Need to Know
- Chipotle’s Q3 digital sales hit $776.4 million, a 202.5% year-over-year increase, accounting for nearly half of the restaurant’s overall sales for the quarter.
- Half of digital sales were delivery, while the rest were from order-ahead pick-up transactions.
- Chipotle’s loyalty program now counts 17 million enrolled members.
- CEO Brian Niccol notes that each restaurant delivers a “digital average unit volume of well over $1-million.”
Chipotle’s digital growth continues to skyrocket, as the company posted a whopping 202.5% year-over-year digital sales growth on Wednesday, as part of its Q3 report.
Digital sales for Chipotle’s Q3 amounted to $776.4 million, nearly half of the restaurant’s overall sales for the quarter. Half of those sales came from delivery orders, while the other half were from order-ahead transactions. The company’s digital sales have also benefitted from Chipotle’s loyalty program, which has grown to 17 million enrolled members.
On the company’s earnings call, Chipotle chairman and CEO Brian Niccol said the restaurant’s digital sales could exceed $2.5 billion in 2020 if momentum continues. “A reduction of dine-in services, more people working from home, increased advertising and digital awareness, recent partnerships with Uber Eats and Grubhub and expanded digital capabilities into Canada all have helped attract new customers into our digital ecosystem while increasing convenient access to Chipotle,” he said. “At this sales rate, our average restaurant delivers a digital average unit volume of well over $1-million, up from just a few hundred thousand dollars per restaurant a few years ago.”
Despite the substantial digital growth, Chipotle’s overall profitability declined for the quarter, owing to significant restructuring and legal costs. Chipotle’s net income for Q3 was $80 million; shares hit $2.82, down from $3.47 during Q3 last year. Overall revenue for the quarter, meanwhile, was $1.6 billion.
Chipotle has seen substantial digital growth throughout 2020, especially as the COVID-19 pandemic hit and the company moved quickly to bolster its digital and takeout offerings beginning in March, with the offer of free delivery throughout the month.
The company posted its best digital quarter to date in April, with digital sales having spiked 80% year over year at that time, and by July, online orders made up 60% of the company’s overall sales. Currently, a number of Chipotle restaurants that were shuttered due to the pandemic have reopened, and Chipotle has invested in the opening of several “Chipotlanes”—drive-thru only restaurants—that have allowed customers to visit brick-and-mortar locations in a way that is safe and contactless.