What you need to know before Chipotle’s earnings release on Wednesday

Key conclusions

Chipotle Mexican Grill is set to report earnings after stocks close Wednesday, with analysts forecasting year-over-year revenue and profit growth.
The company completed a massive 50-for-1 stock split last month, and its shares have been falling ever since.
Baird analysts wrote Sunday that the fast casual chain is “well positioned” to operate despite a “challenging consumer spending environment.”

Chipotle Mexican Grill (CMG) reported its latest quarterly results after the close on Wednesday. Analysts expect revenue and earnings to rise year over year, marking the chain’s first financial result since its 50-for-1 stock split last month.

Analysts are forecasting Chipotle’s revenue will rise 17% year over year to $2.94 billion, with profits rising about 28% to $437.8 million, according to Visible Alpha estimates.

Analysts at Baird wrote Sunday that they believe the chain is well-positioned to continue to post improved earnings despite a “challenging consumer spending environment” that has impacted much of the economy, including some of Chipotle’s competitors.

However, Baird analysts noted that some indicators point to a “softening” in demand earlier this month.

	Analysts’ estimates for Q2 2024	Q1 2024	Q2 2023
Income	$2.94 billion	$2.7 billion	$2.51 billion
Diluted EPS (after splitting)	31 cents	26 cents	25 cents
Net income	437.82 million dollars	$359.29 million	$341.79 million

Key Metric: Like-for-Like Store Sales

Chipotle’s last two quarterly results were lifted by higher comparable-store sales, thanks to higher prices and increased traffic. Baird analysts wrote that the company’s results should continue to be boosted by Chipotle’s “strong and improving value proposition.”

Analysts have noted that while Chipotle has raised prices, it has done so at a slower pace than most of the industry: Analysts found that the cost of its chicken burrito, the chain’s most popular item, has risen slower than the rate of “food away from home” inflation as measured by the Consumer Price Index (CPI) over the past decade.

Business Spotlight: Performance Since Spin-Off, CFO Retirement Announcement

The company announced earlier this month that longtime CFO Jack Hartung is retiring next year, with his successor, current VP of Finance Adam Rymer, set to take over in January. Hartung, who has been Chipotle’s CFO since 2002, will remain with the company until March.

Chipotle completed its 50-for-1 stock split last month. The company said it wanted to make the stock more accessible to employees and a broader range of investors.

Chipotle shares were little changed Monday. They have fallen nearly 20% since the split became effective June 26.