Latest news with #Boatwright
Yahoo
25-07-2025
- Business
- Yahoo
Chipotle's negative same-store sales streak continues
This story was originally published on Restaurant Dive. To receive daily news and insights, subscribe to our free daily Restaurant Dive newsletter. Dive Brief: Chipotle's same-store sales declined about 4% during Q2 2025, continuing a trend of negative growth that began in Q1, the company said in a Wednesday earnings report. The decrease was driven by a 4.9% drop in transactions, partially offset by a 0.9% increase in average check. While Q2 marks one of the brand's worst quarters for comparable sales growth since 2020, Chipotle expects flat comparable sales for the year, according to the report. Ongoing volatility with sales related to consumer spending led the chain to that projection, CFO Adam Rymer said on a Wednesday earnings call. Dive Insight: Despite a slowdown in May, sales momentum grew in June, Boatwright said during the earnings call, thanks to enhanced marketing initiatives and menu innovation. 'Exiting the quarter, we returned to a positive comp and transaction trends, which have continued into July,' he said, adding that consumer confidence also appeared to improve in June and July. During the second quarter, Chipotle's total traffic was up 0.7%, compared to a 0.5% increase in fast casual segment traffic, according to data. While traffic chainwide was up at Chipotle, visits per location fell 6%, according to which uses tens of millions of devices and machine learning to estimate visits to locations in the U.S. Comparatively, traffic was flat per location in the fast casual segment. measurements often yield slightly different, but still useful, results from company earnings reports. 'Some of the dip is likely due to lapping the successful Chicken al Pastor launch and to the Easter calendar shift, which made for a difficult comparison,' said. 'But the dip had narrowed to just -1.5% by June 2025, suggesting that the chain may be seeing the impacts of its latest menu additions.' Comparable sales fell during the first half of 2025. In mid-March, the company launched Chipotle Honey Chicken, which was the highest performing LTO in the company's history, and consumers included the protein in about a quarter of all orders. The company plans to expand its LTO cadence from two annually to three, Boatwright said. 'The guest feedback has been very positive,' Boatwright said. 'It will certainly be another LTO that we will bring back in the future.' The company also added its first dip in five years, Adobo Ranch, which is driving incremental transactions, Boatwright said, adding that the chain sees more opportunity to add sides and dips in the future, and already has a side that could launch in the fall. Chipotle has been boosting marketing, with the goal of doubling its reach on social media and streaming, Boatwright said. The goal of summer initiatives was to overcome summer lulls that the company has seen in the past few years, he added. The chain also launched its first 'Summer of Extras,' a three-month gamified program that offers extra points, badges and prizes to rewards members. New membership in the rewards program grew 14% year over year. 'We drove incremental frequency versus normal behavior across all frequency bands, including low frequency,' Boatwright said. 'Of the 5 million, 2 million were low-frequency users that are now engaging with the brand throughout summer on a more consistent basis.' Boatwright added that the chain plans to do another program in the fall targeting college students. Recommended Reading Chipotle's same-store sales wobble on economic uncertainty 登入存取你的投資組合
Yahoo
25-07-2025
- Business
- Yahoo
Chipotle's CEO doesn't think the company gets enough credit for its value proposition
You can find original article here Nrn. Subscribe to our free daily Nrn newsletter. In the first quarter of 2025, Chipotle chief executive officer Scott Boatwright said the 'consumer is sitting on the sideline' due to heightened macroeconomic uncertainty. This trend led to the chain's first negative same-store sales report since the throes of the pandemic in 2020. Chipotle reported its second quarter 2025 results after market on Wednesday, and it seems as though the consumer hasn't budged. Those results included a 4% decrease in same-store sales, including -4.9% traffic, which were below expectations, causing the company's shares to fall 10% in extended trading. Operating margin also decreased to 18.2%, from 19.7% in the prior-year quarter, while restaurant-level operating margin was 27.4%, from 28.9%. Total revenue increased 3%, to $3.1 billion, driven by the opening of 61 restaurants during the quarter. Boatwright once again acknowledged a challenging environment, with ongoing consumer volatility, but added that trends for both sales and traffic picked up toward the end of June and into July, correlating with a pickup in consumer sentiment scores. However, he said consumers, especially low-income consumers, are still heavily pursuing value deals in a competitive environment and Chipotle needs to work on new and creative ways to communicate its own value proposition. 'Low-income consumers are looking for a price point,' he said. 'Look no further than competitors with snack occasions or $5 meals and that's where the consumer is drifting toward. That causes us to look differently at value. As sentiment improves, the business will improve. That's the biggest headwind we face.' Boatwright went so far as to say he doesn't think Chipotle is getting credit for its value proposition, which extends beyond price point and into convenience and culinary. Changing that perception is a priority in the coming months. 'How do we better communicate our value proposition and center it around the core equities of the brand in a unique way that is authentically Chipotle and not targeted at the competition and not price pointed?' he said. 'We need to figure out how to communicate value and showcase value and that is work we'll lean into in the back part of the year.' Chipotle's recovery plan also includes a continued ramp up of marketing, including an iteration of its successful Summer of Extras promotion that has driven a double-digit increase in loyalty signups and has also re-engaged lapsed users. A similar campaign is expected in the coming weeks targeting college students. The company also anticipates an increase in limited-time offerings in 2026 following its successful launch of Adobo Ranch, its first dip introduction in five years. Kalinowski Equity Research reports a current five-restaurant test of Red Chimichurri Sauce, which could be its next launch. 'We see more opportunity in sides and dips in the future,' Boatwright said. Another tailwind executives expect to show up in the back half of the year comes from its produce slicer rollout, which has been completed, and its continued rollout of its high efficiency equipment package, including a double plancha. The produce slicers, Boatwright said, enables team members to complete prep work on time and be properly deployed for peak periods, while the equipment package — expected to be completed in about three years — should improve consistency and quality while also unlocking new growth platforms, like catering. Catering, by the way, will be tested in about 60 restaurants in the fall. 'Our goal is to scale catering within restaurants without disrupting core operations. It represents 1% to 2% of sales versus our peers who are at 5% to 10%, so we think there's a bigger opportunity longer term,' Boatwright said. As the company awaits these tailwinds to build up speed, Chipotle has lowered its full-year outlook following Q2, from low-single digit same-store sales growth to flat. Still, Boatwright reiterates his confidence in the plan and intends to stay the course. 'All of the consumer metrics we look at show positive progress,' he said. 'We've unpacked this thing 10 ways to understand if this is self-inflicted or a macro problem and there's nothing glaring that says we have a misstep. That gives us the confidence to stay on strategy, innovate where we can, meet consumers where they are, and continue execution in the restaurants.' Contact Alicia Kelso at Sign in to access your portfolio
Yahoo
25-07-2025
- Business
- Yahoo
Chipotle Earnings: Another Rough Quarter
Key Points Chipotle missed revenue expectations as comparable-restaurant sales fell 4% in the second quarter. The company lowered its outlook for the full year, although management does expect some improvement in the second half. Investors punished the stock in after-hours trading after the second disappointing quarter in a row. 10 stocks we like better than Chipotle Mexican Grill › Here's our initial take on Chipotle's (NYSE: CMG) financial report. Key Metrics Metric Q2 2024 Q2 2025 Change vs. Expectations Revenue $2.97 billion $3.06 billion 3% Missed Earnings per share (adjusted) $0.34 $0.33 (2.9%) Met Comparable restaurant sales 11.1% (4%) (15.1) pp n/a Operating margin 19.7% 18.2% (1.5) pp n/a Fewer People Are Going to Chipotle Chipotle managed to eke out 3% revenue growth in the second quarter, below analyst expectations, only because it opened 61 new company-owned restaurants. Comparable-restaurant sales dropped 4%, compared to 11% growth in the same period last year, driven by a 4.9% decline in transactions. Profitability also suffered. Adjusted earnings per share was down slightly, while operating margin contracted by 1.5 percentage points to 18.2%. The negative impacts of lower sales volumes and cost inflation for some ingredients were partially offset by menu price increases. Chipotle CEO Scott Boatwright pointed to momentum from the company's summer marketing initiatives, which could start to improve results. For the full year, Chipotle expects comparable restaurant sales to be roughly flat, which implies a meaningful improvement in the second half. Immediate Market Reaction Shares of Chipotle plunged 11% in after-hours trading Wednesday, with investors reacting negatively to the company's revenue miss. While the company's outlook called for some improvement in the second half of the year, investors may not be buying the story. Going into the second-quarter report, Chipotle stock was down about 12% year to date. What to Watch This is the second quarter in a row Chipotle missed expectations and also the second quarter in a row the company dialed back its full-year outlook. While guidance calling for roughly flat comparable-restaurant growth for the full year would be an improvement over the second quarter, the company had previously guided for low- to mid-single-digit growth. It's difficult to know how much of Chipotle's sales woes are due to company-specific issues and how much are due to the macroeconomic environment. While the company benefited from a boost to menu prices, those higher prices could be more than some of its customers are willing to pay. With two quarters of weak results and lowered expectations, investors are right to be wary of Boatwright's talk of "momentum." Helpful Resources Full earnings report Investor relations page Should you buy stock in Chipotle Mexican Grill right now? Before you buy stock in Chipotle Mexican Grill, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Chipotle Mexican Grill wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $641,800!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,023,813!* Now, it's worth noting Stock Advisor's total average return is 1,034% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Timothy Green has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chipotle Mexican Grill. The Motley Fool recommends the following options: short September 2025 $60 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy. Chipotle Earnings: Another Rough Quarter was originally published by The Motley Fool 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
Yahoo
17-07-2025
- Business
- Yahoo
Jim Cramer Recommends Texas Roadhouse Over Chipotle
Chipotle Mexican Grill, Inc. (NYSE:CMG) is one of the stocks in Jim Cramer's spotlight. A caller asked if it is worth waiting for the company to report later this month to sell, and Cramer responded: 'Okay, why to sell, right? Boatwright, he's a good CEO. I think that a lot of people feel right now, that the price, that it's gotten, the meals are too expensive. I think that's nonsense. What's really happened here is they did this 50-for-1 split, and there's just stock sloshing around everywhere. It just hasn't been able to put together two good quarters. When it does that, I think it can break out again. But it's not, we don't own it. When it comes to restaurants, I like, you know, I like Texas Roadhouse. Why? Because it's a regional and national story. I prefer that to the stock of Chipotle.' A chef plating up a wide variety of dishes for a restaurant chain. Chipotle (NYSE:CMG) operates a chain of restaurants that offer Mexican-inspired food and beverages, including burritos, bowls, and tacos. The company also provides delivery services through its app and website. While we acknowledge the potential of CMG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now. Disclosure: None. This article is originally published at Insider Monkey. 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
Yahoo
16-06-2025
- Business
- Yahoo
From COO to CEO: The cold reality of climbing to No. 1
Scott Boatwright always aimed to be a CEO. Not just any CEO but the leader of a Fortune 500 company. That moment arrived in late 2024 when he was elevated to the top job at Chipotle after Brian Niccol left to lead Starbucks. But as Boatwright shared at the recent Fortune COO Summit, the jump from second-in-command to chief executive is less a step up and more a transformation. A CEO today has to run a great business, manage a great stock, and, ultimately, shape a lasting organizational legacy, Boatwright said. As COO, he and Niccol were a strong pairing, he said, because he focused on operations, while Niccol excelled at communicating the company's growth story to investors. One of the hardest adjustments as CEO, Boatwright admitted, is shifting from pulling the levers himself to managing outcomes through others—and doing so while building investor confidence and long-term vision. 'It's just a completely different job,' he said. Other newly minted CEOs echoed that learning curve. Howard Hochhauser, the CEO of and its former COO and CFO, stepped into the role earlier this year at the private equity-backed company. Although he'd previously served as interim chief executive, the weight of the job still caught him off guard once permanently in the role. 'Everybody wants a successful exit,' he said. 'To do that, you have to grow the company. And now I'm spending 110% of my time on growth.' At Xerox, Steve Bandrowczak stepped into the CEO role in 2023 following the sudden passing of John Visentin. He had spent five years as COO, was a seasoned CIO, and had attended numerous board and committee meetings. But once he became CEO, the stakes shifted. 'COOs drive change. COOs make cultural shifts, drive outputs,' Bandrowczak said at the Fortune COO Summit. 'The difference as a CEO is you're now the leader, the face of the company. So you've got to be able to drive the culture with shareholders, with employees, with partners, but more importantly, understanding things that you did not know, and the admission of the things that you did not know.' Bandrowczak encouraged aspiring CEOs to take governance and leadership courses to prepare for the transition to the corner office. And as a teacher of rising executives himself, he offered one consistent piece of advice: 'Get comfortable being uncomfortable.' Ruth Today's newsletter was curated by Lily Mae Lazarus. This story was originally featured on 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
