Chipotle shares fall after missing on top and bottom lines in fourth quarter

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Adjusted earnings per share of $8.29 missed the expectation for $8.92 a share. Revenue of $2.18 billion fell slightly short of the expectation for $2.2B. Same-store sales rose 5.6%, short of the 6.9% expected. 

Revenue was up 11.2% from the fourth quarter 2021, driven by comparable store sales and new store openings. Chipotle said in-restaurant sales increased 17.5% in the fourth quarter from the year earlier, and digital sales made up 37.4% of total food and beverage revenue.

“We delivered strong growth in 2022, expanding average unit volumes and restaurant level margin, while opening the highest number of new restaurants in six years, despite facing a challenging and fluid macro environment,” said CEO Brian Niccol.

Among the quarter’s highlights, Chipotle pointed to 100 new restaurant openings, including 90 locations with its drive-through Chipotlanes. “These formats continue to perform well and are helping enhance guest access and convenience, as well as increase new restaurant sales, margins, and returns,” the company said.

Fourth-quarter food, beverage and packaging costs were 29.3% of total revenue, a decline from the prior year. Chipotle raised menu prices, and said lower avocado prices also helped partially offset higher costs for dairy and tortillas.

 For the year, total revenue rose 14.4% to $8.6B, while comparable store sales rose 8%. In-restaurant sales rose 26.4% for the year, and digital sales made up 39.4% of food and beverage revenue.

For 2023, the company is projecting first-quarter comparable restaurant sales growth in the high-single digits. It also sees 255 to 285 new restaurant openings this year, including as many as 15 with a Chipotlane.

It also announced it would buy back an additional $200 million of shares.