UL Solutions to Help Companies in Japan Meet New Climate Disclosure Standards in Collaboration with Fujitsu
This alliance combines UL Solutions' ULTRUS software portfolio, a unified digital platform designed to streamline regulatory, supply chain and sustainability management, with Fujitsu's deep local market expertise and established client network. Specifically, Fujitsu will leverage UL Solutions' UL 360 environmental, social and governance (ESG) data management software, an offering in the ULTRUS platform, to help its customers meet the evolving sustainability disclosure standards. These new standards, developed by the Sustainability Standards Board of Japan (SSBJ), are aligned with the International Financial Reporting Standards Foundation's International Sustainability Standards Board (ISSB).
'For long-term business success for companies in Japan, strong ESG reporting is no longer a side issue but a core need for companies,' said Hidehiko Yamajo, regional vice president, Japan, UL Solutions. 'Our new partnership with Fujitsu is a strategic move to help companies navigate these complex ESG reporting demands and complement our existing ESG data management software. These tools simplify these challenges, allowing businesses to manage their data easily, meet new reporting requirements and ultimately create real business value.'
The SSBJ's new standards, promoting companies to report sustainability and climate-related information, are now available for voluntary application and proposed for mandatory application in 2027, mirroring the global trend towards increased ESG reporting accountability. These standards build upon previous initiatives, including requirements by the Tokyo Stock Exchange and Japan's Financial Services Agency, a government agency and an integrated financial regulator responsible for overseeing the banking, securities and exchange, and insurance sectors to ensure the stability of Japan's financial system, which have progressively strengthened sustainability disclosure expectations for Japanese listed companies.
'Fujitsu is thrilled to join with UL Solutions for ESG and sustainability reporting in Japan,' said Hidenori Ito, senior vice president, head of Cross-Industry Solutions Business Unit of Fujitsu. 'Fujitsu is consolidating all internal and external data, strengthening disclosure and regulatory compliance, and promoting rapid management decision-making through financial and non-financial analysis to realize ESG management. As part of FujitsuUvance, a business model based on social issues, we will integrate Fujitsu's technologies, such as AI and blockchain technology, based on our knowledge and know-how cultivated through collaboration with UL Solutions and our own practices. We will support the realization of data-driven sustainability management and contribute to the realization of a sustainable society by maximizing corporate value.'
In addition to its software solutions, UL Solutions offers a comprehensive suite of enterprise sustainability services, including environmental product declarations and zero-waste-to-landfill claim validations. The ULTRUS software platform, which includes Sustainable Supply Chain & environmental, health, and safety (EHS) services, was recognized as a leader by Verdantix in their Green Quadrant: ESG and Sustainability Reporting Software 2023 and 2025 reports and Green Quadrant: EHS Software 2025 report, as a unified platform, highlighting its effectiveness in helping companies navigate complex ESG reporting regulations and global compliance challenges.
About UL Solutions
A global leader in applied safety science, UL Solutions transforms safety, security and sustainability challenges into opportunities for customers in more than 110 countries. UL Solutions delivers testing, inspection, and certification services, together with software products and advisory offerings, that support our customers' product innovation and business growth. The UL Solutions Mark serves as a recognized symbol of trust in our customers' products and reflects an unwavering commitment to advancing our safety mission. We help our customers innovate, launch new products and services, navigate global markets and complex supply chains, and grow sustainably and responsibly into the future. Our science is your advantage.
About Fujitsu
Fujitsu's purpose is to make the world more sustainable by building trust in society through innovation. As the digital transformation partner of choice for customers around the globe, our 113,000 employees work to resolve some of the greatest challenges facing humanity. Our range of services and solutions draw on five key technologies: AI, Computing, Networks, Data & Security, and Converging Technologies, which we bring together to deliver sustainability transformation. Fujitsu Limited (TSE:6702) reported consolidated revenues of 3.6 trillion yen (US$23 billion) for the fiscal year ended March 31, 2025 and remains the top digital services company in Japan by market share. Find out more: global.fujitsu
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Business Wire
28 minutes ago
- Business Wire
Packaging Corporation of America Reports Second Quarter 2025 Results
LAKE FOREST, Ill.--(BUSINESS WIRE)--Packaging Corporation of America (NYSE: PKG) today reported second quarter 2025 net income of $242 million, or $2.67 per share, and net income of $224 million, or $2.48 per share, excluding special items. Second quarter net sales were $2.2 billion in 2025 and $2.1 billion in 2024. (1) For descriptions and amounts of our special items, see the schedules with this release. (2) Diluted EPS excluding Special Items is a non-GAAP financial measure. For information regarding our use of non-GAAP financial measures and descriptions and amounts of our special items, see the schedules with this release. (3) Amounts may not foot due to rounding. Expand Reported earnings in the second quarter of 2025 include special items primarily for gains from the sale of real estate in connection with the disposal of corrugated products facilities that were previously closed, partially offset by costs related to the pending Greif containerboard business acquisition. Excluding special items, the $.28 per share increase in second quarter 2025 earnings compared to the second quarter of 2024 was driven primarily by higher prices and mix in the Packaging segment $.98, lower fiber costs $.13, higher prices and mix in the Paper segment $.04 and lower tax rate $.02. These items were partially offset by higher operating costs ($.30), higher maintenance outage expense ($.21), lower production and export sales volume in the Packaging Segment ($.13), higher depreciation expense ($.10), higher fixed and other expense ($.09), lower volume in the Paper segment ($.02), higher freight expense ($.02) and higher interest expense ($.02). Results were $.07 above second quarter guidance of $2.41 per share primarily due to lower operating costs and fiber costs. Financial information by segment is summarized below and in the schedules with this release. (1) Segment operating income (loss) excluding special items and EBITDA excluding special items are non-GAAP financial measures. We provide information regarding our use of non-GAAP financial measures and reconciliations of historical non-GAAP financial measures presented in this press release to the most comparable measure reported in accordance with GAAP in the schedules to this press release. Expand In the Packaging segment, total corrugated products shipments were up 1.7% per day and flat overall compared to the second quarter of 2024, with one additional workday in 2024. Containerboard production was 1,195,000 tons, and containerboard inventory was up 38,000 tons from the end of the second quarter of 2024 and down 17,000 tons compared to the end of the first quarter of 2025. In the Paper segment, sales volume was down 5% from the second quarter of 2024 and 7% compared to the first quarter of 2025. Commenting on reported results, Mark W. Kowlzan, Chairman and CEO, said, 'We operated very well during the quarter, delivering strong earnings and cash flows as well as higher margins in the Packaging segment. Pricing in the Packaging segment was consistent with expectations as we fully realized our earlier announced price increases. Despite cautious ordering patterns from customers, corrugated products volume was solid and steady throughout the quarter, with per day shipments exceeding the second quarter of 2024 and the first quarter of 2025. As expected, export containerboard sales were lower. We ran our containerboard mills to meet demand and drew down inventory to end at targeted levels. The Paper segment delivered another profitable quarter with strong margin performance, as we realized our earlier price increases. We continued to successfully manage costs across all of our operations, executing our capital projects and efficiency initiatives, which have helped offset inflation.' 'Looking ahead as we move from the second and into the third quarter,' Mr. Kowlzan added, 'while our corrugated products customers have remained cautious into July as economic uncertainty persists, we expect higher corrugated shipments, which will drive increased containerboard production. Export containerboard sales will be lower due to the effects of the global trade environment. We will build some containerboard inventory ahead of our fourth quarter maintenance outage at the DeRidder mill. We expect prices and mix in the Packaging segment to be relatively flat. We also expect flat pricing in the Paper segment and expect production and sales to increase with the International Falls mill outage completed in the second quarter and seasonal back-to-school orders. We have no scheduled maintenance outages during the third quarter and expect maintenance outage expense to be lower. Freight costs will be higher with the full effect of rail rate increases at our mills. Operating costs will be near second quarter levels and fiber costs will be slightly lower. Considering these items, we expect third quarter earnings of $2.80 per share, excluding special items. Our guidance does not include any possible impact from the pending acquisition of the Greif containerboard business, which is subject to satisfaction of certain conditions, including regulatory approval.' We present our earnings expectation for the upcoming quarter excluding special items as special items are difficult to predict and quantify and may reflect the effect of future events. We expect to incur acquisition and integration related costs for our pending acquisition of the Greif containerboard business during the third quarter; however, additional special items may arise due to third quarter events. PCA is the third largest producer of containerboard products and a leading producer of uncoated freesheet paper in North America. PCA operates eight mills and 85 corrugated products plants and related facilities. Some of the statements in this press release are forward-looking statements. Forward-looking statements include statements about our future earnings and financial condition, expected benefits from acquisitions and restructuring activities, our industry and our business strategy. Statements that contain words such as 'will', 'should', 'anticipate', 'believe', 'expect', 'intend', 'estimate', 'hope' or similar expressions, are forward-looking statements. These forward-looking statements are based on the current expectations of PCA. Because forward-looking statements involve inherent risks and uncertainties, the plans, actions and actual results of PCA could differ materially. The factors that could cause plans, actions and results to differ materially from PCA's current expectations include the following: the impact of general economic conditions; conditions in the paper and packaging industries, including competition, product demand and product pricing; fluctuations in wood fiber and recycled fiber costs; fluctuations in purchased energy costs; the possibility of unplanned outages or interruptions at our principal facilities; and legislative or regulatory requirements, particularly concerning environmental matters, as well as those identified under Item 1A. Risk Factors in PCA's Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission and available at the SEC's website at ' '. Packaging Corporation of America Consolidated Earnings Results Unaudited (dollars in millions, except per-share data) Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Net sales $ 2,171.3 $ 2,075.3 $ 4,312.3 $ 4,054.8 Cost of sales (1,688.3 ) (1) (1,637.6 ) (3,374.5 ) (1) (3,246.7 ) (2) Gross profit 483.0 437.7 937.8 808.1 Selling, general, and administrative expenses (153.2 ) (149.5 ) (314.6 ) (301.3 ) Other income (expense), net 3.9 (1) (12.2 ) (2) (9.2 ) (1) (34.8 ) (2) Income from operations 333.7 276.0 614.0 472.0 Non-operating pension income - 1.1 - 2.2 Interest expense, net (13.1 ) (10.4 ) (26.0 ) (19.9 ) Income before taxes 320.6 266.7 588.0 454.3 Provision for income taxes (79.1 ) (67.8 ) (142.7 ) (108.4 ) Net income $ 241.5 $ 198.9 $ 445.3 $ 345.9 Earnings per share: Basic $ 2.68 $ 2.22 $ 4.95 $ 3.86 Diluted $ 2.67 $ 2.21 $ 4.93 $ 3.84 Computation of diluted earnings per share under the two class method: Net income $ 241.5 $ 198.9 $ 445.3 $ 345.9 Less: Distributed and undistributed income available to participating securities (1.6 ) (1.4 ) (3.0 ) (2.5 ) Net income attributable to PCA shareholders $ 239.9 $ 197.5 $ 442.3 $ 343.4 Diluted weighted average shares outstanding 89.7 89.5 89.7 89.5 Diluted earnings per share $ 2.67 $ 2.21 $ 4.93 $ 3.84 Supplemental financial information: Capital spending $ 169.7 $ 245.0 $ 317.8 $ 321.7 Cash, cash equivalents, and marketable debt securities $ 955.9 $ 1,172.8 $ 955.9 $ 1,172.8 Expand (1) The three and six months ended June 30, 2025 include the following: a. $24.6 million and $18.8 million, respectively, of income related to gains on sales of corrugated products facilities, partially offset by closure costs related to corrugated products facilities. These items were recorded in 'Cost of sales' and 'Other expense, net', as appropriate. b. $1.6 million of charges related to the announced Greif, Inc. acquisition, which were recorded in 'Other expense, net.' (2) The three and six months ended June 30, 2024 include the following: a. $0.6 million of income and $9.7 million of charges, respectively, related to the announced discontinuation of production of uncoated freesheet paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities. The costs were recorded in 'Cost of sales' and 'Other expense, net', as appropriate. b. $0.1 million of charges consisting of closure costs related to corrugated products facilities. For the six months ended June 30, 2024, these charges were completely offset by $0.1 million of income primarily related to a favorable lease buyout for a closed corrugated products facility during the first quarter of 2024. These items were recorded in "Cost of sales" and "Other expense, net", as appropriate. Expand Packaging Corporation of America Segment Information Unaudited (dollars in millions) Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Segment sales Packaging $ 2,005.9 $ 1,908.3 $ 3,976.3 $ 3,706.5 Paper 145.8 150.1 300.0 313.9 Corporate and Other 19.6 16.9 36.0 34.4 $ 2,171.3 $ 2,075.3 $ 4,312.3 $ 4,054.8 Segment operating income (loss) Packaging $ 346.3 $ 279.8 $ 624.4 $ 483.6 Paper 25.8 26.7 61.4 56.4 Corporate and Other (38.4 ) (30.5 ) (71.8 ) (68.0 ) Income from operations 333.7 276.0 614.0 472.0 Non-operating pension income - 1.1 - 2.2 Interest expense, net (13.1 ) (10.4 ) (26.0 ) (19.9 ) Income before taxes $ 320.6 $ 266.7 $ 588.0 $ 454.3 Segment operating income (loss) excluding special items (1) Packaging $ 321.7 $ 279.9 $ 605.6 $ 487.5 Paper 25.8 26.1 61.4 62.2 Corporate and Other (36.8 ) (30.5 ) (70.2 ) (68.0 ) $ 310.7 $ 275.5 $ 596.8 $ 481.7 EBITDA excluding special items (1) Packaging $ 452.9 $ 400.0 $ 862.1 $ 726.2 Paper 30.3 30.6 70.5 71.2 Corporate and Other (32.4 ) (26.6 ) (60.8 ) (60.2 ) $ 450.8 $ 404.0 $ 871.8 $ 737.2 Expand (1) Income (loss) from operations excluding special items, segment operating income (loss) excluding special items, earnings before non-operating pension income, interest, income taxes, and depreciation, amortization, and depletion (EBITDA), segment EBITDA, EBITDA excluding special items, and segment EBITDA excluding special items are non-GAAP financial measures. Management excludes special items as it believes these items are not necessarily reflective of the ongoing results of operations of our business. We present these measures because they provide a means to evaluate the performance of our segments and our company on an ongoing basis using the same measures that are used by our management, because these measures assist in providing a meaningful comparison between periods presented and because these measures are frequently used by investors and other interested parties in the evaluation of companies and the performance of their segments. The tables included in "Reconciliation of Non-GAAP Financial Measures" on the following pages reconcile the non-GAAP measures with the most directly comparable GAAP measures. Any analysis of non-GAAP financial measures should be done only in conjunction with results presented in accordance with GAAP. The non-GAAP measures are not intended to be substitutes for GAAP financial measures and should not be used as such. Expand (1) See footnote (1) on page 2, for a discussion of non-GAAP financial measures. Expand Packaging Corporation of America Reconciliation of Non-GAAP Financial Measures Unaudited (dollars in millions) Net Income Excluding Special Items and EPS Excluding Special Items (1) Three Months Ended June 30, 2025 2024 Income before taxes Income Taxes Net Income Diluted EPS Income before taxes Income Taxes Net Income Diluted EPS As reported in accordance with GAAP $ 320.6 $ (79.1 ) $ 241.5 $ 2.67 $ 266.7 $ (67.8 ) $ 198.9 $ 2.21 Special items (2): Facilities closure and other (income) costs (24.6 ) 6.1 (18.5 ) (0.20 ) 0.1 - 0.1 - Acquisition and integration-related costs 1.6 (0.4 ) 1.2 0.01 - - - - Jackson mill conversion-related activities - - - - (0.6 ) 0.2 (0.4 ) - Total special items (23.0 ) 5.7 (17.3 ) (0.19 ) (0.5 ) 0.2 (0.3 ) - Excluding special items $ 297.6 $ (73.4 ) $ 224.2 $ 2.48 $ 266.2 $ (67.6 ) $ 198.6 $ 2.20 (3) Six Months Ended June 30, 2025 2024 Income before taxes Income Taxes Net Income Diluted EPS Income before taxes Income Taxes Net Income Diluted EPS As reported in accordance with GAAP $ 588.0 $ (142.7 ) $ 445.3 $ 4.93 $ 454.3 $ (108.4 ) $ 345.9 $ 3.84 Special items (2): Facilities closure and other income (18.8 ) 4.7 (14.1 ) (0.15 ) - - - - Acquisition and integration-related costs 1.6 (0.4 ) 1.2 0.01 - - - - Jackson mill conversion-related activities - - - - 9.7 (2.4 ) 7.3 0.08 Total special items (17.2 ) 4.3 (12.9 ) (0.14 ) 9.7 (2.4 ) 7.3 0.08 Excluding special items $ 570.8 $ (138.4 ) $ 432.4 $ 4.79 $ 464.0 $ (110.8 ) $ 353.2 $ 3.92 Expand (1) Net income excluding special items and earnings per share excluding special items are non-GAAP financial measures. Management excludes special items as it believes these items are not necessarily reflective of the ongoing results of operations of our business. We present these measures because they provide a means to evaluate the performance of our company on an ongoing basis using the same measures that are used by our management, because these measures assist in providing a meaningful comparison between periods presented and because these measures are frequently used by investors and other interested parties in the evaluation of companies and their performance. Any analysis of non-GAAP financial measures should be done only in conjunction with results presented in accordance with GAAP. The non-GAAP measures are not intended to be substitutes for GAAP financial measures and should not be used as such. (2) Pre-tax special items are tax-effected at a combined federal and state income tax rate in effect for the period the special items were recorded and this rate is adjusted for each subsequent quarter to be consistent with the estimated annual effective tax rate, in accordance with ASC 270, Interim Reporting, and ASC 740-270, Income Taxes – Intra Period Tax Allocation. For all periods presented, income taxes on pre-tax special items represent the current amount of tax. For more information related to these items, see the footnotes to the Consolidated Earnings Results on page 1. (3) Amount may not foot due to rounding. Expand Packaging Corporation of America Reconciliation of Non-GAAP Financial Measures Unaudited (dollars in millions) EBITDA and EBITDA Excluding Special Items (1) EBITDA represents income before non-operating pension income, interest, income taxes, and depreciation, amortization, and depletion. The following table reconciles net income to EBITDA and EBITDA excluding special items: Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Net income $ 241.5 $ 198.9 $ 445.3 $ 345.9 Non-operating pension income - (1.1 ) - (2.2 ) Interest expense, net 13.1 10.4 26.0 19.9 Provision for income taxes 79.1 67.8 142.7 108.4 Depreciation, amortization, and depletion 140.7 128.5 278.6 256.9 EBITDA (1) $ 474.4 $ 404.5 $ 892.6 $ 728.9 Special items: Facilities closure and other (income) costs (25.2 ) 0.1 (22.4 ) - Acquisition and integration-related costs 1.6 - 1.6 - Jackson mill conversion-related activities - (0.6 ) - 8.3 EBITDA excluding special items (1) $ 450.8 $ 404.0 $ 871.8 $ 737.2 Expand (1) See footnote (1) on page 2, for a discussion of non-GAAP financial measures. Expand Packaging Corporation of America Reconciliation of Non-GAAP Financial Measures Unaudited (dollars in millions) The following table reconciles segment operating income (loss) to segment EBITDA and segment EBITDA excluding special items: Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Packaging Segment operating income $ 346.3 $ 279.8 $ 624.4 $ 483.6 Depreciation, amortization, and depletion 131.8 120.1 260.1 238.6 EBITDA (1) 478.1 399.9 884.5 722.2 Facilities closure and other (income) costs (25.2 ) 0.1 (22.4 ) - Jackson mill conversion-related activities - - - 4.0 EBITDA excluding special items (1) $ 452.9 $ 400.0 $ 862.1 $ 726.2 Paper Segment operating income $ 25.8 $ 26.7 $ 61.4 $ 56.4 Depreciation, amortization, and depletion 4.5 4.5 9.1 10.5 EBITDA (1) 30.3 31.2 70.5 66.9 Jackson mill conversion-related activities - (0.6 ) - 4.3 EBITDA excluding special items (1) $ 30.3 $ 30.6 $ 70.5 $ 71.2 Corporate and Other Segment operating loss $ (38.4 ) $ (30.5 ) $ (71.8 ) $ (68.0 ) Depreciation, amortization, and depletion 4.4 3.9 9.4 7.8 EBITDA (1) (34.0 ) (26.6 ) (62.4 ) (60.2 ) Acquisition and integration-related costs 1.6 - 1.6 - EBITDA excluding special items (1) $ (32.4 ) $ (26.6 ) $ (60.8 ) $ (60.2 ) EBITDA excluding special items (1) $ 450.8 $ 404.0 $ 871.8 $ 737.2 Expand (1) See footnote (1) on page 2, for a discussion of non-GAAP financial measures. Expand
Business Wire
32 minutes ago
- Business Wire
Traeger Announces Reporting Date for Second Quarter Fiscal 2025 Financial Results
SALT LAKE CITY--(BUSINESS WIRE)--Traeger, Inc. ('Traeger') (NYSE: COOK), creator and category leader of the wood pellet grill, today announced that it will release its second quarter fiscal 2025 financial results after market close on Wednesday, August 6, 2025. Management will host a conference call at 4:30 p.m. Eastern Time to discuss its financial results. Those who wish to participate in the call may do so by dialing (833) 470-1428 or +1 (404) 975-4839 for international callers, conference ID 399638. To pre-register for the conference call, please visit Traeger Second Quarter Fiscal 2025 Earnings Conference Call. The conference call will also be webcast live at For those unable to participate, a replay of the conference call will be available approximately two hours after the conclusion of the call until Wednesday, August 20, 2025. To access the telephone replay please dial (866) 813-9403, conference ID 534836. A replay of the webcast will also be available approximately two hours after the conclusion of the call on Traeger's website at The replay will be available on Traeger's website for approximately one year following the call. ABOUT TRAEGER GRILLS® Traeger Grills, headquartered in Salt Lake City, is the creator and category leader of the wood pellet grill, an outdoor cooking system that ignites all-natural hardwoods to grill, smoke, bake, roast, braise, and barbecue. After 35 years, Traeger entered the griddle category further establishing its leadership position in the outdoor cooking space by introducing innovative alternatives to griddle, sear, fry, steam, sauté and more, all in one place. The grills are versatile and easy to use, empowering cooks of all skill sets to create delicious meals with flavor that cannot be replicated. Grills are at the core of Traeger's platform and are complemented by Traeger wood pellets, rubs, sauces, and accessories.
Yahoo
34 minutes ago
- Yahoo
Chipotle (NYSE:CMG) Misses Q2 Revenue Estimates, Stock Drops 10.7%
Mexican fast-food chain Chipotle (NYSE:CMG) missed Wall Street's revenue expectations in Q2 CY2025 as sales rose 3% year on year to $3.06 billion. Its non-GAAP profit of $0.33 per share was in line with analysts' consensus estimates. Is now the time to buy Chipotle? Find out in our full research report. Chipotle (CMG) Q2 CY2025 Highlights: Revenue: $3.06 billion vs analyst estimates of $3.11 billion (3% year-on-year growth, 1.5% miss) Adjusted EPS: $0.33 vs analyst estimates of $0.33 (in line) 2025 Guidance: "About flat full year comparable restaurant sales", lowered from previous outlook of "sales growth in the low single digit range" Operating Margin: 18.2%, down from 19.7% in the same quarter last year Free Cash Flow Margin: 13.1%, down from 14.2% in the same quarter last year Same-Store Sales fell 4% year on year (11.1% in the same quarter last year) Market Capitalization: $70.57 billion "We are seeing momentum build as we rolled out our summer marketing initiatives and as our comparisons ease," said Scott Boatwright, Chief Executive Officer, Chipotle. Company Overview Born from a desire to offer quick meals with fresh, flavorful ingredients, Chipotle (NYSE:CMG) is a fast-food chain known for its healthy, Mexican-inspired cuisine and customizable dishes. Revenue Growth A company's long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. With $11.58 billion in revenue over the past 12 months, Chipotle is one of the most widely recognized restaurant chains and benefits from customer loyalty, a luxury many don't have. Its scale also gives it negotiating leverage with suppliers, enabling it to source its ingredients at a lower cost. As you can see below, Chipotle grew its sales at an impressive 14.3% compounded annual growth rate over the last six years (we compare to 2019 to normalize for COVID-19 impacts) as it opened new restaurants and increased sales at existing, established dining locations. This quarter, Chipotle's revenue grew by 3% year on year to $3.06 billion, falling short of Wall Street's estimates. Looking ahead, sell-side analysts expect revenue to grow 12.7% over the next 12 months, a slight deceleration versus the last six years. We still think its growth trajectory is attractive given its scale and suggests the market is baking in success for its menu offerings. Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) stock benefiting from the rise of AI. Click here to access our free report one of our favorites growth stories. Restaurant Performance Number of Restaurants The number of dining locations a restaurant chain operates is a critical driver of how quickly company-level sales can grow. Over the last two years, Chipotle opened new restaurants at a rapid clip by averaging 8.2% annual growth, among the fastest in the restaurant sector. When a chain opens new restaurants, it usually means it's investing for growth because there's healthy demand for its meals and there are markets where its concepts have few or no locations. Note that Chipotle reports its restaurant count intermittently, so some data points are missing in the chart below. Same-Store Sales A company's restaurant base only paints one part of the picture. When demand is high, it makes sense to open more. But when demand is low, it's prudent to close some locations and use the money in other ways. Same-store sales provides a deeper understanding of this issue because it measures organic growth at restaurants open for at least a year. Chipotle has been one of the most successful restaurant chains over the last two years thanks to skyrocketing demand within its existing dining locations. On average, the company has posted exceptional year-on-year same-store sales growth of 4.8%. This performance suggests its rollout of new restaurants is beneficial for shareholders. We like this backdrop because it gives Chipotle multiple ways to win: revenue growth can come from new restaurants or increased foot traffic and higher sales per customer at existing locations. In the latest quarter, Chipotle's same-store sales fell by 4% year on year. This decline was a reversal from its historical levels. A one quarter hiccup shouldn't deter you from investing in a business, and we'll be monitoring the company to see how things progress. Key Takeaways from Chipotle's Q2 Results We struggled to find many positives in these results. Its revenue slightly missed and its same-store sales fell slightly short of Wall Street's estimates. Looking ahead, the company lowered full-year same-store sales guidance, expecting "about flat full year comparable restaurant sales", lowered from previous outlook of "sales growth in the low single digit range". Overall, this quarter could have been better. The stock traded down 10.7% to $47.20 immediately following the results. Chipotle didn't show it's best hand this quarter, but does that create an opportunity to buy the stock right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it's free. Error 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
