Chipotle Mexican Grill fell short of Wall Street revenue expectations for the third quarter. The company announced it missed its goal by about $30 million as younger customers made fewer visits amid rising costs and slower wage growth.
Revenue falls short, but growth continues
The fast-casual chain reported $3 billion in third-quarter revenue, compared to analyst expectations of $3.03 billion.
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Despite the shortfall, revenue was still up 7.5% from 2024, thanks largely to the opening of 84 new restaurants during the quarter.
Chipotle Chief Executive Scott Boatwright said overall store traffic fell less than 1%, blaming what he called “macroeconomic pressures.” Those include what CNBC calls the sluggish consumer economy — unemployment, student loan debt and slow wage growth. Boatwright said, “We’re not losing that customer. They’re just coming less often.”
Younger customers feeling the pinch
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Chipotle expects to open 350 to 370 new locations in 2026, including a foray into the international market.
Inflation is hitting Chipotle’s customer base hardest. Roughly 40% of its diners earn under $100,0000 a year, and most fall between ages 25 and 35 — a group particularly affected by higher living costs.
Same-store sales rose slightly — up 0.3% from the previous quarter — but that growth came mainly from higher menu prices rather than increased traffic.
Menu innovation and digital push
Chipotle is trying to counter the slowdown with new menu items like carne asada and red chimichurri as part of what it calls an “innovation push.”
The company is also investing heavily in digital engagement, which now accounts for nearly 37% of total sales.
Still, investors reacted sharply to the earnings news — with Chipotle shares dropping 13% on Wednesday.
Despite softer traffic, Boatwright says Chipotle won’t cut prices to attract more customers. He argued the $10 price point for the burrito chain is still a better option than other fast-casual restaurants that wind up around the $15 mark per purchase.
What’s ahead
Looking ahead, Chipotle now expects its same-store sales to fall by single-digit percentages for 2025. That marks a turnaround from the start of 2025, when the company was predicting such sales would rise by single digits.
Even so, the company plans to open hundreds of new restaurants in 2026, betting that brand loyalty and menu innovation will drive long-term momentum.
