Chipotle Tops Sales Expectations as Price Hikes Buoy Results
(Bloomberg) -- Chipotle Mexican Grill Inc.’s sales last quarter topped analysts’ estimates as the restaurant chain benefited from price increases and digital ordering along with vaccination efforts that helped bring some customers back in stores.
- The key measure of same-store sales rose 15.1% in the third quarter, Chipotle said on Thursday. Analysts estimated a 13.7% gain on average, according to data compiled by Bloomberg. Revenue topped projections.
- See more details.
- The results suggest customers won’t be deterred by higher prices. The chain raised its menu prices by as much as 4% earlier this year as the industry faces a shortage of staff along with increasing raw ingredient costs.
- Chief Executive Officer Brian Niccol has been bullish on dine-in business, while also promoting more delivery options. And the company’s experimenting with more plant-based items, including chorizo that’s made with pea protein instead of meat.
- Restaurant margin in the quarter was 23.5%, beating estimates of 22.7%. Worker pay is rising across the industry as companies try to attract and keep employees, raising costs. Unlike many of its peers, Chipotle, which has about 2,800 locations, doesn’t franchise.
- The company said it still expects to open about 200 new locations this year, despite construction delays and higher costs that are cropping up amid supply-chain woes. Niccol has said the company can reach 6,000 stores in North America in the long term.
- Chipotle’s shares rose 1.4% at 4:28 p.m. after regular trading in New York. The stock was up 33% this year through Thursday’s close, outpacing the 21% gain of the S&P 500 index.
- Read the TOPLive blog on Chipotle’s results.
- See Chipotle estimates.
- Read the statement.
©2021 Bloomberg L.P.