More diners are eating at Chipotle despite higher prices, bucking Wall Street's concerns about restaurants

By Bill Peters

Surprise same-store sales gain lifts shares of the Mexican fast-casual chain in after-hours trade

Some analysts said new menu items and a loyalty program relaunch would help revive Chipotle's sales and stock price.

Chipotle Mexican Grill's quarterly earnings results on Wednesday showed that consumers were still willing to dine out despite a surge in gas prices last month due to the Iran war. But the Mexican fast-casual chain is staying cautious on the year ahead, mirroring Wall Street and restaurant analysts' own reservations about the sector.

Shares of Chipotle (CMG) jumped about 4% after hours on Wednesday, after the company managed to eke out a surprise same-store sales gain for the first quarter, which covered the start of the Iran war and growing concerns about the impact of the economy.

However, management, in its outlook for the year, wasn't completely ready to forecast a bigger rebound. But it signaled that at least conditions aren't getting worse

The fast-casual chain stuck with its expectations for same-store sales to come in "about flat" this year. The company said the same thing in February.

Chipotle said its same-store sales rose 0.5% during the first quarter, helped by a small bump in transactions as well as menu-price increases. That was better than analysts' expectations for a decline of 0.7%.

Chipotle's stock is still down 35.3% over the past 12 months. Its value is about half of where it was during its peak in 2024 - as fast-casual chains fell out of favor amid greater competition from sit-down chains that began to offer more value deals at lower prices.

However, some analysts last month said new menu items - like the return of chicken al pastor, and high-protein options - as well as a loyalty program relaunch would help revive sales and the company's share price.

Chipotle reported first-quarter sales of $3.09 billion, up 7.4% year over year, a bit above FactSet forecasts for $3.07 billion. The company reported adjusted earnings per share of 24 cents, down 17.2% and in line with Wall Street's estimates.

Earlier on Wednesday, shares of chicken-wing chain Wingstop (WING) fell after higher gas prices due to the Iran war chewed up its lower-income consumers' budgets and hurt sales. However, Starbucks (SBUX) on Tuesday said its turnaround efforts were helping to bring more younger and lower-income shoppers back to the coffee chain.

-Bill Peters

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