A customer holds a bag of food outside a Chipotle restaurant in New York on January 12, 2024.
Angus Mordaunt | Bloomberg | getty images
Chipotle Mexican Grill It reported mixed quarterly results on Tuesday, even though traffic to its restaurants was a quarter higher.
The company’s shares fell 3% in extended trading.
Here’s how the company reported compared to what Wall Street expected, based on LSEG’s survey of analysts.
- Earnings per share: Adjusted 27 cents vs. expected 25 cents
- Revenue: $2.79 billion vs. Expected $2.82 billion
Chipotle reported third-quarter net income of $378.4 million, or 28 cents per share, compared with $313.2 million, or 23 cents per share, in the year-ago quarter.
The company’s food and beverage costs increased during the quarter. That’s partly because of Chipotle’s decision to reemphasize generous portions after social media backlash over the size of its burrito bowls this summer.
Excluding items, the company earned 27 cents per share.
net sales It increased 13% to $2.79 billion.
Same-store sales rose 6%, just below StreetAccount estimates of 6.3%. Traffic to restaurants increased 3.3% in the quarter, continuing to overcome an overall slump in foot traffic across the industry. While many consumers are choosing to eat out less, Chipotle has benefited by attracting a base of wealthy customers willing to pay more for burritos and bowls.
“We’re seeing growth across all income groups right now,” interim CEO Scott Boatwright said Tuesday on CNBC’s “Closing Bell: Overtime.”
Boatwright said demand was weak early in the third quarter, but sales accelerated throughout the period, especially with Chipotle relaunching its smoked brisket. The limited-time menu item is currently the priciest protein, surpassing the chain’s steak and beef barbacoa options.
Boatwright, formerly Chipotle’s chief operating officer, took over to lead the company after former CEO Brian Niccol left at the end of August. Starbucks‘conversion. During the company’s conference call Tuesday, Boatwright reassured investors that the chain’s strategy would not change despite the leadership shakeup.
“I have worked with a talented management team to create and advance a successful strategy and will continue to execute on it,” he said.
Digital sales accounted for 34% of the chain’s quarterly food and beverage sales.
The company opened 86 new locations during the quarter, 73 of which included a “Chipotlane” dedicated to picking up online orders.
Chipotle is also investing in new equipment to improve preparation and cooking. The company plans to roll out the new produce slicer to all restaurants by next summer. Chipotle has also added double-sided grills to 74 restaurants and plans to announce a strategy to add the equipment to new and existing restaurants early next year.
Chipotle reiterated its outlook for mid-to-high single-digit same-store sales growth for the full year. The company also expects to open 285 to 315 new restaurants this year.
By 2025, Chipotle plans to open 315 to 345 new stores. More than 80% of those restaurants will include Chipotlane.
