How CMG (Chipotle Mexican Grill) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a fast-casual restaurant chain like CMG (formerly Chipotle Mexican Grill) makes money is essential for investors and anyone interested in the business of food service and hospitality. In this post, we break down CMG's quarterly income statement (Q3 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick CMG Overview

CMG operates a network of fast-casual restaurants specializing in Mexican-inspired cuisine, primarily burritos, bowls, tacos, and salads. Revenue comes almost entirely from in-store and digital food & beverage sales, with a small contribution from delivery services. The company’s business model centers on high-throughput locations, digital ordering, and operational efficiency, with a focus on fresh ingredients and streamlined menus.

Revenue Breakdown

• Total Revenue (Q3 2025): $3.00B (+7.5% YoY)
  • Food & Beverage Revenue: $2.99B (99.5% of total, +7.6% YoY)
  • Delivery Service Revenue: $14.2M (0.5% of total, -8.7% YoY)
  • Growth is powered by new store openings, digital sales expansion, and increased same-store traffic.

Gross Profit and Margins

• Gross Profit: $735.6M (24.5% gross margin)
  • Cost of Revenue: $2.27B (+9.0% YoY)
  • CMG maintains robust margins due to its scalable digital business model, efficient supply chain, and menu simplicity.
• Most costs come from food ingredients, labor, occupancy, and supply chain logistics.

Operating Income and Expenses

• Operating Income: $477.2M (+0.8% YoY, 15.9% margin)
• Operating Expenses: $258.4M (+8.2% YoY)
  • SG&A: $146.7M (+15.9% YoY, 4.9% of revenue) — includes corporate overhead, marketing, and administrative costs.
  • CMG continues to invest in digital innovation and marketing while maintaining operational efficiency and expanding its restaurant footprint.

Net Income

• Pre-Tax Income: $497.0M (-1.1% YoY, 16.5% margin)
• Income Tax: $114.9M (23.1% effective tax rate)
• Net Income: $382.1M (-1.4% YoY, 12.7% net margin)
• CMG converts a significant portion of sales into profit due to its scalable operations and strong brand pricing power.

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What Drives CMG's Money Machine?

• Food & Beverage Sales: 99.5% of revenue — in-store and digital orders are the core driver.
• Digital Sales Penetration: Digital orders now represent a substantial share, supporting higher throughput and lower labor costs.
• Strategic Investments: Expansion into new formats (drive-thru, digital-only stores), supply chain optimization, and technology upgrades.
• Future Growth Areas: International expansion and menu innovation, though not yet profitable at scale.

Visualizing CMG's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially SG&A) taking the largest chunk.
• Even after significant investments in marketing and technology, 12.7% of revenue drops to the bottom line.

Key Takeaways

• CMG's money comes overwhelmingly from food & beverage sales at its restaurants.
• High gross and net margins illustrate the power of CMG's efficient, scalable business model.
• Heavy investment in digital innovation and marketing, balanced by efficiency in operating costs.
• Ongoing growth is driven by new store openings, digital sales, and menu innovation.

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FAQ About CMG's Income Statement

1. What is the main source of CMG's revenue in 2025?

CMG generates over 99% of its revenue from food & beverage sales at its restaurants. Delivery service revenue is a minor contributor at 0.5%.

2. How profitable is CMG in Q3 2025?

CMG reported net income of $382.1M in Q3 2025, with a net margin of approximately 12.7%, reflecting strong profitability driven by operational efficiency and brand strength.

3. What are the largest expense categories for CMG?

The biggest expenses on CMG's income statement are cost of revenue (food, labor, occupancy) and operating expenses, particularly Sales, General & Administrative (SG&A) costs, which reached $146.7M in Q3 2025 as CMG prioritizes marketing and digital innovation.

4. Why does delivery service operate at a loss?

Delivery Service, despite generating $14.2M in revenue, posted a YoY decline and operates at a loss due to high third-party fees and aggressive investment in digital infrastructure, as CMG believes these will drive long-term growth—even if the division is unprofitable today.

5. How does CMG's effective tax rate compare to previous years?

CMG's effective tax rate in Q3 2025 was 23.1%, consistent with previous years. This moderate rate is primarily due to tax benefits from share-based compensation and international structuring.