Restaurant, Retailer Earnings Hit by Lease Accounting Overhaul

U.S. retailers and restaurants reported balance sheets that ballooned by the billions in the first quarter with the addition of a fundamental operating expense: leases on their stores and eateries.

Chipotle Mexican Grill Inc. tripled its liabilities, McDonald’s Corp. increased its liabilities by a third, and Nordstrom Inc. reported a nearly 25% increase in its total liabilities—all thanks to new lease accounting rules.

The historic balance sheet shift has rippled across industries as companies began reporting their financials under the new accounting standard this spring. But none saw as dramatic a hit as retailers and restaurants—capital intensive companies that now ...