Chipotle Mexican Grill (CMG) 10-K risk factor changes: FY2023 vs FY2022

If any of the risks and uncertainties described below [removed: actually] occur or continue to occur, our business, financial condition and results of operations, and the trading price of our common stock could be materially and adversely affected.

Any report, legitimate or rumored, of food-borne illness such as E. coli, hepatitis A, norovirus or salmonella, or other food safety [removed: issue,] [added: issues,] such as food tampering or contamination, at one of our restaurants could adversely affect our reputation and have a negative impact on our sales.

[removed: In addition, we] [added: We] may be at a higher risk for food safety incidents than some competitors due to our greater use of fresh, unprocessed produce, handling of raw chicken in our restaurants, our reliance on employees cooking with traditional methods [removed: rather than automation,] and [removed: our avoidance] [added: the lack] of [added: added preservatives and] frozen [removed: ingredients.][added: ingredients in our menu items.]

Our digital business, which accounted for a significant portion of our [removed: 2022] [added: 2023] total revenue, is subject to risks.

In [removed: 2022, 39.4%] [added: 2023, 37.4%] of our food and beverage revenue was derived from digital orders, which includes third-party delivery and customer pickup in-restaurant and through our Chipotlanes.

Approximately [removed: 19%] [added: 18%] of our [removed: 2022] [added: 2023] food and beverage revenue consisted of delivery orders for which we are reliant on third-party delivery companies.

In [removed: 2022,] [added: 2023,] we implemented [removed: several] menu price increases to partially offset the increases in [removed: delivery,] [added: ingredients,] labor and other costs; however, our higher menu prices may cause some guests to shift their purchases to other restaurants offered on the platform.

If a third-party delivery driver fails to make timely deliveries or fails to deliver the complete order, our guests may attribute the bad customer experience to Chipotle and [added: our reputation and sales] could [removed: stop ordering from us.][added: be negatively impacted.]

The ordering and payment platforms used by these third parties, our mobile app or our online ordering site [removed: has] [added: have] been and could again be interrupted by technological failures, user errors, cyber-attacks or other factors, which could adversely impact sales through these channels and negatively impact our overall sales and reputation.

[removed: The] [added: In addition, the] delivery business has been consolidating and may continue to consolidate, which may give third-party delivery companies more leverage in negotiating the terms and pricing of contracts, which in turn could negatively impact our profits from this channel.

We also compete with non-traditional market participants, such as [removed: convenience stores,] [added: “convenience meals” in the form of entrées, side dishes or meal preparation kits from the deli or prepared foods sections of] grocery stores, [removed: coffee shops,] meal kit delivery services, and “ghost” or “dark” kitchens, where meals are prepared at separate takeaway premises rather than a restaurant.

If [removed: consumer] [added: guest] or dietary preferences change, if our marketing efforts are unsuccessful, or if our restaurants are unable to compete successfully with other restaurant outlets, our business could be adversely affected.

If we do not continue to persuade [removed: consumers] [added: guests] of the benefits of paying higher prices for our higher-quality food, our sales and results of operations could be hurt*.*

Our success depends in large part on our ability to persuade [removed: consumers] [added: guests] that food made with ingredients that were raised or grown according to our Food [removed: With] [added: with] Integrity principles [removed: is] [added: are] worth paying a higher price relative to prices of some of our competitors, particularly quick-service restaurants.

If we are not able to successfully persuade [removed: consumers] [added: guests] that consuming food made in accordance with our Food [removed: With] [added: with] Integrity principles is better for them and the environment, or if [removed: consumers are] [added: guests do] not [removed: willing to pay] [added: agree with] the [removed: prices we charge,] [added: overall value proposition of] our [added: menu, our] sales could be adversely affected, which would negatively impact our results of operations.

These platforms have dramatically increased the speed and scale of dissemination and accessibility of information, including negative [removed: publicity related to] [added: comments about our] food [removed: safety incidents and] [added: quality or safety,] negative guest [removed: and] [added: or] employee [removed: experiences.][added: experiences and videos depicting inappropriate behavior of employees and guests.]

[removed: Accurate and] [added: Accurate,] inaccurate or misleading information can be widely disseminated before there is any meaningful opportunity to respond or address an issue.

It is impossible for us to fully predict or control social media backlash, [removed: which] [added: and the inappropriate use of social media by our guests or employees] could harm our business, prospects, financial condition, and results of operations, regardless of the information’s accuracy.

[removed: New social] [added: Social] media and internet-based communication platforms are [removed: developing] [added: evolving] rapidly, and we need to continuously innovate and evolve our marketing strategies to maintain our brand relevance and broad appeal to guests.

[removed: The inappropriate use] [added: Use] of social media by our [added: employees,] guests [removed: or employees] [added: and associates] could lead to litigation or result in negative publicity that could damage our reputation.

Maintaining appropriate staffing in our restaurants requires precise workforce planning, which [removed: planning] has become more complex due to predictive scheduling laws (also called “fair workweek” or “secure scheduling”) and “just cause” termination legislation in certain geographic areas where we [removed: operate, and the so-called “great resignation” trend.][added: operate.]

The market for qualified talent continues to be competitive and we must [removed: ensure that we] continue to offer competitive wages, benefits and workplace conditions to retain qualified employees.

We have experienced and may continue to experience challenges in hiring and retaining restaurant employees and in maintaining full restaurant staffing in various locations, which has resulted in longer wait times for guest orders, temporary closures of the digital make line and decreased employee [added: and guest] satisfaction.

A shortage of qualified candidates who meet [removed: all] legal work authorization requirements, failure to [removed: hire] [added: hire, train] and retain new restaurant employees in a timely manner or higher than expected turnover levels could affect our ability to open new restaurants, grow sales at existing restaurants or meet our labor cost objectives.

For example, [removed: a number of lawsuits previously] [added: we] have [removed: been] [added: had lawsuits] filed against us alleging violations of federal and state laws regarding employee wages and payment of overtime, meal and rest breaks, employee classification, employee record-keeping and related practices with respect to our employees.

We incur legal costs to defend these [added: types] cases, and we could incur losses from these and similar cases, and the amount of such losses or costs could be material.

In addition, several [removed: jurisdictions, including] [added: jurisdictions (e.g.] New York City, Philadelphia, Chicago, Seattle, [removed: Oregon, San Francisco, San Jose and Berkeley] [added: etc.)] have implemented fair workweek or “secure scheduling” legislation, which impose complex requirements related to scheduling for certain restaurant and retail employees, and additional jurisdictions are considering similar legislation.

All of these regulations impose additional obligations on us and our failure to comply with any of these regulations could subject us to penalties and other legal liabilities, which could adversely affect our [removed: business] [added: ability to attract] and [added: retain employees and our] results of [removed: operations] [added: operations,] and potentially cause us to close or reduce operating hours of some restaurants in these jurisdictions.

For example, we previously reported the settlement of a complaint alleging that we violated New York City’s Fair Workweek law and Earned Safe and Sick Time [removed: Act.][added: Act, and we also have been and are undergoing several audits of our compliance with employment law requirements, which could result in additional liabilities.]

Increases in the cost of [removed: labor] [added: labor, including mandated minimum wage increases,] could adversely impact our business and profitability.

Our [removed: business] [added: profitability] has been and could continue to be adversely impacted by increases in labor [removed: costs caused] [added: costs, including wages and benefits, which are some of our most significant costs, including increases triggered] by [removed: factors such as] federal, state and local laws governing matters such as minimum wages, meal and rest breaks and changes to eligibility for overtime pay; regulations regarding scheduling and benefits; increased health care and workers’ compensation insurance costs; [added: and] higher wages and [added: benefit] costs [removed: of other benefits] necessary to attract, hire and retain high-quality employees with the right skill sets in a highly competitive job [removed: market; and increased wages, benefits and costs related to the COVID-19 pandemic.][added: market.]

In addition, state and local laws [removed: such as the recently passed California AB 257 (the “FAST Act”)] may require wage increases and [added: standards on] working [removed: hour] [added: hours] and [removed: working condition standards] [added: other factors] that would restrict our flexibility to respond to market conditions and increase our costs without corresponding benefits.

Risks Related to [removed: IT Systems, Cybersecurity and] [added: Cybersecurity,] Data [removed: Privacy][added: Privacy and IT Systems]

[removed: The] [added: Additionally, the] techniques and sophistication used to conduct cyber-attacks and [removed: breaches of] [added: compromise] information technology systems, as well as the sources and targets of these attacks, change frequently and are often not recognized until [added: such] attacks are launched or have been in place for a period of time.

[removed: Virginia, Colorado, Connecticut and Utah have enacted] [added: Other states passed] similar [removed: data] privacy legislation that [removed: will take] [added: took] effect in 2023, and [removed: several] other states and countries [added: passed or] are considering expanding or passing [added: comprehensive] privacy [removed: laws in the near term.][added: laws.]

Our failure to comply with applicable laws and regulations or other obligations to which we may be subject relating to personal [removed: data,] [added: information,] or to protect personal [removed: data] [added: information] from unauthorized access, use or other processing, could result in enforcement actions and regulatory investigations against us, claims for damages by customers and other affected individuals, fines or damage to our brand reputation, any of which could have a material adverse effect on our operations, financial performance and business.

The regulatory environment related to privacy and data security is changing at an ever-increasing pace, with [removed: new and] [added: new,] increasingly [removed: rigorous] [added: rigorous, and often unclear] requirements applicable to our business.

In addition, the issues regulated by privacy laws (such as advertising and marketing, children, biometric, employee, [added: surveillance, artificial intelligence,] and health related information) have expanded, as have the number of city, state, federal and international governmental bodies and agencies that have recently passed or are currently considering privacy legislation or regulatory rulemaking.

Where not limited by [removed: preemption,] [added: preemption and where there are perceived shortcomings in federal laws,] many states have passed or are considering adopting stricter versions of federal privacy laws (e.g., state level statutes similar to the Telephone Consumer Protection Act of [removed: 1991 (“TCPA”),] [added: 1991,] the Health Insurance Portability and Accountability Act, and the Children’s Online Privacy Protection Act of [removed: 1998 (“COPPA”)).][added: 1998).]

Increases in the costs of [removed: ingredient] [added: ingredients] and other materials, including increases caused by inflation, global [removed: conflicts, the COVID-19 pandemic] [added: conflicts] and climate risks, [added: or the failure to procure sufficient ingredients] could adversely affect our results of operations.

In addition, several jurisdictions (e.g., California, New York City and Seattle) have implemented minimum wages for delivery drivers, and other jurisdictions are considering similar wage regulations, which could increase delivery fees and decrease our digital sales.

We use our mobile app to drive convenience and increase brand engagement with our guests.

Our aggressive pace of opening new restaurants can make it increasingly difficult to recruit and hire sufficient numbers of qualified employees to manage and work in our restaurants, to maintain an effective system of internal controls for a dispersed workforce and to train employees to deliver a consistently high-quality product and customer experience, which could materially harm our business and results of operations.

Beginning in April 2024, new California legislation requires national restaurant chains, including Chipotle, to pay a minimum $20 per hour wage to restaurant workers in California, which minimum wage may be increased annually by a state-appointed council.

Other state, county and city jurisdictions are considering similar regulations.

Many of our information technology systems (whether cloud-based or hosted in proprietary servers), including those used for our point-of-sale, web and mobile platforms, online and mobile payment systems, delivery services and rewards programs and administrative functions, contain personal, financial or other information that is entrusted to us by our guests, business partners and employees.

Many of our information technology systems also contain confidential information about our business, such as business strategies, development initiatives and designs, and confidential information about third parties, such as suppliers.

Similar to many other restaurant companies, we have in the past experienced, and we expect to continue to experience, cyber-attacks, including phishing, and other attempts to breach, or gain unauthorized access to, our systems and databases.

To date, these attacks have not had a material impact on our operations, but we cannot provide assurance that they will not have an impact in the future.

Our third-party providers’ and business partners’ information technology systems and databases are likewise subject to such risks.

The number and frequency of these attempts varies from year to year but could be exacerbated to some extent by an increase in our digital operations.

In addition, we provide some guest and employee data, as well as confidential information important to our business, to third parties to conduct our business.

Individuals performing work for us and these third parties also may access some of this data, including on personally owned digital devices.

To the extent we, a third party or such an individual were to experience a breach of our or their information technology systems that results in the unauthorized access, theft, use, destruction or other compromises of customers’ or employees’ data or confidential information of Chipotle stored in or transmitted through such systems, including through cyber-attacks or other external or internal methods, it could result in a material loss of revenues from the potential adverse impact to our reputation and brand, a decrease in our ability to retain customers or attract new ones, the imposition of potentially significant costs (including loss of data or payment for recovery of data) and liabilities, loss of business, loss of business partners and licensees and the disruption to our supply chain, business and plans.

Unauthorized access, theft, use, destruction or other compromises are becoming increasingly sophisticated and may occur through a variety of methods, including attacks using malicious code, vulnerabilities in software, hardware or other infrastructure (including systems used by our supply chain), system misconfigurations, phishing or social engineering.

The rapid evolution and increased adoption of artificial intelligence technologies may intensify our cybersecurity risks.

Our logging capabilities, or the logging capabilities of third parties, are not always complete or sufficiently granular, affecting our ability to fully understand the scope of security breaches.

Such security breaches also could result in a violation of applicable U.S. and international privacy, cyber and other laws or trigger data breach notification laws, including new disclosure rules promulgated by the SEC, and subject us to private third party or securities litigation and governmental investigations and proceedings, any of which could result in our exposure to material civil or criminal liability.

We may be required to make significant capital investments and other expenditures to investigate security incidents, remedy cybersecurity problems, recuperate lost data, prevent future compromises and adapt systems and practices to react to the changing threat environment.

These include costs associated with notifying affected individuals and other agencies, additional security technologies, training and personnel, retention of experts and providing credit monitoring services for individuals whose data has been breached.

These costs could be material and could adversely impact our results of operations in the period in which they are incurred, including by causing us to delay the pursuit of other important business strategies and initiatives, and may not meaningfully limit the success of future attempts to breach our information technology systems.

Media or other reports of existing or perceived security vulnerabilities in our systems or those of our third-party business partners or service providers can also adversely impact our brand and reputation and materially impact our business.

The rapid evolution and increased adoption of artificial intelligence technologies amplifies these concerns.

We continue to make significant investments in technology, third-party services and personnel to develop and implement systems and processes that are designed to anticipate cyber-attacks and to prevent or minimize breaches of our information technology systems or data loss, but these security measures cannot provide assurance that we will be successful in preventing such breaches or data loss.

In addition, a number of recent lawsuits have pled creative claims under privacy legislation such as the Video Privacy Protection Act, Electronic Communications Privacy Act (including the WireTap Act and Stored Communications Act), Computer Fraud and Abuse Act, and similar state laws alleging wiretapping, eavesdropping, tape recording and invasion of privacy through the use of marketing pixels, analytics software, session replay technology, voice recording, and live chat functionality.

Defending against such claims can be costly and strain internal resources.

Ongoing global conflicts have disrupted and could continue to disrupt some shipping routes, which could result in shortages or delays of certain ingredients.

In the past year, the cost of opening new restaurants has increased, due to construction labor inflation and increased costs of materials and equipment.

Our timeline for completing construction also has gotten longer, due to landlord reluctance to commit to building in light of high interest rates, tight money supply and general economic conditions, and due to backlogs and long wait times for us to obtain required permits and utility hookups.

If we partner with or acquire new businesses and third-party providers that do not align with our core values or that do not fulfill their contractual responsibilities and commitments, our brand reputation and international growth plans could suffer.

Our global growth strategy includes expanding our existing restaurant footprint and introducing Chipotle in new international jurisdictions in which we currently do not operate.

The success of our strategy will depend on our identifying and partnering with new business partners, including licensees, joint venture partners, suppliers and distributors, and may include identifying suitable acquisition targets in these new jurisdictions that align with our core values.

In 2023, we signed our first-ever development agreement to open restaurants in the Middle East in partnership with international franchise retail operator Alshaya Group, which will initially open new Chipotle restaurants in Dubai and Kuwait before expanding further across the region.

Licensees like Alshaya, and future joint venture partners would be authorized to operate restaurants under the Chipotle brand, and we believe guests will expect the same quality of food and customer service in these third-party operated restaurants as they receive in Chipotle-operated restaurants.

We provide extensive training to our business partners and we include specific food quality and safety standards and guest service requirements in the contracts we sign with our business partners; however, we do not have direct control over the restaurants operated by third-party partners, and the quality and service in those restaurants may be less than the quality and service of Chipotle-operated restaurants.

Failure of our business partners to adhere to our high food quality and operating standards could damage our brand reputation and impair our international expansion plans.

New partnerships and/or acquisitions also may divert management’s attention from other initiatives and/or day-to-day operations, which could adversely affect our business and results of operations.

Risks Related to Sustainability Factors

We are subject to evolving public disclosure requirements and expectations, including with respect to sustainability matters, that could expose us to numerous risks and could adversely affect our reputation and results of operations.

We are subject to evolving disclosure obligations promulgated by governmental and regulatory organizations relating to sustainability factors that impact our business.

We may be more susceptible than our competitors to significant negative consequences from food safety incidents due to several highly publicized food safety incidents involving E. coli, C. perfringens bacteria and norovirus that were connected to a number of our restaurants between 2015 to 2018.

These incidents and the related negative publicity had a significant negative impact on our sales and profitability for those years.

Because of consumer perceptions of our restaurants in the wake of these incidents, any future food safety incidents associated with our restaurants—even incidents that would be considered minor at our competitors—may have a more significant negative impact on our sales and our ability to retain guests.

Competition from food delivery services, which promote a wide variety of restaurant options on their sites, also has increased in recent years, particularly during the COVID-19 pandemic.

As a result of our highly publicized food safety incidents in 2015 – 2018, negative social media posts about our business may generate a disproportionately negative response than would be experienced by other companies without a similar history.

We rely on our restaurant-level employees to consistently provide high-quality food and positive experiences to our guests.

In addition, our ability to continue to open new restaurants depends on us attracting, hiring, developing and retaining high-quality employees to manage and work in our restaurants.

We also have been and are undergoing several audits of our compliance with employment law requirements in other cities, which could result in additional liabilities.

Although the FAST Act is stayed pending a referendum in 2024, it is possible that ultimately it will be enforced, and that other jurisdictions will pass similar laws.

We could experience a cybersecurity or privacy incident, which generally refers to any intentional attack or an unintentional event that results in unauthorized access to personal information or systems to disrupt operations, corrupt data or steal confidential information or intellectual property, or a ransomware attack, which is a type of malicious software that infects a computer and restricts users' access to it until a ransom is paid.

Any such incident that compromises the information of our guests or employees or disrupts our business operations could result in widespread negative publicity, damage to our reputation, a loss of guests, disruption of our business and legal liabilities.

If any of our critical suppliers is the target of a cybersecurity or ransomware attack, we could experience a significant disruption in our supply chain and possibly shortages of key ingredients.

In the past year, a ransomware attack on one of our key vendors required us to reperform manual processes, which resulted in delays and reduced efficiencies.

In addition, as more business activities have shifted online and more people are working remotely, we have experienced an increase in cybersecurity threats and attempts to breach our security networks.

We continuously monitor and develop our information technology networks and infrastructure to prevent, detect, address and mitigate the risk of unauthorized access, misuse, malware and other events that could have a security impact; however, there can be no assurance that these measures will be effective.

The majority of our restaurant sales are made by credit or debit cards, and we also maintain personal information regarding our employees and guests, and confidential information about our guests and suppliers.

We segment our card data environment and employ a cyber security protection program that is based on proven industry frameworks, including cyber security techniques, tactics and procedures such as the deployment of a robust set of security controls, continuous monitoring and detection programs, network protections, vendor selection criteria, secure software development programs and ongoing employee training, awareness and incident response preparedness.

In addition, we continuously scan our environment for any vulnerabilities, perform penetration testing, engage third parties to assess effectiveness of our security measures and collaborate with members of the cyber security community.

However, there are no assurances that such programs will be effective in detecting or preventing cybersecurity breaches.

From time to time we have been, and likely will continue to be, the target of cyber and other security threats.

For example, some of our guests have experienced account takeover fraud, in which guests use the same log in credentials on multiple websites and, when a third party fraudulently obtains those credentials from one website, they can gain unauthorized access to the guests’ accounts on our website and charge food orders to the credit card linked to their account (without accessing credit card data).

We may become subject to legal proceedings or governmental investigations for purportedly fraudulent transactions arising out of the actual or alleged theft of data or if guest or employee information is obtained by unauthorized persons or used inappropriately.

Any such claim or proceeding, or any adverse publicity resulting from such an event, may have a material adverse effect on our business and we may incur significant remediation costs.

Our inability or failure to execute a comprehensive business continuity plan at our restaurant support centers following a disaster or force majeure event could have a material adverse impact on our business.

Many of our corporate systems and processes and corporate support for our restaurant operations are centralized at one location.

We have disaster recovery procedures and business continuity plans in place to address crisis-level events, including hurricanes and other natural disasters, and back up and off-site locations for recovery of electronic and other forms of data and information, and the COVID-19 pandemic provided a limited test of our ability to manage our business remotely.

However, if we are unable to fully implement our disaster recovery plans, we may experience delays in recovery of data, inability to perform vital corporate functions, tardiness in required reporting and compliance, failures to adequately support field operations and other breakdowns in normal communication and operating procedures that could have a material adverse effect on our financial condition, results of operation and exposure to administrative and other legal claims.

In addition, these threats are constantly evolving, which increases the difficulty of accurately and timely predicting, planning for and protecting against the threat.

As a result, our disaster recovery procedures and business continuity plans security may not adequately address all threats we face or protect us from loss.

A violation of Chipotle’s Deferred Prosecution Agreement could have an adverse effect on our business and reputation.

In April 2020, Chipotle signed a Deferred Prosecution Agreement (the “DPA”) to settle an official criminal investigation conducted by the U.S. Attorney’s Office for the Central District of California, in conjunction with the U.S. Food and Drug Administration’s Office of Criminal Investigations (collectively, the “DOJ”), into food safety matters that occurred in our restaurants dating back to January 1, 2013.

Pursuant to the DPA, the DOJ filed a two-count Class A Misdemeanor Information in the United States District Court for the Central District of California charging Chipotle with adulterating and causing food to be adulterated within the meaning of the Federal Food, Drug and Cosmetic Act while such food was held for sale.

Under the DPA, Chipotle paid a fine and is required to maintain a comprehensive compliance program designed to ensure Chipotle complies with all applicable federal and state food safety laws.

If Chipotle is in full compliance with all of its obligations under the DPA at the conclusion of the three-year deferred prosecution term, which ends in April 2023, the DOJ agreed to move to dismiss the two-count Information filed against Chipotle.

Chipotle owns and operates over 3,100 restaurants and we dedicate substantial resources to our food safety program; however, even with strong preventative controls and interventions, food safety risks cannot be completely eliminated in any restaurant.

Food safety risks may arise due to possible failures by restaurant employees or suppliers to follow food safety policies and procedures, employees or guests coming to the restaurant while ill or contaminated ingredients in the food we sell.

If Chipotle is found to have breached the terms of the DPA, the DOJ may elect to prosecute, or bring a civil action against us for conduct alleged in the DPA’s Statement of Facts, which could result in additional fines, penalties, and have material adverse impacts on our results of operations and adversely affect our brand and reputation.

Since 2020, COVID-19 related disruptions in the global supply chain have increased the cost and decreased the availability of construction materials and restaurant equipment needed to open and operate our restaurants, which can delay the openings of new restaurants.

Risks Related to Environmental, Social and Governance Factors

If we are unable to achieve our social and environmental sustainability goals, our reputation and results of operations could be adversely affected.

We also could experience shortages of key ingredients [added: for many unforeseen reasons, such as crop damage due to inclement weather,] if our suppliers need to close or restrict [removed: operations due to the impact of COVID-19] [added: operations, or] due to industry-wide shipping and freight delays.

As of December 31, [removed: 2022,] [added: 2023,] we had [removed: $1.3] [added: $1.9] billion in cash and cash equivalents, current and long-term investments, and restricted cash, [removed: nearly all] of which [added: the substantial majority] are interest bearing.

[removed: Nearly] [added: Over] 30 years later, our devotion to seeking out high-quality ingredients, raised with respect for animals, farmers, and the environment, remains at the core of our commitment to Food [removed: With] [added: with] Integrity.

As of December 31, [removed: 2022,] [added: 2023,] we owned and operated [removed: 3,129] [added: 3,371] Chipotle restaurants throughout the United [removed: States, 53] [added: States (“U.S.”) and 66] international Chipotle [removed: restaurants, and five non-Chipotle] restaurants.

We manage our operations based on eight regions and [removed: have aggregated] [added: aggregate] our operations to one reportable segment.

Our mission is to win today while [removed: creating a bright] [added: we grow our] future by focusing on five key fundamental strategies:

Amplifying technology and innovation to drive [removed: digital] growth and productivity at our [removed: restaurants and] [added: restaurants,] support [removed: centers;][added: centers and in our supply chain; and]

[removed: And expanding] [added: Expanding] access and convenience by accelerating new restaurant [removed: openings.][added: openings in North America and internationally.]

Serving [removed: high quality] [added: high-quality] food while still charging reasonable prices is critical to ensuring guests enjoy wholesome food at a great value.

For more information about our sustainability and animal welfare initiatives, see our biennial Sustainability Report and interim Update Report on our website [removed: www.chipotle.com/about-us/sustainability.][added: www.chipotle.com/sustainability.]

[removed: We’ve] [added: We have] also sought to increase, where practical, the number of suppliers for our ingredients to help mitigate pricing volatility and reduce our reliance on one or several suppliers, which could create supply shortages.

In addition, we closely monitor industry news, trade tariffs, weather, exchange rates, foreign demand, crises and other world events that may affect our ingredient [removed: prices.][added: prices or available supply.]

Certain key ingredients [removed: (certain cuts of beef,] [added: (beef,] tomatoes, tortillas and adobo) are purchased from a small number of suppliers.

We are committed to serving only safe, [removed: high quality] [added: high-quality] food.

small grower [removed: support;][added: support during on-site audits;]

These and other food safety practices underscore our commitment to be a leader in food safety while continuing to serve [removed: high quality] [added: high-quality] food that our guests love.

Our food safety programs are also intended to ensure that we not only continue to comply with applicable [added: national,] federal, state and local food safety regulations, but also establish Chipotle as an industry leader in food safety.

In recent [removed: years] [added: years,] we have significantly upgraded our capabilities by digitizing our restaurant kitchens, expanding our partnerships with third-party delivery services and building more Chipotlanes, which is our drive through format for customer pick-up of digital orders.

Digital [removed: sales, which] [added: sales] represent food and beverage revenue generated through the Chipotle website, Chipotle app or third-party delivery aggregators [removed: includes] [added: and include] revenue deferrals associated with Chipotle [removed: Rewards, represented 39.4% of food and beverage revenue in 2022, compared to 45.0% of food and beverage revenue in 2021.][added: Rewards.]

We have made digital ordering convenient with enhancements to the Chipotle app and website, such as [removed: unlimited] customization, contactless delivery, and group [removed: ordering.][added: ordering and we have improved the overall guest experience within the app with the inclusion of order readiness messaging, wrong location detection and reminders to scan for points.]

[removed: In 2022 only] [added: We continue to bargain with the] one restaurant [added: that] voted [added: in 2022] to form a union, and we believe that our relationship with our employees is good.

[removed: U.S.] [added: As of December 31, 2023, U.S.-based employee] diversity statistics were as follows:

[removed: ][added: Description automatically generated](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231x10kg001.jpg)]

Our most recent EEO-1 consolidated report is posted on the Investors page of our website at www.ir.chipotle.com under Corporate Governance – Human Capital Information and additional details about the demographics of our employee population is included [removed: there and] in our biennial Sustainability Report and interim Update Report on our website [removed: www.chipotle.com/about-us/sustainability*.*][added: www.chipotle.com/sustainability*.*]

Maintaining a diverse, equitable and inclusive work environment is critical to our [removed: business success.][added: success as a business.]

[removed: Since] [added: Since] December 2021, we have [removed: been participating] [added: participated] in Management Leadership for Tomorrow’s Black Equity at Work Certification Program, which establishes a comprehensive aggregate measurement system and provides a rigorous, results-oriented approach that accelerates progress toward Black equity internally, amongst our employees, and externally by supporting Black equity within our business partners and in the communities where we operate.

[removed: In addition to the Black Equity at Work Certification Program, in] [added: In] early [removed: 2023] [added: 2023,] we engaged an independent third-party consultant to conduct a Talent Management Equity [removed: Audit, which aims] [added: Audit] to identify [removed: where] [added: places] in [removed: the] [added: our] talent management cycle [added: where] we may need to [removed: debias or] [added: eliminate bias and/or] create more equitable policies, practices, and [removed: procedures,] [added: procedures;] identify potential blockers and new opportunities to [removed: creating] [added: create] and [removed: sustaining] [added: sustain] equity in talent [removed: management,] [added: management;] and identify key strengths and pockets of risk.

We [removed: also] retain an independent third-party compensation consultant each year to conduct a pay equity analysis of our U.S. [added: and Canadian] workforce, including factors of pay (e.g., grade level, tenure in role, most recent promotion) and external market conditions (e.g., geographic [removed: location)] [added: location),] to ensure consistency and equitable treatment [removed: amongst] [added: among] our employees.

We believe [removed: that] [added: in investing and supporting] our people [added: because they are our most important asset] and [removed: culture] give us a competitive advantage in our business.

[removed: Our Leadership] [added: Leadership] Evolution and [removed: Development Program focuses] [added: Development: Focuses] on preparing a cross-functional cohort of mid-level managers for the future of work and leadership.

During the 9-month program, participants learn the critical capabilities of leading oneself, [removed: to] leading others, [removed: to] [added: and] leading the business with topics designed to stretch capabilities and improve decision-making skills.

[removed: Our Executive Development Program, which focuses] [added: Executive Development: Focuses] on developing [removed: eleven] high potential Team Directors [removed: by providing them with opportunities to develop] in areas such as leadership, marketing, business and finance, data and analytics, ESG and hospitality, [removed: as well as] [added: so they] gain an in-depth understanding of various functions within the company.

Online executive coaching for mid- and [removed: senior level] [added: senior-level] leaders throughout the organization.

Development courses and [added: online] programs that focus on creating [removed: an inclusive culture.][added: a culture of belonging.]

The financial, [removed: physical] [added: physical,] and mental wellness of our employees remains our top priority and we believe we have compelling compensation packages and incentive [removed: programs] [added: programs,] and a robust suite of benefit offerings that [removed: enables] [added: enable] us to engage current team members and attract new team members:

[removed: Our commitment to pay equity is evidenced by our investment] [added: We have made substantial investments] in our compensation packages, including competitive wages and industry leading incentive programs, such as our annual and quarterly bonus programs, [removed: that] [added: which] allow us to attract and retain the top talent in the industry.

[removed: Our] [added: We offer a] Debt-Free Degree program that [removed: now] provides Chipotle employees access to nearly 100 degrees at 10 universities, completely tuition debt free.

[removed: New] [added: We support] Career Certificates, which further enhances our Tuition Assistance benefits by providing on-demand certificate programs to help Chipotle team members advance their careers in as little as eight weeks.

[removed: Personalized] [added: In 2023, we also offered personalized] mental health assistance [removed: is available] to all Chipotle employees and their family members [removed: through a partnership] with [removed: Health Advocate;] support [removed: is] available 24/7 via in-person, phone, or virtual visits with a licensed counselor.

We are subject to various federal, state and local laws and regulations that govern aspects of our business [removed: operations, including those governing:][added: operations.]

While costs associated with compliance with [removed: these] laws and regulations have increased as the number and scope of [removed: the laws] [added: regulation] have increased, the total costs incurred have not had, and are not expected to have, a material effect on our capital expenditures, results of operations or competitive position.

See “Risk Factors” in Item 1A for [removed: a] discussion of risks relating to federal, state, local and international laws and regulations applicable to our business.

Digital sales represented 37.4% of food and beverage revenue in 2023, compared to 39.4% of food and beverage revenue in 2022.

At Chipotle, our vision is to cultivate an environment where our employees can thrive, pursue their passion and become lifelong leaders.

As of December 31, 2023, Chipotle employed 116,068 people worldwide and 1,088 contract workers.

Of our employees, 114,042 worked in the United States, and 2,026 worked internationally across Canada, France, Germany, and the United Kingdom.

Within the U.S., 112,572 employees worked in our restaurants, and 1,470 in our Restaurant Support Centers.

There were no union petitions or campaigns in 2023.

Talent Acquisition

We continue to invest heavily in recruiting top talent and ensuring appropriate staffing levels are maintained, especially during our two peak hiring seasons (spring and fall).

We focus on new and innovative ways to attract and engage talent for our restaurants, which includes marketing campaigns that build on our documentary-style television spots, featuring unscripted testimonials from team members about the impact Chipotle has had on their lives.

We invest in advertising on social media and highlight growth opportunities and the possible trajectory of achieving six-figure total compensation in approximately three years.

Additionally, we now offer a formal Summer Internship Program to invest in students while creating opportunities for our restaurant employees to further gain exposure to our Restaurant Support Centers.

![A pie chart with text

![A graph of employees by race and ethnicity

Description automatically generated](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231x10kg002.jpg)

Notably, our rate of internal promotions for 2023 was similar within our employee populations, with approximately 50% of promoted employees identifying as female and 39% of promoted employees identifying as Hispanic or Latino.

We have undertaken several actions to promote diverse, equitable and inclusive work environments.

We created a consistent and structured candidate interview process with new interview guides.

This ensures quality, speed and equitable hiring practices are followed throughout internal and external candidate interviews.

We also launched an internal job board across multiple communication channels to our employees to provide increased visibility and access to internal opportunities.

The consultant concluded that Chipotle has a robust set of processes, practices and policies to enable equitable talent recruiting, development and retention throughout the company and identified opportunities to strengthen Chipotle’s existing practices.

See the Investors page of our website at www.ir.chipotle.com under Corporate Governance – Human Capital Information for additional details.

We have a holistic approach to pay equity to ensure consistent and equitable treatment among our employees.

In 2023, our review included 99% of our U.S. and Canadian employee population, excluding only approximately 50 of our most senior management employees.

The analysis identified small, isolated pay gaps for certain segments of the population, and we subsequently made pay adjustments to close those gaps.

Since there are not many common roles among our 50 most senior executives, we consider both internal equity by level as well as individualized market data to help ensure we maintain pay equity among this group.

We provide high-quality growth and development opportunities to retain top talent and support internal promotions.

In 2023, we had more than 24,000 internal promotions, including 100% of U.S. based Regional Vice Presidents, 87% of Team Directors, and 87% of Field Leaders.

To develop our employees, we provide the following programs:

Cultivate University: A four-day immersive leadership experience designed to upskill our new multi-unit restaurant leaders to excel in their role and execute on their Top 5 KPIs.

Participants are introduced to a variety of leadership models as well as operational tools to support them in leading effective teams and driving results in their restaurants.

General Manager Upskilling: Trains our restaurant leaders in fundamental soft skills to help bolster their leadership acumen so that they can better lead their teams and create an exceptional guest experience.

Teach & Taste Live seminars: Offers lunch and learn sessions on leadership topics such as effective communication, emotional intelligence, and building a culture of accountability to provide on-going professional development for employees at our Restaurant Support Centers.

Each course introduces a new leadership skill and offers best practices and actionable tools to continue developing the top talent that supports our field operations.

Succession Planning: We utilize talent calibrations to identify a diverse pipeline of emerging leaders and define appropriate development programs.

Starting in 2024, we are partnering with SoFi to offer student loan payment matching programs via our 401(k)-retirement program.

This, in addition to a credit optimization service, will help bolster our employees’ financial well-being.

Culture and Engagement

Giving employees the opportunity to provide anonymous feedback is a key part of our employee engagement strategy, which positively contributes to our culture.

This begins with soliciting feedback regarding onboarding.

As of December 31, 2023, 9 in 10 respondents in our restaurants reported a favorable onboarding experience.

Our strong digital platform gave us a competitive advantage during the peaks of the COVID-19 pandemic, as more guests preferred to eat their meals at home and in-restaurant dining was prohibited or restricted.

As of December 31, 2022, Chipotle employed 104,958 people worldwide, of which 103,345 individuals are employed in the U.S. and 1,613 are employed in Canada, France, Germany and the United Kingdom.

In the United States, we employed 102,219 people in our restaurants and 1,126 people in our Restaurant Support Centers and field support organizations.

As a people-first company rooted in values, our purpose of Cultivating a Better World extends beyond serving nutritious food using real ingredients.

It means hiring world-class individuals dedicated to investing in their future and partnering together to positively impact the communities they serve.

Most notably, our diversity and inclusion strategy is to foster a culture that values and champions diversity, while leveraging the individual talents of all team members to grow our business and Cultivate a Better World.

As of December 31, 2022, approximately 50% of our U.S.-based employee population was female and approximately 70% of our U.S.-based employee population was comprised of racial and ethnic minorities.

Therefore, we have undertaken several actions to ensure that our diversity strategy is effective.

We plan to disclose key results and action plans from these initiatives in our Sustainability Report.

In 2022, our review included 99% of our U.S. employee population, excluding only approximately 50 of our most senior management employees, and the results did not identify preferential treatment to any class of employee; however, we identified several isolated discrepancies between actual compensation and our policies and we quickly made pay adjustments to close all identified gaps.

In 2022, we had approximately 22,000 internal promotions.

Additionally, 90% of all restaurant management roles were internal promotions including 100% of US Regional Vice President roles, 81% of Team Directors, and 74% of Field Leader positions.

We provide our employees various learning opportunities to ensure that we maintain a diverse pipeline of talent available to regularly promote employees to leadership positions, including the following:

Coordinated talent calibration across the organization to identify a diverse pipeline of emerging leaders, matching these leaders with the appropriate development programs to ensure we have a slate of ‘ready now’ internal talent for critical roles within the organization.

preparation, sale and labeling of food, including regulations of the Food and Drug Administration, which oversees the safety of the entire food system, including inspections and mandatory food recalls, menu labeling and nutritional content;

employment practices and working conditions, including minimum wage rates, wage and hour practices, fair workweek and “just cause” legislation, employment of minors, discrimination, harassment, classification of employees, paid and family leave, workplace safety, immigration and overtime among others;

data privacy and standards for the protection of personal information, including social security numbers, financial information (including credit card numbers), and health information, including state laws such as the California Privacy Rights Act (“CPRA”) and CCPA in California as well as new privacy-related legislation in Virginia, Colorado, Connecticut, Utah and a growing number of other states, and international laws such as GDPR in the European Union and the Personal Information Protection and Electronic Documents Act (“PIPEDA”) in Canada, and payment card industry standards and requirements;

health, sanitation, safety and fire standards and the sale of alcoholic beverages;

building and zoning requirements, including state and local licensing and regulation governing the design and operation of facilities and land use;

public accommodations and safety conditions, including the Americans with Disabilities Act and similar state laws that give civil rights protections to individuals with disabilities in the context of employment, public accommodations, online resources and other areas;

environmental matters, such as emissions and air quality, water consumption, the discharge, storage, handling, release, and disposal of hazardous or toxic substances, and local ordinances restricting the types of packaging we can use in our restaurants; and

public company compliance, disclosure and governance matters, including accounting and tax regulations, SEC and NYSE disclosure requirements.

For the fiscal year ended December 31, [removed: 2022][added: 2023]

As of June 30, [removed: 2022,] [added: 2023,] the aggregate market value of the registrant’s outstanding common equity held by non-affiliates was [removed: $29.362] [added: $46.885] billion, based on the closing price of the registrant’s common stock on June 30, [removed: 2022,] [added: 2023,] the last trading day of the registrant’s most recently completed second fiscal quarter.

As of February [removed: 6, 2023,] [added: 2, 2024,] there were [removed: 27,621,847] [added: 27,421,169] shares of the registrant’s common stock, par value of $0.01 per share outstanding.

Part III incorporates certain information by reference from the registrant’s definitive proxy statement for the [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after the close of the registrant’s fiscal year ended December 31, [removed: 2022.][added: 2023.]

| Item 1B. | [Unresolved Staff Comments](#Item_1B) | [removed: 18] [added: 19] |

| Item 2. | [Properties](#Item_2) | [removed: 19] [added: 20] |

| Item 3. | [Legal Proceedings](#Item_3) | [removed: 19] [added: 21] |

| Item 4. | [Mine Safety Disclosures](#Item_4) | [removed: 19] [added: 21] |

| Item 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#Item_5) | [removed: 20] [added: 22] |

| Item 6. | [Reserved](#Item_6) | [removed: 22] [added: 24] |

| Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#Item_7) | [removed: 22] [added: 24] |

| Item 7A. | [Quantitative and Qualitative Disclosure About Market Risk](#Item_7A) | [removed: 30] [added: 32] |

| Item 8. | [Financial Statements and Supplementary Data](#Item_8) | [removed: 31] [added: 33] |

| | [Report of Independent Registered Public Accounting Firm](#Report_of_Independent) (PCAOB ID: 42) | [removed: 31] [added: 33] |

| | [Consolidated Balance Sheets as of December 31, [removed: 2022] [added: 2023] and [removed: 2021](#Consolidated_BS)] [added: 2022](#Consolidated_BS)] | [removed: 33] [added: 35] |

| | [Consolidated Statements of Income and Comprehensive Income for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020](#Consolidated_IS)] [added: 2021](#Consolidated_IS)] | [removed: 34] [added: 36] |

| | [Consolidated Statements of Shareholders’ Equity for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020](#Consolidated_SOE)] [added: 2021](#Consolidated_SOE)] | [removed: 35] [added: 37] |

| | [Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020](#Consolidated_SCF)] [added: 2021](#Consolidated_SCF)] | [removed: 36] [added: 38] |

| | [Notes to Consolidated Financial Statements](#Notes_to_FS) | [removed: 37] [added: 39] |

| | [Note 1 – Description of Business and Summary of Significant Accounting Policies](#Note_01) | [removed: 37] [added: 39] |

| | [Note 2 – Supplemental Balance Sheet Information](#Note_02) | [removed: 42] [added: 45] |

| | [Note 3 – Revenue Recognition](#Note_03) | [removed: 43] [added: 46] |

| | [Note 4 – Fair Value [removed: of Financial Instruments](#Note_04)] [added: Measurements](#Note_04)] | [removed: 44] [added: 47] |

| | [Note 5 – Equity Investments](#Note_05) | [removed: 46] [added: 49] |

| | [Note 6 – Income Taxes](#Note_06) | [removed: 46] [added: 49] |

| | [Note 7 – Shareholders’ Equity](#Note_07) | [removed: 49] [added: 52] |

| | [Note 8 – Stock-Based Compensation and Employee Benefit Plans](#Note_08) | [removed: 49] [added: 52] |

| | [Note 9 – Leases](#Note_09) | [removed: 53] [added: 56] |

| | [Note 10 – Earnings Per Share](#Note_10) | [removed: 54] [added: 57] |

| | [Note 11 – Commitments and Contingencies](#Note_11) | [removed: 54] [added: 57] |

| | [Note 12 – Debt](#Note_12) | [removed: 55] [added: 57] |

| | [Note 13 – Related Party Transactions](#Note_13) | [removed: 55] [added: 58] |

| Item 9. | [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](#Item_9) | [removed: 55] [added: 58] |

| Item 9A. | [Controls and Procedures](#Item_9A) | [removed: 55] [added: 58] |

| Item 9B. | [Other Information](#Item_9B) | [removed: 58] [added: 61] |

| Item 9C. | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#Item_9C) | [removed: 58] [added: 61] |

| Item 10. | [Directors, Executive Officers and Corporate Governance](#Item_10) | [removed: 58] [added: 61] |

| Item 11. | [Executive Compensation](#Item_11) | [removed: 58] [added: 62] |

| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#Item_12) | [removed: 58] [added: 62] |

| Item 13. | [Certain Relationships and Related Transactions, and Director Independence](#Item_13) | [removed: 58] [added: 62] |

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

| Item 1C. | [Cybersecurity](#Item_1C) | 19 |

We use words such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “think,” “estimate,” “seek,” “expect,” “predict,” “could,” “project,” “potential”, “goal” and other similar terms and phrases, including references to assumptions, to identify forward-looking statements.

Our actual future results and trends may differ materially depending on a variety of factors, including, but not limited to, the risks and uncertainties described in this report under the heading “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” so you should not place undue reliance on forward-looking statements.

Cybersecurity Risk Management and Strategy

As a global company, we are regularly subject to cyberattacks and other cybersecurity incidents.

In response, we have implemented cybersecurity processes, technologies, and controls to aid in our efforts to assess, identify, and manage cybersecurity risks.

Our enterprise risk management framework considers cybersecurity risk alongside other company risks as part of our overall risk assessment process.

Our enterprise risk management team collaborates with our Information Security function, led by our Chief Information Security Officer (“CISO”) and our Chief Customer and Technology Officer (“CCTO”), to gather insights for assessing, identifying and managing cybersecurity threat risks, their severity, and potential mitigations.

We also are a member of an industry cybersecurity intelligence and risk sharing organization to stay abreast of changes in the cybersecurity environment.

We assess Chipotle’s Information Security program using an industry cybersecurity framework from the National Institute of Standards and Technology.

This program includes policies, processes and procedures that help assess and identify our cybersecurity risks and inform how security measures and controls are developed, implemented and maintained.

The risk assessment along with risk-based analysis and judgment are used to select security controls to address risks.

During this process, the following factors, among others, are considered: likelihood and severity of risk, impact on the Company and others if a risk materializes, feasibility and cost of controls and impact of controls on operations.

We maintain internal resources to perform penetration testing designed to simulate evolving tactics and techniques of real-world threat actors, engage with industry partners and law enforcement and intelligence communities and conduct tabletop exercises and periodic risk interviews across our business.

We also engage an independent third party to perform internal and external penetration testing of Chipotle's information security environment periodically and engage other third parties to periodically conduct assessments of our cybersecurity capabilities.

In addition, we continue to expand training and awareness practices to mitigate risk from human error, including mandatory computer-based training and internal communications for employees.

Our employees undergo cybersecurity awareness training and regular phishing awareness campaigns that are based upon and designed to emulate real-world contemporary threats.

We provide prompt feedback (and, if necessary, additional training or remedial action) based on the results of such exercises.

Our processes also address cybersecurity risks associated with our use of third-party service providers including suppliers, software and cloud-based service providers, as well as third-party security firms used in different capacities to provide or operate some of our cybersecurity controls and technology systems.

We proactively evaluate the cybersecurity risk of a third party by utilizing a repository of risk assessments, external monitoring sources, threat intelligence and predictive analytics to better inform Chipotle during contracting and vendor selection processes.

Additionally, when third party risks are identified, we require those third parties to agree by contract to implement appropriate security controls.

Security issues are documented and tracked, and periodic monitoring of third parties is conducted in an effort to mitigate risk.

In addition to the processes, technologies, and controls that we have in place to reduce the likelihood of a material cybersecurity incident (or series of related cybersecurity incidents), Chipotle has a written incident response plan outlining how to address cybersecurity events that occur.

The plan sets forth the steps for coordination among various corporate functions and governance groups and serves as a framework for the execution of responsibilities across businesses and operational roles.

Our incident response plan is designed to help us coordinate actions to prepare for, detect, respond to and recover from cybersecurity incidents, and includes processes to triage, assess severity, escalate, contain, investigate, and remediate the incident, as well as to assess the need for disclosure, comply with applicable legal obligations and mitigate the impact to our brand and reputation and on impacted parties.

We also maintain insurance coverage that, subject to its terms and conditions, is intended to help us cover certain costs associated with cybersecurity incidents and information system failures.

In addition to our cybersecurity incident response plan, we conduct tabletop exercises to enhance our incident response preparedness.

We maintain business continuity and disaster recovery plans to prepare for and respond to the potential for a disruption in the technology we rely on.

Chipotle (or the third parties it relies on) may not be able to fully, continuously, or effectively implement security controls as intended.

As described above, we utilize a risk-based approach and judgment to determine whether and how to implement certain security controls and it is possible that we may not implement the necessary controls if we are unable to recognize or underestimate a particular risk.

In addition, security controls, no matter how well designed or implemented, may only mitigate and not fully eliminate cybersecurity risks.

Cybersecurity events, when detected by security tools or third parties, may not always be identified immediately or addressed in the manner intended by our cybersecurity incident response plan.

Impact of cybersecurity risks on business strategy, results of operations or financial condition

Based on the information available as of the date of this Annual Report, we have no reason to believe any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition.

For additional information, see “Risks Related to Cybersecurity, Data Privacy and IT Systems,” in Item 1A, “Risk Factors” in this Annual Report.

Cybersecurity Governance

Our cybersecurity risk management and strategy processes are led by our CISO and our CCTO.

These individuals have collectively over 50 years of professional experience in various roles across multiple industries involving managing information security, developing cybersecurity strategy, implementing effective information and cybersecurity programs and managing multiple industry and regulatory compliance environments.

Both individuals previously held positions similar to their current roles at other large publicly traded organizations.

Cybersecurity is an important part of our risk management processes and an area of focus for our Board of Directors (the “Board”) and management.

Although cybersecurity risk oversight continues to remain a top priority for the Board, the Audit and Risk Committee of our Board has primary oversight responsibility for the Company’s cybersecurity and other technology risks.

The Committee regularly reviews and discusses with our CISO and our CCTO the Company’s cybersecurity, privacy and data security programs, the status of projects to strengthen internal cybersecurity, results from third-party assessments, and any significant cybersecurity incidents, including recent incidents at other companies and the emerging threat landscape.

The Committee also reviews with management the implementation and effectiveness of the Company’s controls to monitor and mitigate cybersecurity risks.

As of December 31, [removed: 2022,] [added: 2023,] there were [removed: 3,187] [added: 3,437] restaurants operated by Chipotle and our consolidated [removed: subsidiaries, 3,182 of which were Chipotle restaurants.][added: subsidiaries.]

Our main office is located at 610 Newport Center Drive, [added: Suite 1100,] Newport Beach, CA 92660 and our telephone number is (949) 524-4000.

For additional information regarding the lease terms and provisions, see [removed: Note] [added: [Note] 1.

“Description of Business and Summary of Significant Accounting [removed: Policies”] [added: Policies”](#Note_01)] and [removed: Note] [added: [Note] 9.

[removed: “Leases”] [added: “Leases”](#Note_09)] in our consolidated financial statements included in Item 8.

As of February [removed: 7, 2023,] [added: 5, 2024,] there were approximately [removed: 1,313] [added: 1,508] shareholders of record.

The table below reflects shares of common stock we repurchased during the fourth quarter of [removed: 2022.][added: 2023.]

(1) Shares were repurchased pursuant to repurchase programs announced on July 26, [removed: 2022.][added: 2023 and October 26, 2023.]

(2) The December total includes an additional $200 million in authorized repurchases approved on December [removed: 7, 2022] [added: 14, 2023] and announced February [removed: 7, 2023.][added: 6, 2024.]

The following graph compares the cumulative annual stockholders return on our common stock from December 31, [removed: 2017,] [added: 2018,] through December 31, [removed: 2022,] [added: 2023,] to that of the total return index for the S&P 500 and the S&P 500 Restaurants Index assuming an investment of $100 on December 31, [removed: 2017.][added: 2018.]

Description automatically [removed: generated](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231x10kg002.jpg)][added: generated with medium confidence](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231x10kg003.jpg)]

| Company/Index | [removed: 2017 | | |] 2018 | | | 2019 | | | 2020 | | | 2021 | | | 2022 | | [added: | 2023 | |]

*$100 invested on December 31, [removed: 2017,] [added: 2018,] in stock or index, including reinvestment of dividends.

Fiscal year ending December 31, [removed: 2022.][added: 2023.]

“Financial Statements and Supplementary Data.” This section of the Form 10-K generally discusses [removed: 2022] [added: 2023] items and year-to-year comparisons of [removed: 2022] [added: 2023] to [removed: 2021.][added: 2022.]

Discussions of [removed: 2020] [added: 2021] items and year-to-year comparisons of [removed: 2021] [added: 2022] and [removed: 2020] [added: 2021] that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 on our Annual Report on Form 10-K for the year ended December 31, [removed: 2021.][added: 2022.]

As of December 31, [removed: 2022,] [added: 2023,] we operated [removed: 3,129] [added: 3,371] Chipotle restaurants throughout the United States, [removed: 53] [added: and 66] international Chipotle [removed: restaurants, and five non-Chipotle] restaurants.

We manage our U.S. operations based on eight regions and [removed: have aggregated] [added: aggregate] our operations to one reportable segment.

[removed: 2022] [added: 2023] Financial Highlights, year-over-year:

Total revenue increased [removed: 14.4%] [added: 14.3%] to [removed: $8.6] [added: $9.9] billion

Comparable restaurant sales increased [removed: 8.0%][added: 7.9%]

Diluted earnings per share was [removed: $32.04,] [added: $44.34,] a [removed: 39.9%] [added: 38.4%] increase from [removed: $22.90,] [added: $32.04,] which includes a [removed: $0.74] [added: $0.52] after-tax impact from expenses related to [removed: certain legal proceedings, expenses related to the 2018 performance share COVID-19 related modification, corporate restructuring costs, employee separation costs,] restaurant [removed: asset] [added: and corporate level] impairment and closure costs, [added: accelerated depreciation] and [removed: other costs,] [added: corporate restructuring,] partially offset by [removed: an unrealized gain on investments][added: a reduction in contingencies related to certain legal proceedings.]

*Sales Trends.* Comparable restaurant sales increased [removed: 8.0%] [added: 7.9%] for the year ended December 31, [removed: 2022.][added: 2023.]

During the year ended December 31, [removed: 2022,] [added: 2023,] our restaurant operating costs (food, beverage and packaging; labor; occupancy; and other operating costs) were [removed: 76.1%] [added: 73.8%] of total revenue, a decrease from [removed: 77.4%] [added: 76.1%] during the year ended December 31, [removed: 2021.][added: 2022.]

*Restaurant Development.* During the year ended December 31, [removed: 2022,] [added: 2023,] we opened [removed: 236] [added: 271] new restaurants, which included [removed: 202] [added: 238] restaurants with a Chipotlane.

We expect to open approximately [removed: 255-285] [added: 285-315] new restaurants in [removed: 2023] [added: 2024] (including [removed: 10] [added: 5] to [removed: 15] [added: 10] relocations), which assumes [removed: utility, construction, permit] [added: developer, permit, inspection,] and [removed: material supply] [added: utility] delays do not worsen.

[removed: In April 2022 we announced the formation of the] [added: Our] Cultivate Next [removed: Fund,] [added: Fund is] a venture [removed: that will] [added: formed to] make early-stage investments into strategically aligned companies that further our mission to Cultivate a Better World.

The [removed: venture fund] [added: Fund] has an initial size of $50.0 [removed: million and will be] [added: million, which is] financed almost entirely by Chipotle.

As of December 31, [removed: 2022,] [added: 2023,] we have made [removed: $11.0] [added: $33.0] million in investments through this [removed: fund.][added: Fund.]

| Beginning of period | [removed: 2,966] [added: 3,187] | | [removed: 2,768] [added: 2,966] |

| Chipotle openings | [removed: 235] [added: 270] | | [removed: 215] [added: 235] |

| Chipotle permanent closures | (3) | | [removed: (10)] [added: (3)] |

| Chipotle relocations | (12) | | [removed: (7)] [added: (12)] |

| Total restaurants at end of period | [removed: 3,187] [added: 3,437] | | [removed: 2,966] [added: 3,187] |

| | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | change |

| Food and beverage revenue | $ | [removed: 8,558.0] [added: 9,804.1] | | $ | [removed: 7,457.2] [added: 8,558.0] | | [removed: 14.8%] [added: 14.6%] |

| Delivery service revenue | | [removed: 76.7] [added: 67.5] | | | [removed: 89.9] [added: 76.7] | | [removed: (14.7%)] [added: (11.9%)] |

| Total revenue | $ | [removed: 8,634.7] [added: 9,871.6] | | $ | [removed: 7,547.1] [added: 8,634.7] | | [removed: 14.4%] [added: 14.3%] |

| Average restaurant sales (1) | $ | [removed: 2.8] [added: 3.0] | | $ | [removed: 2.6] [added: 2.8] | | [removed: 6.1%] [added: 6.9%] |

| Comparable restaurant sales increase | | [removed: 8.0%] [added: 7.9%] | | | [removed: 19.3%] [added: 8.0%] | | |

| Food, beverage and packaging | $ | [removed: 2,602.2] [added: 2,912.6] | | $ | [removed: 2,308.6] [added: 2,602.2] | | [removed: 12.7%] [added: 11.9%] |

| As a percentage of total revenue | | [removed: 30.1%] [added: 29.5%] | | | [removed: 30.6%] [added: 30.1%] | | [removed: (0.5%)] [added: (0.6%)] |

Food, beverage and packaging costs decreased [added: 0.6%] as a percentage of total revenue for the year ended December 31, [removed: 2022] [added: 2023] compared to the year ended December 31, [removed: 2021, primarily due to the benefit of] [added: 2022, including 1.6% from] menu price [removed: increases.][added: increases and 0.6% from lower avocado costs, partially offset by 1.6% due to inflation across several ingredient costs, primarily beef, tortillas and queso.]

| Labor costs | $ | [removed: 2,198.0] [added: 2,441.0] | | $ | [removed: 1,917.8] [added: 2,198.0] | | [removed: 14.6%] [added: 11.1%] |

| As a percentage of total revenue | | [removed: 25.5%] [added: 24.7%] | | | [removed: 25.4%] [added: 25.5%] | | [removed: 0.1%] [added: (0.8%)] |

| October | | | 52,611 | | $ | 1,840.49 | | 52,611 | | $ | 271,538,394 |

| November | | | 13,084 | | $ | 2,092.54 | | 13,084 | | $ | 244,159,596 |

| December | | | 8,828 | | $ | 2,271.49 | | 8,828 | | $ | 424,106,921 |

| Total | | | 74,523 | | $ | 1,935.80 | | 74,523 | | | |

![A graph showing the difference between a grill and a grill

| Chipotle Mexican Grill, Inc. | $ | 100 | | $ | 194 | | $ | 321 | | $ | 405 | | $ | 321 | | $ | 536 |

| S&P 500 | | 100 | | | 129 | | | 150 | | | 190 | | | 153 | | | 191 |

| S&P 500 Restaurants | | 100 | | | 122 | | | 141 | | | 170 | | | 153 | | | 172 |

The increase is primarily attributable to higher transactions and, to a lesser extent, an increase in average check.

Digital sales represented 37.4% of total food and beverage revenue.

The decrease was driven primarily by sales leverage and, to a lesser extent, lower avocado prices.

These decreases were partially offset by higher inflation across several food ingredients and, to a lesser extent, wage inflation.

In December 2023, our Board approved an additional $50.0 million financial commitment to this Fund.

As of December 31, 2023, none of this additional $50.0 million has been invested.

| | 2023 | | 2022 |

| Non-Chipotle openings | 1 | | 1 |

| Non-Chipotle permanent closures | (6) | | \- |

| Transactions | | 5.0% | | | 0.9% | | |

| Average check | | 2.9% | | | 7.1% | | |

| Menu price increase | | 5.2% | | | 12.0% | | |

| Check mix | | (2.3%) | | | (4.9%) | | |

The following is a summary of the change in restaurant sales for the period indicated:

| | | |

| --- | --- | --- |

| | | |

| | | |

| | Year ended | |

| | (dollars in millions) | |

| For the period ending December 31, 2022 | $ | 8,634.7 |

| Change from: | | |

| Comparable restaurant sales | | 636.3 |

| Restaurant not yet in comparable base opened in 2023 | | 242.1 |

| Restaurant not yet in comparable base opened in 2022 | | 356.3 |

| Other | | 2.2 |

| For the period ending December 31, 2023 | $ | 9,871.6 |

| | 2023 | | | 2022 | | | change |

| | 2023 | | | 2022 | | | change |

Beginning in April 2024, California legislation will require national restaurant chains, including Chipotle, to pay a minimum $20 per hour wage to restaurant workers in California This will increase wages in California nearly 20% and will result in wage inflation increasing from the low to mid-single digit range to the mid-single-digit range.

We expect to increase menu prices in California to mitigate higher wage costs resulting from this legislation.

| | 2023 | | | 2022 | | | change |

| October | | | 45,448 | | $ | 1,512.59 | | 45,448 | | $ | 344,061,582 |

| November | | | 53,236 | | $ | 1,464.22 | | 53,236 | | $ | 266,112,344 |

| December | | | 35,071 | | $ | 1,487.43 | | 35,071 | | $ | 413,946,701 |

| Total | | | 133,755 | | $ | 1,486.74 | | 133,755 | | | |

![Chart, line chart

| Chipotle Mexican Grill, Inc. | $ | 100 | | $ | 149 | | $ | 290 | | $ | 480 | | | 605 | | $ | 480 |

| S&P 500 | | 100 | | | 94 | | | 121 | | | 140 | | | 178 | | | 144 |

| S&P 500 Restaurants | | 100 | | | 108 | | | 132 | | | 152 | | | 184 | | | 166 |

The increase is primarily attributable to an increase in menu prices and, to a lesser extent, an increase in transactions, partially offset by a decrease in group size from the continued resurgence of our in-restaurant business.

In-restaurant sales increased 26.4% for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily due to menu price increases, a shift in consumer behaviors related to COVID-19 from digital sales to in-restaurant sales across the country, and new restaurant openings.

In-restaurant sales represent food and beverage revenue generated on-premise and include revenue deferrals associated with Chipotle Rewards.

Digital sales represented 39.4% of food and beverage revenue for the year ended December 31, 2022, compared to 45.0% of food and beverage revenue for the year ended December 31, 2021.

The decrease in digital sales as a percentage of food and beverage revenue is primarily related to the increase of in-restaurant sales discussed above.

Digital sales represent food and beverage revenue generated through the Chipotle website, Chipotle app or third-party delivery aggregators and includes revenue deferrals associated with Chipotle Rewards.

We updated the definition of digital sales in the first quarter of 2022 to include revenue deferrals related to Chipotle Rewards.

We made this change to allow for a reconciliation to total food and beverage revenue as we now present in-restaurant sales.

The decrease was driven primarily by sales leverage and, to a lesser extent, lower delivery expenses associated with lower volume of delivery transactions, partially offset by wage inflation and higher commodity inflation primarily from avocados, packaging, dairy, beef and chicken.

| | 2022 | | 2021 |

| Pizzeria Locale openings | 1 | | \- |

| | | | | | | | |

The significant factors contributing to the total revenue increase for the year ended December 31, 2022 compared to the year ended December 31, 2021, were comparable restaurant sales increases and new restaurant openings.

Total revenue increased due to comparable restaurant sales increase of $568.6 million and restaurants not yet in the comparable base of $519.4 million, of which $210.5 million was due to restaurants opened in 2022.

This decrease was partially offset by inflation across the menu, primarily related to higher costs for avocados, packaging, dairy, beef and chicken.

Other operating costs include, among other items, marketing and promotional costs, delivery expense, bank and credit card processing fees, restaurant utilities, technology costs, and maintenance costs.

These decreases were partially offset by higher costs across several expenses, most notably higher utilities primarily related to inflation in natural gas and electricity and higher maintenance costs.

General and administrative expenses decreased in dollar terms for the year ended December 31, 2022 compared to the year ended December 31, 2021, primarily due to the following: a $81.5 million decrease in stock-based compensation and related taxes, primarily attributable to the timing of vesting of the December 2020 modification of 2018 performance awards related to COVID-19; a $13.7 million decrease in performance bonuses and related taxes; and a $12.4 million decrease in litigation expense in 2022 compared to 2021.

These decreases were partially offset by a $21.5 million increase in employee wages primarily due to headcount growth; $20.5 million increase in outside services expense related to corporate initiatives; and $12.5 million associated with the biennial All Managers’ Conference that was held in March 2022.

Pre-opening costs

| Pre-opening costs | $ | 29.6 | | $ | 21.3 | | 39.0% |

Pre-opening costs increased in dollar terms for the year ended December 31, 2022 compared to the year ended December 31, 2021, primarily due to higher wages and rent on increased openings of 236 new restaurants of in 2022 compared to 215 in 2021.

Should our business deteriorate due to changing conditions, there are actions we can take to further conserve liquidity.

| Operating leases(1) | | $ | 5,430 | | $ | 394 | | $ | 842 | | $ | 815 | | $ | 3,379 |

| Purchase obligations(2) | | | 2,174 | | | 870 | | | 663 | | | 641 | | | \- |

| Total | | $ | 7,604 | | $ | 1,264 | | $ | 1,505 | | $ | 1,456 | | $ | 3,379 |

Fixed CAM is also included in our operating lease liability.

For the purpose of reviewing restaurant assets to be held and used for potential impairment, assets are grouped together at the market level, or in the case of a potential relocation or closure, at the restaurant level.

We manage our restaurants as a group with common costs and promotional activities; as such, an individual restaurant’s cash flows are not generally independent of the cash flows of others in a market.

A relative increase of 100 basis points in our performance payout percentage estimates for all active performance share awards as of December 31, 2022 would have resulted in increased general and administrative expense on our consolidated statement of income and comprehensive income of approximately $0.8 million for the year ended December 31, 2022.

Unanticipated changes may produce materially different amounts of expense than that reported under these programs.

We have audited the accompanying consolidated balance sheets of Chipotle Mexican Grill, Inc. (the Company) as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income and comprehensive income, shareholders' equity and cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 [removed: framework),] [added: framework)] and our report dated February [removed: 8, 2023] [added: 7, 2024] expressed an unqualified opinion thereon.

| *Description of the Matter* | | The Company incurred [removed: $99.8] [added: $126.7] million in stock-based compensation expense during the year ended December 31, [removed: 2022.] [added: 2023.] Approximately [removed: 116,000] [added: 114,000] of the Company’s vested and non-vested stock awards were subject to [removed: service and] performance conditions during the year ended December 31, [removed: 2022.] [added: 2023.] As described in Notes 1 and 8 of the consolidated financial statements, the Company [removed: estimates] [added: records] the grant date fair value of the [added: performance] stock awards and expenses the fair value of [added: the performance] stock awards subject to service conditions over the respective vesting period. Stock-based compensation expense of stock awards subject to performance conditions is based on the estimated probability of achieving levels of performance associated with particular levels of payout. Additionally, at each reporting period, the Company evaluates the probable outcome of the performance conditions including consideration of significant assumptions and as applicable, recognizes the cumulative effect of the change in estimate in the period of the change. Auditing the [removed: grant date fair value and the appropriateness] [added: estimated quantity] of [added: awards] the [removed: accounting treatment] [added: Company determined are probable] of [added: vesting for] the Company’s stock awards subject to [removed: service and] performance conditions was complex and judgmental. In particular, the [removed: fair value estimate for] stock [removed: awards subject to service and performance conditions] [added: compensation expense] is sensitive to significant assumptions including management’s internal estimates of the Company’s future performance. |

| *How We Addressed the Matter in Our Audit* | | We obtained an understanding, evaluated the design, and tested the operating effectiveness of management’s controls over stock-based compensation. We tested controls over management’s review of the assumptions used with regards to the [removed: service and] performance conditions. We also tested management's controls to validate that data used in management’s internal estimates of the Company’s future performance was complete and accurate. Our substantive audit procedures included, among others, testing the significant assumptions underlying the performance conditions (e.g., certain targets related to growth in [removed: comparable restaurant sales, average] [added: cumulative] restaurant [removed: margin,] [added: cash flow dollars] and cumulative [added: base] restaurant cash flow dollars) and testing the completeness and accuracy of the underlying data. We evaluated management’s significant assumptions by comparing the assumptions to current market and economic trends, historical results of the Company's business, and to other relevant factors. We additionally performed a sensitivity analysis of the significant assumptions to evaluate the change in the [removed: fair value of] [added: expense to be recognized for] the stock awards subject to performance [removed: conditions resulting from changes in the assumptions.] [added: conditions.] We also evaluated the adequacy of the Company’s stock-based compensation disclosures included in Notes 1 and 8 of the consolidated financial statements in relation to these matters. |

| | [added: 2023 | | |] 2022 | | | 2021 | |

| Cash and cash equivalents | $ | [removed: 384,000] [added: 560,609] | | $ | [removed: 815,374] [added: 384,000] |

| Accounts receivable, net | | [removed: 106,880] [added: 115,535] | | | [removed: 99,599] [added: 106,880] |

| Inventory | | [removed: 35,668] [added: 39,309] | | | [removed: 32,826] [added: 35,668] |

| Prepaid expenses and other current assets | | [removed: 86,412] [added: 117,462] | | | [removed: 78,756] [added: 86,412] |

| Income tax receivable | | [removed: 47,741] [added: 52,960] | | | [removed: 94,064] [added: 47,741] |

| Investments | | [removed: 515,136] [added: 734,838] | | | [removed: 260,945] [added: 515,136] |

| Total current assets | | [removed: 1,175,837] [added: 1,620,713] | | | [removed: 1,381,564] [added: 1,175,837] |

| Leasehold improvements, property and equipment, net | | [removed: 1,951,147] [added: 2,170,038] | | | [removed: 1,769,278] [added: 1,951,147] |

| Long-term investments | | [removed: 388,055] [added: 564,488] | | | [removed: 274,311] [added: 388,055] |

| Restricted cash | | [removed: 24,966] [added: 25,554] | | | [removed: 30,856] [added: 24,966] |

| Operating lease assets | | [removed: 3,302,402] [added: 3,578,548] | | | [removed: 3,118,294] [added: 3,302,402] |

| Other assets | | [removed: 63,158] [added: 63,082] | | | [removed: 56,716] [added: 63,158] |

| Total assets | $ | [removed: 6,927,504] [added: 8,044,362] | | $ | [removed: 6,652,958] [added: 6,927,504] |

| Accounts payable | $ | [removed: 184,566] [added: 197,646] | | $ | [removed: 163,161] [added: 184,566] |

| Accrued payroll and benefits | | [removed: 170,456] [added: 227,537] | | | [removed: 162,405] [added: 170,456] |

| Accrued liabilities | | [removed: 147,539] [added: 147,688] | | | [removed: 173,052] [added: 147,539] |

| Unearned revenue | | [removed: 183,071] [added: 209,680] | | | [removed: 156,351] [added: 183,071] |

| Current operating lease liabilities | | [removed: 236,248] [added: 248,074] | | | [removed: 218,713] [added: 236,248] |

| Total current liabilities | | [removed: 921,880] [added: 1,030,625] | | | [removed: 873,682] [added: 921,880] |

| Long-term operating lease liabilities | | [removed: 3,495,162] [added: 3,803,551] | | | [removed: 3,301,601] [added: 3,495,162] |

| Deferred income tax liabilities | | [removed: 98,623] [added: 89,109] | | | [removed: 141,765] [added: 98,623] |

| Other liabilities | | [removed: 43,816] [added: 58,870] | | | [removed: 38,536] [added: 43,816] |

| Total liabilities | | [removed: 4,559,481] [added: 4,982,155] | | | [removed: 4,355,584] [added: 4,559,481] |

| Preferred stock, $0.01 par value, 600,000 shares authorized, no shares issued as of December 31, [removed: 2022] [added: 2023] and December 31, [removed: 2021,] [added: 2022,] respectively | | \- | | | \- |

| Common stock, $0.01 par value, 230,000 shares authorized, [removed: 37,320] [added: 37,483] and [removed: 37,132] [added: 37,320] shares issued as of December 31, [removed: 2022] [added: 2023] and December 31, [removed: 2021,] [added: 2022,] respectively | | [removed: 373] [added: 375] | | | [removed: 371] [added: 373] |

| Additional paid-in capital | | [removed: 1,829,304] [added: 1,956,160] | | | [removed: 1,729,312] [added: 1,829,304] |

| Treasury stock, at cost, [removed: 9,693] [added: 10,057] and [removed: 9,052] [added: 9,693] common shares as of December 31, [removed: 2022] [added: 2023] and December 31, [removed: 2021,] [added: 2022,] respectively | | [removed: (4,282,014)] [added: (4,944,656)] | | | [removed: (3,356,102)] [added: (4,282,014)] |

| Accumulated other comprehensive loss | | [removed: (7,888)] [added: (6,657)] | | | [removed: (5,354)] [added: (7,888)] |

| Retained earnings | | [removed: 4,828,248] [added: 6,056,985] | | | [removed: 3,929,147] [added: 4,828,248] |

| Total shareholders' equity | | [removed: 2,368,023] [added: 3,062,207] | | | [removed: 2,297,374] [added: 2,368,023] |

| Total liabilities and shareholders' equity | $ | [removed: 6,927,504] [added: 8,044,362] | | $ | [removed: 6,652,958] [added: 6,927,504] |

| | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | [removed: 2020] [added: 2021] | |

| Food and beverage revenue | $ | [removed: 8,558,001] [added: 9,804,124] | | $ | [removed: 7,457,169] [added: 8,558,001] | | $ | [removed: 5,920,545] [added: 7,457,169] |

| Delivery service revenue | | [removed: 76,651] [added: 67,525] | | | [removed: 89,892] [added: 76,651] | | | [removed: 64,089] [added: 89,892] |

| | | Evaluation of stock-based compensation performance condition assumptions |

February 7, 2024

| | 2023 | | | 2022 | |

| Acquisition of treasury stock | \- | | | \- | | | \- | | 364 | | | (662,642) | | | \- | | | \- | | | (662,642) |

| Net income | \- | | | \- | | | \- | | \- | | | \- | | | 1,228,737 | | | \- | | | 1,228,737 |

| Balance, December 31, 2023 | 37,483 | | $ | 375 | | $ | 1,956,160 | | 10,057 | | $ | (4,944,656) | | $ | 6,056,985 | | $ | (6,657) | | $ | 3,062,207 |

| Net income | $ | 1,228,737 | | $ | 899,101 | | $ | 652,984 |

| Depreciation and amortization | | 319,394 | | | 286,826 | | | 254,657 |

In the current year we closed all non-Chipotle restaurants.

These gains or losses are included in interest and other income, net on the consolidated statements of income and comprehensive income.

The functional currency of our foreign entities is the currency of the primary economic environment in which the entity operates.

The operations, assets, and liabilities of our entities outside the U.S. are initially measured using the functional currency of that entity.

Gains and losses arising from the impact of foreign currency exchange rate fluctuations on transactions in foreign currency are included as a separate component of other comprehensive income (loss), net of income taxes on the consolidated statements of income and comprehensive income.

Customers may redeem earned points for various rewards, which are primarily comprised of free food and beverage items.

Food, Beverage and Packaging Costs

Food, beverage and packaging costs include inventory, warehousing and related purchasing and distribution costs.

Other Operating Costs

Other operating costs include, among other items, marketing and promotional costs, delivery expense, bank and credit card processing fees, restaurant utilities, technology costs, and maintenance costs.

Consideration Received from Vendors

We receive consideration for a variety of vendor-sponsored programs, such as volume rebates and promotions.

Vendor consideration is recorded as a reduction of food, beverage and packaging or other operating costs on our consolidated statements of income and comprehensive income depending on the classification of the related costs.

Performance goals are determined by the Board and include measures such as comparable restaurant sales, average restaurant operating margin, restaurant cash flow, new restaurant unit growth, and total shareholder return relative to our peer group.

Long-lived assets are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

For restaurant assets we test impairment at the individual restaurant asset group level, which includes leasehold improvements, property and equipment and operating lease assets.

In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure.” The ASU updates reportable segment disclosure requirements, primarily through requiring enhanced disclosures about significant segment expenses and information used to assess segment performance.

The ASU is effective for fiscal years beginning after December 15, 2023, with early adoption permitted.

We are currently evaluating the impact of adopting this ASU on our disclosures.

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The ASU includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction.

The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and should be applied either prospectively or retrospectively.

We are currently evaluating the impact of adopting this ASU on our disclosures.

Prepaid expenses and other current assets were as follows:

| | 2023 | | | 2022 | |

| Prepaid expenses | $ | 97,670 | | $ | 69,167 |

| Other current assets | | 19,792 | | | 17,245 |

| Prepaid expenses and other current assets | $ | 117,462 | | $ | 86,412 |

| | 2023 | | | 2022 | |

| | 2023 | | | 2022 | |

| Accrued payroll, bonuses and taxes | | 170,251 | | | 118,638 |

| | 2023 | | | 2022 | |

| General, product and automobile insurance reserves | | 30,169 | | | 29,544 |

| | | Valuation and accounting for stock-based compensation |

February 8, 2023

| Balance, December 31, 2019 | 36,323 | | $ | 363 | | $ | 1,465,697 | | 8,568 | | $ | (2,699,119) | | $ | 2,921,448 | | $ | (5,363) | | $ | 1,683,026 |

| Adoption of ASU No. 2016-13, Financial Instrument-Credit Losses (Topic 326) | \- | | | \- | | | \- | | \- | | | \- | | | (1,051) | | | \- | | | (1,051) |

| Acquisition of treasury stock | \- | | | \- | | | \- | | 135 | | | (102,956) | | | \- | | | \- | | | (102,956) |

| Net income | \- | | | \- | | | \- | | \- | | | \- | | | 355,766 | | | \- | | | 355,766 |

Pizzeria Locale is a fast casual pizza concept that is owned and operated by a consolidated entity that we are an investor in.

Certain prior-year amounts have been reclassified to conform to the current year presentation.

Our international operations use the local currency as the functional currency.

In June 2021, we enhanced Chipotle Rewards and introduced a new redemption feature we call the “Rewards Exchange” that provides loyalty members multiple redemption options.

Previously, Chipotle Rewards points were automatically redeemed for a free entrée when the customer obtained the required number of points.

We completed our most recent breakage assessment as of October 31, 2022, which resulted in a reduction in revenue recognized of $6,070 during the three months ended December 31, 2022.

The reduction in revenue recognized was primarily the result of a change in our ultimate redemption rate estimate as program data indicated a higher redemption trend than previously estimated.

For the purpose of reviewing restaurant assets to be held and used for potential impairment, assets are grouped together at the market level, or in the case of a potential relocation or closure, at the restaurant level.

We manage our restaurants as a group with common costs and promotional activities; as such, an individual restaurant’s cash flows are not generally independent of the cash flows of others in a market.

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The pronouncement provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burden related to the expected market transition from the London Interbank Offered Rate ("LIBOR") and other interbank offered rates to alternative reference rates.

The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2024 (the sunset date was extended from December 31, 2022 to December 31, 2024 by the issuance of ASU No. 2022-06 in December 2022).

We are evaluating the impact of the transition from LIBOR to alternative reference rates but do not expect a significant impact to our consolidated financial statements.

| Accrued payroll and bonuses | | 109,190 | | | 107,799 |

| Legal reserve liability | | 15,227 | | | 48,098 |

Fair Value of Financial Instruments

| Cash | $ | 119,639 | | $ | \- | | $ | \- | | $ | 119,639 | | $ | 119,639 | | $ | \- | | $ | \- |

| U.S. Treasury securities | | 501,288 | | | \- | | | 1,116 | | | 500,172 | | | \- | | | 260,945 | | | 240,343 |

| Subtotal | | 1,197,023 | | | \- | | | 1,116 | | | 1,195,907 | | | 695,735 | | | 260,945 | | | 240,343 |

| Corporate debt security(2) | | 18,000 | | | \- | | | \- | | | 18,000 | | | \- | | | \- | | | 18,000 |

| Note receivable(3) | | \- | | | \- | | | \- | | | \- | | | \- | | | \- | | | \- |

| Subtotal | | 18,000 | | | \- | | | \- | | | 18,000 | | | \- | | | \- | | | 18,000 |

| Total | $ | 1,334,662 | | $ | \- | | $ | 1,116 | | $ | 1,333,546 | | $ | 815,374 | | $ | 260,945 | | $ | 258,343 |

| Equity method investments | $ | 11,697 | | $ | 9,251 |

We do not have significant influence over these entities.

| Meals and entertainment | | \- | | | \- | | | 0.1 | |

| Enhanced deduction for food donation | | \- | | | \- | | | (0.1) | |

| Total deferred income tax liability | | | | | 1,161,571 | | | 1,132,744 |

| Total deferred income tax asset | | | | | 1,062,948 | | | 990,979 |

The alternative minimum tax and the excise tax are effective in taxable years beginning after December 31, 2022.

While these tax law changes have no immediate effect and are not expected to have a material adverse effect on our results of operations going forward, we will continue to evaluate its impact as further information becomes available.

As of December 31, 2021 there were 2,141 shares of common stock that remained available for future issuances under this plan.

On March 23, 2022, the Board approved the 2022 Stock Incentive Plan, which was then approved by the shareholders on May 18, 2022.

Once the shareholders approved the 2022 Stock Incentive plan, the remaining shares available for issuance under the 2011 Stock Incentive plan were terminated.

The numbers of shares authorized for issuance under the 2022 Stock Incentive Plan will not exceed 2,431.

As of December 31, [removed: 2022,] [added: 2023,] we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial and Administrative Officer, of the effectiveness of the design and operation of our disclosure controls and procedures.

There were no changes during the fiscal quarter ended December 31, [removed: 2022,] [added: 2023] in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Management assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on the framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (the “2013 framework”).

Based on that assessment, management concluded that, as of December 31, [removed: 2022,] [added: 2023,] our internal control over financial reporting was effective based on the criteria established in the 2013 framework.

Our independent registered public accounting firm, Ernst & Young LLP, has issued an attestation report on the effectiveness of our internal control over financial reporting as of December 31, [removed: 2022.][added: 2023.]

We have audited Chipotle Mexican Grill, Inc.’s internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Chipotle Mexican Grill, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income and comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] and the related notes and our report dated February [removed: 8, 2023] [added: 7, 2024] expressed an unqualified opinion thereon.

February 7, 2024

February 8, 2023

Adoption or Termination of 10b5-1 Trading Plans

During the fiscal quarter ended December 31, 2023, one Section 16 officer adopted modified or terminated a “Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K of the Exchange Act):

Christopher Brandt, Chief Brand Officer, adopted a new trading plan on December 14, 2023 (with the first trade under the plan to occur on or after March 15, 2024).

The trading plan will be effective until January 31, 2025 and provides for the exercise of a SOSAR for 4,453 shares and the sale of the net shares if the Company’s stock price reaches a specified limit order.

The Rule 10b5-1 trading arrangement complies with our Insider Trading Policy and actual transactions will be disclosed in Section 16 filings made with the SEC in accordance with applicable securities laws, rules and regulations.

Adoption of an Executive Officer Severance Plan and Letter Agreement with the CEO

On February 6, 2024, the Compensation, People and Culture Committee of the Company’s Board of Directors (the “Committee”) approved the Chipotle Mexican Grill, Inc. Executive Officer Severance Plan, which was effective immediately (the “Severance Plan”).

The Severance Plan provides for severance benefits to the “executive officers” of the Company, as defined by Rule 3b-7 under the Securities Exchange Act of 1934, as amended (the “Participants”), if the Participant’s employment is terminated either by the Company without “cause” (excluding termination by the Company due to the Participant’s death or disability) or due to a resignation by the Participant for “good reason” (each as defined in the Severance Plan) that in each case does not entitle the Participant to benefits under the Company’s Change in Control Severance Plan (a “Qualifying Termination”).

Under the Severance Plan, if a Participant experiences a Qualified Termination, the Participant would be eligible to receive (i) cash severance equal to the sum of the Participant’s base salary plus target cash bonus under the Company’s Annual Incentive Plan for the year in which the Qualifying Termination occurs multiplied by two, in the case of the Chief Executive Officer, or one and one-half, in the case of other Participants, which cash severance would be paid in equal installments over 24 months, for the Chief Executive Officer, and 18 months for other Participants, plus (ii) a pro-rated portion of the Participant’s annual bonus under the Company’s Annual Incentive Plan for the year in which the Qualifying Termination occurs, based on the Company’s actual performance, plus (iii) the cash equivalent of the employer portion of the cost of the Company group health plans in which the Participant was participating immediately prior to the Qualifying Termination for 24 months, with respect to the Chief Executive Officer, or for 18 months, with respect to other Participants.

In addition, each Participant will vest in a pro rata portion of their unvested equity awards under the Company’s equity compensation plans, with the performance-based equity awards vesting based on the extent of the Company’s achievement of the applicable performance-based metrics.

Any SOSARs held by the Participant would be exercisable for 12 months after the Qualifying Termination or if earlier, until the expiration date.

A Participant’s eligibility for payments and benefits under the Severance Plan is subject to such Participant’s timely execution and nonrevocation of a separation and general release agreement, in the form provided by the Company, which contains customary confidentiality, non-solicitation and non-disparagement restrictions.

On February 6, 2024 the Committee also approved a letter agreement with the Company’s Chief Executive Officer providing that, if he is subject to a Qualifying Termination under the Severance Plan, he will receive an additional 12 months of pro-rated vesting credit for any equity awards held by him on the Qualifying Termination Date.

The foregoing description of the Severance Plan and the letter agreement with the Company’s Chief Executive Officer does not purport to be complete and is qualified in its entirety by the full text of the Severance Plan and the letter agreement, which are filed as Exhibit 10.25 and Exhibit 10.26 to this annual report on Form 10-K and are incorporated herein by reference.

None.

Incorporated by reference from the definitive proxy statement for our [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after December 31, [removed: 2022.][added: 2023.]

Incorporated by reference from the definitive proxy statement for our [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after December 31, [removed: 2022.][added: 2023.]

Incorporated by reference from the definitive proxy statement for our [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after December 31, [removed: 2022.][added: 2023.]

(2) Includes [removed: 2,317,950] [added: 2,164,565] shares remaining available under the Chipotle Mexican Grill, Inc. 2022 Stock Incentive Plan, and [removed: 249,416] [added: 247,784] shares remaining available under the Chipotle Mexican Grill, Inc. Employee Stock Purchase Plan.

In addition to being available for future issuance upon exercise of SOSARs or stock options that may be granted after December 31, [removed: 2022,] [added: 2023,] all of the shares available for grant under the Chipotle Mexican Grill, Inc. 2022 Stock Incentive Plan, may instead be issued in the form of restricted stock, restricted stock units, performance shares or other equity-based awards.

Additional information for this item is incorporated by reference from the definitive proxy statement for our [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after December 31, [removed: 2022.][added: 2023.]

| Equity Compensation Plans Approved by Security Holders | 410,735 | | $ | 1,302.60 | | 2,412,349 |

| Total | 410,735 | | $ | 1,302.60 | | 2,412,349 |

| Equity Compensation Plans Approved by Security Holders | 479,281 | | $ | 1,053.84 | | 2,567,366 |

| Total | 479,281 | | $ | 1,053.84 | | 2,567,366 |

Incorporated by reference from the definitive proxy statement for our [removed: 2023] [added: 2024] annual meeting of shareholders, which will be filed no later than 120 days after December 31, [removed: 2022.][added: 2023.]

Incorporated by reference from the definitive proxy statement for our 2024 annual meeting of shareholders, which will be filed no later than 120 days after December 31, 2023.

Consolidated Statements of Income and Comprehensive Income for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020;][added: 2021;]

Consolidated Balance Sheets as of December 31, [removed: 2022] [added: 2023] and [removed: 2021;][added: 2022;]

Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020;][added: 2021;]

Consolidated Statements of Equity for the years ended December 31, [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020;][added: 2021;]

| 3.2 | [Chipotle Mexican Grill, Inc. Amended and Restated Bylaws](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001058090/000119312521169329/d172677d8k.htm) | 8-K | 001-32731 | [removed: December 9, 2022] [added: June 1, 2023] | 3.1 | |

| [removed: 10.1†] [added: 10.12†] | [Form of [removed: 2019 Transformation] [added: 2021] Performance Share Unit [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809019000015/cmg-20190331xex10_2.htm) (1)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809021000022/cmg-20210331xex10_2.htm)] | [removed: 10-K] [added: 10-Q] | 001-32731 | [removed: February 10, 2020] [added: April 29, 2021] | 10.2 | |

| [removed: 10.2†] [added: 10.1†] | [Change in Control Severance Plan, effective June 1, 2019](http://www.sec.gov/Archives/edgar/data/1058090/000105809019000029/cmg-20190630xex10_1.htm) | 10-Q | 001-32731 | July 24, 2019 | 10.1 | |

| [removed: 10.3†] [added: 10.2†] | [Form of Participation and Restrictive Covenant Agreement for Change in Control Severance Plan](http://www.sec.gov/Archives/edgar/data/1058090/000105809019000029/cmg-20190630xex10_2.htm) | 10-Q | 001-32731 | July 24, 2019 | 10.2 | |

| [removed: 10.4†] [added: 10.3†] | [Amended and Restated Chipotle Mexican Grill, Inc. 2011 Stock Incentive Plan](http://www.sec.gov/Archives/edgar/data/1058090/000119312518173614/d578721dex101.htm) | 8-K | 001-32731 | May 24, 2018 | 10.1 | |

| [removed: 10.5†] [added: 10.8†] | [Form of [removed: 2016] [added: 2018] Stock Appreciation Rights [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809016000069/cmg-20160331xex10_1.htm)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000042/cmg-20180331xex10_14.htm)] | 10-Q | 001-32731 | April [removed: 27, 2016] [added: 26, 2018] | [removed: 10.1] [added: 10.14] | |

| [removed: 10.6†] [added: 10.4†] | [Amended and Restated Registration Rights Agreement dated January 31, 2006 among Chipotle Mexican Grill, Inc., McDonald’s Corporation and certain shareholders](http://www.sec.gov/Archives/edgar/data/1058090/000104746906003640/a2168474zex-10_6.htm) | 10-K | 001-32731 | March 17, 2006 | 10.6 | |

| [removed: 10.7†] [added: 10.5†] | [Form of Director and Officer Indemnification Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000119312507060643/dex101.htm) | 8-K | 001-32731 | March 21, 2007 | 10.1 | |

| [removed: 10.8†] [added: 10.6†] | [Offer Letter, dated February 11, 2018, between Brian R. Niccol and Chipotle Mexican Grill, Inc.](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000022/cmg-20180214xex10_1.htm) | 8-K | 001-32731 | February 15, 2018 | 10.1 | |

| [removed: 10.11] [added: 10.7†] | [removed: [Investor] [added: [Executive Chairman] Agreement dated [removed: December 14, 2016] [added: November 28, 2017] between Chipotle Mexican Grill, Inc. and [removed: Pershing Square Capital Management, L.P.](http://www.sec.gov/Archives/edgar/data/1058090/000105809016000091/cmg-20161219xex10_1.htm)] [added: Steve Ells](http://www.sec.gov/Archives/edgar/data/1058090/000105809017000047/cmg-20171201xex10_1.htm)] | 8-K | 001-32731 | December [removed: 19, 2016] [added: 1, 2017] | 10.1 | |

| [removed: 10.12†] [added: 10.14†] | [Form of [removed: 2018 CEO SOSARs Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000119312518108713/d755493dex102.htm)] [added: 2022 Stock Appreciation Rights Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_2.htm)] | [removed: 8-K/A] [added: 10-Q] | 001-32731 | April [removed: 3, 2018] [added: 28, 2022] | 10.2 | |

| [removed: 10.13†] [added: 10.15†] | [Form of [removed: 2018 Premium-priced SOSARs Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000119312518108713/d755493dex103.htm)] [added: 2022 Performance Share Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_3.htm)] | [removed: 8-K/A] [added: 10-Q] | 001-32731 | April [removed: 3, 2018] [added: 28, 2022] | 10.3 | |

| [removed: 10.14†] [added: 10.9†] | [removed: [Executive] [added: [Amendment No. 1 dated March 5, 2020 to the Executive] Chairman Agreement dated November 28, 2017 between Chipotle Mexican Grill, Inc. and Steve [removed: Ells](http://www.sec.gov/Archives/edgar/data/1058090/000105809017000047/cmg-20171201xex10_1.htm)] [added: Ells](http://www.sec.gov/Archives/edgar/data/1058090/000105809020000020/cmg-20200331xex10_1.htm)] | [removed: 8-K] [added: 10-Q] | 001-32731 | [removed: December 1, 2017] [added: April 29, 2020] | 10.1 | |

| [removed: 10.16†] [added: 10.20†] | [Form of [removed: 2018] [added: 2023] Stock Appreciation Rights [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000042/cmg-20180331xex10_14.htm)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000020/cmg-20230331xex10_2.htm)] | 10-Q | 001-32731 | April [removed: 26, 2018] [added: 27, 2023] | [removed: 10.14] [added: 10.2] | |

| [removed: 10.17†] [added: 10.13†] | [Form of [removed: 2021 Director] [added: 2022] Restricted Stock Unit [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809021000039/cmg-20210630xex10_2.htm)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_1.htm)] | 10-Q | 001-32731 | [removed: July 23, 2021] [added: April 28, 2022] | [removed: 10.2] [added: 10.1] | |

| [removed: 10.20] [added: 10.10] | [Revolving Credit Agreement dated April 13, 2021, among Chipotle Mexican Grill, Inc. and JPMorgan Chase Bank, N.A., Administrative Agent, and other lenders party to the [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000119312521118604/d173359dex101.htm)] [added: Agreement, amended February 1, 2023](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex10_10.htm)] | [removed: 8-K] [added: \-] | [removed: 001-32731] [added: \-] | [removed: April 16, 2021] [added: \-] | [removed: 10.1] [added: \-] | [added: X] |

| [removed: 10.21†] [added: 10.11†] | [Form of 2020 [removed: Performance Share Agreement](http://www.sec.gov/Archives/edgar/data/0001058090/000105809021000010/cmg-20201231xex10_34.htm)] [added: Stock Appreciation Rights Agreement](http://www.sec.gov/Archives/edgar/data/0001058090/000105809021000010/cmg-20201231xex10_36.htm)] | 10-K | 001-32731 | February 10, 2021 | [removed: 10.34] [added: 10.36] | |

| [removed: 10.24†] [added: 10.21†] | [Form of [removed: 2021] [added: 2023] Performance Share [removed: Unit Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809021000022/cmg-20210331xex10_2.htm)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000020/cmg-20230331xex10_3.htm)] | 10-Q | 001-32731 | April [removed: 29, 2021] [added: 27, 2023] | [removed: 10.2] [added: 10.3] | |

| [removed: 10.26†] [added: 10.19†] | [Form of [removed: 2022] [added: 2023] Restricted Stock Unit [removed: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_1.htm)] [added: Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000020/cmg-20230331xex10_1.htm)] | 10-Q | 001-32731 | April [removed: 28, 2022] [added: 27, 2023] | 10.1 | |

| [removed: 10.27†] [added: 10.16†] | [Form of 2022 Stock [removed: Appreciation Rights Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_2.htm)] [added: Option Agreement (Canada)](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_4.htm)] | 10-Q | 001-32731 | April 28, 2022 | [removed: 10.2] [added: 10.4] | |

| [removed: 10.28†] [added: 10.22†] | [Form of [removed: 2022 Performance Share Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_3.htm)] [added: 2023 Stock Option Agreement (Canada)](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000020/cmg-20230331xex10_4.htm)] | 10-Q | 001-32731 | April [removed: 28, 2022] [added: 27, 2023] | [removed: 10.3] [added: 10.4] | |

| [removed: 10.30†] [added: 10.17†] | [Director Compensation Program and Stock Ownership Guidelines (Revised May [removed: 18, 2022)](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000036/cmg-20220630xex10_1.htm)] [added: 25, 2023)](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000030/cmg-20230630xex10_1.htm)] | 10-Q | 001-32731 | July [removed: 27, 2022] [added: 28, 2023] | 10.1 | |

| [removed: 10.31†] [added: 10.18†] | [Chipotle Mexican Grill, Inc. 2022 Stock Incentive Plan](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000036/cmg-20220630xex10_2.htm) | 10-Q | 001-32731 | July 27, 2022 | 10.2 | |

| [removed: 10.32†] [added: 10.23†] | [Chipotle Mexican Grill, Inc. Employee Stock Purchase [removed: Plan](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000036/cmg-20220630xex10_3.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000041/cmg-20230930xex10_1.htm)] | 10-Q | 001-32731 | [removed: July] [added: October] 27, [removed: 2022] [added: 2023] | 10.3 | |

| [removed: 10.33†] [added: 10.24†] | [Supplemental Deferred Investment [removed: Plan](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex10_33.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex10_33.htm)] | [added: 10-K] | [added: 001-32731] | [added: February 9, 2023] | [added: 10.33] | [removed: X] |

| 21.1 | [Subsidiaries of Chipotle Mexican Grill, [removed: Inc.](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex21_1.htm)] [added: Inc.](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex21_1.htm)] | \- | \- | \- | \- | X |

| 23.1 | [Consent of Ernst & Young LLP (as the independent registered public accounting firm of Chipotle Mexican Grill, [removed: Inc.)](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex23_1.htm)] [added: Inc.)](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex23_1.htm)] | \- | \- | \- | \- | X |

| 31.1 | [Certification of Chief Executive Officer of Chipotle Mexican Grill, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex31_1.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex31_1.htm)] | \- | \- | \- | \- | X |

| 31.2 | [Certification of Chief Financial and Administrative Officer of Chipotle Mexican Grill, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex31_2.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex31_2.htm)] | \- | \- | \- | \- | X |

| 32.1 | [Certification of Chief Executive Officer and Chief Financial and Administrative Officer of Chipotle Mexican Grill, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000105809023000010/cmg-20221231xex32_1.htm)] [added: 2002](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex32_1.htm)] | \- | \- | \- | \- | X |

| 10.25† | [Executive Officer Severance Plan](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex10_25.htm) | \- | \- | \- | \- | X |

| 10.26† | [Letter Agreement regarding Severance dated February 6, 2024 between Brian Niccol and Chipotle Mexican Grill, Inc.](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex10_26.htm) | \- | \- | \- | \- | X |

| 97.1† | [Executive Compensation Recovery Policy](https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231xex97_1.htm) | \- | \- | \- | \- | X |

| --- | --- | --- | --- | --- | --- | --- |

| 10.9† | [Non-Plan Inducement SOSARs Agreement between Brian R. Niccol and Chipotle Mexican Grill, Inc.](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000027/cmg-20180306xex4_3.htm) | S-8 | 33-223467 | March 6, 2018 | 4.3 | |

| 10.10† | [Non-Plan Inducement RSUs Agreement between Brian R. Niccol and Chipotle Mexican Grill, Inc.](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000027/cmg-20180306xex4_4.htm) | S-8 | 33-223467 | March 6, 2018 | 4.4 | |

| 10.15† | [Offer Letter, dated March 9, 2018, between Christopher Brandt and Chipotle Mexican Grill, Inc.](http://www.sec.gov/Archives/edgar/data/1058090/000105809018000042/cmg-20180331xex10_13.htm) | 10-Q | 001-32731 | April 26, 2018 | 10.13 | |

| 10.18† | [Amendment No. 1 dated March 5, 2020 to the Executive Chairman Agreement dated November 28, 2017 between Chipotle Mexican Grill, Inc. and Steve Ells](http://www.sec.gov/Archives/edgar/data/1058090/000105809020000020/cmg-20200331xex10_1.htm) | 10-Q | 001-32731 | April 29, 2020 | 10.1 | |

| 10.19† | [Deferred Prosecution Agreement dated April 20, 2020 between Chipotle Mexican Grill, Inc. and the United States Attorney’s Office for the Central District of California and the United States Department of Justice’s Consumer Protection Branch](http://www.sec.gov/Archives/edgar/data/1058090/000119312520113342/d909015dex101.htm) | 8-K | 001-32731 | April 21, 2020 | 10.1 | |

| 10.22† | [Form of 2020 Restricted Stock Units Agreement](http://www.sec.gov/Archives/edgar/data/0001058090/000105809021000010/cmg-20201231xex10_35.htm) | 10-K | 001-32731 | February 10, 2021 | 10.35 | |

| 10.23† | [Form of 2020 Stock Appreciation Rights Agreement](http://www.sec.gov/Archives/edgar/data/0001058090/000105809021000010/cmg-20201231xex10_36.htm) | 10-K | 001-32731 | February 10, 2021 | 10.36 | |

| 10.25† | [Form of Amended and Restated 2018 Performance Share Unit Agreement](http://www.sec.gov/Archives/edgar/data/1058090/000105809021000022/cmg-20210331xex10_3.htm) | 10-Q | 001-32731 | April 29, 2021 | 10.3 | |

| 10.29† | [Form of 2022 Stock Option Agreement (Canada)](http://www.sec.gov/Archives/edgar/data/1058090/000105809022000027/cmg-20220331xex10_4.htm) | 10-Q | 001-32731 | April 28, 2022 | 10.4 | |

Date: February [removed: 8, 2023][added: 7, 2024]

| /s/ BRIAN NICCOL | | February [removed: 8, 2023] [added: 7, 2024] | | Chief Executive Officer and Chairman of the Board of Directors (principal executive officer) |

| /s/ JOHN R. HARTUNG | | February [removed: 8, 2023] [added: 7, 2024] | | Chief Financial and Administrative Officer (principal financial and accounting officer) |

| /s/ ALBERT [removed: S.] BALDOCCHI | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| /s/ MATTHEW [removed: A.] CAREY | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| Matthew [removed: A.] Carey | | | | |

| /s/ GREGG [removed: L.] ENGLES | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| Gregg [removed: L.] Engles | | | | |

| /s/ PATRICIA FILI-KRUSHEL | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| /s/ MAURICIO GUTIERREZ | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| /s/ ROBIN [removed: S.] HICKENLOOPER | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| Robin [removed: S.] Hickenlooper | | | | |

| /s/ SCOTT MAW | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| /s/ MARY [removed: A.] WINSTON | | February [removed: 8, 2023] [added: 7, 2024] | | Director |

| Mary [removed: A.] Winston | | | | |

| | | | | |

| /s/ LAURA FUENTES | | February 7, 2024 | | Director |

| Laura Fuentes | | | | |