	211,988
Indefinite-lived intangible assets	3,404	3,404
Goodwill	2,222	2,222
Deferred expenses, net and other assets	4,178	4,010
Total assets	306,804	332,879
Current liabilities
Accounts payable	5,429	3,886
Accrued expenses	20,008	20,569
Short-term operating lease liabilities	35,434	29,319
Total current liabilities	60,871	53,774
Long-term debt	22,386
Long-term operating lease liabilities	195,681	206,726
Other long-term liabilities	5,775	3,210
Total liabilities	284,713	263,710
Commitments and contingencies (Note 10)
Equity
Common stock, $0.01 par value—authorized 200,000 shares; outstanding 24,212 and 23,638 shares as of September 27, 2020 and December 29, 2019, respectively	338	331
Additional paid-in-capital	438,140	435,278
Treasury stock, held at cost, 9,612 and 9,465 shares as of September 27, 2020, and December 29, 2019, respectively	(113,266)	(112,680)
Accumulated deficit	(303,050)	(254,081)
Total stockholders’ equity	22,162	68,848
Non-controlling interest	(71)	321
Total equity	22,091	69,169
Total liabilities and equity	$ 306,804	$ 332,879

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 27, 2020	Dec. 29, 2019
Statement Of Financial Position [Abstract]
Allowances on accounts receivable	$ 65	$ 202
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized	200,000,000	200,000,000
Common stock, outstanding	24,212,000	23,638,000
Treasury stock, shares	9,612,000	9,465,000

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Revenues
Total revenues	$ 72,663	$ 104,238	$ 216,415	$ 307,955
Sandwich shop operating expenses
Labor and related expenses	25,809	32,430	78,090	96,517
Occupancy expenses	13,904	14,850	43,581	44,457
Other operating expenses	12,126	13,274	35,881	37,235
General and administrative expenses	9,821	11,192	28,094	34,709
Depreciation expense	4,699	5,365	15,110	16,486
Pre-opening costs		16	64	26
Impairment, loss on disposal of property and equipment and shop closures	1,721	1,714	9,602	5,077
Total expenses	88,801	106,381	271,425	316,289
Loss from operations	(16,138)	(2,143)	(55,010)	(8,334)
Interest expense, net	268	28	730	95
Loss before income taxes	(16,406)	(2,171)	(55,740)	(8,429)
Income tax expense (benefit)	(2,917)	66	(6,585)	13,931
Net loss	(13,489)	(2,237)	(49,155)	(22,360)
Net income (loss) attributable to non-controlling interest	(77)	118	(191)	300
Net loss attributable to Potbelly Corporation	$ (13,412)	$ (2,355)	$ (48,964)	$ (22,660)
Net loss per common share attributable to common stockholders:
Basic	$ (0.56)	$ (0.10)	$ (2.06)	$ (0.95)
Diluted	$ (0.56)	$ (0.10)	$ (2.06)	$ (0.95)
Weighted average shares outstanding:
Basic	23,957	23,740	23,792	23,927
Diluted	23,957	23,740	23,792	23,927
Product [Member]
Revenues
Total revenues	$ 72,189	$ 103,560	$ 215,013	$ 305,619
Sandwich shop operating expenses
Cost of goods sold, excluding depreciation	20,721	27,540	61,003	81,782
Franchise Royalties And Fees [Member]
Revenues
Total revenues	$ 474	$ 678	$ 1,402	$ 2,336

Condensed Consolidated Statements of Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment [Member] Revision of Prior Period, Adjustment [Member]	Common Stock [Member]	Treasury Stock [Member]	Additional Paid-in-Capital [Member]	Accumulated Deficit [Member]	Accumulated Deficit [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] Revision of Prior Period, Adjustment [Member]	Non-Controlling Interest [Member]
Beginning balance at Dec. 30, 2018	$ 95,533		$ 330	$ (108,372)	$ 432,771	$ (229,558)		$ 362
Beginning balance, common shares at Dec. 30, 2018			24,143
Cumulative impact (ASU 2016-02 (Topic 842) [Member]) at Dec. 30, 2018		$ (531)					$ (531)
Net income (loss)	(22,360)					(22,660)		300
Stock-based compensation plans	173		$ 1		172
Stock-based compensation plans, shares			118
Repurchases of common stock	(4,217)			(4,217)
Repurchases of common stock, shares			(648)
Distributions to non-controlling interest	(336)							(336)
Contributions from non-controlling interest	39							39
Treasury shares used for stock-based plans	(35)			(35)
Treasury shares used for stock-based plans, shares			(5)
Stock-based compensation expense	1,910				1,910
Ending balance at Sep. 29, 2019	70,176		$ 331	(112,624)	434,853	(252,749)		365
Ending balance, common shares at Sep. 29, 2019			23,608
Beginning balance at Jun. 30, 2019	72,876		$ 331	(111,874)	434,407	(250,394)		406
Beginning balance, common shares at Jun. 30, 2019			23,768
Net income (loss)	(2,237)					(2,355)		118
Stock-based compensation plans, shares			2
Repurchases of common stock	(750)			(750)
Repurchases of common stock, shares			(162)
Distributions to non-controlling interest	(159)							(159)
Stock-based compensation expense	446				446
Ending balance at Sep. 29, 2019	70,176		$ 331	(112,624)	434,853	(252,749)		365
Ending balance, common shares at Sep. 29, 2019			23,608
Beginning balance at Dec. 29, 2019	$ 69,169		$ 331	(112,680)	435,278	(254,081)		321
Beginning balance, common shares at Dec. 29, 2019	23,638		23,638
Cumulative impact at Dec. 29, 2019	$ (254,081)
Cumulative impact (ASU 2016-13 (Topic 326) [Member]) at Dec. 29, 2019		$ (5)					$ (5)
Net income (loss)	(49,155)					(48,964)		(191)
Stock-based compensation plans			$ 6		(6)
Stock-based compensation plans, shares			591
Shares issued for proxy-related expenses	389		$ 1		388
Shares issued for proxy-related expenses, shares			130
Distributions to non-controlling interest	(344)							(344)
Contributions from non-controlling interest	143							143
Treasury shares used for stock-based plans	(586)			(586)
Treasury shares used for stock-based plans, shares			(147)
Stock-based compensation expense	2,480				2,480
Ending balance at Sep. 27, 2020	$ 22,091		$ 338	(113,266)	438,140	(303,050)		(71)
Ending balance, common shares at Sep. 27, 2020	24,212		24,212
Beginning balance at Jun. 28, 2020	$ 34,653		$ 334	(112,757)	436,536	(289,638)		178
Beginning balance, common shares at Jun. 28, 2020			23,898
Net income (loss)	(13,489)					(13,412)		(77)
Stock-based compensation plans			$ 4		(4)
Stock-based compensation plans, shares			437
Distributions to non-controlling interest	(172)							(172)
Treasury shares used for stock-based plans	(509)			(509)
Treasury shares used for stock-based plans, shares			(123)
Stock-based compensation expense	1,608				1,608
Ending balance at Sep. 27, 2020	$ 22,091		$ 338	$ (113,266)	$ 438,140	$ (303,050)		$ (71)
Ending balance, common shares at Sep. 27, 2020	24,212		24,212

Condensed Consolidated Statements of Equity (Unaudited) (Parenthetical) - USD ($) $ in Thousands	9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019
ASU 2016-02 (Topic 842) [Member]
Cumulative impact tax	$ 2	$ 196

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019
Cash flows from operating activities:
Net income (loss)	$ (49,155)	$ (22,360)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation expense	15,110	16,486
Noncash lease expense	20,151	21,246
Deferred income tax	14	13,804
Stock-based compensation expense	2,480	1,910
Asset impairment, store closure and disposal of property and equipment	8,873	2,012
Other operating activities	582	33
Changes in operating assets and liabilities:
Accounts receivable, net	(281)	(347)
Inventories	749	165
Prepaid expenses and other assets	49	3,565
Accounts payable	1,918	763
Operating lease liabilities	(10,776)	(23,046)
Accrued expenses and other liabilities	2,542	(4,368)
Net cash (used in) provided by operating activities:	(7,744)	9,863
Cash flows from investing activities:
Purchases of property and equipment	(8,702)	(9,533)
Net cash used in investing activities:	(8,702)	(9,533)
Cash flows from financing activities:
Borrowings under credit facility	49,786
Repayments under credit facility	(37,400)
Proceeds from paycheck protection program loan	10,000
Payment of debt issuance costs	(553)	(40)
Proceeds from exercise of stock options		173
Employee taxes on certain stock-based payment arrangements	(585)	(35)
Treasury stock repurchases		(4,147)
Distributions to non-controlling interest	(344)	(337)
Contributions from non-controlling interest	143	39
Net cash provided by (used in) financing activities:	21,047	(4,347)
Net increase (decrease) in cash and cash equivalents	4,601	(4,017)
Cash and cash equivalents at beginning of period	18,806	19,775
Cash and cash equivalents at end of period	23,407	15,758
Supplemental cash flow information:
Income taxes paid	240	180
Interest paid	468	66
Supplemental non-cash investing and financing activities:
Unpaid liability for purchases of property and equipment	$ 350	$ 433

Organization and Other Matters

9 Months Ended

Sep. 27, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Other Matters

(1) Organization and Other Matters

Business

Potbelly Corporation (the “Company” or “Potbelly”), through its wholly owned subsidiaries, owns and operates more than 400 company-owned shops in the United States. Additionally, Potbelly franchisees operate over 40 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 the Company’s Annual Report on Form 10-K for the year ended December 29, 2019. The unaudited condensed consolidated financial statements included herein have been prepared by the Company 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 the Company’s balance sheet as of September 27, 2020 and December 29, 2019, its statement of operations for the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, the statement of equity for the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, and its statement of cash flows for the 39 weeks ended September 27, 2020 and September 29, 2019 have been included. The 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 with the third quarter of 2020, shop closure and lease termination expenses are being presented within impairment, loss on disposal of property and equipment and shop closures on the condensed consolidated statements of operations. Prior to the third quarter of 2020, shop closure and lease termination expenses were presented within general and administrative expenses. Prior period amounts have been reclassified to conform to the current presentation. This reclassification had no impact on the loss from operations, balance sheets or statements of cash flows.

The Company does not have any components of other comprehensive income recorded within its consolidated financial statements and therefore, does not separately present a statement of comprehensive income in its condensed consolidated financial statements.

COVID-19

On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus ("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. In response to the pandemic, many states and jurisdictions in which we operate have issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus. We initially closed the vast majority of our dining rooms and shifted to off-premise operations only, and we experienced a sudden and drastic decrease in revenues. Nearly all of our shops have reopened their dining rooms with restrictions, such as social distancing and limited capacities, to ensure the health and safety of our guests and employees. We continue to follow guidance from local authorities in determining the appropriate restrictions to put in place for each shop, including the suspension or reduction of in-shop dining if required due to changes in the pandemic response in each jurisdiction.

The disruption in operations and reduction in revenues have led the Company to consider the impact of the COVID-19 pandemic on the recoverability of its assets, including property and equipment, right-of-use assets for operating leases, goodwill and intangible assets, and others.

Due to the impact of the COVID-19 pandemic, the Company evaluated its goodwill, intangible assets, and long-lived assets, which includes property and equipment and right-of-use assets for operating leases for impairment. The Company did not record any impairment to its goodwill or indefinite-lived intangible assets during the 13 and 39 weeks ended September 27, 2020. The Company recorded impairment charges for its long-lived assets of $1.2 million and $8.0 million, respectively, for the 13 and 39 weeks ended September 27, 2020, primarily driven by the expected impact of the COVID-19 pandemic on future cash flows. The 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. See Note 3 for further details.

The Company recognized an income tax benefit of $6.7 million during 2020 primarily due to the impact of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) which enables the Company to obtain a tax refund from the carryback of net operating losses (“NOLs”) and a refund of prior alternative minimum tax (“AMT”) credits. The Company received $6.0 million of this refund during the third quarter of 2020 and expects to receive the remaining $0.7 million before the end of the current year. See Note 5 for further details.

To preserve financial flexibility, the Company borrowed the $39.8 million of available capacity under its revolving credit facility on March 17, 2020. The Company subsequently repaid $27.4 million of these borrowings through the third quarter of 2020. On August 10, 2020, the Company entered into a loan agreement with Harvest Small Business Finance, LLC in the aggregate amount of $10.0 million pursuant to the Paycheck Protection Program (“PPP”) under the CARES Act. As of September 27, 2020, the Company had total liquidity of $50.8 million, consisting of cash and cash equivalents and amounts available on its revolving credit facility. See Note 7 for further details.

The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. Due to the rapid development and fluidity of this situation, the Company cannot determine the ultimate impact that the COVID-19 pandemic will have on its consolidated financial condition, liquidity, and future results of operations, and therefore any prediction as to the ultimate impact on the Company’s consolidated financial condition, liquidity, and future results of operations is uncertain.

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 seven 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 seven joint venture investments. The Company has ownership interests ranging from 51-80% in these consolidated joint ventures.

Fiscal Year

The Company uses 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 2020 and 2019 both consist of 52 weeks. The fiscal quarters ended September 27, 2020 and September 29, 2019 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.

Recent Accounting Pronouncements

On December 30, 2019, the Company adopted Accounting Standard Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326). This pronouncement requires the measurement and recognition of expected credit losses on financial instruments. ASU 2016-13 replaces the existing incurred loss model with a forward-looking expected credit loss model that requires consideration of a broader range of information to estimate credit losses. The Company recorded a net reduction of $5 thousand to opening accumulated deficit as of December 30, 2019, due to the cumulative impact of adopting Topic 326.

Revenue

6 Months Ended

Jun. 28, 2020

Revenue From Contract With Customer [Abstract]

Revenue

(2) Revenue

The Company primarily earns revenue at a point in time for sandwich shop sales which can occur in person at the shop, over our online or app platforms, or through a third-party platform. Revenue is recorded net of sales-related taxes collected from customers. The payment on these sales is due at the time of the customer’s purchase. The Company also receives royalties from franchisees on their respective sales, which are recognized at the point in time the sale is made and invoiced weekly. Potbelly also records revenue from sales over time related to upfront franchise fees, gift card redemptions and breakage. For the 13 and 39 weeks ended September 27, 2020, revenue recognized from all revenue sources on point in time sales was $72.5 million and $216.0 million, respectively, and revenue recognized from sales over time was $0.1 million and $0.4 million, respectively. For the 13 and 39 weeks ended September 29, 2019, revenue recognized from all revenue sources on point in time sales was $103.9 million and $307.2 million, respectively, and revenue recognized from sales over time was $0.4 million and $0.8 million, respectively.

Franchise Revenue

Potbelly licenses intellectual property and trademarks to franchisees through franchise agreements. As part of these franchise agreements, Potbelly receives an upfront payment from the franchisee, which the Company recognizes over the term of the franchise agreement. The Company records a contract liability for the unearned portion of the upfront franchise payments.

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, which is recognized by the Company 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.

Loyalty Program

During the second quarter of 2020, the Company implemented a new 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. The Company defers 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 a year after the point is earned. When points are redeemed, the Company recognizes revenue for the redeemed product and reduces deferred revenue.

Contract Liabilities

As described above, the Company records current and noncurrent contract liabilities for upfront franchise fees, gift cards and the loyalty program. There are no other contract liabilities or contract assets recorded by the Company. The opening and closing balances of the Company’s 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 30, 2019	$	(1,594	)	$	(2,054	)
Ending balance as of September 27, 2020		(2,627	)		(1,786	)
Increase (decrease) in contract liability	$	1,033		$	(268	)

The aggregate value of remaining performance obligations on outstanding contracts was $4.4 million as of September 27, 2020. The Company expects 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
2020	$	820
2021		1,565
2022		303
2023		219
2024		188
Thereafter		1,318
Total revenue recognized	$	4,413

For the 13 and 39 weeks ended September 27, 2020, the amount of revenue recognized related to the December 30, 2019 liability ending balance was $0.1 million and $0.9 million, respectively. For the 13 and 39 weeks ended September 29, 2019, the amount of revenue recognized related to the December 31, 2018 liability ending balance was $0.2 million and $1.7 million, respectively. This revenue related to the recognition of gift card redemptions and upfront franchise fees. For the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, the Company did not recognize any revenue from obligations satisfied (or partially satisfied) in prior periods.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 13
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 12
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

Fair Value Measurement

9 Months Ended

Sep. 27, 2020

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 Company assesses potential impairments to its 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 the Company’s shops during the 13 and 39 weeks ended September 27, 2020, it was determined that indicators of impairment were present for certain shops as a result of continued underperformance. The Company performed an impairment analysis related to these shops and recorded an impairment charge of $1.2 million and $8.0 million for the 13 and 39 weeks ended September 27, 2020, respectively, primarily driven by the expected impact of the COVID-19 pandemic on future cash flows. The 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. After performing a periodic review of the Company’s shops during the 13 and 39 weeks ended September 29, 2019, the Company recorded an impairment charge of $1.5 million and $1.7 million, respectively.

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.

The Company reviews indefinite-lived intangible assets, which includes goodwill and tradenames, annually at fiscal year-end for impairment or more frequently if events or circumstances indicate that the carrying value may not be recoverable. Due to the impact of the COVID-19 pandemic to the global economy, including but not limited to, the volatility of the Company's stock price as well as that of its competitors, declining sales at the Company's restaurants and the challenging environment for the restaurant industry generally, the Company determined that there were indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the first quarter of 2020. As such, the Company performed an impairment assessment for both goodwill and indefinite lived intangible assets and concluded that the fair value of these assets exceeded their carrying values. The Company has not recorded any impairment to its goodwill or indefinite-lived intangible assets during the 13 and 39 weeks ended September 27, 2020. The 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.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Loss Per Share

9 Months Ended

Sep. 27, 2020

Earnings Per Share [Abstract]

Loss Per Share

(4) Loss Per Share

Basic and diluted income per common share attributable to common stockholders are calculated using the weighted average number of common shares outstanding for the period. Diluted income per common share attributable to common stockholders is computed by dividing the income 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 13 and 39 weeks ended September 27, 2020, and September 29, 2019, the Company 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 13 Weeks Ended						For the 39 Weeks Ended
	September 27,			September 29,			September 27,			September 29,
	2020			2019			2020			2019
Net loss attributable to Potbelly Corporation	$	(13,412	)	$	(2,355	)	$	(48,964	)	$	(22,660	)
Weighted average common shares outstanding-basic		23,957			23,740			23,792			23,927
Plus: Effect of potential stock options exercise		—			—			—			—
Weighted average common shares outstanding-diluted		23,957			23,740			23,792			23,927
Loss per share available to common stockholders-basic	$	(0.56	)	$	(0.10	)	$	(2.06	)	$	(0.95	)
Loss per share available to common stockholders-diluted	$	(0.56	)	$	(0.10	)	$	(2.06	)	$	(0.95	)
Potentially dilutive shares that are considered anti-dilutive:
Common share options		3,015			2,333			2,769			2,366

Income Taxes

6 Months Ended

Jun. 28, 2020

Income Tax Disclosure [Abstract]

Income Taxes

(5) Income Taxes

On March 27, 2020, the CARES Act was enacted into law. The CARES Act is a tax and spending package intended to provide economic relief to address the impact of the COVID-19 pandemic. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain NOLs and allow businesses to carry back NOLs arising in 2018, 2019, and 2020 to the five prior tax years, accelerate refunds of previously generated corporate AMT credits, loosen the business interest limitation under section 163(j), and fix the qualified improvement property regulations in the 2017 Tax Cuts and Jobs Act. As a result of the CARES Act, the Company estimates that it will be able to obtain a tax refund of $6.7 million from the carryback of NOLs and a refund of prior AMT credits. The Company received $6.0 million of this refund as of September 27, 2020. The Company expects to receive the remaining $0.7 million before the end of the current year.

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. The Company recognized an income tax benefit of $3.7 million during the first quarter of 2020 due to the anticipated impact of the CARES Act discussed above and an additional $3.0 million benefit during the third quarter of 2020 due to additional guidance on the CARES Act and the finalization of the Company’s 2019 federal tax return.

The Company regularly assesses the need for a valuation allowance related to its 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 its deferred tax assets will not be realized. In its assessment, the Company considers recent financial operating results, projected future taxable income, the reversal of existing taxable differences, and tax planning strategies. The Company recorded a full valuation allowance against its net deferred tax assets during the first quarter of 2019, resulting in a non-cash charge to income tax expense of $13.6 million. The Company continued to maintain a valuation allowance against all of its deferred tax assets as of September 27, 2020. The Company did not provide for an income tax benefit on its pre-tax loss for the 13 and 39 weeks ended September 27, 2020 and September 29, 2019. The Company assesses the likelihood of the realization of its deferred tax assets each quarter and the valuation allowance is adjusted accordingly.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

Leases

9 Months Ended

Sep. 27, 2020

Leases [Abstract]

Leases

(6) Leases

We determine if a contract contains a lease at inception. The Company leases retail shops, warehouse and office space under operating leases. For leases with renewal periods at the Company’s option, the Company determines the expected lease period based on whether the renewal of any options are reasonably assured at the inception of the lease.

Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the maturities of the leases. The Company estimates this rate based on prevailing financial market conditions, comparable company and credit analysis, and management judgment.

We recognize expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce our right-of-use asset related to the lease. These are amortized through the right-of-use asset as reductions of expense over the lease term.

As a result of COVID-19, the Company suspended the payment of rent on the majority of its leases in April 2020 and has been in discussions with landlords regarding the restructuring of those leases in light of various contractual and legal defenses. The Company entered into 169 and 276 amendments with our respective landlords during the 13 and 39 weeks ended September 27, 2020. Under these agreements, certain rent payments will be abated, deferred or modified without penalty for various periods, generally covering two to four months of rent payments. In April 2020, the Financial Accounting Standards Board issued guidance allowing entities to make a policy election whether to account for lease concessions related to the COVID-19 pandemic as lease modifications. The election applies to any lessor-provided lease concession related to the impact of the COVID-19 pandemic, provided the concession does not result in a substantial increase in the rights of the lessor or in the obligations of the lessee. During the 13 and 39 weeks ended September 27, 2020, we received concessions from certain landlords in the form of rent deferrals and abatements which were not substantial, and we have elected to not account for these rent concessions as lease modifications.

During the 13 and 39 weeks ended September 27, 2020, the Company terminated the leases for 17 and 25 company-owned shops, respectively, which will be permanently closed. The Company incurred $1.5 million and $2.2 million, respectively, in lease termination fees related to these leases for the 13 and 39 weeks ended September 27, 2020. Upon termination of leases during the 13 weeks ended September 27, 2020, the Company derecognized ROU assets of $8.0 million and lease liabilities of $9.0 million that resulted in a net gain of $1.0 million that is recorded in impairment, loss on disposal of property and equipment and shop closures. Upon termination of leases during the 39 weeks ended September 27, 2020, the Company derecognized ROU assets of $12.9 million and lease liabilities of $14.3 million that resulted in a net gain of $1.4 million that is recorded in impairment, loss on disposal of property and equipment and shop closures. Upon termination of leases during the 13 weeks ended September 29, 2019, the Company derecognized ROU asset of $0.7 million and lease liabilities of $0.8 million that resulted in a net gain of $0.1 million that is recorded in impairment, loss on disposal of property and equipment and shop closures. Upon termination of leases during the 39 weeks ended September 29, 2019, the Company derecognized ROU asset of $6.5 million and lease liabilities of $7.5 million that resulted in a net gain of $1.0 million that is recorded in impairment, loss on disposal of property and equipment and shop closures.

Operating lease term and discount rate were as follows:

	September 27,			September 29,
	2020			2019
Weighted average remaining lease term (years)		8.02			8.59
Weighted average discount rate		7.89	%		8.00	%

Certain of the Company’s 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:

		13 weeks ended				39 weeks ended
		September 27,		September 29,		September 27,		September 29,
	Classification	2020		2019		2020		2019
Operating lease cost	Occupancy and General and administrative expenses		11,112		11,187		34,699		33,793
Variable lease cost	Occupancy		2,879		3,277		9,119		10,430
Total lease cost		$	13,991	$	14,464	$	43,818	$	44,223

Supplemental disclosures of cash flow information related to leases were as follows:

	13 weeks ended						39 weeks ended
	September 27,			September 29,			September 27,			September 29,
	2020			2019			2020			2019
Operating cash flows rent paid for operating lease liabilities		10,693			11,762			24,200			35,488
Operating right-of-use assets obtained in exchange for new operating lease liabilities		5,264			4,745			18,800			8,402
Reduction in operating right-of-use assets due to lease terminations		(7,973	)		(659	)		(12,855	)		(6,506	)

As of September 27, 2020, the Company had no real estate leases entered into that had not yet commenced.

Maturities of lease liabilities were as follows as of September 27, 2020:

	Operating Leases
Remainder of 2020		15,588
2021		47,643
2022		40,459
2023		35,972
2024		33,338
2025		31,232
Thereafter		112,177
Total lease payments		316,409
Less: imputed interest		(85,294	)
Present value of lease liabilities	$	231,115

Debt and Credit Facilities

9 Months Ended

Sep. 27, 2020

Debt Disclosure [Abstract]

Debt and Credit Facilities

(7) Debt and Credit Facilities

The components of long-term debt were as follows:

	September 27,		December 29,
	2020		2019
Revolving credit facility	$	12,386	$	-
Paycheck Protection Program loan		10,000		-
Total long-term debt	$	22,386	$	-

Revolving credit facility

On August 7, 2019, the Company entered into a second amended and restated revolving credit facility agreement (the "Credit Agreement") with JPMorgan Chase Bank, N.A. (“JPMorgan”) that expires in July 2022. The Credit Agreement amends and restates that certain amended and restated revolving credit facility agreement, dated as of December 9, 2015, and amended on May 3, 2019 (collectively, the "Prior Credit Agreement") with JPMorgan. The Credit Agreement provides, among other things, for a revolving credit facility in a maximum principal amount $40 million, with possible future increases of up to $20 million under an expansion feature. Borrowings under the credit facility generally bear interest at the Company’s option at either (i) a eurocurrency rate determined by reference to the applicable LIBOR rate plus a margin ranging from 1.25% to 1.75% or (ii) a prime rate as announced by JP Morgan plus a margin ranging from 0.00% to 0.50%. The applicable margin is determined based upon the Company’s consolidated total leverage ratio. On the last day of each calendar quarter, the Company is required to pay a commitment fee of 0.20% per annum in respect of any unused commitments under the credit facility. So long as certain total leverage ratios, EBITDA thresholds and minimum liquidity requirements are met and no default or event of default has occurred or would result, there is no limit on the “restricted payments” (primarily distributions and equity repurchases) that the Company may make, provided that proceeds of the loans under the Credit Agreement may not be used for purposes of making restricted payments.

On March 17, 2020, the Company fully borrowed the available capacity of $39.8 million under the Credit Agreement as a precautionary measure in order to increase its cash position and preserve financial flexibility in light of current uncertainty in the global markets resulting from the COVID-19 pandemic. In accordance with the terms of the Credit Agreement, the proceeds from these borrowings may in the future be used for working capital, general corporate or other permitted purposes.

The Credit Agreement was subsequently amended as of May 15, 2020 (the “Credit Agreement Amendment”) to, among other things (i) change the maturity date from July 31, 2022 to March 31, 2022; (ii) eliminate the $20.0 million expansion feature; (iii) amend the interest rate to the Company’s option at either (a) a eurocurrency rate determined by reference to the applicable LIBOR rate with a 1.00% floor plus a margin of 5.00% or (b) a prime rate as announced by JP Morgan plus 4.00%; (iv) amend the commitment fee to 1.00% per annum in respect of any unused commitments under the credit facility; (v) implement additional restrictions on restricted payments, acquisitions and other indebtedness; and (vi) implement additional financial covenants. Per the terms of the Credit Agreement Amendment, the Company repaid $15.0 million of its outstanding borrowing at the signing of the Credit Agreement Amendment, and may re-borrow this $15.0 million when its cash balance held by JP Morgan declines below $28.0 million. Lastly, the Company was required to pay a fee of 1% of the outstanding loan balance after the signing of the Credit Agreement Amendment.

On July 17, 2020, the Company entered into Amendment No. 2 (the “Second Amendment”) to the Credit Agreement to, among other things: (i) revise its financial covenants; (ii) decrease the aggregate amount of loan commitment available under the Credit Agreement from $40.0 million to $30.0 million after March 31, 2021 and (iii) decrease the interest rate to the Company’s option at either (a) a eurocurrency rate determined by reference to the applicable LIBOR rate with a 1.00% floor plus a margin of 4.75% or (b) a prime rate as announced by JP Morgan plus 2.25%. Per the terms of the Second Amendment, the Company repaid $14.5 million of its outstanding borrowing at the signing of the Second Amendment, and may reborrow the entire amount available under the credit facility when its cash balance held by JP Morgan declines below $10.0 million in total.

The Second Amendment includes financial covenants that require the Company to (i) maintain periodic minimum liquidity levels through February 28, 2022 ranging from $15.0 million to $30.0 million and (ii) maintain monthly minimum adjusted EBITDA thresholds for specified computation periods through February 28, 2022 ranging from ($18.0) million to $8.3 million.

On August 19, 2020, the Company entered into Amendment No. 3 (the “Third Amendment”) to the Credit Agreement to permit the Company to incur indebtedness in the form of a loan agreement with Harvest Small Business Finance, LLC in the aggregate amount of $10.0 million pursuant to the PPP under the CARES Act and (ii) revise financial covenants for the impact of the PPP proceeds. As of September 27, 2020, the Company had $12.4 million outstanding under the Credit Agreement. There were no borrowings outstanding as of September 29, 2019. The Company is currently in compliance with all debt covenants as of September 27, 2020.

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 the ongoing operations of the Company 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. The Company intends to use all of the PPP proceeds toward qualifying expenses and pursue forgiveness of the Loan amount, but it is not able to determine the likelihood or the amount of forgiveness that will be obtained.

The Company has recorded the amount of the Loan as long-term debt in its condensed consolidated balance sheet as of September 27, 2020 and related interest has been recorded to interest expense on its condensed consolidated statement of operations for the 13 weeks ended September 27, 2020.

Capital Stock

9 Months Ended

Sep. 27, 2020

Equity [Abstract]

Capital Stock

(8) Capital Stock

On May 8, 2018, the Company announced that its Board of Directors authorized a stock repurchase program for up to $65.0 million of its outstanding common stock. The program permits the Company, 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 13 and 39 weeks ended September 27, 2020, the Company did not repurchase any shares of its common stock. In light of the COVID-19 pandemic, the Company does not have plans to repurchase any common stock under its stock repurchase program at this time. For the 13 and 39 weeks ended September 29, 2019, the Company repurchased 162,162 shares and 647,821 shares of its common stock for approximately $0.7 million and $4.2 million, respectively, under the stock repurchase program, including cost and commission, in open market transactions. Repurchased shares are included as treasury stock in the condensed consolidated balance sheets and the condensed consolidated statements of equity.

Stock-Based Compensation

9 Months Ended

Sep. 27, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

(9) Stock-Based Compensation

Stock options

The Company has awarded stock options to certain of its employees and certain non-employee members of its Board of Directors. The grants generally vest over a four-year period. The fair value of stock options is determined using the Black-Scholes option pricing model. There were no stock options granted during the 13 and 39 weeks ended September 27, 2020.

A summary of stock option activity for the 39 weeks ended September 27, 2020 is as follows:

Options	Shares (Thousands)			Weighted Average Exercise Price			Aggregate Intrinsic Value (Thousands)		Weighted Average Remaining Term (Years)
Outstanding—December 29, 2019		1,774		$	11.34		$	—		4.33
Granted		—			—
Exercised		—			—
Canceled		(165	)		(12.35	)
Outstanding—September 27, 2020		1,609			11.23		$	—		3.31
Exercisable—September 27, 2020		1,556		$	11.18		$	—		3.18

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 13 weeks ended September 27, 2020, the Company recognized stock-based compensation credit of $0.1 million due to forfeiture credits. For the 39 weeks ended September 27, 2020, the Company recognized stock-based compensation expense related to stock options of $0.2 million. For the 13 and 39 weeks ended September 29, 2019, the Company recognized stock-based compensation expense related to stock options of $0.1 million and $0.7 million, respectively. As of September 27, 2020, unrecognized stock-based compensation expense for stock options was $0.2 million, which will be recognized through fiscal year 2022. The Company records stock-based compensation expense within general and administrative expenses in the condensed consolidated statements of operations.

Restricted stock units

The Company awards restricted stock units (“RSUs”) to certain of its employees and certain non-employee members of its Board of Directors. The Board of Director grants have a vesting schedule of 50% on the first anniversary of the grant date and 50% on the second anniversary of the grant date. The employee grants vest in one-third increments over a three-year period. For the 13 and 39 weeks ended September 27, 2020, the Company recognized stock-based compensation expense related to RSUs of $1.0 million and $1.6 million, respectively. For the 13 and 39 weeks ended September 29, 2019, the Company recognized stock-based compensation expense related to RSUs of $0.3 million and $1.2 million, respectively. As of September 27, 2020, unrecognized stock-based compensation expense for RSUs was $3.1 million, which will be recognized though fiscal year 2023.

A summary of RSU activity for the 39 weeks ended September 27, 2020 is as follows:

RSUs	Number of RSUs (Thousands)			Weighted Average Fair Value per Share
Non-vested as of December 29, 2019		463		$	7.59
Granted		1,574			3.13
Vested		(201	)		2.87
Canceled		(430	)		3.87
Non-vested as of September 27, 2020		1,406		$	3.68

Performance stock units

The Company awards performance share units (“PSUs”) to certain of its employees. The PSUs have certain vesting conditions based upon the Company’s financial performance or the Company’s stock price.

The Company has granted PSUs that are subject to service and market vesting conditions. The fair market value was established using a Monte Carlo simulation model. Participants are entitled to receive a specified number of shares of the Company’s common stock contingent on the Company's achievement of a stock return on the Company's common stock. The PSUs may vest during a performance period of five years. Compensation expense for these awards is being amortized over an average expected service period or earlier based on when vesting conditions are met. For the 13 and 39 weeks ended September 27, 2020, the Company recognized stock-based compensation expense for PSUs with market vesting conditions of $0.7 million.

A summary of activity for PSUs with market vesting conditions for the 39 weeks ended September 27, 2020 is as follows:

PSUs	Number of PSUs (Thousands)			Weighted Average Fair Value per Share
Non-vested as of December 29, 2019		—		$	—
Granted		1,475			1.43
Vested		(391	)		4.20
Canceled		(332	)		1.50
Non-vested as of September 27, 2020		752		$	1.42

The Company also previously granted PSUs that are subject to service and performance vesting conditions. The PSUs will vest based on the Company’s achievement of certain targets related to adjusted EBITDA and same store sales goals. The quantity of shares that will vest ranges from 0% to 200% of the targeted number of shares. If the defined minimum targets are not met, then no shares will vest. As of September 27, 2020, there were 45 thousand PSUs with performance vesting conditions outstanding with a grant date fair value of $8.46 per share. For the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, no expense was recognized related to PSUs with performance vesting conditions.

Commitments and Contingencies

9 Months Ended

Sep. 27, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

(10) Commitments and Contingencies

The Company is 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. In the opinion of management, the amount of ultimate liability with respect to those actions should not have a material adverse impact on the Company’s financial position or results of operations and cash flows.

Related Party Transactions

9 Months Ended

Sep. 27, 2020

Related Party Transactions

(11) Related Party Transactions

On May 10, 2020, the Company entered into a Settlement Agreement (the “Settlement Agreement”) with Intrinsic Investment Holdings, LLC, the Vann A. Avedisian Trust U/A 8/29/85, Vann A. Avedisian, KGT Investments, LLC, The Khimji Foundation, Mahmood Khimji, Bryant L. Keil and Neil Luthra (the foregoing, collectively with each of their respective affiliates, the “Vann Group”). In connection with the Settlement Agreement with the Vann Group, the Company issued 130,000 shares of common stock (including 41,311 shares issued to the Vann A. Avedisian Trust U/A 8/29/85, 43,571 shares issued to KGT Investments, LLC and 45,118 shares issued to The Khimji Foundation) to reimburse the Vann Group for its documented out-of-pocket costs, fees and expenses incurred in connection with the Settlement Agreement. The Company recorded expense of $0.4 million within general and administrative expenses related to the issuance of these shares. Based on a report of Schedule 13D filed by the Vann Group on August 17, 2020, the Vann Group beneficially owns 2.69% of the common stock of the Company.

Organization and Other Matters (Policies)	9 Months Ended
Organization and Other Matters (Policies)	Sep. 27, 2020
Accounting Policies [Abstract]
Business	Business Potbelly Corporation (the “Company” or “Potbelly”), through its wholly owned subsidiaries, owns and operates more than 400 company-owned shops in the United States. Additionally, Potbelly franchisees operate over 40 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 the Company’s Annual Report on Form 10-K for the year ended December 29, 2019. The unaudited condensed consolidated financial statements included herein have been prepared by the Company 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 the Company’s balance sheet as of September 27, 2020 and December 29, 2019, its statement of operations for the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, the statement of equity for the 13 and 39 weeks ended September 27, 2020 and September 29, 2019, and its statement of cash flows for the 39 weeks ended September 27, 2020 and September 29, 2019 have been included. The 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 with the third quarter of 2020, shop closure and lease termination expenses are being presented within impairment, loss on disposal of property and equipment and shop closures on the condensed consolidated statements of operations. Prior to the third quarter of 2020, shop closure and lease termination expenses were presented within general and administrative expenses. Prior period amounts have been reclassified to conform to the current presentation. This reclassification had no impact on the loss from operations, balance sheets or statements of cash flows. The Company does not have any components of other comprehensive income recorded within its consolidated financial statements and therefore, does not separately present a statement of comprehensive income in its condensed consolidated financial statements.
COVID-19	COVID-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus ("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. In response to the pandemic, many states and jurisdictions in which we operate have issued stay-at-home orders and other measures aimed at slowing the spread of the coronavirus. We initially closed the vast majority of our dining rooms and shifted to off-premise operations only, and we experienced a sudden and drastic decrease in revenues. Nearly all of our shops have reopened their dining rooms with restrictions, such as social distancing and limited capacities, to ensure the health and safety of our guests and employees. We continue to follow guidance from local authorities in determining the appropriate restrictions to put in place for each shop, including the suspension or reduction of in-shop dining if required due to changes in the pandemic response in each jurisdiction. The disruption in operations and reduction in revenues have led the Company to consider the impact of the COVID-19 pandemic on the recoverability of its assets, including property and equipment, right-of-use assets for operating leases, goodwill and intangible assets, and others. Due to the impact of the COVID-19 pandemic, the Company evaluated its goodwill, intangible assets, and long-lived assets, which includes property and equipment and right-of-use assets for operating leases for impairment. The Company did not record any impairment to its goodwill or indefinite-lived intangible assets during the 13 and 39 weeks ended September 27, 2020. The Company recorded impairment charges for its long-lived assets of $1.2 million and $8.0 million, respectively, for the 13 and 39 weeks ended September 27, 2020, primarily driven by the expected impact of the COVID-19 pandemic on future cash flows. The 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. See Note 3 for further details. The Company recognized an income tax benefit of $6.7 million during 2020 primarily due to the impact of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) which enables the Company to obtain a tax refund from the carryback of net operating losses (“NOLs”) and a refund of prior alternative minimum tax (“AMT”) credits. The Company received $6.0 million of this refund during the third quarter of 2020 and expects to receive the remaining $0.7 million before the end of the current year. See Note 5 for further details. To preserve financial flexibility, the Company borrowed the $39.8 million of available capacity under its revolving credit facility on March 17, 2020. The Company subsequently repaid $27.4 million of these borrowings through the third quarter of 2020. On August 10, 2020, the Company entered into a loan agreement with Harvest Small Business Finance, LLC in the aggregate amount of $10.0 million pursuant to the Paycheck Protection Program (“PPP”) under the CARES Act. As of September 27, 2020, the Company had total liquidity of $50.8 million, consisting of cash and cash equivalents and amounts available on its revolving credit facility. See Note 7 for further details. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. Due to the rapid development and fluidity of this situation, the Company cannot determine the ultimate impact that the COVID-19 pandemic will have on its consolidated financial condition, liquidity, and future results of operations, and therefore any prediction as to the ultimate impact on the Company’s consolidated financial condition, liquidity, and future results of operations is uncertain.
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 seven 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 seven joint venture investments. The Company has ownership interests ranging from 51-80% in these consolidated joint ventures.
Fiscal Year	Fiscal Year The Company uses 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 2020 and 2019 both consist of 52 weeks. The fiscal quarters ended September 27, 2020 and September 29, 2019 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 Pronouncements On December 30, 2019, the Company adopted Accounting Standard Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326). This pronouncement requires the measurement and recognition of expected credit losses on financial instruments. ASU 2016-13 replaces the existing incurred loss model with a forward-looking expected credit loss model that requires consideration of a broader range of information to estimate credit losses. The Company recorded a net reduction of $5 thousand to opening accumulated deficit as of December 30, 2019, due to the cumulative impact of adopting Topic 326.

Revenue (Tables)

6 Months Ended

Jun. 28, 2020

Revenue From Contract With Customer [Abstract]

Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers

The opening and closing balances of the Company’s 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 30, 2019	$	(1,594	)	$	(2,054	)
Ending balance as of September 27, 2020		(2,627	)		(1,786	)
Increase (decrease) in contract liability	$	1,033		$	(268	)

Summary of Expected Revenue Recognition Related to Contract Liabilities

The Company expects 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
2020	$	820
2021		1,565
2022		303
2023		219
2024		188
Thereafter		1,318
Total revenue recognized	$	4,413

Loss Per Share (Tables)

9 Months Ended

Sep. 27, 2020

Earnings Per Share [Abstract]

Summary of Loss Per Share Calculation

The following table summarizes the loss per share calculation:

	For the 13 Weeks Ended						For the 39 Weeks Ended
	September 27,			September 29,			September 27,			September 29,
	2020			2019			2020			2019
Net loss attributable to Potbelly Corporation	$	(13,412	)	$	(2,355	)	$	(48,964	)	$	(22,660	)
Weighted average common shares outstanding-basic		23,957			23,740			23,792			23,927
Plus: Effect of potential stock options exercise		—			—			—			—
Weighted average common shares outstanding-diluted		23,957			23,740			23,792			23,927
Loss per share available to common stockholders-basic	$	(0.56	)	$	(0.10	)	$	(2.06	)	$	(0.95	)
Loss per share available to common stockholders-diluted	$	(0.56	)	$	(0.10	)	$	(2.06	)	$	(0.95	)
Potentially dilutive shares that are considered anti-dilutive:
Common share options		3,015			2,333			2,769			2,366

Leases (Tables)

9 Months Ended

Sep. 27, 2020

Leases [Abstract]

Operating Lease Term and Discount Rate

Operating lease term and discount rate were as follows:

	September 27,			September 29,
	2020			2019
Weighted average remaining lease term (years)		8.02			8.59
Weighted average discount rate		7.89	%		8.00	%

Components of Lease Cost

The components of lease cost were as follows:

		13 weeks ended				39 weeks ended
		September 27,		September 29,		September 27,		September 29,
	Classification	2020		2019		2020		2019
Operating lease cost	Occupancy and General and administrative expenses		11,112		11,187		34,699		33,793
Variable lease cost	Occupancy		2,879		3,277		9,119		10,430
Total lease cost		$	13,991	$	14,464	$	43,818	$	44,223

Supplemental Disclosures of Cash Flow Information Related to Leases

Supplemental disclosures of cash flow information related to leases were as follows:

	13 weeks ended						39 weeks ended
	September 27,			September 29,			September 27,			September 29,
	2020			2019			2020			2019
Operating cash flows rent paid for operating lease liabilities		10,693			11,762			24,200			35,488
Operating right-of-use assets obtained in exchange for new operating lease liabilities		5,264			4,745			18,800			8,402
Reduction in operating right-of-use assets due to lease terminations		(7,973	)		(659	)		(12,855	)		(6,506	)

Maturities of Lease Liabilities

Maturities of lease liabilities were as follows as of September 27, 2020:

	Operating Leases
Remainder of 2020		15,588
2021		47,643
2022		40,459
2023		35,972
2024		33,338
2025		31,232
Thereafter		112,177
Total lease payments		316,409
Less: imputed interest		(85,294	)
Present value of lease liabilities	$	231,115

Debt and Credit Facilities (Tables)

9 Months Ended

Sep. 27, 2020

Debt Disclosure [Abstract]

Component of Long-term Debt

The components of long-term debt were as follows:

	September 27,		December 29,
	2020		2019
Revolving credit facility	$	12,386	$	-
Paycheck Protection Program loan		10,000		-
Total long-term debt	$	22,386	$	-

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 27, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Stock Option Activity

A summary of stock option activity for the 39 weeks ended September 27, 2020 is as follows:

Options	Shares (Thousands)			Weighted Average Exercise Price			Aggregate Intrinsic Value (Thousands)		Weighted Average Remaining Term (Years)
Outstanding—December 29, 2019		1,774		$	11.34		$	—		4.33
Granted		—			—
Exercised		—			—
Canceled		(165	)		(12.35	)
Outstanding—September 27, 2020		1,609			11.23		$	—		3.31
Exercisable—September 27, 2020		1,556		$	11.18		$	—		3.18

Summary of RSU Activity

A summary of RSU activity for the 39 weeks ended September 27, 2020 is as follows:

RSUs	Number of RSUs (Thousands)			Weighted Average Fair Value per Share
Non-vested as of December 29, 2019		463		$	7.59
Granted		1,574			3.13
Vested		(201	)		2.87
Canceled		(430	)		3.87
Non-vested as of September 27, 2020		1,406		$	3.68

Summary of PSU Activity

A summary of activity for PSUs with market vesting conditions for the 39 weeks ended September 27, 2020 is as follows:

PSUs	Number of PSUs (Thousands)			Weighted Average Fair Value per Share
Non-vested as of December 29, 2019		—		$	—
Granted		1,475			1.43
Vested		(391	)		4.20
Canceled		(332	)		1.50
Non-vested as of September 27, 2020		752		$	1.42

Organization and Other Matters - Additional Information (Detail) $ in Thousands	1 Months Ended	3 Months Ended				9 Months Ended
	Jul. 17, 2020 USD ($)	Sep. 27, 2020 USD ($) Shop JointVenture	Mar. 29, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 29, 2019 USD ($)	Sep. 27, 2020 USD ($) Shop Subsidiary JointVenture	Sep. 30, 2019 USD ($)	Sep. 29, 2019 USD ($)	Dec. 27, 2020 USD ($)	Aug. 10, 2020 USD ($)	Mar. 27, 2020 USD ($)	Mar. 17, 2020 USD ($)	Dec. 30, 2019 USD ($)	Dec. 29, 2019 USD ($)	Dec. 30, 2018 USD ($)
Nature Of Business And Basis Of Presentation [Line Items]
Number of shops franchisees operate \| Shop		40				40
Impairment charge		$ 1,200		$ 1,500		$ 8,000	$ 1,700
Income tax expense (benefit)		(2,917)	$ (3,700)		$ 66	(6,585)		$ 13,931
Tax refund from net operating loss carryback											$ 6,700
Line of credit facility amount borrowed	$ 10,000
Repayments of borrowing						37,400
Cash and cash equivalents		$ 23,407			$ 15,758	$ 23,407		$ 15,758						$ 18,806	$ 19,775
Number of wholly owned subsidiaries \| Subsidiary						7
Number of joint ventures \| JointVenture		7				7
ASU 2016-13 (Topic 326) [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Reduction in accumulated deficit													$ 5
Revolving Credit Facility [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Repayments of borrowing	$ 14,500
COVID 19 [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Income tax expense (benefit)						$ 6,700
Tax refund from net operating loss carryback		$ 6,000				6,000
COVID 19 [Member] \| Scenario, Forecast [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Tax refund from net operating loss carryback									$ 700
CARES Act Of 2020 [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Income tax expense (benefit)		(3,000)
Repayments of borrowing		27,400
CARES Act Of 2020 [Member] \| Revolving Credit Facility [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Line of credit facility amount borrowed												$ 39,800
Cash and cash equivalents		$ 50,800				$ 50,800
CARES Act Of 2020 [Member] \| Harvest Small Business Finance [Member] \| Paycheck Protection Program Loan [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Loan amount										$ 10,000
Minimum [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Number of shops Potbelly Corporation owns or operates \| Shop		400				400
Ownership interest rate						51.00%
Maximum [Member]
Nature Of Business And Basis Of Presentation [Line Items]
Ownership interest rate						80.00%

Revenue - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
Revenue - Additional Information (Detail) - USD ($)	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	$ 72,663,000	$ 104,238,000	$ 216,415,000	$ 307,955,000
Aggregate value of remaining performance obligation on outstanding contracts	4,413,000		4,413,000
Revenue recognized related to prior periods	0	0	0	0
January 1, 2018 Liability Ending Balance [Member]
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	100,000	200,000	900,000	1,700,000
Point in Time Sales [Member]
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	72,500,000	103,900,000	216,000,000.0	307,200,000
Over Time Sales [Member]
Disaggregation Of Revenue [Line Items]
Amount of revenue recognized	$ 100,000	$ 400,000	$ 400,000	$ 800,000

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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+ Details

Revenue - Summary of Current and Noncurrent Contract Liabilities from Contracts with Customers (Detail) $ in Thousands	9 Months Ended
	Sep. 27, 2020 USD ($)
Revenue From Contract With Customer [Abstract]
Beginning balance of current contract liability	$ (1,594)
Ending balance of current contract liability	(2,627)
Increase (decrease) in contract liability	1,033
Beginning balance of noncurrent contract liability	(2,054)
Ending balance of noncurrent contract liability	(1,786)
Increase (decrease) in contract liability	$ (268)

Revenue - Summary of Expected Revenue Recognition Related to Contract Liabilities (Detail1) $ in Thousands	Sep. 27, 2020 USD ($)
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 4,413
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-10-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 820
Revenue, remaining performance obligation, expected timing of satisfaction, period	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]
Revenue, remaining performance obligations	$ 1,565
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
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	$ 303
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year
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	$ 219
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	$ 188
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	$ 1,318
Revenue, remaining performance obligation, expected timing of satisfaction, period	1 year

Revenue - Summary of Expected Revenue Recognition Related to Contract Liabilities (Detail) $ in Thousands	Sep. 27, 2020 USD ($)
Revenue From Contract With Customer [Abstract]
Revenue, remaining performance obligations	$ 4,413

Fair Value Measurement - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 30, 2019	Sep. 27, 2020	Sep. 30, 2019
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impairment charge	$ 1.2	$ 1.5	$ 8.0	$ 1.7
COVID 19 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impact of the COVID 19 pandamic to thr global economy			Due to the impact of the COVID-19 pandemic to the global economy, including but not limited to, the volatility of the Company's stock price as well as that of its competitors, declining sales at the Company's restaurants and the challenging environment for the restaurant industry generally, the Company determined that there were indicators of potential impairment of its goodwill and indefinite-lived intangible assets during the first quarter of 2020. As such, the Company performed an impairment assessment for both goodwill and indefinite lived intangible assets and concluded that the fair value of these assets exceeded their carrying values. The Company has not recorded any impairment to its goodwill or indefinite-lived intangible assets during the 13 and 39 weeks ended September 27, 2020. The 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 - Additional Information (Detail) - shares	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Common Share Options [Member]
Loss Per Share [Line Items]
Potential common shares included in diluted shares outstanding	0	0	0	0

Loss Per Share - Summary of Loss Per Share Calculation (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Loss Per Share [Line Items]
Net loss attributable to Potbelly Corporation	$ (13,412)	$ (2,355)	$ (48,964)	$ (22,660)
Weighted average common shares outstanding-basic	23,957	23,740	23,792	23,927
Weighted average common shares outstanding-diluted	23,957	23,740	23,792	23,927
Loss per share available to common stockholders-basic	$ (0.56)	$ (0.10)	$ (2.06)	$ (0.95)
Loss per share available to common stockholders-diluted	$ (0.56)	$ (0.10)	$ (2.06)	$ (0.95)
Common Share Options [Member]
Loss Per Share [Line Items]
Potentially dilutive shares that are considered anti-dilutive	3,015	2,333	2,769	2,366

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 27, 2020	Mar. 29, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019	Dec. 31, 2020	Mar. 27, 2020	Mar. 31, 2019
Tax refund from net operating loss carryback							$ 6,700
Income taxes receivable	$ 6,000			$ 6,000
Income tax expense (benefit)	(2,917)	$ (3,700)	$ 66	$ (6,585)	$ 13,931
Deferred tax assets, valuation allowance								$ 13,600
CARES Act Of 2020 [Member]
Income tax expense (benefit)	$ (3,000)
Scenario, Forecast [Member]
Income taxes receivable						$ 700

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Leases - Additional Information (Detail) $ in Millions	3 Months Ended		9 Months Ended
Leases - Additional Information (Detail) $ in Millions	Sep. 27, 2020 USD ($) Shop	Sep. 29, 2019 USD ($)	Sep. 27, 2020 USD ($) Shop	Sep. 29, 2019 USD ($)
Leases [Abstract]
Number of shop lease terminated \| Shop	17		25
Lease termination fee	$ 1.5		$ 2.2
Derecognized right-of-use assets	8.0	$ 0.7	12.9	$ 6.5
Derecognized lease liabilities	9.0	0.8	14.3	7.5
Net gain on termination of lease	1.0	$ 0.1	1.4	$ 1.0
Additional operating leases payments related to shops not yet open, amount	$ 0.0		$ 0.0

Leases - Operating Lease Term and Discount Rate (Detail)	Sep. 27, 2020	Sep. 29, 2019
Leases [Abstract]
Weighted average remaining lease term (years)	8 years 7 days	7 years 10 months 20 days
Weighted average discount rate	7.89%	8.00%

Leases - Components of Lease Cost (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Lessee Lease Description [Line Items]
Total lease cost	$ 13,991	$ 14,464	$ 43,818	$ 44,223
Occupancy and General and Administrative Expenses [Member]
Lessee Lease Description [Line Items]
Operating lease cost	11,112	11,187	34,699	33,793
Occupancy Expenses [Member]
Lessee Lease Description [Line Items]
Variable lease cost	$ 2,879	$ 3,277	$ 9,119	$ 10,430

Leases - Supplemental Disclosures of Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Leases [Abstract]
Operating cash flows rent paid for operating lease liabilities	$ 10,693	$ 11,762	$ 24,200	$ 35,488
Operating right-of-use assets obtained in exchange for new operating lease liabilities	5,264	4,745	18,800	8,402
Reduction in operating right-of-use assets due to lease terminations	$ (7,973)	$ (659)	$ (12,855)	$ (6,506)

Leases - Maturities of Lease Liabilities (Detail) $ in Thousands	Sep. 27, 2020 USD ($)
Operating Leases
Remainder of 2020	$ 15,588
2021	47,643
2022	40,459
2023	35,972
2024	33,338
2025	31,232
Thereafter	112,177
Total lease payments	316,409
Less: imputed interest	(85,294)
Present value of lease liabilities	$ 231,115

Debt and Credit Facilities - Component of Long-term Debt (Detail) $ in Thousands	Sep. 27, 2020 USD ($)
Debt Instrument [Line Items]
Long-term debt	$ 22,386
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Long-term debt	12,386
Paycheck Protection Program Loan [Member]
Debt Instrument [Line Items]
Long-term debt	$ 10,000

Debt and Credit Facilities - Additional Information (Detail) - USD ($)			1 Months Ended		3 Months Ended	9 Months Ended
	Aug. 10, 2020	Aug. 07, 2019	Jul. 17, 2020	May 15, 2020	Sep. 27, 2020	Sep. 27, 2020	Sep. 29, 2019	Mar. 17, 2020
Short Term Debt [Line Items]
Line of credit facility amount borrowed						$ 37,400,000
Line of credit facility amount borrowed			$ 10,000,000.0
February 28, 2022 [Member] \| Minimum [Member]
Short Term Debt [Line Items]
Minimum Liquidity Level						15,000,000.0
Minimum Building Adjusted EBITDA						(18,000,000.0)
February 28, 2022 [Member] \| Maximum [Member]
Short Term Debt [Line Items]
Minimum Liquidity Level						30,000,000.0
Minimum Building Adjusted EBITDA						8,300,000
Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Upfront fee payable				1.00%
CARES Act Of 2020 [Member]
Short Term Debt [Line Items]
Line of credit facility amount borrowed					$ 27,400,000
London Interbank Offered Rate (LIBOR) [Member] \| Maximum [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate		1.75%	4.75%
London Interbank Offered Rate (LIBOR) [Member] \| Maximum [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate				5.00%
London Interbank Offered Rate (LIBOR) [Member] \| Minimum [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate		1.25%	1.00%
London Interbank Offered Rate (LIBOR) [Member] \| Minimum [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate				1.00%
Prime Rate [Member] \| Minimum [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate			2.25%
JPMorgan Chase Bank, N.A. [Member]
Short Term Debt [Line Items]
Commitment fee, percentage		0.20%
JPMorgan Chase Bank, N.A. [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, future increases				$ 20,000,000.0
Commitment fee, percentage				1.00%
Credit facility agreement, amount outstanding				$ 15,000,000.0
Line of credit facility amount borrowed				$ 28,000,000.0
JPMorgan Chase Bank, N.A. [Member] \| Maximum [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, Maturity date				Mar. 31, 2022
JPMorgan Chase Bank, N.A. [Member] \| Minimum [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, Maturity date				Jul. 31, 2022
JPMorgan Chase Bank, N.A. [Member] \| Prime Rate [Member] \| Maximum [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate		0.50%
JPMorgan Chase Bank, N.A. [Member] \| Prime Rate [Member] \| Minimum [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate		0.00%
JPMorgan Chase Bank, N.A. [Member] \| Prime Rate [Member] \| Minimum [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate				4.00%
Revolving Credit Facility [Member]
Short Term Debt [Line Items]
Credit facility agreement, maximum principal amount			$ 40,000,000.0
Credit facility agreement, future increases			30,000,000.0
Line of credit facility amount borrowed			$ 14,500,000
Revolving Credit Facility [Member] \| CARES Act Of 2020 [Member]
Short Term Debt [Line Items]
Line of credit facility amount borrowed								$ 39,800,000
Revolving Credit Facility [Member] \| JPMorgan Chase Bank, N.A. [Member]
Short Term Debt [Line Items]
Credit facility agreement, expiration date		Jul. 31, 2022
Credit facility agreement, maximum principal amount		$ 40,000,000
Revolving Credit Facility [Member] \| JPMorgan Chase Bank, N.A. [Member] \| Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Line of credit facility amount borrowed				$ 15,000,000.0
Revolving Credit Facility [Member] \| JPMorgan Chase Bank, N.A. [Member] \| COVID 19 [Member]
Short Term Debt [Line Items]
Line of credit facility amount borrowed								$ 39,800,000
Revolving Credit Facility [Member] \| JPMorgan Chase Bank, N.A. [Member] \| Maximum [Member]
Short Term Debt [Line Items]
Credit facility agreement, future increases		$ 20,000,000
Paycheck Protection Program Loan [Member] \| Harvest Small Business Finance [Member] \| Loan [Member] \| Potbelly Sandwich Works, LLC [Member]
Short Term Debt [Line Items]
Loan amount	$ 10,000,000.0
Paycheck Protection Program Loan [Member] \| CARES Act Of 2020 [Member] \| Potbelly Sandwich Works, LLC [Member]
Short Term Debt [Line Items]
Credit facility agreement, interest rate	1.00%
Loan maturity period	5 years
Paycheck Protection Program Loan [Member] \| CARES Act Of 2020 [Member] \| Harvest Small Business Finance [Member] \| Third Credit Agreement Amendment [Member]
Short Term Debt [Line Items]
Line of credit facility amount borrowed					$ 10,000,000.0	10,000,000.0
Credit facility agreement, amount outstanding						$ 12,400,000	$ 0

Capital Stock - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019	May 08, 2018
Equity Class Of Treasury Stock [Line Items]
Stock repurchase program, authorized amount					$ 65,000,000.0
Common stock repurchased value		$ 750,000		$ 4,217,000
Stock Repurchase Program [Member]
Equity Class Of Treasury Stock [Line Items]
Common stock shares repurchased	0	162,162	0	647,821
Common stock repurchased value		$ 700,000		$ 4,200,000

Stock-Based Compensation - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 27, 2020	Sep. 29, 2019	Sep. 27, 2020	Sep. 29, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense			$ 2,480,000	$ 1,910,000
Stock-based compensation expense			2,480,000	1,910,000
Common Share Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation forfeiture credit	$ 100,000
Recognized stock-based compensation expense		$ 100,000	200,000	700,000
Unrecognized stock compensation expense	$ 200,000		$ 200,000
Unrecognized stock compensation expense, recognition period			2022
Stock-based compensation expense		100,000	$ 200,000	700,000
Performance Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants vesting period			5 years
Share-based Compensation vested outstanding	45,000		45,000
Stock units issued, grant-date fair value	$ 0.0846		$ 0.0846
Performance Stock Units [Member] \| Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage of targeted number of shares			0.00%
Performance Stock Units [Member] \| Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage of targeted number of shares			200.00%
Performance Stock Units [Member] \| Market Vesting Conditions [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense	$ 700,000		$ 700,000
Stock-based compensation expense	700,000		700,000
Performance Stock Units [Member] \| Performance Vesting Conditions [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized stock-based compensation expense	0	0	0	0
Stock-based compensation expense	$ 0	0	$ 0	0
Non-Employee Board Of Directors [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting description			The quantity of shares that will vest ranges from 0% to 200% of the targeted number of shares. If the defined minimum targets are not met, then no shares will vest.
Employee and Non Employee Directors [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants vesting period			4 years
Method used to determine fair value of the options			Black-Scholes option pricing model
Stock options granted	0		0
Non-Employee Board Of Directors [Member] \| Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants vesting period			3 years
Recognized stock-based compensation expense	$ 1,000,000.0	300,000	$ 1,600,000	1,200,000
Unrecognized stock compensation expense	3,100,000		$ 3,100,000
Unrecognized stock compensation expense, recognition period			2023
Vesting description			The employee grants vest in one-third increments over a three-year period.
Stock-based compensation expense	$ 1,000,000.0	$ 300,000	$ 1,600,000	$ 1,200,000
Non-Employee Board Of Directors [Member] \| Restricted Stock Units (RSUs) [Member] \| First Anniversary [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			50.00%
Non-Employee Board Of Directors [Member] \| Restricted Stock Units (RSUs) [Member] \| Second Anniversary [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			50.00%

Stock-Based Compensation - Summary of Stock Option Activity (Detail) shares in Thousands	9 Months Ended	12 Months Ended
	Sep. 27, 2020 $ / shares shares	Dec. 29, 2019 $ / shares shares
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Options outstanding shares, beginning balance \| shares	1,774
Options, canceled \| shares	(165)
Options outstanding shares, ending balance \| shares	1,609	1,774
Options outstanding shares, exercisable \| shares	1,556
Options outstanding weighted average exercise price, beginning balance \| $ / shares	$ 11.34
Options, weighted average exercise price, canceled \| $ / shares	(12.35)
Options outstanding weighted average exercise price, ending balance \| $ / shares	11.23	$ 11.34
Options outstanding weighted average exercise price, exercisable \| $ / shares	$ 11.18
Option outstanding weighted average remaining term	3 years 3 months 21 days	4 years 3 months 29 days
Options exercisable weighted average remaining term	3 years 2 months 4 days

Stock-Based Compensation - Summary of RSU Activity (Detail) - Restricted Stock Units (RSUs) [Member] shares in Thousands	9 Months Ended
	Sep. 27, 2020 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares, Non-vested, beginning balance \| shares	463
Number of shares, Granted \| shares	1,574
Number of shares, Vested \| shares	(201)
Number of shares, Canceled \| shares	(430)
Number of shares, Non-vested, ending balance \| shares	1,406
Weighted Average Fair Value per Share, Non-vested, beginning balance \| $ / shares	$ 7.59
Weighted Average Fair Value per Share, Granted \| $ / shares	3.13
Weighted Average Fair Value per Share, Vested \| $ / shares	2.87
Weighted Average Fair Value per Share, Canceled \| $ / shares	3.87
Weighted Average Fair Value per Share, Non-vested, ending balance \| $ / shares	$ 3.68

Stock-Based Compensation - Summary of PSU Activity (Detail) - Performance Stock Units [Member] shares in Thousands	9 Months Ended
	Sep. 27, 2020 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares, Granted \| shares	1,475
Number of shares, Vested \| shares	(391)
Number of shares, Canceled \| shares	(332)
Number of shares, Non-vested, ending balance \| shares	752
Weighted Average Fair Value per Share, Granted \| $ / shares	$ 1.43
Weighted Average Fair Value per Share, Vested \| $ / shares	4.20
Weighted Average Fair Value per Share, Canceled \| $ / shares	1.50
Weighted Average Fair Value per Share, Non-vested, ending balance \| $ / shares	$ 1.42

Related Party Transactions - Additional Information (Detail) - USD ($) shares in Thousands, $ in Millions		9 Months Ended
	Aug. 17, 2020	Sep. 27, 2020	May 10, 2020
Related Party Transaction [Line Items]
Shares issued to related parties			130,000
Expense related to issuance of shares		$ 0.4
Vann A. Avedisian Trust [Member]
Related Party Transaction [Line Items]
Shares issued to related parties			41,311
Ownership percentage related party	2.69%
KGT Investments [Member]
Related Party Transaction [Line Items]
Shares issued to related parties			43,571
The Khimji Foundation [Member]
Related Party Transaction [Line Items]
Shares issued to related parties			45,118