In this weekly feature, we highlight a company that reported earnings that came in outside of analysts’ expectations, with a focus on what the beat or miss says about consumer demand and economic activity.

Restaurant chain Chipotle Mexican Grill (CMG) posted higher-than-expected earnings and revenue in the third quarter as consumers splurged on burritos despite more expensive menu prices🧸.

Revenue rose 11.3% from a year ago to $2.46 billion, as Chipotle opened more restaurants while 澳洲幸运5官方开奖结果体彩网:same-store sales increased 5% on more transactions. 澳洲幸运5官方开奖结果体彩网:Net income was up almost 13% to $313.2 million, equal to a diluted $11.32 per share and well above analysts' estimates. The company's 澳洲幸运5官方开奖结果体彩网:operating margin, at 16%, improved almost a full percentage point from the same quarter last year.

The strong results suggest Chipotle remains a popular choice for consumers in an era of high inflation and food prices, and reflects the robust 澳洲幸运5官方开奖结果体彩网:consumer spending that 澳洲幸运5官方开奖结果体彩网:powered GDP growth in the third quarter.

澳洲幸运5官方开奖结果体彩网:Chief Financial Officer (CFO) John Hartung said on the company's quarterly earnings call thဣat customers of all income levels are "holding up really well,ꦅ" and emphasized people are choosing to dine at Chipotle "because we are very affordable."

Inflation Still a Headwind, Executives Say

However, executives mentioned that inflation for certain food categories like beef and queso dip dented profitability somewhat, offsetting the price increases Chipotle started implementing two years ago and paused last year. Chipotle hiked menu prices again in early October for the first time in more than a year, in an effort to offset persistent inflation.

Hartung cautioned that higher cheese and avocado prices could raise the company's costs in the fourth quarter, while higher labor costs due to wage inflation could also affect the bottom line. Despite this, executives project sales growth for the fourth quarter and 2023 at large to be in the mid-to-high single-digit range.

Chipotle shares rose 4.5% on Friday. They've risen nearly 40% this year, far outperforming the AdvisorShares Restaurant ETF (EATZ), a proxy for the performanc💃e of the restaurant industry, which is roughly flat year-to-🎃date.