Chipotle Mexican Grill — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue increased 9.6% year-over-year to $3.3 billion for the quarter ended September 30, 2026.
• Comparable restaurant sales increased 2.1%, driven by a 1.3% increase in average check and a 0.8% increase in transactions.
• Operating margin decreased to 13.7% from 15.9% in the prior year period.
• Restaurant level operating margin decreased to 23.3% from 24.5% in the prior year period.
• Diluted earnings per share was $0.27, a 6.9% decrease from $0.29 in the prior year period.
• Adjusted diluted earnings per share was $0.27, a 6.9% decrease from $0.29 in the prior year period.
• Net income was $339.9 million compared to $382.1 million in the prior year period.
• Food, beverage, and packaging costs were 29.5% of total revenue, down from 30.0% in the prior year period.
• Labor costs were 25.7% of total revenue, up from 25.2% in the prior year period.
• General and administrative expenses were $185.2 million, up from $146.7 million in the prior year period.
• The effective income tax rate was 25.6%, up from 23.1% in the prior year period.
• Cash and cash equivalents were $634.2 million as of September 30, 2026, compared to $350.5 million as of December 31, 2025.
• Unearned revenue was $223.6 million as of September 30, 2026, compared to $240.4 million as of December 31, 2025.

Guidance and Future Outlook:

• For 2026, management anticipates full-year comparable restaurant sales growth in the low single-digit range.
• For 2026, management expects 350 to 370 new restaurant openings, including 10 to 15 international partner-operated restaurants, with approximately 80% of new company-owned restaurants featuring a Chipotlane.
• For 2026, management estimates an underlying full-year effective tax rate between 24% and 26% before discrete items.
• For 2027, management anticipates 340 to 360 new company-owned restaurant openings in the U.S. and Canada.
• For 2027, management anticipates 15 to 25 company-owned and partner-operated restaurants outside the U.S. and Canada.

Business Segments and Product Lines:

• Digital sales represented 38.8% of total food and beverage revenue for the quarter, up from 36.7% in the prior year period.
• The company opened 84 company-owned restaurants during the quarter, 53 of which included a Chipotlane.
• The company opened five international partner-operated restaurants during the quarter.
• Chipotlanes are noted to enhance guest access, convenience, and increase new restaurant sales, margins, and returns.
• The company entered three new international markets during the quarter.
• Total restaurant count reached 4,267 company-owned restaurants and 20 partner-operated restaurants as of September 30, 2026.

Market and Competitive Landscape:

• The company reported three consecutive quarters of positive comparable transaction growth.
• Menu price increases contributed to lower food, beverage, and packaging costs and helped offset labor cost increases.
• Tariff relief and favorable limited-time offer mix contributed to lower food, beverage, and packaging costs.
• Inflationary pressures, particularly in beef and freight, and higher protein usage partially offset cost benefits.
• The company is the only restaurant company of its size that owns and operates all its restaurants in the United States, Canada, and Europe.

Risks and Challenges:

• Labor costs increased due to lower sales volumes, higher employee compensation (wage inflation and bonuses), additional labor for operational execution, and increased insurance costs.
• General and administrative expenses increased due to stock-based compensation, performance bonuses, and outside services related to corporate initiatives.
• The effective income tax rate increased due to higher nondeductible expenses and a reduction in tax credits.
• The press release lists numerous forward-looking risks including wage inflation, union organizing efforts, supply chain disruptions, food safety incidents, cybersecurity risks, and competition.

Management Commentary and Tone:

• CEO Scott Boatwright stated that three consecutive quarters of positive comparable transaction growth demonstrate the "Recipe for Growth" strategy is working.
• Management highlighted progress on menu and digital innovation, high-efficiency equipment rollout, and global expansion.
• Management expressed confidence in the strategy and its ability to execute in building Chipotle into an iconic global brand.

Other Key Points:

• The company repurchased $110.0 million of stock during the third quarter at an average price per share of $34.05.
• As of September 30, 2026, $1.6 billion remained available under share repurchase authorizations from the Board of Directors.
• The company will host a conference call on October 28, 2026, at 4:30 PM Eastern time to discuss results.
• Supplemental slides will be available on the company's investor relations website.