- Chipotle has found new sources of avocados for its guacamole over the last two years.
- But the chain could still take a hit if President Donald Trump adds tariffs to Mexican imports.
- About half of Chipotle’s avocados come from Mexico, CEO Scott Boatwright said on an earnings call.
Chipotle has spent years diversifying where it gets avocados for its guacamole. But it could still see a hit from tariffs on Mexican versions of the fruit.
The California-based restaurant chain has found new sources of avocados in recent years, CEO Scott Boatwright said during a call on Tuesday to discuss the company’s fourth-quarter earnings.
“Our supply chain team has done a remarkable job over the last couple of years with vendor diversification,” Boatwright said.
“Today, we source from both Colombia, Peru as well as the Dominican Republic,” he said. “Only about 50% of our avocado supply today is coming out of Mexico.”
About 90% of all avocados consumed in the US come from Mexico, according to the US Department of Agriculture.
Trump indicated on Monday that his administration would hold off on implementing 25% tariffs on Mexican goods for one month after he spoke with Mexican President Claudia Sheinbaum.
If the tariff takes effect, it could increase Chipotle’s cost of sales by 0.6 percentage points, CFO Adam Rymer said on Tuesday’s earnings call. Besides avocados, Chipotle also imports limes, peppers, and tomatoes from Mexico, Rymer said.
Shares of Chipotle fell as much as 5% in after-hours trading on Tuesday. The chain’s comparable sales and revenue were lower than analysts surveyed by Bloomberg were expecting.
Chipotle’s source of avocados varies based on the time of year. In 2023, for instance, Chipotle got the fruit from Mexico in the spring before shifting to sources in California during the summer, then-CFO Jack Hartung told the Wall Street Journal at the time.
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