Chipotle Meets Expectations Amid Headwinds, Plans for Continued Growth
Chipotle Mexican Grill (CMG) reported positive fourth-quarter results, surpassing market expectations despite facing challenges.
Financial Highlights
* Same-store sales surged 5.4%, driven by strong transactions.
* Annual revenue grew 7.4% to $11.3 billion.
* Adjusted earnings per share met estimates at $0.25.
Operational Developments
* CEO Scott Boatwright cited "strong transaction" growth and expanded margins.
* The company expects low- to mid-single-digit same-store sales growth in 2025, considering tougher comparisons.
* Chipotle plans to open 315-345 new locations, aiming for 7,000 restaurants in North America.
Earnings Estimate Breakdown
* Adj. EPS: $0.25 vs. Consensus: $0.25
* Revenue: $2.85B vs. Consensus: $2.85B
* Same-Store Sales Growth: 5.4% vs. Consensus: 5.67%
Market Reaction
* Chipotle shares declined 5% in after-hours trading.
Cost and Pricing
* Food, beverage, and packaging costs rose to 30.4% of revenue.
* Chipotle implemented a 2% price increase in December.
* The company plans steady pricing in 2025, with potential adjustments if persistent inflation impacts its business.
Innovation and Technology
* Chipotle Honey Chicken as a limited-time offering has garnered positive feedback.
* The company continues to invest in automation, including a digital makeline and an avocado-peeling robot.
Outlook
* Chipotle remains optimistic about its long-term growth prospects.
* Throughput optimization and operational efficiency are key drivers of traffic.
* The company plans to expand its reach and enhance its customer experience through innovation and technology.