Chipotle Mexican Grill, Inc. (NYSE:CMG) net income fell to $7.8 million, or 27 cents a share, from $144.9 million, or $4.59 a share in Q3 last year. Revenue fell 14.8 percent to $1.04 billion which is below analyst expectations of $1.09 billion.
Initially Chipotle share value rose aftermarket on Tuesday but quickly fell, closing -2.01% down from the closing market price. “While we are on the road to recovery, we are not satisfied,” Steve Ells, CEO of Chipotle, stated during a conference call on Tuesday.
“It’s not stabilized much,” said Will Slabaugh, a restaurant analyst with Stephens, said on CNBC’s “Closing Bell” on Tuesday. “We’ve seen it slowly improve, but not at quite the rate where people thought it was going to.”
Chipotle is still recovering from the E. coli scare. The company continues to attempt to win customers back via temporary rewards program, such as promotions like buy one burrito get one free, etc. Shares of Chipotle are down over 36 percent over the past year.
“Even after the relative success of this summer’s loyalty program, Chiptopia, Chipotle still has a long way to go to win back customers from the ongoing food safety scares starting this time last year,” Kate Hogenson, consultant at Kobie Marketing, told CNBC. “The rewards of Chiptopia were certainly there, with such a high return on investment for high frequency customers, but the program was limited in what it could do from a loyalty perspective since it was temporary.”
Chipotle reported that 6 million people enrolled for Chiptopia and 2.5 million earned rewards. 85,000 people received free catering from Chipotle for completing the reward program which is valued at $240. That sums up to over $20 million in free catering.