((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
Chipotle Mexican Grill CMG.N said on Wednesday it had raised menu prices by about 2% as the burrito chain faces higher input costs amid volatile demand for restaurants in the United States .
Key ingredients such as dairy, beef and avocado have cost more this year, weighing on restaurateurs' margins in an environment where consumers are already cutting back on dining out in favor of cheaper meals at home.
Input cost inflation has contributed to U.S. restaurants and fast-food chains raising menu prices in 2023, tempering consumer demand.
While Chipotle ignored these price increases, executives said in October on a conference call after the earnings release that they were still seeing single-digit inflation on cost of sales, as well as cost of labor.
However, given weak demand trends – Chipotle fell short of market expectations for quarterly same-store sales – the company suggested that a price increase might not come until early 2025.
“For the first time in over a year, we made a modest price increase of approximately 2% nationally to offset inflation,” Laurie Schalow, Chipotle's chief corporate affairs officer, said in a statement. press release published Wednesday.
“The timing of this increase is also a positive signal regarding current demand trends,” Brian Vaccaro, an analyst at Raymond James, said in a note.
The company had raised its prices in California in April when the FAST Act, which raised wages for workers at fast food chains, took effect.
