Food is served at a Chipotle restaurant on in Chicago, Illinois.
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Chipotle Mexican Grill on Thursday reported quarterly earnings that beat expectations, helped by higher menu prices for its burritos and bowls.
Shares of the corporate rose greater than 2% in prolonged buying and selling.
Here’s what the corporate reported in contrast with what Wall Street was anticipating, based mostly on a survey of analysts by LSEG, previously identified as Refinitiv:
- Earnings per share: $11.36 adjusted vs. $10.55 anticipated
- Revenue: $2.47 billion, in keeping with expectations
The burrito chain reported third-quarter web revenue of $313.2 million, or $11.32 per share, up from $257.1 million, or $9.20 per share, a 12 months earlier. Excluding company restructuring prices, Chipotle earned $11.36 per share.
Beef and queso prices rose this quarter, largely offsetting final 12 months’s menu worth hikes. Earlier this month, Chipotle raised menu prices for the primary time in additional than a 12 months, citing inflation.
The firm had paused its aggressive worth hikes earlier this 12 months as customers pulled again their restaurant spending. Still, executives have maintained that Chipotle has pricing energy and extra room to run.
“I believe the Chipotle worth, after we have not raised prices in over a 12 months till this newest motion, is coming by, and persons are selecting to dine at Chipotle as a result of we’re very inexpensive,” CFO Jack Hartung stated on the corporate’s convention name.
Customers in California can even count on to pay much more for his or her burritos subsequent 12 months. Executives stated the corporate will cross alongside the higher labor prices that may come from California elevating wages for fast-food employees to $20 an hour in April. About 15% of Chipotle’s eating places are in California.
“We are positively going to cross this on, we simply have not made a remaining resolution on as to what degree but,” Hartung stated.
Chipotle’s web gross sales climbed 11.3% to $2.47 billion. Same-store gross sales rose 5%, beating StreetAccount estimates of 4.6%. The firm credited higher transactions and menu prices for the quarter’s same-store gross sales progress. Chipotle prices have been up 2.8% in contrast with the year-ago interval, resulting from final 12 months’s worth hikes.
CEO Brian Niccol stated that site visitors traits have remained robust in October, helped by the latest return of carne asada as a limited-time menu merchandise.
Chipotle opened 62 new eating places throughout the quarter. All however eight of these areas featured a “Chipotlane,” a drive-thru lane reserved for selecting up digital orders.
Looking to 2024, the corporate expects that it’ll open 285 to 315 new eating places.
Chipotle additionally reiterated its forecast for 2023 same-store gross sales progress within the mid-to-high single digit vary.