Chipotle swings positive after a tough 2025

Chipotle’s stock price rallied by nearly 5% in after-hours trading Wednesday following a better-than-expected first quarter earnings report that included the chain’s first positive same-store sales metric in over a year, at 0.5%. Transactions were also positive at 0.6%.

Total revenue was $3.1 billion, marking a nearly 7% increase year-over-year.

“Our first quarter performance exceeded expectations, and we are encouraged by the early momentum we are seeing in our recipe for growth and positioning,” CEO Scott Boatwright said during the call.

Though Chipotle was hindered by inflationary pressures, which pulled restaurant-level margins down 250 basis points year-over-year to 23.7%, the company found momentum from its High Protein Menu, launched in December, the return of its Chicken al Pastor, and the introduction of Cilantro Lime Sauce in March. During Q1, nearly one-fourth of all transactions included an add-on protein, illustrating that the chain has become a destination among the increasing number of consumers seeking out the nutrient.

Meanwhile, the Chicken al Pastor generated incremental transactions and the Cilantro Lime Sauce outperformed Red Chimichurri Sauce, which had previously been Chipotle’s most popular sauce.

We can expect additional innovation around sides and beverages this year with a goal of keeping Chipotle top-of-mind, Boatwright said.

He added that the company also continued to invest in pricing below inflation to reinforce its value proposition, which helped drive traffic.

Additional momentum is coming from its high-efficiency equipment package, now in more than 600 restaurants with 2,000 targeted by year’s end. The package includes a dual-sided plancha, three-pan rice cooker and high-capacity fryer, which Boatwright calls a “game changer” for creating more throughput during peak hours.

Chipotle is also working to strengthen its hospitality scores to meet consumer demands, part of its five-pillar “Recipe for Growth” strategy unveiled in February following its first negative same-store sales year in its history in 2025.

“This means extraordinary food, a clean restaurant, fast and accurate service and friendly teams,” Boatwright said. To support the hospitality objective, Chipotle is testing a new mystery shopping program to provide an independent view of its restaurant operations.

On the tech side, the company’s new digital makeline display, called Chipotle Kitchen, featuring an improved interface that makes back-of-house employees’ jobs easier. This system is now live in more than 100 restaurants with systemwide rollout expected by the end of next year.

“We are already seeing meaningful improvements on time performance, visual order accuracy and customer satisfaction,” Boatwright said.

He also sees a tailwind from the company’s newly enhanced loyalty program, introduced earlier this month. It was created to deepen guest engagement and accelerate engagement. Loyalty comps “meaningfully” outpaced non-loyalty comps in Q1, Boatwright said, “reinforcing the power of the platform and the opportunity ahead.”

Notably, Chipotle’s momentum has continued in Q2. CFO Adam Rymer said there has been a “nice step up” in April following the Cilantro Lime Sauce introduction.

Despite swinging positive, Chipotle is maintaining a flat same-store sales guidance for the full year. Rymer said that while the company’s initiatives continue to gain traction, this conservative guidance reflects the dynamic consumer environment.