Surprise, surprise: Turns out having a string of E.coli and norovirus outbreaks in your restaurants isn’t good for business. According to the Wall Street Journal, Chipotle—the purveyor or human baby-sized burritos—took a huge financial hit last quarter for that very reason. The restaurant chain says that it had a “decline in quarterly revenue” for the first time in its history since going public.
It wasn’t just a small decline in revenue, but a whopping 44 percent drop in fourth-quarter profits. Bloomberg Business reports that the chain lost $72.3 million worth of business last quarter, and the company’s 6.8 percent drop in sales in Q4 “equates to about 10.3 million fewer burritos than it moved in the year-earlier period, back when McDonald’s and virtually every other fast-casual concept yearned to be ‘the next Chipotle.'”
Chipotle’s stock price, which used to be over $600 per share, also took a hit. It is now trading around the $450 mark, though it dropped as low as $404 in January. The burrito chain was also slapped with a subpoena on January 28, “widening the scope of a federal probe” into the outbreak of foodborne diseases at the chain.
Chipotle’s Sales Have Dropped by 10.3 Million Burritos – Bloomberg Business https://t.co/UeUacWKPeQ
— Melissa Etezadi (@maetezadi) February 3, 2016
Not everything is coming up negative for Chipotle and it’s fans, however. Earlier this week the Centers of Disease Control and Prevention announced that the two E.coli outbreaks that were responsible for 60 people falling ill are officially over. The investigators were not able to identify a “contaminated food or ingredient” that was responsible for the outbreaks that occurred across 14 states.
Over the past month, Chipotle has been trying to win customers back, namely through free food. Each location is now allowed to serve “twice the amount of free food it is normally allowed too.” Plus, the chain is hosting a nationwide staff meeting on February 8, during which Chipotle will shut down all of its stores for one day, to educate employees on food safety methods to ensure such fiasco never happens again.