Chipotle CEO: We need to pick up the speed on innovation Brian SozziAugust 18, 2025 at 9:43 PM Listen and subscribe to Opening Bid Unfiltered on Apple Podcasts, Amazon Music, Spotify, YouTube, or wherever you find your favorite podcasts.
- - Chipotle CEO: We need to pick up the speed on innovation
Brian SozziAugust 18, 2025 at 9:43 PM
Listen and subscribe to Opening Bid Unfiltered on Apple Podcasts, Amazon Music, Spotify, YouTube, or wherever you find your favorite podcasts.
Chipotle (CMG) is aiming to serve up more innovation and value-focused marketing over the next year as the burrito chain encounters cautious consumers and new competitors.
"The brands that are winning in this very tough consumer backdrop are the brands that are innovating in a really meaningful way. Innovation at Chipotle has always been very measured, and it will remain a measured process," Boatwright told Yahoo Finance in a new episode of the Opening Bid Unfiltered podcast (see video above; listen below). "I think we need to move up the speed of innovation."
Chipotle has only known high growth over the past decade — in store openings, sales, earnings, and stock price.
Its shares are up 264% in the past 10 years, according to Yahoo Finance data, compared to the S&P 500's 212% advance and McDonald's (MCD) 224% gain.
The sizzling stock price reflects Chipotle's relative outperformance in the restaurant industry in terms of sales and profits. Credit that to the company's generous portion sizes and messaging of healthy ingredients.
But now, Chipotle is heading into an interesting five-year period.
The company is adding new restaurant technology to drive efficiency. Think dual-sided grills and AI cameras. It's opening its first location in the Mexican food mecca — Mexico — in early 2026 (it will have the same menu as US locations, Boatwright said). That comes on the heels of what appears to be a successful opening in October 2024 in Dubai.
"There are obviously several expats in Dubai, which helps us," Boatwright added. "But I'll tell you the core of the menu is really rice, beans, and chicken, and that type of cuisine works in any corner of the globe. And so that gives us a lot of confidence." No pork is on the menu at the Dubai location.
And it's picking up the pace of new menu offerings, especially in dips.
This comes as new fast casual restaurants, from chains like Cava (CAVA) to upstarts with their first stores, sprout up to compete for diners' dollars.
"I feel like we're at an inflection point," Boatwright said, as consumer uncertainty rises and companies lose pricing power after years of inflation.
"It's not new news to anyone that the consumer uncertainty is probably greater this year than it was last year, and it wasn't great last year," Boatwright said. "And so consumers are being very, I guess for lack of a better word, choosy about how they spend their dollars, where they spend their dollars. They're looking for value."
The second quarter is where a lot of the negatives nipping at the Chipotle growth story came to a head.
Chipotle reported on July 23 that same-store sales fell 4% in the second quarter, more than the 2.9% decline Wall Street expected.
Traffic dropped 4.9%, more than the estimated 4.4% drop. That's an acceleration from the 2.3% fall in the first quarter, which marked Chipotle's first quarterly foot traffic decline since 2022.
Chipotle also cut its guidance. It expects flat full-year same-store sales growth, compared to an increase in the low-single-digit range previously.
The stock was hammered in response.
Shares are now down 26% year to date compared to a 10% gain for the S&P 500.
"We can understand why the bears may own the near-term narrative (management pegging second half improvement to better macro-economy/less lower-income blips when tariff threats to wallets loom)," Citi analyst Jon Tower wrote.
Boatwright is hanging his hat on Chipotle not bleeding market share to other chains. So if the economy gets back into gear, Chipotle could get back to being Chipotle, with industry-leading sales and stock price growth.
"Based on our data and what we're seeing with the consumer, we're not losing customers. We're losing frequency of those customer visits," he said.
"They're still enjoying the great food that they've always appreciated and loved about our great brand. They're just coming less often because I think they're being more conservative on how they think about spending dollars in this really uncertain macroeconomic environment."
Brian Sozzi is Yahoo Finance's Executive Editor and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email [email protected].
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