Chipotle Guides Fourth-Quarter Comparable Sales To Around 2% After A 'Choppy Start' To The Quarter
The CFO pointed to next week's brisket return and a 3% to 4% exit rate to offset softer October trends.
Chipotle Mexican Grill expects fourth-quarter comparable sales of around 2%, CFO Adam Rymer said on the company's third-quarter earnings call Wednesday, after October trends softened in line with the broader industry. Rymer and CEO Scott Boatwright both leaned on the return of smoked brisket next week to lift the quarter's exit rate to 3% to 4%.
A soft October, a brisket bet
Rymer said that, taking into account the "choppy start for the quarter," fourth-quarter comps should land "around a plus 2%," with an exit rate in the 3% to 4% range. He said brisket and several marketing initiatives would fuel that.
Boatwright said September finished up 3.8% with very little promotion. Industry pullback hit the first part of October, he said, but Chipotle has "since regained positive transactions." He called brisket "an extraordinary product" and said he feels "very confident that November and December set up very well."
Rymer said in his prepared remarks that the company is confident it will deliver on its low-single-digit comparable sales guidance for 2026, a forecast unchanged from July. Asked by an Evercore ISI analyst about 2027, he said it was too early to guide comps and that guidance would come on the next call.
What brisket costs the margin
Chipotle owns and operates restaurants serving burritos, bowls, tacos and salads; as of December 31, 2025, it owned 3,938 in the United States and 104 internationally.
Third-quarter sales grew 9.6% to $3.3 billion, with comparable sales up 2.1% and transactions up 0.8%. Restaurant-level margin was 23.3%, down 120 basis points (1.2 percentage points) from a year earlier, and adjusted earnings per share were 27 cents, down 7%.
For the fourth quarter, Rymer guided to cost of sales around 30.5% because of the brisket offer, and marketing costs in the high 3% range. He expects margins just under 22%, roughly 150 basis points below last year. Half of that gap is a gift card breakage benefit in the prior year, he said.
Loyalty at 33% of sales
Loyalty members accounted for over 33% of sales, the company's highest ever, Boatwright said. The rewards base has passed 24 million, and he said Chief Digital Officer Arlie Sisson believes it could reach the 40% to 50% range.
The company had said sales slowed from mid-July amid industry pressure, and it answered with promotions that lifted marketing costs. Yahoo Finance reported the stock was down more than 20% this year heading into the report. Chipotle's market value was $35.4 billion.
Brisket returns to restaurants next week, and Rymer said 2027 comparable sales guidance will come on the next earnings call.
Sources
- Chipotle Mexican Grill (CMG) Q3 2026 earnings — CNBC
- Chipotle Q3 earnings: Sales growth, traffic trends in focus | Seeking Alpha — seekingalpha.com
- Chipotle expects modestly higher sales this year as drive-thru ‘Chipotlanes’ come to more stores — MarketWatch
- Chipotle's bet on discounts expected to sustain Q3 sales momentum — Yahoo Finance
- Traders are betting big against Chipotle into earnings — CNBC
