Chipotle is potentially adding new menu items that go beyond their signature burritos and burrito bowls.
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The company’s CEO Brian Niccol teased some potential new menu items on Tuesday during a second-quarter earnings call that exceeded Wall Street’s expectations.
“On the menu side, we are elevating our core by developing innovations that lead to food culture and meet guests requests. Our lifestyle bowls remain popular with customers and we continue to test new menu items that are in various stages of development,” Niccol said on the call.
The item that’s the furthest along in the testing stage is carne asada, which differs from the current steak option on the menu because it’s thinly sliced rather than cubed. Niccol said the chain is sorting out when to launch the item in restaurants nationwide.
“[Carne asada] is easy to execute operationally as unique flavor profile and is receiving terrific customer feedback in our test markets,” Niccol said.
Another item still in the testing phase is quesadillas — and it may be a while before customers will see it on all menus. Niccol said the quesadillas that are being tested in select locations are being made with new ovens that are improving the quality and taste of the food item. The updated appliance also gives Chipotle the potentially to add other food options such as desserts and nachos.
“That being said, we still have some work to do in order to streamline our workflow,” the CEO said on the Tuesday call, adding that the company won’t sacrifice turnout for a nationwide rollout of new items.
It’s unclear how the items will affect food costs if they are added to the menu in the future. Chipotle said its second-quarter food costs rose to 33.7 percent, mainly due to higher avocado prices. Niccol said the Mexican eatery anticipated a price hike in avocados in March but then saw another spike in June.
“Avocado prices are likely to remain elevated in July, but should start to moderate as we move through the quarter as our sourcing shifts to another market,” Niccol said.
|CMG||CHIPOTLE MEXICAN GRILL INC.||824.47||-5.88||-0.71%|
Chipotle's stock hit an all-time high Tuesday after it reported second-quarter earnings of $91 million — exceeding Wall Street expectations. The company reported $1.43 billion in sales, a 13 percent growth compared to last year.
The chain’s successful quarter indicated it's on the road to recovery after weathering food safety concerns following norovirus outbreaks at multiple U.S. locations.