Back in January, I told you about how shitty Chipotle’s stock was following a set of brutal E. coli and norovirus outbreaks around the country. Now that we’re one quarter of the way through 2016 calendar year, things aren’t much better for the company. Once considered a unicorn stock by analysts thanks to explosive revenue growth, Chipotle just reported it’s first quarterly loss EVER since IPOing in 2006.
In a report released on Tuesday, Chipotle lost $26.4 million in the first quarter of 2016. Via CNN:
In a report released Tuesday, Chipotle blamed the loss on lower same-store sales, which were hurt by fewer purchases as well as more promotional discount offers.
Chipotle said its same-store sales were down nearly 30% from last year.
In order to gain consumer trust back, the company has been throwing a ton of freebies and promotions at the general public. Except that’s pretty expensive and comes at a huge cost for their thousands and thousands of owned and operated stores. Via CNN:
In February, Chipotle closed all of its stores for a four-hour meeting to discuss safety protocols and offered all of its customers one free entree.
Since then, Chipotle has given away things like free guacamole and chips and offered $50 off catering.
On Monday, it announced two new promotions — a “buy one get one” free deal for teachers, faculty and school staff valid on May 3 and a free burrito for customers who buy $25 or more in gift cards before June 10.
Right before the outbreak, Chipotle’s stock hit an all time high of $758, reports CNN. It’s taken quite a nosedive since then, closing at $445.80 today.
But hey, there’s bright beacon of hope for Chipotle! It comes in the form of mouth-watering chorizo tostadas, which will soon be unveiled nationwide. And, according to Eater, they’re still planning on opening 220 to 235 new restaurants and launching a rewards program so people are encouraged to go back to having those 2-3 burrito bowl lunches a week:
In an earnings call with analysts today, Chipotle executives announced a plan to bring skeptical customers back to the fast-casual burrito chain. In addition to a massive marketing push and buy-one-get-one-free offers, the chain will soon introduce a new protein to its lineup — chorizo — and a temporary rewards program.
Will anything convince you to go back to Chipotle with the same enthusiasm that you once did?