Operations

Chipotle's Q2 results 'stun' industry watchers

July 21, 2021

"Stunning" is how industry watchers described Chipotle's second-quarter results after the Colorado-based chain reported Tuesday that earnings per share came in at $6.60, smashing the 29 cents it posted last year. It beat the $6.50 per share forecast by analysts.

Chairman and CEO Brian Niccol told investors during an earnings call that the brand was well on its way to surpassing its highest average unit volume.

"While our trailing 12-month AUV is $2.41 million, the underlying run rate during the quarter is now above the historical peak of $2.5 million AUV," he said in the call with analysts. "So it's a nice achievement for (an) organization to have $2.5 million AUVs again. But more importantly, we have growth strategies that will take us to the next leg of our journey, $3 million AUVs, along with industry-leading returns on invested capital that improve as we continue to add Chipotlanes."

Niccol's ultimate goal is to have 6,000 restaurants operating in North America with AUVs pushing over $3 million. The chain now has over 2,850.

"Stronger restaurant-level economics combined with significant unit growth should allow us to optimize earnings power for many years to come," he said.

Q2 year-over-year highlights

• Revenue increased 38.7% to $1.9 billion.
• Comparable restaurant sales increased 31.2%.
• Digital sales grew 10.5% and accounted for 48.5% of sales/
• Diluted earnings per share was $6.60, a 2,175.9% increase from $0.29.

For 2021, management is anticipating the following:

• Third-quarter comparable restaurant sales growth in the low- to mid-double digits range.
• At or slightly above 200 restaurant openings.
• An estimated effective full-year tax rate between 25% and 27%