Chipotle's sales disappoint, shares dive 6 percent

Earnings Reuters

This Thursday, Jan. 12, 2017, photo, shows the sign on a Chipotle restaurant in Pittsburgh. Chipotle Mexican Grill, Inc. reports financial results, Tuesday, July 25, 2017. (AP Photo/Gene J. Puskar) (AP)

Chipotle Mexican Grill Inc <CMG.N> reported a smaller-than-expected rise in sales at established restaurants, hurt by mixed reviews of its new queso side dish and a Norovirus outbreak that forced the brief closure of a Virginia restaurant in July.

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Shares of Chipotle fell nearly 6 percent in after-hours trade. Chipotle said it would open fewer stores than usual next year, after a management shakeup and millions of dollars in free food giveaways failed to revive business following a bruising string of food safety lapses in 2015.

Sales at Chipotle restaurants open at least 13 months rose 1 percent for the third quarter ended Sept. 30. Analysts, on average, expected a rise of 1.2 percent, according to Consensus Metrix.

Net profit rose to $19.6 million, or 69 cents per diluted share, from $7.8 million, or 27 cents per share, a year earlier while revenue rose 8.8 percent to $1.13 billion.

 

(Reporting by Lisa Baertlein in Los Angeles, Peter Henderson in San Francisco and Uday Sampath in Bengaluru; Editing by Arun Koyyur and Lisa Shumaker)

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