Chipotle (CMG) reported that sales improved in the first quarter on Wednesday as the burrito chain aimed to regain momentum amid a tricky consumer backdrop.
Same-store sales rose 0.5% in Q1, beating expectations for a 0.9% decline, according to Bloomberg consensus data. Revenue grew to $3.09 billion, more than the $3.07 billion expected, while adjusted earnings per share came in line with expectations at $0.24, though profits declined from $0.29 per share in the same quarter last year.
The stock rose about 3% in premarket trading on Thursday.
The bar for Chipotle’s results was set somewhat low after the last quarter, when same-store sales fell 2.5%, even as higher menu prices helped offset lower transactions. That was below the 2.9% same-store sales increase that Wall Street expected, according to Bloomberg estimates.
Chipotle reiterated its forecast for no sales growth in 2026 as its core customer continues to face economic pressure, leading to a decline in traffic.
“We really just want to remain cautious on our outlook given the dynamic consumer environment,” CEO Scott Boatwright said.
Boatwright added that he believes the company is still pricing its meals at a “20% to 30% discount” to its fast-casual peers. “We learned last year that the customer was much more discerning on how they spend their cash,” he said.
Limited-time offerings like chicken al pastor, the launch of its high-protein menu, and increased marketing help blunt the impact of other headwinds, such as winter storms, higher gas prices, and elevated input costs, Telsey Advisory Group Sarang Vora wrote in a note to clients ahead of the report.
Boatwright told investors that the company’s “value proposition remains industry-leading and differentiating,” and that one-fourth of transactions included add-on protein options, such as its protein cup.
He said the team is always looking for better entry points for customers, like it did with the high-protein menu taco, which costs about $3.50. It’s also testing a “happier hour” where consumers can get 2 tacos for less than $3.
Boatwright also said in the release that the team is bringing on a new chief brand officer and a new chief digital officer to “further strengthen our value proposition, sharpen our brand messaging, and accelerate innovation — positioning Chipotle for sustained, long-term growth as we advance on our path to becoming a global iconic brand.”
Some other catalysts investors were watching include the limited return of honey chicken, the recently relaunched rewards program, and the expansion of catering and customizable group orders.
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