Chipotle Revenue Rises 9.6% to $3.3B, but Margins Narrow and EPS Slips to $0.27
Transactions grew for a third straight quarter and digital sales reached 38.8% of revenue, while labor, other operating costs and G&A pressured profit. Chipotle kept its 2026 outlook and set 2027 opening targets.
Chipotle (CMG) reported third-quarter revenue of $3.3 billion on Wednesday, up 9.6% from a year earlier, and comparable restaurant sales growth of 2.1%. Earnings per share, both GAAP and adjusted, fell to $0.27 from $0.29 as higher labor, other operating and administrative costs outpaced sales growth. Comparable sales beat the roughly 1.5% consensus and EPS missed the $0.29 consensus, according to market data. Chipotle maintained its 2026 outlook, and shares rose 0.8% after hours, according to market data.
Third-quarter results
| Metric | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
| Comparable restaurant sales | +2.1% | n/a | +0.8% transactions, +1.3% check |
| Digital sales (share of food and beverage) | 38.8% | 36.7% | +2.1 pts |
| Restaurant-level operating margin | 23.3% | 24.5% | -1.2 pts |
| Operating margin | 13.7% | 15.9% | -2.2 pts |
| Net income | $339.9M | $382.1M | -11% |
| Diluted EPS (GAAP and adjusted) | $0.27 | $0.29 | -6.9% |
Revenue growth came mainly from new restaurant openings, with comparable sales adding 2.1%. By our calculation, net income fell about 11% even as revenue grew 9.6%. Transactions rose 0.8%, the third straight quarter of positive transaction growth, and average check rose 1.3%.
Where the margin went
| Cost line (share of revenue) | Q3 2026 | Q3 2025 |
|---|---|---|
| Food, beverage and packaging | 29.5% | 30.0% |
| Labor | 25.7% | 25.2% |
| Other operating costs | 16.0% | 15.0% |
| General and administrative ($) | $185.2M | $146.7M |
| Effective tax rate | 25.6% | 23.1% |
Food costs improved by half a point, helped by menu price increases, tariff relief and the mix of limited-time offers. Labor rose because of lower volumes, wage inflation, bonuses and promotional staffing, and other operating costs rose a full point. G&A increased about 26% by our calculation, driven mainly by stock-based compensation, bonuses and outside services.
Openings and outlook
Chipotle opened 84 company-owned restaurants in the quarter, 53 of them with a Chipotlane, plus five international partner-operated locations. It maintained its 2026 outlook: low single-digit comparable sales growth and 350 to 370 new restaurants, including 10 to 15 international partner-operated, with about 80% of new company-owned restaurants including a Chipotlane. For 2027, it expects 340 to 360 new company-owned restaurants in the U.S. and Canada and 15 to 25 outside those countries, including partner-operated locations.
Cash and buybacks
Chipotle repurchased $110.0 million of stock in the quarter at an average of $34.05 per share, with about $1.6 billion remaining under its authorizations. Cash and equivalents were $634.2 million at Sept. 30, up from $350.5 million at the end of 2025.
What it means
Traffic is growing, and digital orders are taking a larger share, but costs are rising faster than sales. Chipotle did not change its full-year comparable sales outlook, so investors will look to the 4:30 p.m. ET call for the fourth-quarter-to-date update and any detail on labor and operating-cost trends.
Sources: Chipotle, "Chipotle Announces Third Quarter 2026 Results" (Oct. 28). Consensus estimates and the after-hours move are per market data. This is informational, not a recommendation to buy or sell.
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