Chipotle Mexican Grill, Inc. (CMG) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

July 26, 2023 4:30 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good afternoon, and welcome to the Chipotle Mexican Grill Second Quarter 2023 Results Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded.

I would now like to turn the conference over to Cindy Olsen, Head of Investor Relations and Strategy. Please go ahead.

Cindy Olsen

Hello, everyone, and welcome to our second quarter fiscal 2023 earnings call. By now, you should have access to our earnings press release. If not, it may be found on our Investor Relations website at ir.chipotle.com.

I will begin by reminding you that certain statements and projections made in this presentation about our future business and financial results constitute forward-looking statements. These statements are based on management's current business and market expectations, and our actual results could differ materially from those projections in the forward-looking statements. Please see the risk factors contained in our Annual Report on Form 10-K and in our Form 10-Q for a discussion of risks that may cause our actual results to vary from these forward-looking statements.

Our discussion today will include non-GAAP financial measures. A reconciliation to GAAP measures can be found via the link included on the presentation page within the Investor Relations section of our website.

We will start today's call with prepared remarks from Brian Niccol, Chairman and Chief Executive Officer; and Jack Hartung, Chief Financial and Administrative Officer, after which we will take your questions. Our entire Executive leadership team is available during the Q&A session.

And with that, I'll turn the call over to Brian.

Brian Niccol

Thanks, Cindy, and good afternoon, everyone. The strength in our business continued into the second quarter, driven by our focus on exceptional food and exceptional people, as well as the success of Chicken al Pastor.

For the quarter, sales grew 14% to reach $2.5 billion, driven by a 7.4% comp. In restaurant sales increased 16%, digital sales represented 38% of sales. Restaurant level margin was 27.5%, an increase of 230 basis points year-over-year. Adjusted diluted EPS was $12.65, representing 36% growth over last year, and we opened 47 new restaurants, including 40 Chipotlanes.

For the third quarter, we anticipate comps in the low to mid-single-digit range, driven by transaction growth, as we are rolling off of pricing. For the full year, we continue to anticipate mid to high-single-digit comps. Before reviewing our strategic priorities, I want to share a few organizational updates.