Chipotle Updates 2025 Sales Forecast Amid Declining Customer visits
Chipotle Mexican Grill has revised its same-store sales outlook for 2025, now anticipating flat growth after experiencing a drop in customer traffic for the second quarter in a row. This adjustment marks the second consecutive revision, moving away from earlier expectations of modest single-digit increases.
Financial Overview and Recent Results
During the second quarter, Chipotle’s total revenue rose by 3% to $3.06 billion, largely fueled by new restaurant openings. Though, same-store sales declined by 4%, a steeper fall compared to the previous quarter’s 0.4% decrease and analysts’ forecasted drop of 2.9%. The average check size increased roughly 1%, partially offsetting an almost 5% decline in customer visits.
- Earnings per share: Adjusted earnings aligned with projections at $0.33 per share.
- Total revenue: Reported at $3.06 billion versus an expected $3.11 billion.
The company recorded net income of $436 million (32 cents per share), down from $456 million (33 cents per share) during the same period last year when excluding one-time charges and legal costs.
Main Drivers Behind Sales Variability
This slowdown follows a period last year when Chipotle outperformed many rivals despite industry-wide challenges such as reduced foot traffic and cautious consumer spending patterns.
The downturn in late 2024 was influenced by seasonal disruptions including altered holiday schedules and extreme weather events like wildfires in California that significantly affected January operations. Additionally, broader economic uncertainties prompted consumers to cut back on dining out during early spring months.
Signs of Advancement Emerging Mid-Year
despite these obstacles,CEO Scott Boatwright noted encouraging signs starting in June as promotional efforts-including launching new menu items like Spicy Mango Salsa-helped attract customers back throughout summer.
“By the close of Q2, we observed positive momentum returning with increases in both transactions and comparable store sales extending into July,” Boatwright stated during Chipotle’s earnings discussion.
Sustained Growth Strategy Looking Forward
The leadership team remains confident about regaining traction over time with targets set on achieving mid-single-digit growth rates for same-store sales alongside average unit volumes approaching approximately $4 million annually per location.
This optimistic outlook is bolstered by plans to open between 315 and 345 new restaurants this year-a bold expansion reflecting confidence despite near-term challenges posed by inflationary pressures and evolving post-pandemic dining habits nationwide.
