Dive Brief:
- Chipotle Mexican Grill CFO Jack Hartung said the company is keeping a close watch on U.S. inflation trends as it weighs the need for price increases this year.
- The Newport Beach, Calif.-headquartered burrito giant is bracing for the possibility of inflation-induced pressure on ingredients such as beef, Hartung said during an earnings call on Tuesday. "We think inflation will be reasonably tame," he said. "Hopefully, that will come true."
- Chipotle reported fourth-quarter net income of $223.7 million for the period ending Dec. 31, up from $133.5 million a year earlier, which fell short of predictions.
Dive Insight:
Inflation has forced Chipotle, like many other companies, to pass on higher costs to consumers.
Hartung said the company has not yet made any decisions on whether it will raise prices going forward.
"We’ll watch how the inflation element plays out, and we don’t have any plans right now to take pricing action," he said. "So, we might be more patient this year than we were last year."
Chipotle’s fourth-quarter net income of $223.7 million, or $8.02 per share, missed the marked compared with Wall Street expectations of $8.90 per share, according to a report by CNBC.
Despite its weaker-than-expected earnings in the previous quarter, the burrito chain has so far not seen any "meaningful resistance" to its pricing, according to its CEO, Brian Niccol.
"We continue to see the higher-income consumer, the individual that earns over $100,000, coming more often," he said during the earnings call.
