Chipotle Mexican Grill and Starbucks released their latest earnings reports after closing bell tonight. Chipotle reported earnings of 87 cents per share on $998.4 million in revenue, against the consensus estimates of 91 cents per share in earnings and $1.05 billion in sales. In the year-ago quarter, the fast casual dining chain posted earnings of $4.45 per share and $1.2 billion in revenue.
Starbucks posted adjusted earnings of 49 cents per share on $5.24 billion in sales for its third fiscal quarter, compared to the consensus estimates of 49 cents per share in earnings and $5.34 billion in revenue. In the year-ago quarter, the coffee chain reported earnings of 42 cents per share on $4.88 billion in revenue.
In his 2021 year-end letter, Baupost's Seth Klarman looked at the year in review and how COVID-19 swept through every part of our lives. He blamed much of the ills of the pandemic on those who choose not to get vaccinated while also expressing a dislike for the social division COVID-19 has caused. Q4 2021 Read More
Chipotle Mexican Grill’s comparable sales plunge
Chipotle Mexican Grill’s comparable store sales plunged 23.6%, which was worse than the consensus of 20.6% decline. The fast casual dining chain said comparable restaurant transactions plunged 19.3%. Food costs increased as a percentage of revenue by 110 basis points to 34.2% on the back of higher costs at suppliers due to the new food safety procedures and food waste costs. The restaurant level operating margin plunged from 28% in the year-ago quarter to 15.5% this year.
“We returned to profitability, and saw a modest improvement in comp sales trends in the second quarter, said Chipotle Mexican Grill Founder, Chairman and Co-CEO Steve Ells in a statement. “Our most recent marketing efforts, led by our Chiptopia frequency program, are off to a nice start in the third quarter, as customers are embracing the program and nearly 30% of all transactions are engaged in Chiptopia… While it has only been a few weeks since Chiptopia launched, we are pleased to see that July sales comp trends have already improved by 200 to 300 basis points, and transaction comp trends have improved by an even greater amount.”
Shares of Chipotle Mexican Grill jumped by as much as 2.38% to $428.32 in after-hours trades.
Starbucks falls after earnings
Starbucks’s GAAP earnings rose 24% to 51 cents per share, a new record. Global comparable store sales increased 4%, compared to the consensus of 5.7% growth. In the previous quarter, the company reported a 7% increase in same store sales in the U.S. and the Americas. Starbucks said the Americas segment saw a 4% increase in comparable store sales, while the China/ Asia Pacific region recorded a 3% increase and the EMEA segment’s comparable store sales ticked down 1%.
The coffee chain expects adjusted earnings for the fourth quarter to be between 54 cents and 55 cents per share, compared to the consensus of 55 cents per share. It expects full-year earnings to be between $1.88 and $1.89 per share, compared to the consensus of $1.89 per share.
Shares of Starbucks slumped in after-hours trades, falling as much as 3.06% to $55.84.