When Adonis Maracallo sat down for dinner Sunday night at the Chipotle Mexican Grill on Court Street in Brooklyn, he wasn’t thinking about E.coli.
Mr. Maracallo, 25, has been eating at Chipotle for years; he even worked at one of the chain’s stores in Manhattan. But like many customers, Mr. Maracallo decided to steer clear for a while after a string of public health scares damaged Chipotle’s reputation in 2015 and 2016, switching to Dos Toros Taqueria for his Mexican fix.
Late last year, however, Mr. Maracallo was ready to give Chipotle another chance. Now, he eats there as often as three times a week, without any concern that he might get sick.
“I loved the food,” he said. “I missed it.”
That is just what Brian Niccol, Chipotle’s chief executive, who stepped in to revive the fast-casual brand in February 2018, wants to hear. Four years after reports of E.coli and Norovirus sent customers fleeing, Chipotle has made a significant comeback. Last week, the chain’s stock price reached a high of $759, surpassing the mark it set in August 2015, not long before the crisis began.
In announcing its second-quarter earnings on Tuesday, Chipotle reported same-store sales growth of 10 percent, beating analysts’ estimates and continuing its momentum from the last five quarters. Its stock price surged in after-hours trading, though some analysts have cautioned that there could be a drop in the coming months.
When he arrived, Mr. Niccol faced some skepticism from critics who argued that the tactics he used to succeed as chief executive of Taco Bell — introducing new menu items and selling off stores to franchisees — might not apply at Chipotle. But after relocating Chipotle’s headquarters to Southern California (where Taco Bell is also based) from Denver, Mr. Niccol has presided over a resurgence in sales driven by a revamped advertising strategy and the growth of the chain’s delivery business.
“When I got to Chipotle, they weren’t short on ideas,” Mr. Niccol said in an interview. “They just had lots of ideas and none of the discipline to carry the ideas all the way out.”
As chief executive, Mr. Niccol said he has tried to keep the chain’s management focused on a few key projects, including the chain’s digital presence. Last year, Chipotle started a partnership with DoorDash, one of the leading third-party food-delivery apps; delivery services are now available at 95 percent of the chain’s locations. Some restaurants brands have struggled to monetize the growing online delivery market, but Chipotle saw its digital sales nearly double over the past quarter.
“They are exceptional in how well the brand has capitalized on digital ordering,” said Sara Senatore, a restaurant analyst at Bernstein who tracks Chipotle. “When you look across the landscape of restaurants that have partnered with aggregators, Chipotle has seen the most material impact on its business.”
One factor that has helped Chipotle’s delivery business is the densely packed structure of its signature burrito, which tends to stay fresh while it’s being transported. But perhaps more important, the chain has also found an efficient way to prepare food for customers who order online, installing separate assembly-line stations in nearly 2,000 of its kitchens.
CreditBenjamin Rasmussen for The New York Times
“If someone places a mobile order, and someone else wants an order at the counter, they both need the food right away,” said Larry Reinstein, a restaurant industry consultant. “These additional production stations just provide a lot more speed and flexibility.”
Chipotle’s marketing has also changed. “If you want to get people into your restaurant, you need to show pictures of food, and that’s something Chipotle historically hadn’t done,” Ms. Senatore said. These days, the company has a more active presence on social media and runs television commercials that highlight its fresh ingredients.
Another important factor: Many consumers seem to have moved beyond the chain’s safety scandals of 2015 and 2016.
Before those health scares, Chipotle was growing rapidly, with an enthusiastic base of millennial customers. The chain even enjoyed the patronage of the political elite: While she campaigned for president in the spring of 2015, Hillary Clinton famously stopped for a burrito bowl at a Chipotle in northwest Ohio.
Then, from late 2015 to early 2016, hundreds of people across the country got sick after eating at Chipotle, and the company’s stock price plummeted. Steve Ells, the chain’s founder and Mr. Niccol’s predecessor as chief executive, apologized on the “Today” show, and the company hired a new food safety officer who instituted a wide range of health precautions.
Chipotle has not had to deal with a major food-safety scare since 2016, despite scattered reports of health problems. Mr. Niccol said the chain was “an industry leader” on food safety, with policies like a provision that ensures employees still get paid when they call in sick.
“Our managers and field leaders are zero tolerance on asking sick people to work,” Mr. Niccol said. “We’re doing some really progressive things on the food safety front, and we’re going to have to, because we’re going to stay committed to using real ingredients.”
Even as its fortunes improve, however, Chipotle still must contend with the broader challenges in the restaurant industry. Last year, the turnover rate among the chain’s hourly workers was 145 percent — a strikingly high figure, though not an unusual one given the serious labor shortages facing fast-food companies.
“A good restaurant experience is dependent on a great staff that knows what they’re doing,” said Marissa Andrada, Chipotle’s chief people officer. “When you have newer people, it’s challenging for the more tenured people to carry the load.”
Last month, Chipotle announced a new bonus program created to keep hourly employees at the chain longer. Now, staff members who meet certain performance benchmarks can earn what amounts to an additional month’s pay every year.
Itzi Hernandez, 26, took over as the manager of a Chipotle in Irvine, Calif., in April. After her first three months, only a quarter of the original staff still worked there. “It has progressively gotten worse,” she said, “not just with turnover itself, but with having to work around schedules to cover shifts.”
Ms. Hernandez said she hoped the new bonus program would encourage employees to stay.
“It’s going to continue to drive new talent to the company,” she said, “and help people who are eager to be a part of this continue to help us with everything we want to achieve.”
