(Reuters) -Chipotle Mexican Grill on Wednesday slashed annual sales forecast for the third time this year, signaling that even its typically affluent diners are cutting back on eating out amid mounting cost pressures.
The burrito chain’s shares, which have lost 34% of their value so far this year, were down nearly 3% after the bell.
While inflation continues to strain household budgets and dampen consumer confidence, concerns over a prolonged government shutdown have added to economic uncertainty. Even higher-income consumers are trading down, putting pressure on fast-casual chains such as Chipotle.
Like other restaurant chains, Chipotle has leaned on targeted promotions to offset weakening traffic. It brought back grilled steak Carne Asada as a limited-time offering in early September, priced around $13, slightly below last year’s offer on Smoked Brisket.
The company’s restaurant visits rose just 0.5% between July and September over the year earlier, trailing the 0.7% growth across the fast-casual segment, according to data from Placer.ai, a foot-traffic analytics firm.
Comparable restaurant sales at Chipotle rose 0.3% for the third quarter, compared with analysts’ average estimate of a 1.36% rise, according to data compiled by LSEG.
Adjusted net income came in at $389.9 million, or 29 cents per share, compared with $366.6 million, or 27 cents per share, a year ago.
The bowls and burrito maker expects 2025 comparable restaurant sales to decline in the low-single digit range, compared with its prior forecast of about flat. Analysts were expecting a 0.28% drop in comparable sales.
(Reporting by Savyata Mishra in Bengaluru; Editing by Shilpi Majumdar)
