Earnings Results
During earnings call, management also talked up faster grills, automation and floated making more new menu items out of existing ingredients
Ahead of Chipotle’s results, some analysts cited the chain’s chicken al pastor offering and rewards-program incentives as potential benefits.
Associated Press
Executives at Chipotle Mexican Grill Inc. on Tuesday said the chain plans to put a “pause” on raising prices — while still leaving the door open for more if necessary — and said new restaurant openings, falling avocado costs and efforts to strengthen employee training in its kitchens lifted first-quarter results.
Shares of Chipotle CMG jumped nearly 8% after hours on Tuesday following the results, which beat expectations.
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Chipotle Mexican Grill Inc. recently reported its first-quarter earnings results for 2021, revealing a 21.9 percent increase in sales and an unexpected surge in stock prices. The company credited the surge in part to its menu innovation, price pauses, and increasing store counts.
The Denver-based burrito chain announced that it has decided to pause planned menu price increases and instead focus on investing in and marketing “hidden gems” on the menu. These gems are lesser-known items on the Chipotle menu that often have lower price points, such as white rice, quesadillas, nachos, and large orders of tacos.
The company also reported having 691 new restaurant openings since the start of the COVID-19 pandemic in March 2020. New stores boosted earnings significantly, and cheaper avocados, resulting from a California avocado shortage, also contributed positively to the company’s bottom line.
Chipotle also boasted regarding its loyalty program, which had more than 19 million members as of March 31, 2021, an increase of 18.6 percent from 2020.
“Our ongoing brand recovery and the successful launch of Crew at Home, our digital catering platform, demonstrated the strength and broad appeal of the Chipotle brand,” CEO Brian Niccol said.
In the first quarter of 2021, Chipotle recorded sales of $1.65 billion, representing a year-over-year increase of 21.9 percent. Same-store sales increased by 18.1 percent as well.
Looking ahead, the company plans to continue opening new stores, focusing on menu innovation, and utilizing its loyalty program to build an even stronger customer base.
Overall, Chipotle’s first quarter results proved to be quite positive and promising, with financial reports indicating an unexpected surge in sales and stock prices. The company’s decision to pause menu price increases and focus on menu innovation and store openings has proven to be a smart move, and it is likely that these gains will continue in the upcoming quarters.
