Financial Data and Key Metrics Changes - Sales grew over 6% to reach $2.9 billion, including a comparable sales decline of 0.4% [8][44] - Digital sales represented 35.4% of total sales [8] - Restaurant-level margin was 26.2%, a decrease of 130 basis points year over year [8][44] - Adjusted diluted earnings per share was $0.29, representing 7% growth over last year [8][44] - Cost of sales increased to 29.2%, up about 40 basis points from last year [47] - Labor costs for the quarter were 25%, an increase of about 60 basis points from last year [51] Business Line Data and Key Metrics Changes - The company opened 57 new restaurants, including 48 Chipotle lanes [8] - The average cost of a popular entree is still under $10, which is about 20% to 30% below comparable fast-casual meals [15] - New restaurant economics remain strong, with year two cash-on-cash returns around 60% [38] Market Data and Key Metrics Changes - The company is facing a slowdown in consumer spending, impacting transaction trends [10][11] - Current underlying trends would result in a low single-digit full-year comparable sales growth [12] Company Strategy and Development Direction - The company focuses on five key strategies: successful restaurant operations, technology and innovation, brand visibility, people leadership, and expanding access through new restaurant openings [12][13] - The company aims to expand to 7,000 restaurants in the US and Canada [37][42] - Marketing plans will ramp up in the summer to enhance visibility and relevance [30] Management's Comments on Operating Environment and Future Outlook - Management noted that elevated consumer uncertainty is impacting spending habits, leading to a slowdown in transaction trends [10][11] - The company remains optimistic about returning to positive transaction growth in the second half of the year [12][46] - Management emphasized the strength of the Chipotle brand and its value proposition [11][63] Other Important Information - The company has a strong balance sheet with $2.1 billion in cash and no debt [55] - The board authorized an additional $400 million for share repurchase [55] Q&A Session Summary Question: How does the company view competition in the fast-casual space? - Management expressed confidence that competition does not materially impact their business, often seeing increased traffic in areas with new competitors [62][63] Question: What is the impact of tariffs on new store CapEx? - Management indicated that tariffs could lead to a mid-single-digit increase in new store build costs, but the impact appears minimal at this point [66][68] Question: What are the underlying factors for the slowdown in consumer spending? - Management attributed the slowdown to economic uncertainty and consumers eating at home more frequently, rather than issues specific to Chipotle [73][74] Question: How does the company plan to address digital sales performance? - Management acknowledged the need for improvement in digital sales and is working on removing friction points in the app to enhance customer experience [113][114] Question: What initiatives are in place to drive positive transaction comps? - Management highlighted the importance of operational efficiency, marketing initiatives, and digital enhancements to drive positive transaction growth in the second half of the year [134]

Part I - Financial Information [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20FINANCIAL%20STATEMENTS) For the first quarter ended March 31, 2025, Chipotle reported total revenue of **$2.88 billion**, a **6.4% increase** year-over-year, and net income of **$386.6 million**, up from **$359.3 million** in the prior-year period. Total assets decreased slightly to **$9.04 billion**. The financial statements also reflect a **50-for-1 stock split** effected in June 2024, with all share and per-share data retroactively adjusted - On June 26, 2024, the company executed a **50-for-1 stock split**. All share and per-share information in this report has been retroactively adjusted to reflect this split[17](index=17&type=chunk) [Condensed Consolidated Balance Sheets](index=3&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Balance Sheet Summary (as of March 31, 2025 vs. December 31, 2024) | Balance Sheet Item | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $1,661,648 | $1,780,587 | | **Total Assets** | $9,044,094 | $9,204,374 | | **Total Current Liabilities** | $1,091,538 | $1,168,768 | | **Total Liabilities** | $5,553,222 | $5,548,828 | | **Total Shareholders' Equity** | $3,490,872 | $3,655,546 | [Condensed Consolidated Statements of Income](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20AND%20COMPREHENSIVE%20INCOME) Income Statement Summary (Three months ended March 31) | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $2,875,253 | $2,701,848 | +6.4% | | **Income from Operations** | $479,250 | $441,292 | +8.6% | | **Net Income** | $386,599 | $359,287 | +7.6% | | **Diluted EPS** | $0.28 | $0.26 | +7.7% | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Cash Flow Summary (Three months ended March 31) | Cash Flow Activity | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $557,075 | $569,234 | | Net cash provided by/(used in) investing activities | $6,079 | ($301,039) | | Net cash used in financing activities | ($585,174) | ($100,074) | - Cash used in financing activities increased significantly, driven by a large increase in common stock repurchases to **$553.8 million** in Q1 2025 from **$27.0 million** in Q1 2024[14](index=14&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=NOTES%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) - As of March 31, 2025, the company operated **3,781 restaurants**, including **3,697** in the U.S. and **84** internationally, plus **five** licensed locations[16](index=16&type=chunk) - During Q1 2025, the company repurchased **$553.7 million** of its common stock. As of March 31, 2025, **$874.7 million** remained authorized for future repurchases, which includes a new **$400 million** authorization approved in March 2025[34](index=34&type=chunk) - The company is facing a shareholder class action lawsuit alleging that statements regarding portion sizes were materially false and misleading. The accrued legal liability for various matters was **$21.2 million** as of March 31, 2025[46](index=46&type=chunk)[49](index=49&type=chunk) [Management's Discussion and Analysis (MD&A)](index=16&type=section&id=Item%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management reported a **6.4% increase** in total revenue to **$2.9 billion**, primarily driven by new restaurant openings. However, comparable restaurant sales decreased by **0.4%** due to a **2.3% decline** in transaction volume, which management attributes to a slowdown in consumer spending and inclement weather. Operating costs as a percentage of revenue rose due to inflation and wage increases, though G&A expenses declined. The company plans to open **315-345 new restaurants** in 2025, with a strong focus on Chipotlane locations. Liquidity remains strong with **$2.0 billion** in cash and investments [Operating Results and Sales Trends](index=17&type=section&id=Results%20of%20Operations) Q1 2025 Key Performance Metrics (vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $2.9 billion (+6.4%) | $2.7 billion | | Comparable Restaurant Sales | -0.4% | +7.0% | | Transactions | -2.3% | +5.4% | | Average Check | +1.9% | +1.6% | | Diluted EPS | $0.28 (+7.7%) | $0.26 | - The decrease in comparable restaurant sales was attributed to a **2.3% decline** in transactions, reflecting a slowdown in consumer spending and periods of inclement weather[60](index=60&type=chunk) - Digital sales represented **35.4%** of total food and beverage revenue for the quarter[60](index=60&type=chunk) [Restaurant Development](index=17&type=section&id=Restaurant%20Development) - Opened **57 new restaurants** in Q1 2025, of which **48 (84%)** included a Chipotlane[61](index=61&type=chunk) - The company expects to open approximately **315 to 345** company-owned restaurants in 2025, with at least **80%** featuring a Chipotlane[61](index=61&type=chunk) - Two licensed restaurants were opened in the Middle East during the quarter, bringing the total to **five**[61](index=61&type=chunk)[64](index=64&type=chunk) [Cost Analysis](index=18&type=section&id=Cost%20Analysis) Operating Costs as a Percentage of Total Revenue (Q1 2025 vs Q1 2024) | Cost Category | Q1 2025 | Q1 2024 | Change (basis points) | | :--- | :--- | :--- | :--- | | Food, beverage and packaging | 29.2% | 28.8% | +40 bps | | Labor | 25.0% | 24.4% | +60 bps | | Occupancy | 5.2% | 5.0% | +20 bps | | General and administrative | 6.0% | 7.6% | -160 bps | - Food costs increased due to inflation and higher usage of avocados, dairy, and chicken[67](index=67&type=chunk) - Labor costs rose due to restaurant wage inflation, including minimum wage increases in California[69](index=69&type=chunk) - General and administrative expenses decreased by **$31.8 million**, primarily due to the absence of the biennial All Managers' Conference held in Q1 2024 and lower legal contingency costs[73](index=73&type=chunk) [Liquidity and Capital Resources](index=21&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2025, the company had a cash and marketable investments balance of **$2.0 billion**[77](index=77&type=chunk) - Primary uses of cash flow are capital for new restaurant construction and share repurchases[77](index=77&type=chunk) - The company has a **$500 million** undrawn revolving credit facility[78](index=78&type=chunk) [Market Risk Disclosures](index=22&type=section&id=Item%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURE%20ABOUT%20MARKET%20RISK) The company identifies its primary market risks as commodity price volatility, interest rate fluctuations, and foreign currency exchange. Commodity risks for ingredients and materials are managed through various supplier pricing agreements. Interest rate risk exists on its **$2.1 billion** of cash and investments. Foreign currency risk is considered not material due to the predominance of U.S. operations - The company is exposed to commodity price risks for food, packaging, and construction materials, which it attempts to mitigate through a mix of fixed and formula-based pricing protocols with suppliers[85](index=85&type=chunk) - Interest rate risk exposure comes from its **$2.1 billion** in cash, cash equivalents, and investments[86](index=86&type=chunk) [Controls and Procedures](index=22&type=section&id=Item%204.%20CONTROLS%20AND%20PROCEDURES) Based on an evaluation conducted by management, including the CEO and CFO, the company's disclosure controls and procedures were deemed effective as of March 31, 2025. There were no material changes to internal controls over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[89](index=89&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[90](index=90&type=chunk) Part II - Other Information [Legal Proceedings](index=22&type=section&id=Item%201.%20LEGAL%20PROCEEDINGS) For information regarding legal proceedings, the company refers readers to Note 11, "Commitments and Contingencies," within the condensed consolidated financial statements - Information on legal proceedings is detailed in Note 11 of the financial statements[92](index=92&type=chunk) [Stock Repurchases](index=23&type=section&id=Item%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) During the first quarter of 2025, Chipotle repurchased **10,224,763 shares** of its common stock for a total of approximately **$553.7 million**, at an average price of **$54.15 per share**. The board approved an additional **$400 million** for repurchases in March 2025 Share Repurchases in Q1 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | January 2025 | 3,430,595 | $57.71 | | February 2025 | 3,019,040 | $55.10 | | March 2025 | 3,775,128 | $50.16 | | **Total Q1** | **10,224,763** | **$54.15** | - The total available for future repurchases as of March 31, 2025, was **$874.7 million**, which includes a new **$400 million** authorization approved by the Board on March 27, 2025[96](index=96&type=chunk)

For the quarter ended March 2025, Chipotle Mexican Grill (CMG) reported revenue of $2.88 billion, up 6.4% over the same period last year. EPS came in at $0.29, compared to $0.27 in the year-ago quarter. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. Here is how Chipotle performed in the just reported quarter in terms of the metrics most widely monitored and pr ...

Core Viewpoint - Chipotle Mexican Grill reported quarterly earnings of $0.29 per share, exceeding the Zacks Consensus Estimate of $0.28 per share, and showing an increase from $0.27 per share a year ago, indicating a positive earnings surprise of 3.57% [1][2] Financial Performance - The company achieved revenues of $2.88 billion for the quarter ended March 2025, which was 1.49% below the Zacks Consensus Estimate, compared to $2.7 billion in the same quarter last year [2] - Over the last four quarters, Chipotle has surpassed consensus EPS estimates four times but has only topped consensus revenue estimates once [2] Stock Performance - Chipotle shares have declined approximately 21.9% since the beginning of the year, contrasting with the S&P 500's decline of 10.1% [3] - The current Zacks Rank for Chipotle is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.36 on revenues of $3.24 billion, and for the current fiscal year, it is $1.26 on revenues of $12.52 billion [7] - The trend of estimate revisions for Chipotle is currently mixed, which may change following the recent earnings report [6] Industry Context - The Retail - Restaurants industry, to which Chipotle belongs, is currently ranked in the bottom 20% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

Core Viewpoint - Chipotle Mexican Grill has lowered its annual comparable sales growth forecast due to persistent inflation and economic uncertainty, leading to a decline in consumer dining out, which resulted in a 3% drop in the company's shares after hours [1][5]. Financial Performance - The company reported total revenue of $2.85 billion for the first quarter, which was below analysts' average estimates of $2.95 billion [4]. - Comparable restaurant sales fell by 0.4% in the first quarter ended March 31, a significant decline compared to a 5.4% increase in the previous quarter [4][6]. - Restaurant-level operating margin decreased to 26.2% in the first quarter, down from 27.5% a year ago [6]. Market Conditions - Economic factors such as sticky inflation and rising living costs have led consumers to reduce restaurant visits, impacting Chipotle's sales [1][2]. - The company has noted that consumer uncertainty began to rise in February, with trends of reduced spending continuing into April [3]. Tariff Impact - Analysts have indicated that Chipotle may face challenges from import tariffs on key ingredients like avocados and beef, which could affect costs [3][6]. - In January, the company estimated that tariffs on Mexico would result in a roughly 60-basis-point increase in raw material costs for the year [7]. Operational Adjustments - To mitigate the impact of rising input costs, Chipotle has invested in technology to optimize kitchen operations, including the introduction of produce slicers and three-tiered rice cookers [7].

Financial Performance - Total revenue for Q1 2025 was $2.9 billion, a 6.4% increase compared to Q1 2024[4] - Net income for Q1 2025 was $386.6 million, or $0.28 per diluted share, compared to $359.3 million, or $0.26 per diluted share in Q1 2024[10] - Adjusted net income for the first quarter of 2025 was $396,800, compared to $369,255 in the same quarter of 2024, reflecting an increase of 7.5%[29] - Income from operations for Q1 2025 was $479,250, representing 16.7% of total revenue, compared to $441,292 or 16.3% in Q1 2024[38] - The operating margin increased to 16.7% from 16.3% in Q1 2024[8] - Restaurant level operating margin for Q1 2025 was $753,622, representing 26.2% of total revenue, slightly down from 27.5% in Q1 2024[38] Sales and Transactions - Comparable restaurant sales decreased by 0.4%, with a 2.3% decline in transactions offset by a 1.9% increase in average check[4] - Comparable restaurant sales decreased by 0.4% in the first quarter of 2025, following a 5.4% increase in the previous quarter[24] - Average restaurant sales for the three months ended March 31, 2025, were $3,186, slightly down from $3,213 in the previous quarter, a decrease of 0.8%[24] - Digital sales accounted for 35.4% of total food and beverage revenue[4] Costs and Expenses - Labor costs were 25.0% of total revenue, up from 24.4% in Q1 2024, primarily due to wage inflation[7] - General and administrative expenses decreased to $172,783, accounting for 6.0% of total revenue, down from 7.6% in the previous year[38] - Depreciation and amortization expenses increased to $87,211, making up 3.0% of total revenue, compared to 3.1% in the previous year[38] - Pre-opening costs rose to $8,210, maintaining a consistent 0.3% of total revenue year-over-year[38] - Impairment, closure costs, and asset disposals were reported at $6,168, consistent at 0.2% of total revenue for both years[38] Tax and Liabilities - The effective income tax rate for Q1 2025 was 22.9%, up from 22.0% in Q1 2024[9] - Total liabilities remained relatively stable, with a slight increase from $5,548,828 as of December 31, 2024, to $5,553,222 as of March 31, 2025[20] Growth and Expansion - The company opened 57 new restaurants in Q1 2025, with 48 featuring a Chipotlane[5] - The company plans to open 315 to 345 new company-owned restaurants in 2025, with over 80% expected to have a Chipotlane[14] - Company-owned restaurants opened during the first quarter of 2025 totaled 57, while 119 were opened in the previous quarter, indicating a decrease of 52.9%[24] Cash Flow - The company reported a net cash provided by operating activities of $557,075 for the first quarter of 2025, compared to $569,234 in the same period of 2024, a decrease of 2.1%[22] - The company repurchased common stock amounting to $553,796 during the first quarter of 2025, compared to $27,005 in the same period of 2024[22] Current Assets - Total current assets decreased from $1,780,587 as of December 31, 2024, to $1,661,648 as of March 31, 2025, a decline of 6.7%[20]

CHIPOTLE HIGHLIGHTS BRAND STRENGTH AND INNOVATION IN FIRST QUARTER RESULTSNEWPORT BEACH, Calif., April 23, 2025 /PRNewswire/ -- Chipotle Mexican Grill, Inc. (NYSE: CMG) today reported financial results for its first quarter ended March 31, 2025.First quarter highlights, year over year: Total revenue increased 6.4% to $2.9 billion Comparable restaurant sales decreased 0.4% Operating margin was 16.7%, an increase from 16.3% Restaurant level operating margin1 was 26.2%, a decrease from 27.5% Diluted earnings ...

Shares of fast casual food giant Chipotle (NYSE: CMG ) (NEOE: CMGS:CA ) are down about 22% both in the last six months and year-to-date. Chipotle's stock is also down roughly 20% in This account is managed by Noah's Arc Capital Management. Our goal is provide Wall Street level insights to main street investors. Our research focus is mainly on 20th century stocks (old economy) undergoing a 21st century transformation, but occasionally we'll write on companies that help transform 20th century firms as well. W ...

Group 1: Earnings Season Overview - The earnings season has commenced, with several consumer-facing companies, including Chipotle Mexican Grill (CMG), American Airlines (AAL), and Skechers (SKX), scheduled to report this week [1] - Guidance from these companies will be critical in assessing the state of the consumer and their post-earnings stock performance [1][8] Group 2: Chipotle Mexican Grill (CMG) - CMG shares have declined nearly 25% in 2025, underperforming the S&P 500, with negative EPS revisions leading to a Zacks Consensus EPS estimate of $0.28, down nearly 10% since January [2] - Year-over-year growth is projected at 3.7%, with sales expected to increase by 8.5% to $2.9 billion, reflecting a 5% downward revision [3] - CMG has consistently posted double-digit percentage year-over-year sales growth, with the latest period showing sales of $2.8 billion, a 13% improvement [5] Group 3: American Airlines (AAL) - AAL's guidance will be a significant factor in its earnings release, especially following Delta Air Lines' (DAL) recent results, which indicated a cautious outlook due to economic uncertainty [10] - Analysts have reduced their EPS expectations for AAL, reflecting a broader theme of uncertainty that is likely to influence the stock's movement post-earnings [11][13] Group 4: Skechers (SKX) - SKX shares have dropped over 30% in 2025, following a strong multi-year performance, with analysts cutting EPS expectations by 23% to a current estimate of $1.18 [14][16] - Revenue expectations for SKX remain stable, with quarterly sales projected at $2.4 billion, while margins will be a key focus in the earnings report [16][19] - The stock has seen a decline of approximately 9% over the past two years, suggesting that much of the negative sentiment may already be reflected in the share price [19]

Core Viewpoint - Chipotle Mexican Grill, Inc. is experiencing a decline in stock price ahead of its first-quarter earnings report, despite announcing its first expansion into Mexico, which may indicate a broader international strategy [1]. Financial Performance Expectations - Analysts anticipate Chipotle will report earnings of 28 cents per share on revenue of $2.93 billion, reflecting year-over-year increases of 3.7% and 8.5% respectively [2]. - The stock has a history of mixed earnings reactions, averaging a 6.6% move in either direction over the past eight quarters, with the options market indicating a potential next-day swing of 11.7% [2]. Stock Performance Trends - Chipotle's stock has been in a downtrend for most of 2025, with a year-to-date decline of 24.9% and a 12-month decline of 20.6% [3]. - Recent attempts to rally have been consistently rejected at the 40-day moving average, indicating ongoing bearish sentiment [3]. Analyst Ratings and Price Targets - BofA Global Research has reduced its price target for Chipotle to $64 from $71, which still represents a 40% premium to current stock levels [6]. - The average 12-month price objective for the stock stands at $63, suggesting potential for further downward revisions [6]. Volatility Assessment - The stock's Schaeffer's Volatility Scorecard (SVS) is at 25 out of 100, indicating that it has underperformed relative to the volatility expectations priced into its options [7].