Shares of Chipotle Mexican Grill Inc (NYSE:CMG) fell sharply in U.S. premarket trading on Wednesday after the restaurant group delivered better-than-expected quarterly results but issued a cautious outlook for 2026, projecting flat comparable sales that fell short of Wall Street forecasts.
The burrito chain reported fourth-quarter earnings of $0.25 per share, beating analysts’ estimates by one cent. Revenue increased 4.9% from a year earlier to $3 billion, coming in ahead of the $2.96 billion consensus.
Comparable restaurant sales declined 2.5% during the quarter, a smaller drop than the roughly 3% decline expected by the market. Still, the outlook dampened investor sentiment.
“Chipotle’s 4Q comps came just above consensus, but were negative and while commentary on 1Q suggested an improvement in trends pre-winter storm, the full quarter is still expected to be down -1-2%,” Wolfe Research analyst Travis Harbauer said in a note.
Looking ahead, Chipotle said it expects full-year comparable sales in 2026 to be roughly flat, compared with analysts’ expectations for around 1.9% growth, citing ongoing caution among consumers when it comes to discretionary spending.
Morgan Stanley analyst Brian Harbour said the guidance appears to leave out any “significant uplift from the sales layers CMG is aiming to add,” while also reflecting the broader slowdown in sales momentum seen through 2025 and the more challenging comparisons the company faces going forward. He added that Chipotle remains “a show-me story [in the] near term.”
On expansion plans, management said the company expects to open between 350 and 370 new restaurants in 2026, including 10 to 15 locations operated by international partners. Around 80% of company-owned restaurants are projected to feature a Chipotlane, the brand’s drive-through format designed to support digital and pickup orders.
Chipotle also guided to an underlying effective tax rate of 24% to 26% for the full year, excluding discrete items.
While revenue growth topped expectations—rising 4.9% versus analysts’ forecasts for a 4.2% increase—the results come at a time when diners have been pulling back on eating out amid broader economic uncertainty, weighing on near-term growth expectations.