Chipotle Mexican Grill Inc. (NYSE: CMG) announced its second quarter 2025 financial results, revealing a nuanced performance amid ongoing economic challenges and strategic expansion efforts. The company reported a total revenue increase of 3.0% year-over-year to $3.1 billion for the quarter ended June 30, 2025, driven primarily by the opening of 61 new company-owned restaurants, including 47 with Chipotlane drive-thru lanes. However, comparable restaurant sales declined by 4.0%, reflecting a 4.9% decrease in transactions partially offset by a 0.9% increase in average check size. Digital sales accounted for 35.5% of total food and beverage revenue, underscoring Chipotle’s continued digital transformation.
Operating margin contracted to 18.2% from 19.7% in the prior year quarter, while restaurant-level operating margin decreased to 27.4% from 28.9%. Diluted earnings per share (EPS) fell slightly by 3.0% to \(0.32, with adjusted diluted EPS down 2.9% to \)0.33. The company’s net income stood at \(436.1 million, a 4.3% decrease from \)455.7 million in the same period last year.
Cost management showed mixed results: food, beverage, and packaging costs improved to 28.9% of revenue from 29.4%, benefiting from prior menu price increases and cost efficiencies, despite inflationary pressures on key ingredients like steak and chicken. Labor costs rose to 24.7% of revenue from 24.1%, primarily due to lower sales volumes, though wage inflation was mitigated by efficient labor management.
General and administrative expenses decreased to \(172.2 million from \)175.0 million, aided by lower performance bonuses and stock-based compensation. The effective income tax rate improved slightly to 24.5% from 25.0%.
Chipotle’s balance sheet remains robust with total assets of \(9.27 billion and shareholders’ equity of \)3.53 billion as of June 30, 2025. The company repurchased \(435.9 million of stock during the quarter at an average price of \)50.16 per share, with $838.8 million remaining authorized for repurchases.
Looking ahead, Chipotle projects flat full-year comparable restaurant sales for 2025 and plans to open between 315 and 345 new company-owned restaurants, with over 80% featuring Chipotlanes. The company anticipates an underlying effective tax rate between 25% and 27% for the full year.
This earnings release aligns with themes from prior quarters, where Chipotle emphasized digital sales growth, operational efficiency, and strategic expansion through Chipotlanes. CEO Scott Boatwright highlighted the company’s commitment to delivering high-quality, hand-crafted meals and expanding its market presence globally.
In summary, Chipotle’s Q2 2025 results reflect steady revenue growth fueled by new restaurant openings and digital sales, tempered by challenges in comparable sales and margin pressures. The company’s strategic focus on innovation, operational excellence, and expansion positions it well for sustained long-term growth.
For detailed financial data and the full earnings release, visit the source document.
Tags: CMG, Chipotle Mexican Grill, Q2 2025, Chipotlane Expansion, Digital Sales Growth, Restaurant Operating Margin