Financial Data and Key Metrics Changes - Sales grew 7.5% year-over-year to reach $3 billion, with a comparable sales increase of 0.3% [4][23] - Digital sales accounted for 36.7% of total sales [4] - Restaurant-level margin was 24.5%, a decline of 100 basis points year-over-year [4][23] - Adjusted diluted EPS was $0.29, an increase of 7% over last year [4][23] - Full-year comps are now anticipated to decline in the low single-digit range [23] Business Line Data and Key Metrics Changes - The company opened 84 new restaurants, including 64 Chipotlanes [4] - Marketing costs increased to 3% of sales, up 90 basis points from last year [26] - Cost of sales was 30%, a decrease of 60 basis points from last year, primarily due to menu price increases and cost efficiencies [24] Market Data and Key Metrics Changes - The consumer cohort with household income below $100,000 represents about 40% of total sales and is dining out less often due to economic concerns [5] - The 25-35 age group, which is a significant demographic for the company, is facing challenges such as unemployment and increased student loan repayments [5] Company Strategy and Development Direction - The company aims to strengthen its consumer flywheel by improving execution, enhancing communication of value, and accelerating menu and digital innovation [6][21] - Five key strategies include running successful restaurants, sustaining world-class leadership, amplifying technology and innovation, expanding access, and enhancing brand visibility [7] - The company plans to expand its restaurant openings in North America and internationally, targeting 7,000 restaurants long-term [18][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the third quarter performance fell short due to macroeconomic pressures but expressed confidence in returning to positive transaction growth [4][22] - The company is focused on delivering value and improving guest experiences despite the challenging economic backdrop [24][66] - Management anticipates inflation to remain in the mid-single-digit range and does not plan to fully offset this in the near term [24] Other Important Information - The company is rolling out a High-Efficiency Equipment Package (HEAP) to improve throughput and culinary execution [10][11] - A catering pilot program has been launched, with plans for a full marketing push to drive demand [15] - The company is working on a new creative campaign to better communicate its value proposition [16] Q&A Session Summary Question: Pricing strategy for 2026 - Management indicated a slow and measured approach to pricing in 2026, focusing on traffic growth over margin expansion [31][32] Question: Confidence in returning to mid-single-digit same-store sales - Management remains confident in returning to mid-single-digit same-store sales, depending on consumer conditions [35] Question: Traffic perspective and losses - Significant pullback is observed from the consumer cohort under $100,000, with losses attributed to dining out less rather than competition [41] Question: HEAP throughput results - Early results from HEAP indicate improved labor efficiency and guest experience, with positive feedback from pilot locations [46] Question: Menu innovation for 2026 - Management plans to increase the pace of culinary innovation, including new limited-time offers and sauces [87]

Financial Data and Key Metrics Changes - Sales grew 7.5% year-over-year to reach $3 billion, with a comparable sales increase of 0.3% [4][24] - Digital sales accounted for 36.7% of total sales [4] - Restaurant-level margin was 24.5%, a decline of 100 basis points year-over-year [4][24] - Adjusted diluted EPS was $0.29, an increase of 7% over the previous year [4][24] - Full-year comparable sales are anticipated to decline in the low single-digit range [24] Business Line Data and Key Metrics Changes - The company opened 84 new restaurants, including 64 Chipotlanes [4] - Marketing costs increased to 3% of sales, up 90 basis points from last year, reflecting accelerated marketing spend [27] - Cost of sales was 30%, a decrease of 60 basis points from last year, primarily due to menu price increases and cost efficiencies [25] Market Data and Key Metrics Changes - The consumer cohort with household income below $100,000 represents about 40% of total sales and is dining out less often due to economic concerns [5] - The 25 to 35-year-old age group, which is a significant demographic for the company, is facing headwinds such as unemployment and increased student loan repayments [5] Company Strategy and Development Direction - The company aims to strengthen its consumer flywheel by improving execution, enhancing communication of value, and accelerating menu and digital innovation [6][22] - Five key strategies include running successful restaurants, sustaining world-class leadership, amplifying technology and innovation, and expanding access through new restaurant openings [7][19] - The company plans to expand its catering business, which currently represents 1-2% of sales, compared to 5-10% for peers [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the third quarter performance fell short of expectations due to macroeconomic pressures [4] - The company is focused on transaction-led growth and aims to return to consistent positive transaction growth [23] - Management expressed confidence in the long-term growth potential, targeting 7,000 restaurants in North America and expanding internationally [23][21] Other Important Information - The company is rolling out a High-Efficiency Equipment Package to improve throughput and culinary execution [11][12] - The effective tax rate for Q3 was 23.1% for GAAP and 22.8% for non-GAAP [29] - The company ended the quarter with $1.8 billion in cash and no debt, having repurchased $687 million of its stock [29][30] Q&A Session Summary Question: Pricing strategy for 2026 - Management indicated a slow and measured approach to pricing in 2026, with plans to not fully offset inflation in the near term [32][33] Question: Confidence in returning to mid-single-digit same-store sales - Management believes it is possible, depending on consumer conditions, with a focus on transaction-led growth [36][37] Question: Comp expectations for Q4 - Management expects Q4 comps to decline in the low to mid-single-digit range due to ongoing economic uncertainty [38][39] Question: High-Efficiency Equipment Package results - Early results show labor efficiency gains and improved guest experience scores, with positive feedback from pilot locations [41][42] Question: Menu innovation for 2026 - Management plans to increase the pace of culinary innovation, including new limited-time offers and sauces [76][78]

Financial Data and Key Metrics Changes - Consolidated revenue for Q4 was $9.6 billion, reflecting a 5% increase year-over-year, driven by 2% net new company-operated store growth and a 1% increase in global comparable store sales [23][24] - Earnings per share (EPS) for Q4 was $0.52, down 34% from the prior year, primarily due to investments in the business and restructuring costs [28][29] - Consolidated operating margin was 9.4%, contracting 500 basis points from the prior year, mainly due to inflation and investments in labor [28][29] Business Line Data and Key Metrics Changes - U.S. comparable store sales were flat year-over-year, with ticket up 1%, reflecting fewer discount-driven offers [23] - International segment reported 9% year-over-year net revenue growth in Q4, reaching over $2 billion, with strong performance in China, Japan, the U.K., and Mexico [25][26] - The delivery business in the U.S. grew nearly 30% year-over-year in Q4, surpassing $1 billion in sales for the full fiscal year [10] Market Data and Key Metrics Changes - North America company-operated comparable store sales improved to flat year-over-year, with positive comp growth in Canada [6][23] - Starbucks China achieved 2% comparable store sales growth in Q4, driven by a 9% improvement in comparable transactions [25][26] - The international segment's revenue reached an all-time high of $7.8 billion for the fiscal year [15] Company Strategy and Development Direction - The company is focused on its "Back to Starbucks" strategy, emphasizing customer connection and craft, while also innovating across various access points [5][39] - Investments are being made in staffing and operational hours to enhance customer experience and service speed [9][10] - The company is piloting a new coffee house prototype with lower build costs and optimized space utilization [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the turnaround strategy, noting that Q4 marked the first quarter of global comparable sales growth in seven quarters [32] - The holiday season is anticipated to be a significant opportunity for the company, with a focus on delivering a warm and welcoming customer experience [17] - Management acknowledged the challenges posed by inflation and dynamic coffee prices but remains optimistic about long-term growth potential [66][68] Other Important Information - The company closed 107 net stores globally as part of its restructuring efforts, which are expected to be slightly accretive to profitability [29][30] - The company plans to continue its disciplined capital deployment and improve profitability of new coffee houses [30][31] - The company announced an increase in its quarterly dividend, marking the 15th consecutive year of increases [33] Q&A Session Summary Question: Concerns about the "Back to Starbucks" strategy - Management clarified that the strategy is comprehensive and aims to enhance customer connection and craft across all service channels, not just in-cafe [36][39] Question: Feedback on the Protein Platform and pricing - Management reported positive feedback on the Protein Platform, with customers appreciating the customization and value it offers [42][44] Question: Progress of the Green Apron Service model - Management indicated that the Green Apron Service is building momentum, with initial pilot stores outperforming others, and expects continued improvement as teams adapt [49][51] Question: Impact of store closures on profitability - Management stated that closures were based on customer experience viability and financial performance, and they expect some sales transfer to nearby stores [70][72] Question: Future pricing strategies and value perceptions - Management emphasized a strategic approach to pricing, monitoring value perception closely while navigating inflation challenges [80][81]

Financial Data and Key Metrics Changes - The company reported consolidated revenue of $9.6 billion for Q4, reflecting a 5% increase year-over-year, driven by 2% net new company-operated store growth and a 1% increase in global comparable store sales [23][24] - Earnings per share (EPS) for Q4 was $0.52, down 34% from the prior year, primarily due to inflation and investments in the Back to Starbucks strategy [29][33] - The consolidated operating margin for Q4 was 9.4%, contracting 500 basis points from the prior year, mainly due to inflation and increased labor costs [28][29] Business Line Data and Key Metrics Changes - U.S. comparable store sales were flat year-over-year, with ticket prices up 1%, reflecting fewer discount-driven offers [23][24] - The international segment reported a 9% year-over-year net revenue growth in Q4, reaching over $2 billion, with strong performance in China, Japan, the U.K., and Mexico [25][26] - The channel development segment saw a 16% year-over-year revenue growth due to higher revenue from the Global Coffee Alliance [27] Market Data and Key Metrics Changes - The international business ended the year with record revenues of $7.8 billion, opening 316 net new coffee houses in Q4, totaling over 900 for fiscal 2025 [15] - Starbucks China achieved 2% comparable store sales growth in Q4, driven by a 9% improvement in comparable transactions [25][26] - The U.S. licensed store portfolio revenue declined in Q4, primarily due to trends in grocery and retail channels, while travel segments showed positive growth [24][25] Company Strategy and Development Direction - The company is focused on its "Back to Starbucks" strategy, emphasizing customer connection and craft, with significant investments in staffing and service standards [5][8] - The rollout of the Green Apron Service aims to enhance customer experience and operational efficiency, with positive early results observed [9][10] - The company is piloting a new coffee house prototype to optimize space utilization and reduce build costs while maintaining a full coffee house experience [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the turnaround strategy, noting the first positive quarter in global comparable store sales in seven quarters [6][22] - The holiday season is anticipated to be a significant opportunity for growth, with a focus on delivering a warm and welcoming customer experience [16][17] - The company acknowledges ongoing challenges with inflation and commodity prices but remains optimistic about long-term growth potential [28][32] Other Important Information - The company completed 107 net store closures globally as part of its restructuring efforts, which are expected to be slightly accretive to profitability [30][31] - The company plans to continue investing in Green Apron Service and menu innovation to drive customer engagement and transaction growth [19][20] Q&A Session Summary Question: Concerns about the "Back to Starbucks" strategy - Management clarified that the strategy is comprehensive and aims to enhance customer connection and craft across all service channels, not just in-cafe experiences [36][39] Question: Feedback on the Protein Platform - The Protein Platform has received positive feedback, with customers appreciating the customization options and perceived value [42][46] Question: Progress of the Green Apron Service model - Management noted that the initial rollout has shown positive results, with ongoing improvements expected as staff and customers adapt to the new service standard [49][51] Question: Impact of store closures on profitability - Management indicated that closures were based on the inability to meet customer experience standards and profitability, with expectations of sales transfer to nearby locations [70][72] Question: Future pricing strategies - The company plans to be strategic with pricing, monitoring value perception while addressing inflationary pressures [80][81]

Financial Data and Key Metrics Changes - Consolidated revenue for Q4 was $9.6 billion, reflecting a 5% increase year-over-year, driven by 2% net new company-operated store growth and a 1% increase in global comparable store sales [22][24] - Earnings per share (EPS) for Q4 was $0.52, down 34% from the prior year, primarily due to inflation and investments in the Back to Starbucks strategy [27][32] - Consolidated operating margin was 9.4%, contracting 500 basis points from the prior year, mainly due to inflation and increased labor costs [26][27] Business Line Data and Key Metrics Changes - U.S. comparable store sales were flat year-over-year, with ticket up 1%, while transaction comps were down 1% [22][24] - International segment reported 9% year-over-year net revenue growth in Q4, reaching over $2 billion, with strong performance in China, Japan, the U.K., and Mexico [24][25] - The channel development segment saw a 16% year-over-year revenue growth due to higher revenue from the Global Coffee Alliance [26] Market Data and Key Metrics Changes - The international business ended the year with record revenues of $7.8 billion, with 316 net new coffee houses opened in Q4 [14][24] - Starbucks China achieved 2% comparable store sales growth in Q4, driven by a 9% improvement in comparable transactions [24][25] - The college and university segment showcased year-over-year growth, supported by a good start to the fall semester [24] Company Strategy and Development Direction - The company launched the Back to Starbucks strategy to enhance customer experience and improve profitability, focusing on customer connection and craft [4][6] - Investments were made in staffing and hours to improve customer service, with the Green Apron Service becoming the new standard for customer experience [7][8] - The company is piloting a new coffee house prototype with lower build costs and optimized space utilization to enhance customer experience [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the turnaround strategy, noting that Q4 marked the first positive quarter in seven quarters, with momentum continuing into Q1 [4][30] - The holiday season is expected to be a significant opportunity for growth, with a focus on delivering a warm and welcoming environment [15][16] - Management acknowledged the challenges posed by inflation and dynamic coffee prices but remains optimistic about long-term growth potential [31][32] Other Important Information - The company completed 107 net store closures globally as part of its restructuring efforts, which are expected to be slightly accretive to profitability [27][28] - The company plans to continue disciplined capital deployment and expects to reduce G&A expenses in fiscal 2026 [29][30] Q&A Session Summary Question: Concerns about the Back to Starbucks strategy - Management clarified that the Back to Starbucks strategy is comprehensive and aims to enhance customer connection and craft across all service channels, not just in-cafe [34][36] Question: Feedback on the Protein Platform - The Protein Platform has received positive feedback, with customers appreciating the customization options and value, leading to increased awareness and sales [40][42] Question: Current state of Green Apron Service - Management noted that the Green Apron Service is still in its early stages but is showing positive trends, with initial pilot stores outperforming others [46][48] Question: Impact of store closures on profitability - Store closures were based on the inability to meet customer experience standards and profitability, but they are expected to positively impact overall margins [66][68] Question: Future pricing strategy - The company plans to be strategic with pricing, monitoring value perception while addressing inflation and commodity costs [75][76]

[Music] Hey, John. The stock kind of bouncing around a bit in the after hours here. Now it's higher by more than 3%.Its third quarter results essentially uh in line for Chipotle. The company lowering though its fullear same store sales guidance. Now for the third quarter in a row, it now expects low singledigit decline versus a prior forecast of flat.Now that's despite its EPS coming in right in line at 29 cents. Revenue is also in line at 3 billion for the quarter. Same store sales also up 0.3%.Its average ...

Core Insights - Chipotle's third quarter results are in line with expectations, but the company has lowered its full-year same-store sales guidance to a low single-digit decline from a prior forecast of flat [1][2] - Earnings per share (EPS) for the quarter is reported at 29 cents, with revenue also in line at $3 billion [1] - Same-store sales increased by 0.3%, while the average check rose by 1.1%, but traffic fell by just under 1% [1][2] Financial Performance - Restaurant margin stands at approximately 24.5%, which is 1% lower than analyst estimates due to increased costs for beef and chicken, as well as the impact of tariffs [2] - The company is experiencing a notable decline in spending from consumers earning under $100,000 annually, particularly among the 25 to 34 age group [3] Consumer Behavior - There is a measurable pullback in spending from younger consumers, who are reportedly eating at home more often rather than dining out [3] - Despite the decline in spending, the company is still gaining market share within this demographic, although overall spending in restaurants is down due to macroeconomic pressures [4] Strategic Response - The company plans to enhance its messaging around value propositions to address the changing consumer behavior and economic conditions [4]

Uh but we have more earnings to bring you. Starbucks results are out. Kate Rogers has those numbers.Hi Kate. Hey Morgan. So the stock a little bit higher here as you can see by more than one and a half%.A mixed fourth quarter for Starbucks. Uh EPS a miss here. 52 cents adjusted versus estimates of 56 cents.Revenues though would beat 9.6% billion for the quarter versus the 9.35% billion estimated. And that's even with the labor investments that the company is making right now. Comps turning positive globally ...

Core Insights - Starbucks reported mixed results for Q4, with adjusted EPS of 52 cents, missing estimates of 56 cents [1] - Revenue for the quarter was $9.6 billion, exceeding the estimated $9.35 billion, despite ongoing labor investments [2] - Global comparable store sales turned positive, with Q4 comp sales up 1%, better than the estimated decline of 0.3% [2] - North American comp sales were flat, compared to estimates of a 0.9% increase, with a noted decline in transactions [2] - Positive trends were observed in US comps in September, as the company's "back to Starbucks" plan began to take effect [3] - International comp sales also exceeded expectations, with Q4 sales up 3%, and same-store sales in China increased by 2% [3]

Core Insights - Chipotle has lowered its expectations for the year for the third consecutive time, indicating ongoing challenges in meeting previous forecasts [1] Company Summary - The company has revised its financial outlook, suggesting a cautious approach to future performance [1] - This adjustment reflects potential operational or market challenges that may impact revenue and growth [1] Industry Summary - The fast-casual dining sector may be experiencing pressures that affect companies like Chipotle, leading to conservative forecasts [1] - The trend of revising expectations could signal broader industry challenges that investors should monitor [1]