Four days ago, the Chipotle earnings report released for the second quarter of 2018. The financial report gave the restaurant chain’s stock a temporary boost, but it has since corrected and is currently trading in the red today.
Chipotle Q2 2018
The second quarter for many businesses ended back on June 30th, 2018. According to the Chipotle earnings report, which compares Q218 to Q217, the company’s revenue increased 8.3% to $1.3 billion. Its restaurant sales rose 3.3%, and its restaurant-level operating margin grew 0.9%.
Chipotle’s net income was $46.9 million, which was a 29.7% decrease from its $66.7 million in 2017. The $46.9 million included the after-tax impact of $33.4 million in expenses related to the restaurant asset impairment, legal costs, and corporate restructuring.
If these items were excluded from the costs, Chipotle’s Q2 earnings in 2018 would have been $80.2 million and would have increased 20.2%.
The company opened 34 new restaurants last quarter and closed or relocated eight.
“I’m pleased to report a solid second quarter with sales and restaurant margins ahead of expectations,” said Brian Niccol, Chipotle chief executive officer, in the official press release. “While we made progress during the quarter with particular strength in digital sales, I firmly believe we can accelerate that progress by executing our reorganization and our strategy to win today and cultivate tomorrow.”
Food costs were 32.6% of the company’s revenue, which was a decrease of 150 basis points compared to its Q2 2017 numbers. This decrease was due to the menu price increases and the relief of avocado prices. These prices were partially offset by the elevation of beef prices though.
Chipotle’s company earnings rely heavily on the organic availability of foods from farms around each store’s location.
Chipotle Stock Movement (NYSE:CMG)
According to Yahoo Finance, Chipotle’s stock jumped nearly 6% after its Q2 earnings were released last Thursday.
Chipotle opened the market today at $470.15 a share and closed the day at $465.47 a share, down -$6.83 (-1.45%). Chipotle’s market cap is currently sitting at $12.946 billion.
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