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Call sheet · Q1'26

Chipotle Mexican Grill (CMG)

Q1'26 earnings call · held April 29, 2026 · compared with the Q4'25 call · management-credibility review
9/12
Disclosure score
2 medium, 4 low flags
Financial quality
Bottom line
The sleeper story is the heat equipment package delivering measurable comp lifts at 600+ locations, this is real capacity expansion hiding behind LTO headlines. Yes, they beat and raised guidance, but restaurant margins collapsed 250 bps faster than the pricing/inflation gap explains. The binding constraint is management's commitment to underpricing inflation by 150+ bps for the full year, which locks in margin pressure regardless of demand. Scott Boatwright: 'We charge a very fair price point for what we offer... we continue to grow our pricing power by underpricing the industry.' My view changes if they start disclosing loyalty member counts again or if heat equipment rollout stalls below 2,000 locations by year-end.

The 30-second version

  • High-efficiency equipment package is the real growth driver hiding in plain sight
  • Positive transaction growth returned but margin pressure accelerating faster than expected
  • They've gone silent on specific loyalty member counts after emphasizing it for quarters

What changed this quarter

MetricQ4'25Q1'26Change
Revenue$3.0B (+4.9% YoY)$3.1B (+7.4% YoY)+250 bps acceleration
Comparable Sales-2.5%+0.5%+300 bps turnaround
Transaction GrowthNegative (implied)+0.6%Returned to positive
Restaurant Margin25.9% (adjusted)23.7% (adjusted for legal)-250 bps deterioration
Adjusted EPS$0.25$0.24-17% decline
Cost of Sales30.2%29.6%-40 bps improvement
Labor Costs (adjusted)25.2%25.7%+70 bps pressure
Marketing Spend3.5%3.4%-10 bps but dollar increase
Digital Sales %37.2%38.6%+140 bps acceleration
New Restaurant Openings132 (Q4)49 (Q1)On track for 350 annual

Accountability tracked

8 new promises made4 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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