Key Takeaways
- Chipotle Mexican Grill shares surged in extended trading Wednesday after the restaurant chain reported better-than-expected results for the second quarter.
- The chain’s revenue and earnings grew from the year-ago period and beat analysts’ estimates.
- The results marked Chipotle’s first earnings report since its stock split last month.
Chipotle Mexican Grill (CMG) shares jumped in extended trading Wednesday after the company posted better-than-expected results for the second quarter.
The company reported second-quarter revenue of $2.97 billion, up 18.2% year-over-year and topping analysts’ estimates compiled by Visible Alpha. Net income was $455.67 million or 33 cents per share, also showing growth from the same period a year prior and above expectations.
Bucking the ‘Value Meal’ Trend
Chipotle, alongside “fast casual” peers like Sweetgreen (SG), has not joined the “value meal” trend like many fast food restaurants. Analysts have suggested that Chipotle hasn’t felt the same pressure as others like McDonald’s (MCD) to lower prices, allowing the company to sustain revenue growth amid a difficult consumer spending environment.
“The second quarter was outstanding as successful brand marketing, including the return of Chicken Al Pastor, drove strong demand to our restaurants,” Chipotle CEO Brian Niccol said, adding that the restaurant’s “focus and training around throughput paid off as we were able to meet the stronger demand trends.”
The results marked Chipotle’s first earnings report since its stock split last month.
The burrito chain’s shares were up more than 5% at $54.76 in extended trading Wednesday following the release.