Chipotle Mexican Grill (CMG) Q1 2024 earnings

Chipotle Mexican Grill on Wednesday reported quarterly earnings and revenue that beat analysts’ expectations, fueled by higher traffic to its restaurants.

The stock rose 4% in extended trading.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: $13.37 adjusted vs. $11.68 expected
• Revenue: $2.7 billion vs. $2.68 billion expected

Chipotle reported first-quarter net income of $359.3 million, or $13.01 per share, up from $291.6 million, or $10.50 per share, a year earlier.

Excluding a 36-cent hit from increases to its legal reserves, the burrito chain earned $13.37 per share.

Net sales climbed 14.1% to $2.7 billion.

The company’s same-store sales rose 7%, topping StreetAccount estimates of 5.2%. Chipotle said traffic increased 5.4% from the year-ago period, while the average check was up just 1.6%.

In February, Chief Financial Officer Jack Hartung told analysts that “unusually cold weather” hurt January sales. But demand rebounded in the rest of the quarter to offset the sluggish first month.

Chipotle has become the rare restaurant chain to report rising transactions despite higher menu prices. The company once again raised its prices in October, citing inflation. Others in the restaurant industry have turned to limited-time offers and deals to appeal to customers, particularly those with lower incomes.

CEO Brian Niccol said the company saw traffic growth across income groups during the quarter. He credited the chain’s value perception among diners. Previously, executives have also emphasized that most of its customers come from higher-income brackets.

Earlier this month, Chipotle raised prices in California roughly 7% to offset the state’s higher minimum wage for fast-food workers, but the company does not have plans for any more hikes, Niccol said on CNBC’s “Closing Bell” on Wednesday.

Chipotle has also been focusing on making its burritos and bowls more quickly, improving the industry metric known as throughput. Niccol said throughput reached its highest level in four years during the first quarter.

The chain added 47 new locations to its footprint during the first quarter, inching closer to its long-term goal of doubling its total number of restaurants to reach 7,000 stores.

For the full year, Chipotle now anticipates same-store sales will grow by a mid-to-high single-digit percentage, up from its prior range of a mid-single-digit increase. The company reiterated its forecast of 285 to 315 new locations in 2024.

In March, Chipotle’s board approved a 50-for-1 stock split, one of the largest in the New York Stock Exchange’s history. The company is seeking shareholder approval at its annual meeting on June 6. If investors vote “yes,” the stock will start trading on a post-split basis on June 26.