Chipotle profits beat expectations despite higher costs, Omicron -Breaking
Praveen Parmasivam and Hilary Russ
(Reuters) – Chipotle Mexican Grill Inc Wall Street forecasts for quarter profits and comparable sales beat on Tuesday by (NYSE:). Higher demand for burritos, rice bowls, and other food items helped Omicron to overcome a loss.
The bell brought more than 8% increase in shares.
Many restaurants were forced to reduce their hours due to increasing COVID-19 case numbers. Increasing costs also caused many other chain stores, including McDonald’s Corp. (NYSE:). Starbucks Corp To miss profit estimates, please refer to (NASDAQ:).
“We see increasing pressure on wages. During an earnings call, Brian Niccol, Chief Executive Officer stated that he wants to ensure that the company remains competitive in this area. “Our restaurants are more staffed than ever before the COVID.”
Chipotle’s decision to offer drive-thru order-ahead lanes in more stores, along with new menu items like smoked brisket helped ease the pain.
The adjusted earnings per share were $5.58, compared to estimates of $5.25.
Higher-than-anticipated beef and freight costs prompted it to hike menu prices 4% in December, but the company has seen “no resistance” to higher prices, Niccol said.
Digital sales increased 3.8% to 41.6% in the fourth quarter.
In North America, the goal to open new sites over time has been increased by at least 7,000 from 6,000 – especially in smaller cities.
Comparable sales at the burrito chain rose by 15.2% during the fourth quarter that ended December 31, according to Refinitiv polls. Analysts had expected 14.8% growth.
Comparable restaurant sales growth is expected to be in the single digits for the current quarter. This compares with the 7.6% increase.
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