Chipotle shares jump 7% as CEO sees continued same‑store sales growth
Chipotle’s stock rose sharply after the chain reported mixed quarterly results but highlighted rising traffic and same‑store sales.
Chipotle Mexican Grill announced mixed third‑quarter results on Wednesday, noting a decline in its restaurant‑level operating margin while traffic and same‑store sales continued to rise.
Shares of the fast‑casual chain rose 7% in extended trading after the earnings call.
Chief Executive Officer Scott Boatwright said the company is still early in its “recipe for growth” initiatives, which he believes are gaining traction despite broader consumer and industry headwinds.
He added that traffic, which had softened in early October, has returned to growth and expressed “high confidence” in the company’s performance for the remainder of the fourth quarter.
Chief Financial Officer Adam Rymer said Chipotle expects fourth‑quarter same‑store sales growth of about 2%.
Quarterly financial highlights
Fiscal third‑quarter net income fell to $339.9 million, or 27 cents per share, from $382.1 million, or 29 cents per share, a year earlier.
Restaurant‑level operating margin decreased to 23.3% from 24.5% the prior year.
Excluding restaurant asset impairment charges and stock‑based compensation, earnings were 27 cents per share.
Net sales rose 9.6% to $3.29 billion, driven by new restaurant openings.
The chain opened 84 company‑owned restaurants and five international locations operated by licensees during the quarter.
Sales trends and consumer behavior
Chipotle reported same‑store sales growth for the third straight quarter, with stores open at least 13 months seeing a 2.1% increase, helped by a 1.3% rise in average check size.
Boatwright highlighted that low‑income consumers outperformed higher‑income diners during the quarter, and that this performance was not driven by discounts, as spending peaked in September when promotions were minimal.
Earlier supply concerns, including a July cyclospora scare and an August temporary removal of jalapeños from Minnesota locations due to a potential salmonella link, did not prevent the chain from achieving growth.
Overall, Chipotle’s leadership remains optimistic about the year‑end outlook, citing the momentum from recent traffic gains and ongoing growth initiatives.
