Chipotle Mexican grill On Wednesday, he reported weaker quarterly income than expected after his sales in the same store decreased for the first time since 2020.
Executives cited a slowdown in consumer spending and adverse climate as two of the factors that decreased the demand for their burritos and bowls.
The company also lowered the upper end of its perspective for the growth of sales of the same store throughout the year.
Chipotle’s actions fell more than 2% in extended trade. The action closed 3.5% before Wednesday.
This is what the company reported compared to what Wall Street expected, based on an LSEG analysts survey:
- Profit per action: 29 tight cents compared to 28 expected cents
- Revenue: $ 2.88 billion compared to $ 2.95 billion expected
Net sales increased 6.4% to $ 2.88 billion.
Sales of the same chain store fell 0.4% during the quarter, below the 1.7% growth projected by Streetacount estimates. Restaurant transactions fell 2.3% and were only partially compensated with an increase of 1.9% in the average control.
Customers began withdrawing their expenses in February due to economic uncertainty, said CEO Scott Boatwright to analysts at the company’s telephone conference.
“We could see this in our visits study, where saving money due to concerns about the economy was the overwhelming reason why consumers were reducing the frequency of visits to the restaurant,” he said, and added that the deceleration of traffic has continued in April.
Spring months generally begin what Chipotle calls “Burritos Season”, the busiest time of the year for the chain, from Easter to May. But the party landed several weeks later this year, delaying the usual seasonal increase in demand, although the limited time launch of its Chipotle Honey Chickn helped sales in March.
Chipotle sales generally slow down during the summer months as university students return home and many customers travel internationally.
The company does not expect traffic to its restaurants to grow until the second half of the year.
“I am sure we have a solid plan to return to the compensation of positive transactions in the second half of the year, and during these uncertain times, we will continue to invest in the things that make Chipotle a special brand: our people, the proposal of culinary value, of value, innovation and growth,” said Boatwright in a statement.
For the whole year, Chipotle now projects that sales in the same store will grow in a single low digit. Previously, it predicted the growth of sales in the same store in the low -digit rank.
“Looking towards the future, our marketing team has an improved plan for this summer and the rest of the year to make Chipotle more visible, more relevant and more dear,” said Boatwright.
Chipotle is also projecting greater inflation in the second quarter, fed by the White House rates on aluminum and a wide import tariff of 10%. Approximately half of the company’s avocado supply comes from outside Mexico, for example.
Chipotle’s financial director, Adam Rymer, estimated that tariffs will add 50 basic points, or 0.5%, to their cost of sales continuously. In the second quarter, tariffs are expected to reach their cost of sales in 20 basic points, or 0.2%, due to the company’s inventory before the tasks were implemented.
“These estimates do not include any impact of the fees that were postponed, or 25% tariffs in Mexico and Canada since our imports fall under [U.S.-Mexico-Canada Agreement] Exemption, “said Rymer.
The company reiterated its plans to open between 315 and 345 new restaurants at the end of 2025.
Chipotle reported a net income of the first quarter of $ 386.6 million, or 28 cents per share, compared to $ 359.3 million, or 26 cents per share, a year earlier.
Excluding compensation subsidies based on actions related to its recent transition from the CEO, the company won 29 cents per share.
