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Yahoo
22 minutes ago
- Yahoo
Chipotle stock sinks after company reports second straight sales decline, cuts guidance
Chipotle Mexican Grill (CMG) reported another quarter of negative sales growth, sending shares sharply lower in premarket trading on Thursday. The fast-casual restaurant chain posted results on Wednesday as it navigates an uncertain consumer environment and as its new leadership deals with the most challenging backdrop in years. Chipotle reported same-store sales fell 4% in the second quarter, more than the 2.9% decline Wall Street expected, according to Bloomberg data. Shares of Chipotle were down more than 10% before the bell. Traffic also fell more than expected, falling 4.9% against the 4.4% drop that had been forecast by the Street. That's an acceleration from the 2.3% drop seen in the first quarter, which marked Chipotle's first quarterly foot traffic decline since 2022. Chipotle also cut its guidance again, saying it now expects flat full-year same-store sales growth, compared to an increase in the low-single-digit range. Ahead of Wednesday's report, analysts expected same-store sales to grow 0.8% for the fiscal year. CEO Scott Boatwright told investors that "ongoing volatility in our trends in the consumer environment" prompted the company to cut its full-year same-store sales forecast. Earnings were in line with forecasts, tallying $0.33 per share on an adjusted basis. Revenue missed forecasts, coming in at $3.06 billion, below the $3.11 billion analysts had expected. "We did see some share loss in the April-May time frame as the low-income consumer pulled back, but we're back to share gains yet again in June-July," Boatwright told investors on the company's earnings call. Boatwright added the company is "trending along with the macro and consumer sentiment at this point, and so I don't have overarching fears." Still, the exec admitted he believes its perceived value proposition isn't translating to consumers in the same way it did this time last year. "We've got to figure out a way we can communicate value for the consumer and showcase the value we are to QSR and fast casual," he said. "There's more work to do there, and that's what we'll lean into in the back half of the year." Boatwright told investors the company expects to return to positive transaction growth in the second half of the year. Chipotle expects tariffs to raise its cost of sales by 0.5% on an ongoing basis, with the company forecasting an additional 0.4% impact in the third quarter. In mid-June, the company launched Adobo Ranch, its first new dip since Queso Blanco. William Blair analyst Sharon Zackfia wrote in a note to clients prior to the report this new item "seemed to yield both improved traffic and ticket given the associated upcharge." CFO Adam Rymer said the company saw "strength" with sides, including the Adobo Ranch, which came "late in the quarter," but "other items like guac, queso chips, even drinks" held up "really nicely." An increased cadence of limited-time offerings, more sides and dips, leaning into its reward members, and its catering business will help it return to positive growth, Boatwright said. "I'm confident ... that we have a path to get back to mid-single-digit growth and return us back to where we need to be in the coming months." — Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@
Bloomberg
24 minutes ago
- Bloomberg
Dollar-Yuan Trading Surged in April Volatility, BOE Survey Shows
The amount of Chinese yuan traded versus the US dollar soared in London during April's market ructions, outstripping the increase for other major currency pairs, according to Bank of England data. While currency trading in London surged to a record as President Donald Trump's trade tariff policies roiled global markets, the jump in the dollar-yuan pair was particularly notable. Daily average turnover jumped 42% to $182.6 billion from October 2024, among the biggest increases for any pair, according to the BOE's semi-annual turnover survey published this week.
Yahoo
an hour ago
- Yahoo
Trending tickers: The latest investor updates on Tesla, Alphabet, Chipotle, BT and ITV
Tesla (TSLA) Shares in Tesla fell nearly 7% in pre-market trading on Thursday morning, after the electric vehicle (EV) company's second quarter earnings slightly missed estimates. In results released after the bell on Wednesday, Tesla posted second quarter revenue of $22.5bn (£16.6bn) compared to $22.64bn expected by Bloomberg consensus, a 12% drop compared with the $25.05bn reported a year ago. Adjusted earnings per share (EPS) came in at $0.40 compared to expectations of $0.42, while operating income of $923m was also lower than the $1.23bn expected. "We continue to expand our vehicle offering, including first builds of a more affordable model in June, with volume production planned for the second half of 2025," the company said in a statement. Tesla also said its purpose-built robotaxi was still scheduled for volume production starting in 2026. Read more: Stocks rise amid hopes the EU and US will reach trade deal In an earnings call, Tesla CEO Elon Musk said that the company could experience "a few rough quarters", when asked about the expiration of EV tax credits, with the Trump administration set to cut these incentives. Matt Britzman, senior equity analyst at Hargreaves Lansdown, said Tesla's second quarter "numbers were objectively poor, but that was already expected, and shares were broadly flat on the initial release." "The typical playbook for the past few quarters has been declining fundamentals but enough AI hype to keep investors sleeping at night," said Britzman, who holds shares in Tesla. "The mid-single-digit swing came off the back of the earnings call as Elon Musk warned the tough times could continue into 2026." He added: "Tesla is in a very small cohort of companies with enough growth potential that investors are, for now at least, willing to look past weakening core financials. Last night's comments confirmed many fears around tariffs, rising costs, tougher margins, and struggling cash flows. But with that now firmly built in as the base case, the AI story can take back the wheel." Alphabet (GOOGL, GOOG) Fellow "Magnificent 7" tech giant Alphabet (GOOGL, GOOG) also reported after the market close on Wednesday, though its second quarter results topped Wall Street estimates, driving shares up more than 2% in pre-market trading on Thursday. Alphabet, Google's parent company, posted second quarter revenue of $96.43bn, beating expectations of $93.97bn. Earnings were $2.31 per share compared to a Bloomberg consensus estimate of $2.18. The company's outlook for capital expenditures (capex), however, was higher than expected. The tech giant expects to spend $85bn in the year, $10bn more than had been previously expected. Read more: Oil prices rise as trade deals take centre stage Ben Barringer, head of technology research at Quilter Cheviot, said: "Given the concerns around disruption from artificial intelligence and Chat GPT, Alphabet produced a really good set of numbers in its latest results. Revenues were up 15%, three percentage points better than expected and the search business delivered at the top of its range. The cloud business, meanwhile, was also a strong performer with revenues up 32% so it is encouraging to see the business growing strongly in the face of pressures." He said that the increase in its capex guidance "is a very solid raise and should be viewed as a positive, with investment looking to drive away the threat of Chat GPT". "Alphabet has been playing catch up somewhat in the AI arms race, but it is doing well to fend off the likes of Chat GPT," said Barringer. "The big question will be whether it can keep innovating at a pace that allows it to maintain its search monopoly. This boost in investment suggests the fight will continue." Chipotle Mexican Grill (CMG) Shares in Chipotle (CMG) slid nearly 10% in pre-market trading on Thursday, after the burrito chain missed expectations on same store sales and cut its forecast. Chipotle said in results released after the market close on Wednesday that same-store sales in the second quarter fell 4% compared to a Bloomberg consensus estimate of a 2.9% decline. Read more: Stocks that are trending today In addition, Chipotle said it now expected same store sales to be about flat for the year, compared to previous guidance of growth in the low single digit range. Second quarter revenue of $3.06bn was short of the expected $3.11bn, though adjusted earnings were in line with Wall Street expectations of $0.33 per share. BT (BT-A.L) On the London market, shares in BT (BT-A.L) popped 5% on Thursday morning, after the telecoms company said it was still on track to achieve full-year guidance despite posting a dip in revenue. BT posted total revenue of £4.88bn ($6.61bn) in the first quarter, which was down 3% on the same period last year. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) came in at £2.05bn, which was 1% lower than the first quarter last year. Stocks: Create your watchlist and portfolio In a separate statement on Thursday, BT announced it had appointed Virgin Media O2 chief financial officer (CFO) Patricia Cobian to succeed Simon Lowth as the company's new CFO. Matt Dorset, equity research analyst at Quilter Cheviot, said: "BT's results continue to be fairly weak but in line with expectations. UK Service revenue was down 1.4% over the year as the consumer segment continues to lag. The business division also remains the weakest division with legacy sales continuing to hurt. Consequently, earnings were down 0.5%, but ahead of consensus, as BT impresses with its cost cutting and Openreach remaining strong." ITV (ITV.L) Shares in ITV (ITV.L) surged more than 7% on Thursday morning, after the broadcaster announced further cost cutting plans. In half-year results released on Thursday, ITV reported a 3% fall in total group revenue to £1.84bn compared to the same period last year. Profit before tax dropped 44% to £99m in the six months to 30 June compared to the first half of 2024. Read more: Lloyds increases dividend as profits jump by 5% ITV announced an additional £15m in permanent non-content cost savings, taking the total group permanent non-content savings in 2025 to £45m. The broadcaster added that there would be a one-off cost of £40m to achieve the total group savings. Victoria Scholar, head of investment at Interactive Investor, said: "This was always going to be a tricky set of earnings for ITV to deliver because of the strength of H1 2024 on the back of the Men's Euros which made for an unflattering year-on-year comparison. "Within that context ITV fared very well, delivering a smaller-than-expected drop in total ad revenues (down 7% vs forecasts for an 8% drop) and forecast topping earnings and revenue. Amid the broad, structural decline in linear TV advertising and changing TV viewing habits, ITV is pursuing a digital focussed strategy aiming to continue to deliver growth in digital ad revenues." Read more: Which Mag 7 stocks will be the top performers this earnings season? UK's rising debt cost puts Reeves and tax rises in spotlight London IPO fundraising slumps in blow to UKError in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
